AN
ACT Relating to motor vehicle dealer practices; and amending RCW 46.70.180.
BE IT
ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec.
1. RCW
46.70.180 and 1996 c 194 s 3 are each amended to read as follows:
Each
of the following acts or practices is unlawful:
(1)
To cause or permit to be advertised, printed, displayed, published,
distributed, broadcasted, televised, or disseminated in any manner whatsoever,
any statement or representation with regard to the sale or financing of a
vehicle which is false, deceptive, or misleading, including but not limited to
the following:
(a)
That no down payment is required in connection with the sale of a vehicle when
a down payment is in fact required, or that a vehicle may be purchased for a
smaller down payment than is actually required;
(b)
That a certain percentage of the sale price of a vehicle may be financed when
such financing is not offered in a single document evidencing the entire
security transaction;
(c)
That a certain percentage is the amount of the service charge to be charged for
financing, without stating whether this percentage charge is a monthly amount
or an amount to be charged per year;
(d)
That a new vehicle will be sold for a certain amount above or below cost
without computing cost as the exact amount of the factory invoice on the
specific vehicle to be sold;
(e)
That a vehicle will be sold upon a monthly payment of a certain amount, without
including in the statement the number of payments of that same amount which are
required to liquidate the unpaid purchase price.
(2)
To incorporate within the terms of any purchase and sale agreement any
statement or representation with regard to the sale or financing of a vehicle
which is false, deceptive, or misleading, including but not limited to terms
that include as an added cost to the selling price of a vehicle an amount for
licensing or transfer of title of that vehicle which is not actually due to the
state, unless such amount has in fact been paid by the dealer prior to such
sale.
(3)
To set up, promote, or aid in the promotion of a plan by which vehicles are to
be sold to a person for a consideration and upon further consideration that the
purchaser agrees to secure one or more persons to participate in the plan by
respectively making a similar purchase and in turn agreeing to secure one or
more persons likewise to join in said plan, each purchaser being given the
right to secure money, credits, goods, or something of value, depending upon
the number of persons joining the plan.
(4)
To commit, allow, or ratify any act of "bushing" which is defined as
follows: Taking from a prospective buyer of a vehicle a written order or offer
to purchase, or a contract document signed by the buyer, which:
(a)
Is subject to the dealer's, or his or her authorized representative's future
acceptance, and the dealer fails or refuses within ((forty-eight hours))
three calendar days, exclusive of Saturday, Sunday, or legal holiday,
and prior to any further negotiations with said buyer, either (i) to
deliver to the buyer ((either)) the dealer's signed acceptance,
or ((all copies of)) (ii) to void the order, offer, or contract
document ((together with)) and tender the return of any initial
payment or security made or given by the buyer, including but not limited to
money, check, promissory note, vehicle keys, a trade-in, or certificate of
title to a trade-in; or
(b)
Permits the dealer to renegotiate a dollar amount specified as trade-in
allowance on a vehicle delivered or to be delivered by the buyer as part of the
purchase price, for any reason except:
(i)
Failure to disclose that the vehicle's certificate of ownership has been
branded for any reason, including, but not limited to, status as a rebuilt
vehicle as provided in RCW 46.12.050 and 46.12.075; ((and)) or
(ii)
Substantial physical damage or latent mechanical defect occurring before the
dealer took possession of the vehicle and which could not have been reasonably
discoverable at the time of the taking of the order, offer, or contract; or
(iii)
Excessive additional miles or a discrepancy in the mileage. "Excessive
additional miles" means the addition of five hundred miles or more, as
reflected on the vehicle's odometer, between the time the vehicle was first
valued by the dealer for purposes of determining its trade-in value and the time
of actual delivery of the vehicle to the dealer. "A discrepancy in the
mileage" means (A) a discrepancy between the mileage reflected on the
vehicle's odometer and the stated mileage on the signed odometer statement; or
(B) a discrepancy between the mileage stated on the signed odometer statement
and the actual mileage on the vehicle; or
(c)
Fails to comply with the obligation of any written warranty or guarantee given
by the dealer requiring the furnishing of services or repairs within a
reasonable time.
(5)
To commit any offense relating to odometers, as such offenses are defined in
RCW 46.37.540, 46.37.550, 46.37.560, and 46.37.570. A violation of this
subsection is a class C felony punishable under chapter 9A.20 RCW.
(6)
For any vehicle dealer or vehicle ((salesman)) salesperson to
refuse to furnish, upon request of a prospective purchaser, ((the name and
address of the previous registered owner of any used vehicle offered for sale))
for vehicles previously registered to a business or governmental entity, the
name and address of the business or governmental entity.
(7)
To commit any other offense under RCW 46.37.423, 46.37.424, or 46.37.425.
(8)
To commit any offense relating to a dealer's temporary license permit,
including but not limited to failure to properly complete each such permit, or
the issuance of more than one such permit on any one vehicle. However, a
dealer may issue a second temporary permit on a vehicle if the following
conditions are met:
(a)
The lienholder fails to deliver the vehicle title to the dealer within the
required time period;
(b)
The dealer has satisfied the lien; and
(c)
The dealer has proof that payment of the lien was made within two calendar
days, exclusive of Saturday, Sunday, or a legal holiday, after the sales
contract has been executed by all parties and all conditions and contingencies
in the sales contract have been met or otherwise satisfied.
(9)
For a dealer, salesman, or mobile home manufacturer, having taken an instrument
or cash "on deposit" from a purchaser prior to the delivery of the
bargained-for vehicle, to commingle the "on deposit" funds with
assets of the dealer, salesman, or mobile home manufacturer instead of holding
the "on deposit" funds as trustee in a separate trust account until
the purchaser has taken delivery of the bargained-for vehicle. Delivery of a
manufactured home shall be deemed to occur in accordance with RCW
46.70.135(5). Failure, immediately upon receipt, to endorse "on
deposit" instruments to such a trust account, or to set aside "on
deposit" cash for deposit in such trust account, and failure to deposit
such instruments or cash in such trust account by the close of banking hours on
the day following receipt thereof, shall be evidence of intent to commit this
unlawful practice: PROVIDED, HOWEVER, That a motor vehicle dealer may keep a
separate trust account which equals his or her customary total customer
deposits for vehicles for future delivery. For purposes of this section,
"on deposit" funds received from a purchaser of a manufactured home
means those funds that a seller requires a purchaser to advance before ordering
the manufactured home, but does not include any loan proceeds or moneys that
might have been paid on an installment contract.
(10)
For a dealer or manufacturer to fail to comply with the obligations of any
written warranty or guarantee given by the dealer or manufacturer requiring the
furnishing of goods and services or repairs within a reasonable period of time,
or to fail to furnish to a purchaser, all parts which attach to the
manufactured unit including but not limited to the undercarriage, and all items
specified in the terms of a sales agreement signed by the seller and buyer.
(11)
For a vehicle dealer to pay to or receive from any person, firm, partnership,
association, or corporation acting, either directly or through a subsidiary, as
a buyer's agent for consumers, any compensation, fee, purchase moneys or funds that
have been deposited into or withdrawn out of any account controlled or used by
any buyer's agent, gratuity, or reward in connection with the purchase or sale
of a new motor vehicle.
(12)
For a buyer's agent, acting directly or through a subsidiary, to pay to or to
receive from any motor vehicle dealer any compensation, fee, gratuity, or
reward in connection with the purchase or sale of a new motor vehicle. In
addition, it is unlawful for any buyer's agent to engage in any of the
following acts on behalf of or in the name of the consumer:
(a)
Receiving or paying any purchase moneys or funds into or out of any account
controlled or used by any buyer's agent;
(b)
Signing any vehicle purchase orders, sales contract, odometer statements, or
title documents, or having the name of the buyer's agent appear on the vehicle
purchase order, sales contract, or title; or
(c)
Signing any other documentation relating to the purchase, sale, or transfer of
any new motor vehicle.
It
is unlawful for a buyer's agent to use a power of attorney obtained from the
consumer to accomplish or effect the purchase, sale, or transfer of ownership
documents of any new motor vehicle by any means which would otherwise be
prohibited under (a) through (c) of this subsection. However, the buyer's
agent may use a power of attorney for physical delivery of motor vehicle
license plates to the consumer.
Further,
it is unlawful for a buyer's agent to engage in any false, deceptive, or
misleading advertising, disseminated in any manner whatsoever, including but
not limited to making any claim or statement that the buyer's agent offers,
obtains, or guarantees the lowest price on any motor vehicle or words to
similar effect.
(13)
For a buyer's agent to arrange for or to negotiate the purchase, or both, of a
new motor vehicle through an out-of-state dealer without disclosing in writing
to the customer that the new vehicle would not be subject to chapter 19.118
RCW. In addition, it is unlawful for any buyer's agent to fail to have a
written agreement with the customer that: (a) Sets forth the terms of the
parties' agreement; (b) discloses to the customer the total amount of any fees
or other compensation being paid by the customer to the buyer's agent for the
agent's services; and (c) further discloses whether the fee or any portion of
the fee is refundable. The department of licensing shall by December 31, 1996,
in rule, adopt standard disclosure language for buyer's agent agreements under
RCW 46.70.011, 46.70.070, and this section.
(14)
Being a manufacturer, other than a motorcycle manufacturer governed by chapter
46.94 RCW, to:
(a)
Coerce or attempt to coerce any vehicle dealer to order or accept delivery of
any vehicle or vehicles, parts or accessories, or any other commodities which
have not been voluntarily ordered by the vehicle dealer: PROVIDED, That
recommendation, endorsement, exposition, persuasion, urging, or argument are
not deemed to constitute coercion;
(b)
Cancel or fail to renew the franchise or selling agreement of any vehicle
dealer doing business in this state without fairly compensating the dealer at a
fair going business value for his or her capital investment which shall include
but not be limited to tools, equipment, and parts inventory possessed by the
dealer on the day he or she is notified of such cancellation or termination and
which are still within the dealer's possession on the day the cancellation or
termination is effective, if: (i) The capital investment has been entered into
with reasonable and prudent business judgment for the purpose of fulfilling the
franchise; and (ii) the cancellation or nonrenewal was not done in good faith.
Good faith is defined as the duty of each party to any franchise to act in a
fair and equitable manner towards each other, so as to guarantee one party
freedom from coercion, intimidation, or threats of coercion or intimidation
from the other party: PROVIDED, That recommendation, endorsement, exposition,
persuasion, urging, or argument are not deemed to constitute a lack of good faith.
(c)
Encourage, aid, abet, or teach a vehicle dealer to sell vehicles through any
false, deceptive, or misleading sales or financing practices including but not
limited to those practices declared unlawful in this section;
(d)
Coerce or attempt to coerce a vehicle dealer to engage in any practice
forbidden in this section by either threats of actual cancellation or failure
to renew the dealer's franchise agreement;
(e)
Refuse to deliver any vehicle publicly advertised for immediate delivery to any
duly licensed vehicle dealer having a franchise or contractual agreement for
the retail sale of new and unused vehicles sold or distributed by such
manufacturer within sixty days after such dealer's order has been received in
writing unless caused by inability to deliver because of shortage or
curtailment of material, labor, transportation, or utility services, or by any
labor or production difficulty, or by any cause beyond the reasonable control
of the manufacturer;
(f)
To provide under the terms of any warranty that a purchaser of any new or
unused vehicle that has been sold, distributed for sale, or transferred into
this state for resale by the vehicle manufacturer may only make any warranty
claim on any item included as an integral part of the vehicle against the
manufacturer of that item.
Nothing
in this section may be construed to impair the obligations of a contract or to
prevent a manufacturer, distributor, representative, or any other person,
whether or not licensed under this chapter, from requiring performance of a
written contract entered into with any licensee hereunder, nor does the
requirement of such performance constitute a violation of any of the provisions
of this section if any such contract or the terms thereof requiring
performance, have been freely entered into and executed between the contracting
parties. This paragraph and subsection (14)(b) of this section do not apply to
new motor vehicle manufacturers governed by chapter 46.96 RCW.
(15)
Unlawful transfer of an ownership interest in a motor vehicle as defined in RCW
19.116.050.
