PRINTER'S NO. 235
No. 219 Session of 1993
INTRODUCED BY DeLUCA, PESCI, LUCYK, TIGUE, DALEY, COWELL,
LAUGHLIN, McCALL, TRELLO AND PISTELLA, FEBRUARY 3, 1993
REFERRED TO COMMITTEE ON RULES, FEBRUARY 3, 1993
AN ACT
1 Relating to the rights of purchasers of defective used motor
2 vehicles; establishing an enforcement fund; and imposing a
3 fee.
4 The General Assembly of the Commonwealth of Pennsylvania
5 hereby enacts as follows:
6 Section 1. Short title.
7 This act shall be known and may be cited as the Used Motor
8 Vehicle Lemon Law.
9 Section 2. Definitions.
10 The following words and phrases when used in this act shall
11 have the meanings given to them in this section unless the
12 context clearly indicates otherwise:
13 "Consumer." The purchaser, other than for purposes of
14 resale, of a used motor vehicle normally used for personal,
15 family or household purposes and subject to a warranty, and the
16 spouse or child of the purchaser if such motor vehicle is
17 transferred to the spouse or child during the duration of any
18 warranty applicable to such motor vehicle, and any other person
1 entitled by the terms of such warranty to enforce the
2 obligations of the warranty.
3 "Dealer." Any person or business which sells or offers for
4 sale a used vehicle after selling or offering for sale three or
5 more used vehicles in the previous 12-month period. The term
6 does not include a bank or financial institution, a business
7 selling a used vehicle to an employee of that business, a lessor
8 selling a leased vehicle to that vehicle's lessee, a family
9 member of the lessee, or an employee of the lessee.
10 "Repair insurance." A contract in writing for any period of
11 time or any specific mileage to refund, repair, replace,
12 maintain or take other action with respect to a used motor
13 vehicle and which is regulated by the Insurance Department.
14 "Service contract." A contract in writing for any period of
15 time or any specific mileage to refund, repair, replace,
16 maintain or take other action with respect to a used motor
17 vehicle and provided at an extra charge beyond the price of the
18 used motor vehicle.
19 "Used motor vehicle." Any motor vehicle, excluding
20 motorcycles, motor homes and off-road vehicles, which has been
21 sold, bargained, exchanged or given away; which has had title
22 transferred from the person who first acquired it from the
23 manufacturer or dealer; or which has an odometer reading of 500
24 miles or more, not including mileage incurred in delivery from
25 the manufacturer or in transporting the vehicle between dealers
26 for sale.
27 "Warranty." Any undertaking in connection with the sale by a
28 dealer of a used motor vehicle to refund, repair, replace,
29 maintain or take other action with respect to such used motor
30 vehicle and provided at no extra charge beyond the price of the
19930H0219B0235 - 2 -
1 used motor vehicle.
2 Section 3. Written warranty required; terms.
3 (a) Terms of warranty.--No dealer shall sell a used motor
4 vehicle to a consumer without giving the consumer a written
5 warranty which shall, at minimum, apply for the following terms:
6 (1) If the used motor vehicle has 36,000 miles or less,
7 the warranty shall be, at minimum, 60 days or 3,000 miles,
8 whichever comes first.
9 (2) If the used motor vehicle has more than 36,000
10 miles, the warranty shall be, at minimum, 30 days or 1,000
11 miles, whichever comes first.
12 (b) Warranty requirements.--The written warranty shall
13 require the dealer or his agent to repair or, at the election of
14 the dealer, reimburse the consumer for the reasonable cost of
15 repairing the failure of a covered part. Covered parts shall at
16 least include the following items:
17 (1) Engine. All lubricated parts, water pump, fuel pump,
18 manifolds, engine block, cylinder head, rotary engine
19 housings and flywheel.
20 (2) Transmission. The transmission case, internal parts
21 and the torque converter.
22 (3) Drive axle. Front and rear drive axle housings and
23 internal parts, axle shafts, propeller shafts and universal
24 joints.
25 (4) Brakes. Master cylinder, vacuum assist booster,
26 wheel cylinders, hydraulic lines and fittings, and disc brake
27 calipers.
28 (5) Radiator.
29 (6) Steering. The steering gear housing and all internal
30 parts, power steering pump, valve body, piston and rack.
19930H0219B0235 - 3 -
1 (7) Alternator, generator, starter and ignition system,
2 excluding the battery.
3 (c) Notice to be given within warranty period.--Such repair
4 or reimbursement shall be made by the dealer, notwithstanding
5 the fact that the warranty period has expired, provided that the
6 consumer notifies the dealer in writing of the failure of a
7 covered part within the specified warranty period.
8 (d) New car warranty.--If the warranty provided for in the
9 act of March 28, 1984 (P.L.150, No.28), known as the Automobile
10 Lemon Law, is in effect at the time of the sale of the used
11 motor vehicle, the warranty specified in this act shall be
12 required only for the period of time, if any, between the
13 expiration of the new car warranty and the period specified in
14 subsection (a).
15 (e) Exclusions permitted.--The written warranty may contain
16 additional language excluding coverage:
17 (1) for a failure of a covered part caused by a lack of
18 customary maintenance;
19 (2) for a failure of a covered part caused by collision,
20 abuse, negligence, theft, vandalism, fire or other casualty,
21 and damage from the environment (windstorm, lightning, road
22 hazards, etc.);
23 (3) if the odometer has been stopped or altered such
24 that the vehicle's actual mileage cannot be readily
25 determined or if any covered part has been altered such that
26 a covered part was thereby caused to fail;
27 (4) for maintenance services and the parts used in
28 connection with such services such as seals, gaskets, oil or
29 grease unless required in connection with the repair of a
30 covered part;
19930H0219B0235 - 4 -
1 (5) for a motor tune-up;
2 (6) for a failure resulting from racing or other
3 competition;
4 (7) for a failure caused by towing a trailer or another
5 vehicle unless the used motor vehicle is equipped for this as
6 recommended by the manufacturer;
7 (8) if the used motor vehicle is used to carry
8 passengers for hire;
9 (9) if the used motor vehicle is rented to someone else;
10 (10) for repair of valves or rings to correct low
11 compression or oil consumption which are considered normal
12 wear;
13 (11) to the extent otherwise permitted by law, for
14 property damage arising or allegedly arising out of the
15 failure of a covered part; and
16 (12) to the extent otherwise permitted by law, for loss
17 of the use of the used motor vehicle, loss of time,
18 inconvenience, commercial loss or consequential damages.
19 Section 4. Failure to honor warranty.
20 (a) Failure of dealer.--If the dealer or his agent fails to
21 correct a malfunction or defect, as required by the warranty
22 specified in this act, which substantially impairs the value of
23 the used motor vehicle to the consumer after a reasonable period
24 of time, the dealer shall accept return of the used motor
25 vehicle from the consumer and refund to the consumer the full
26 purchase price, including sales or use tax, less a reasonable
27 allowance for any damage not attributable to normal wear or
28 usage, and adjustment for any modifications which either
29 increase or decrease the market value of the vehicle. In
30 determining the purchase price to be refunded, the purchase
19930H0219B0235 - 5 -
1 price shall be deemed equal to the sum of the actual cash
2 difference paid for the used motor vehicle plus, if the dealer
3 elects to not return any vehicles traded in by the consumer, the
4 wholesale value of any such traded-in vehicles as listed in the
5 National Auto Dealers Association Used Car Guide, or such other
6 guide as may be specified in regulations promulgated by the
7 Secretary of Transportation, as adjusted for mileage,
8 improvements and any major physical or mechanical defects in the
9 traded-in vehicle at the time of trade-in. The contract of sale
10 for the used motor vehicle shall include conspicuous language
11 indicating that, if the consumer should be entitled to a refund
12 pursuant to this section, the value of any vehicle traded in by
13 the consumer, if the dealer elects to not return it to the
14 consumer, for purposes of determining the amount of such refund,
15 will be determined by reference to the National Auto Dealers
16 Association Used Car Guide wholesale value, or such other guide
17 as may be approved by the Secretary of Transportation, as
18 adjusted for mileage, improvements and any major physical or
19 mechanical defects, rather than the value listed in the sales
20 contract. Refunds shall be made to the consumer and lienholder,
21 if any, as their interests may appear on the records of
22 ownership kept by the Bureau of Motor Vehicles. If the amount to
23 be refunded to the lienholder will be insufficient to discharge
24 the lien, the dealer shall notify the consumer in writing by
25 certified mail that the consumer has 30 days to pay the
26 lienholder the amount which, together with the amount to be
27 refunded by the dealer, will be sufficient to discharge the
28 lien. The notice to the consumer shall contain conspicuous
29 language warning the consumer that failure to pay such funds to
30 the lienholder within 30 days will terminate the dealer's
19930H0219B0235 - 6 -
1 obligation to provide a refund. If the consumer fails to make
2 such payment within 30 days, the dealer shall have no further
3 responsibility to provide a refund under this section.
4 Alternatively, the dealer may elect to offer to replace the used
5 motor vehicle with a comparably priced vehicle, with such
6 adjustment in price to which the parties may agree. The consumer
7 shall not be obligated to accept a replacement vehicle but may
8 instead elect to receive the refund provided under this section.
9 It shall be an affirmative defense to any claim under this
10 section that:
11 (1) the malfunction or defect does not substantially
12 impair such value; or
13 (2) the malfunction or defect is the result of abuse,
14 neglect or unreasonable modifications or alterations of the
15 used motor vehicle.
16 (b) Presumptions.--It shall be presumed that a dealer has
17 had a reasonable opportunity to correct a malfunction or defect
18 in a used motor vehicle, if:
19 (1) the same malfunction or defect has been subject to
20 repair three or more times by the selling dealer or his agent
21 within the warranty period, but such malfunction or defect
22 continues to exist; or
23 (2) the vehicle is out of service by reason of repair or
24 malfunction or defect for a cumulative total of 15 or more
25 days during the warranty period. The period shall not include
26 days when the dealer is unable to complete the repair because
27 of the unavailability of necessary repair parts. The dealer
28 shall be required to exercise due diligence in attempting to
29 obtain necessary repair parts, provided that, if a vehicle
30 has been out of service for a cumulative total of 45 days,
19930H0219B0235 - 7 -
1 even if a portion of that time is attributable to the
2 unavailability of replacement parts, the consumer shall be
3 entitled to the replacement or refund remedies provided in
4 this section.
5 (c) Extension of warranty term.--The term of any warranty,
6 service contract or repair insurance shall be extended by any
7 time period during which the used motor vehicle is in the
8 possession of the dealer or his duly authorized agent for the
9 purpose of repairing the used motor vehicle under the terms and
10 obligations of the warranty, service contract or repair
11 insurance.
12 (d) Nonextension of warranty term.--The term of any
13 warranty, service contract or repair insurance, and the 15-day
14 out-of-service period, shall not be extended by any time during
15 which repair services are not available to the consumer because
16 of war, invasion or strike, or fire, flood or other natural
17 disaster.
18 Section 5. Waiver void.
19 (a) Waiver against public policy.--Any agreement entered
20 into by a consumer for the purchase of a used motor vehicle
21 which waives, limits or disclaims the rights set forth in this
22 act shall be void as contrary to public policy. If a dealer
23 fails to give the written warranty required by this act, the
24 dealer nevertheless shall be deemed to have given said warranty
25 as a matter of law.
26 (b) Other remedies available.--Nothing in this act shall in
27 any way limit the rights or remedies which are otherwise
28 available to a consumer under any other law.
29 (c) Exceptions.--This act shall not apply to used motor
30 vehicles sold for less than $1,500, or to used motor vehicles
19930H0219B0235 - 8 -
1 with over 100,000 miles at the time of sale if said mileage and
2 the loss of used car lemon law protection is indicated in
3 writing at the time of sale, nor shall it apply to the sale of
4 classic cars registered pursuant to 75 Pa.C.S. (relating to
5 vehicles).
6 Section 6. Inspection requirements.
7 Anyone who sells a used motor vehicle in Pennsylvania to a
8 buyer who titles and registers the vehicle in Pennsylvania must
9 provide proof of State inspection to the buyer at time of
10 delivery of the vehicle. Proof of State inspection shall be a
11 validly affixed window sticker issued no more than ten days
12 prior to delivery or an itemized checklist of those items which
13 must be performed for the vehicle to pass inspection. The
14 checklist shall include an estimate of costs for the repairs to
15 be performed and shall be signed by the inspection mechanic.
16 Section 7. Arbitration and enforcement.
17 (a) Informal dispute settlement procedure.--If a dealer has
18 established or participates in an informal dispute settlement
19 procedure which complies in all respects with the provisions of
20 16 CFR Part 703, the provisions of this act concerning refunds
21 or replacement shall not apply to any consumer who has not first
22 resorted to such procedure.
23 (b) Rights not abrogated.--In no event shall a consumer who
24 has resorted to an informal dispute settlement procedure be
25 precluded from seeking the rights or remedies available by law.
26 (c) Attorney fees may be awarded.--In an action brought to
27 enforce the provisions of this act, the court may award
28 reasonable attorney fees to a prevailing plaintiff.
29 (d) Statute of limitations.--Any action brought pursuant to
30 this act shall be commenced within three years of the date of
19930H0219B0235 - 9 -
1 original delivery of the used motor vehicle to the consumer.
2 Section 8. Itemized statement required.
3 The dealer shall provide to the consumer, each time the
4 consumer's vehicle is returned from being serviced or repaired,
5 a fully itemized statement indicating all work performed on such
6 vehicle, including, but not limited to, parts and labor.
7 Section 9. Disclosure.
8 The Attorney General shall prepare and publish in the
9 Pennsylvania Bulletin a statement which explains a consumer's
10 rights under this act. Dealers shall provide to each consumer at
11 the time of purchase of a used motor vehicle a written statement
12 containing a copy of the Attorney General's statement and a
13 listing of zone offices, with addresses and phone numbers, which
14 can be contacted by the consumer for the purpose of securing the
15 remedies provided for in this act.
16 Section 10. Establishment of fund; imposition of fee.
17 (a) Fund established.--There is hereby established a fund to
18 be known as the Used Motor Vehicle Lemon Law Enforcement Fund.
19 This fund shall be established in and maintained by the Office
20 of Attorney General. The purpose of this fund is to insure
21 enforcement by the Office of Attorney General. Moneys shall be
22 used by the Office of Attorney General only to enforce this act.
23 (b) Fees.--Every dealer subject to this act shall pay an
24 annual fee of $50 to be placed in the fund established in
25 subsection (a).
26 Section 11. Application of unfair trade act.
27 A violation of this act shall also be a violation of the act
28 of December 17, 1968 (P.L.1224, No.387), known as the Unfair
29 Trade Practices and Consumer Protection Law.
30 Section 12. Applicability.
19930H0219B0235 - 10 -
1 This act shall apply to all used motor vehicles sold on or
2 after the effective date of this act.
3 Section 13. Effective date.
4 This act shall take effect in 90 days.
L14L12JLW/19930H0219B0235 - 11 -