| 4-90-401
Title.
This
subchapter shall be known and
may be cited as the
"Arkansas New Motor Vehicle
Quality Assurance Act".
4-90-402
Legislative determinations and
intent.
The Arkansas
General Assembly recognizes that
a motor vehicle is a major
consumer acquisition and that a
defective motor vehicle
undoubtedly creates a hardship
for the consumer. The Arkansas
General Assembly further
recognizes that a duly
franchised motor vehicle dealer
is an authorized service agent
of the manufacturer. It is the
intent of the Arkansas General
Assembly that a good faith motor
vehicle warranty complaint by a
consumer be resolved by the
manufacturer within a specified
period of time. It is further
the intent of the Arkansas
General Assembly to provide the
statutory procedures whereby a
consumer may receive a
replacement motor vehicle, or a
full refund, for a motor vehicle
which cannot be brought into
conformity with the warranty
provided for in this subchapter.
However, nothing in this
subchapter shall in any way
limit the rights or remedies
which are otherwise available to
a consumer under any other law.
4-90-403
Definitions.
As used in
this subchapter, unless the
context otherwise requires:
(1)
"Calendar day" means
any day of the week other than
a legal holiday;
(2)
"Collateral charges"
means those additional charges
to a consumer wholly incurred
as a result of the acquisition
of the motor vehicle. For the
purposes of this subchapter,
collateral charges include,
but are not limited to,
manufacturer-installed or
agent-installed items, earned
finance charges, sales taxes,
title charges, and charges for
extended warranties provided
by the manufacturer, its
subsidiary, or agent;
(3)
"Condition" means a
general problem that may be
attributable to a defect in
more than one (1) part;
(4)
"Consumer" means the
purchaser or lessee, other
than for the purposes of lease
or resale, of a new or
previously untitled motor
vehicle, or any other person
entitled by the terms of the
warranty to enforce the
obligations of the warranty
during the duration of the
motor vehicle quality
assurance period, provided the
purchaser has titled and
registered the motor vehicle
as prescribed by law;
(5)
"Incidental charges"
means those reasonable costs
incurred by the consumer,
including, but not limited to,
towing charges and the costs
of obtaining alternative
transportation which are
directly caused by the
nonconformity or
nonconformities which are the
subject of the claim, but
shall not include loss of use,
loss of income, or personal
injury claims;
(6)
"Lease price" means
the aggregate of:
(A)
The lessor's actual purchase
costs;
(B)
Collateral charges, if
applicable;
(C)
Any fee paid to another
person to obtain the lease;
(D)
Any insurance or other costs
expended by the lessor for
the benefit of the lease;
(E)
An amount equal to state and
local sales taxes, not
otherwise included as
collateral charges, paid by
the lessor when the vehicle
was initially purchased; and
(F)
An amount equal to five
percent (5%) of the lessor's
actual purchase price;
(7)
"Lessee" means any
consumer who leases a motor
vehicle for one (1) year or
more pursuant to a written
lease agreement which provides
that the lessee is responsible
for repairs to such motor
vehicle;
(8)
"Lessee cost" means
the aggregate deposit and
rental payments previously
paid to the lessor for the
leased vehicle;
(9)
"Lessor" means a
person who holds title to a
motor vehicle leased to a
lessee under the written lease
agreement or who holds the
lessor's rights under such
agreement;
(10)
"Manufacturer"
means:
(A)
Any person who is engaged in
the business of constructing
or assembling new motor
vehicles or installing, on
previously assembled vehicle
chassis, special bodies or
equipment which, when
installed, form an integral
part of the new motor
vehicle; or
(B)
In the case of motor
vehicles not manufactured in
the United States, any
person who is engaged in the
business of importing new
motor vehicles into the
United States for the
purpose of selling or
distributing new motor
vehicles to new motor
vehicle dealers;
(11)
"Motor vehicle" or
"vehicle" means any
self-propelled vehicle
licensed, purchased, or leased
in this state and primarily
designed for the
transportation of persons or
property over the public
streets and highways, but does
not include mopeds,
motorcycles, the living
facilities of a motor home, or
vehicles over ten thousand
pounds (10,000 lbs.) gross
vehicle weight rating. For
purposes of this definition,
the limit of ten thousand
pounds (10,000 lbs.) gross
vehicle weight rating does not
apply to motor homes;
(12)
"Motor vehicle quality
assurance period" means a
period of time that:
(A)
Begins:
(i)
On the date of original
delivery of a motor
vehicle; or
(ii)
In the case of a
replacement vehicle
provided by a manufacturer
to a consumer under this
subchapter, on the date of
delivery of the
replacement vehicle to the
consumer; and
(B)
Ends twenty-four (24) months
after the date of the
original delivery of the
motor vehicle to a consumer,
or the first twenty-four
thousand (24,000) miles of
operation attributable to
the consumer, whichever is
later;
(13)
"Nonconformity"
means any specific or generic
defect or condition or any
concurrent combination of
defects or conditions that:
(A)
Substantially impairs the
use, market value, or safety
of a motor vehicle; or
(B)
Renders the motor vehicle
nonconforming to the terms
of an applicable
manufacturer's express
warranty or implied warranty
of merchantability;
(14)
"Person" means any
natural person, partnership,
firm, corporation,
association, joint venture,
trust, or other legal entity;
(15)
"Purchase price"
means the cash price paid for
the motor vehicle appearing in
the sales agreement or
contract, including any net
allowance for a trade-in
vehicle;
(16)
"Replacement motor
vehicle" means a motor
vehicle which is identical or
reasonably equivalent to the
motor vehicle to be replaced,
as the motor vehicle replaced
existed at the time of the
original acquisition; and
(17)
"Warranty" means any
written warranty issued by the
manufacturer, or any
affirmation of fact or promise
made by the manufacturer,
excluding statements made by
the dealer, in connection with
the sale or lease of a motor
vehicle to a consumer which
relates to the nature of the
material or workmanship and
affirms or promises that such
material or workmanship is
free of defects or will meet a
specified level of
performance.
4-90-404
Notice by consumer - Disclosure
by manufacturer, agent, or
dealer.
(a)
(1)
A consumer must notify the
manufacturer of a claim
under this subchapter if the
manufacturer has made the
disclosure required by
subsection (b) of this
section.
(2)
However, if the manufacturer
has not made the required
disclosure, the consumer is
not required to notify the
manufacturer of a claim
under this subchapter.
(b)
(1)
At the time of the
consumer's purchase or lease
of the vehicle, the
manufacturer, its agent, or
an authorized dealer shall
provide to the consumer a
written statement that
explains the consumer's
rights and obligations under
this subchapter.
(2)
The written statement shall
be prepared by the Consumer
Protection Division of the
Office of the Attorney
General and shall include
the telephone number of the
Consumer Protection Division
that the consumer can
contact to obtain
information regarding his or
her rights and obligations
under this subchapter.
(3)
For each failure of the
manufacturer, its agent, or
an authorized dealer to
provide to a consumer the
written statement required
under this section, the
manufacturer shall be liable
to the State of Arkansas for
a civil penalty of not less
than twenty-five dollars
($25.00) nor more than one
thousand dollars ($1,000).
(c)
(1)
The manufacturer shall
clearly and conspicuously
disclose to the consumer, in
the warranty or owner's
manual, that written notice
of the nonconformity is
required before the buyer
may be eligible for a refund
or replacement of the
vehicle.
(2)
The manufacturer shall
provide the consumer with
conspicuous notice of the
address and phone number for
its zone, district, or
regional office for this
state at the time of vehicle
acquisition, to which the
buyer must send
notification.
4-90-405
Required warranty repairs.
If a motor
vehicle does not conform to the
warranty and the consumer
reports the nonconformity to the
manufacturer, its agent, or
authorized dealer during the
motor vehicle quality assurance
period, the manufacturer, its
agent, or authorized dealer
shall make such repairs as are
necessary to correct the
nonconformity, even if the
repairs are made after the
expiration of the term of
protection.
4-90-406
Failure to make required
repairs.
(a)
(1)
After three (3) attempts
have been made to repair the
same nonconformity that
substantially impairs the
motor vehicle, or after one
(1) attempt to repair a
nonconformity that is likely
to cause death or serious
bodily injury, the consumer
shall give written
notification, by certified
or registered mail, to the
manufacturer of the need to
repair the nonconformity in
order to allow the
manufacturer a final attempt
to cure the nonconformity.
(2)
The manufacturer shall,
within ten (10) days after
receipt of the notification,
notify and provide the
consumer with the
opportunity to have the
vehicle repaired at a
reasonably accessible repair
facility, and, after
delivery of the vehicle to
the designated repair
facility by the consumer,
the manufacturer shall,
within ten (10) days,
conform the motor vehicle to
the warranty.
(3)
If the manufacturer fails to
notify and provide the
consumer with the
opportunity to have the
vehicle repaired at a
reasonably accessible repair
facility or fails to perform
the repairs within the time
periods prescribed in this
subsection, the requirement
that the manufacturer be
given a final attempt to
cure the nonconformity does
not apply and a
nonrebuttable presumption of
a reasonable number of
attempts to repair arises.
(b)
(1)
(A)
If the manufacturer, its
agent, or authorized
dealer has not conformed
the motor vehicle to the
warranty by repairing or
correcting one (1) or more
nonconformities that
substantially impair the
motor vehicle after a
reasonable number of
attempts, the
manufacturer, within forty
(40) days, shall:
(i)
At the time of its
receipt of payment of a
reasonable offset for
use by the consumer,
replace the motor
vehicle with a
replacement motor
vehicle acceptable to
the consumer; or
(ii)
Repurchase the motor
vehicle from the
consumer or lessor and
refund to the consumer
or lessor the full
purchase price or lease
price, less a reasonable
offset for use and less
a reasonable offset for
physical damage
sustained to the vehicle
while under the
ownership of the
consumer.
(B)
The replacement or refund
shall include payment of
all collateral and
reasonably incurred
incidental charges.
(2)
(A)
The consumer shall have an
unconditional right to
choose a refund rather
than a replacement.
(B)
At the time of such refund
or replacement, the
consumer, lien holder, or
lessor shall furnish to
the manufacturer clear
title to and possession of
the motor vehicle.
(3)
The amount of reasonable
offset for use by the
consumer shall be determined
by multiplying the actual
price of the new motor
vehicle paid or payable by
the consumer, including any
charges for transportation
and manufacturer-installed
or agent-installed options,
by a fraction having as its
denominator one hundred
twenty thousand (120,000)
and having as its numerator
the number of miles traveled
by the new motor vehicle
prior to the time the buyer
first delivered the vehicle
to the manufacturer, its
agent, or authorized dealer
for correction of the
problem that gave rise to
the nonconformity.
4-90-407
Refunds.
(a)
(1)
Refunds shall be made to the
consumer and lien holder of
record, if any, as their
interests may appear.
(2)
If applicable, refunds shall
be made to the lessor and
lessee as follows:
(A)
The lessee shall receive
the lessee cost less a
reasonable offset for use;
and
(B)
The lessor shall receive
the lease price less the
aggregate deposit and
rental payments previously
paid to the lessor for the
leased vehicle.
(b)
If the manufacturer makes a
refund to the lessor or lessee
pursuant to this subchapter,
the consumer's lease agreement
with the lessor shall be
terminated upon payment of the
refund and no penalty for
early termination shall be
assessed.
(c)
If a replaced vehicle was
financed by the manufacturer,
its subsidiary, or agent, the
manufacturer, subsidiary, or
agent may not require the
buyer to enter into any
refinancing agreement
concerning a replacement
vehicle that would create any
financial obligations upon the
buyer beyond those of the
original financing agreement.
4-90-408
Reimbursement of towing and
rental costs.
Whenever a
vehicle is replaced or refunded
under this subchapter, the
manufacturer shall reimburse the
consumer for necessary towing
and rental costs actually
incurred as a direct result of
the nonconformity.
4-90-409
Option to retain use of vehicle.
A consumer has
the option of retaining the use
of any vehicle returned under
this subchapter until the time
that the consumer has been
tendered a full refund or a
replacement vehicle of
comparable value.
4-90-410
Presumption of reasonable
attempts to repair
Extension of
time to repair in case of war,
invasion, strike, fire, flood,
or natural disaster.
(a) A
rebuttable presumption of a
reasonable number of attempts
to repair is considered to
have been undertaken to
correct a nonconformity if:
(1)
The nonconformity has been
subject to repair as
provided in 4-90-406(a), but
the nonconformity continues
to exist;
(2)
The vehicle is out of
service by reason of repair,
or attempt to repair, any
nonconformity for a
cumulative total of thirty
(30) calendar days; or
(3)
There have been five (5) or
more attempts, on separate
occasions, to repair any
nonconformities that
together substantially
impair the use and value of
the motor vehicle to the
consumer.
(b)
(1)
The thirty (30) calendar
days in subdivision (a)(2)
of this section shall be
extended by any period of
time during which repair
services are not available
as a direct result of war,
invasion, strike, fire,
flood, or natural disaster.
(2)
The manufacturer, its agent,
or authorized dealer shall
provide or make provisions
for the free use of a
vehicle to any consumer
whose vehicle is out of
service beyond thirty (30)
days by reason of delayed
repair as a direct result of
war, invasion, strike, fire,
flood, or natural disaster.
(c)
The burden is on the
manufacturer to show that the
reason for an extension under
subsection (b) of this section
was the direct cause for the
failure of the manufacturer,
its agent, or authorized
dealer to cure any
nonconformity during the time
of the event.
4-90-411
Diagnosis or repair -
Documentation.
(a) A
manufacturer, its agent, or
authorized dealer may not
refuse to diagnose or repair
any vehicle for the purpose of
avoiding liability under this
subchapter.
(b)
(1)
A manufacturer, its agent,
or authorized dealer shall
provide a consumer with a
written repair order each
time the consumer's vehicle
is brought in for
examination or repair.
(2)
The repair order must
indicate all work performed
on the vehicle, including
examination of the vehicle,
parts, and labor.
4-90-412
Resale of returned nonconforming
vehicle.
If a motor
vehicle has been replaced or
repurchased by a manufacturer as
the result of a court judgment,
an arbitration award, or any
voluntary agreement entered into
between a manufacturer and a
consumer that occurs after a
consumer complaint has been
investigated and evaluated
pursuant to this subchapter or a
similar law of another state,
the motor vehicle may not be
resold in Arkansas unless:
(1)
The manufacturer provides the
same express warranty the
manufacturer provided to the
original purchaser, except
that the term of the warranty
need only last for twelve
thousand (12,000) miles or
twelve (12) months after the
date of resale, whichever
occurs first; and
(2)
The manufacturer provides a
written disclosure, signed by
the consumer, indicating that
the vehicle was returned to
the manufacturer because of a
nonconformity not cured within
a reasonable time as provided
by Arkansas law.
4-90-413
Affirmative defenses.
It is an
affirmative defense to any claim
under this subchapter that:
(1)
The nonconformity, defect, or
condition does not
substantially impair the use,
value, or safety of the motor
vehicle;
(2)
The nonconformity, defect, or
condition is the result of an
accident, abuse, neglect, or
unauthorized modification or
alteration of the motor
vehicle by persons other than
the manufacturer, its agent,
or authorized dealer;
(3)
The claim by the consumer was
not filed in good faith; or
(4)
Any other defense allowed by
law that may be raised against
the claim.
4-90-414
Informal proceeding as
precedent.
(a)
(1)
Any manufacturer doing
business in this state,
entering into franchise
agreements for the sale of
its motor vehicles in this
state, or offering express
warranties on its motor
vehicles sold or distributed
for sale in this state,
shall operate, or
participate in, an informal
dispute settlement
proceeding located in the
State of Arkansas which
complies with the
requirements of this
section.
(2)
The provisions of
4-90-406(b)(1) and (2)
concerning refunds or
replacement do not apply to
a consumer who has not first
used this informal
proceeding before commencing
a civil action, unless the
manufacturer allows a
consumer to commence an
action without first using
this informal procedure.
(3)
(A)
The consumer shall receive
adequate written notice
from the manufacturer of
the existence of the
procedure.
(B)
Adequate written notice
may include the
incorporation of the
informal dispute
settlement procedure into
the terms of the written
warranty to which the
motor vehicle does not
conform.
(b)
The informal dispute procedure
must be certified by the
Consumer Protection Division
of the Office of the Attorney
General as meeting the
following criteria:
(1)
The informal dispute
procedure must comply with
the minimum requirements of
the Federal Trade Commission
for informal dispute
settlement procedures as set
forth in 16 C.F.R. 703.1 et
seq., as in effect on the
date of adoption of this
subchapter, unless any
provision of 16 C.F.R. 703.1
et seq. is in conflict with
this subchapter, in which
case the provisions of this
subchapter shall govern;
(2)
The informal dispute
procedure must prescribe a
reasonable time, not to
exceed thirty (30) days
after the decision is
accepted by the buyer,
within which the
manufacturer or its agent
must fulfill the terms of
its decisions;
(3)
(A)
No documents shall be
received by any informal
dispute procedure unless
those documents have been
provided to each of the
parties in the dispute at
or prior to the
proceeding, with an
opportunity for the
parties to comment on the
documents either in
writing or orally.
(B)
If a consumer is present
during the informal
dispute proceeding, the
consumer may request
postponement of the
proceeding meeting to
allow sufficient time to
review any documents
presented at the time of
the meeting which had not
been presented to the
consumer prior to the time
of the meeting;
(4)
(A)
The informal dispute
procedure shall allow each
party to appear and make
an oral presentation
within the State of
Arkansas unless the
consumer agrees to submit
the dispute for decision
on the basis of documents
alone or by telephone, or
unless the party fails to
appear for an oral
presentation after
reasonable prior written
notice.
(B)
If the consumer agrees to
submit the dispute for
decision on the basis of
documents alone, then the
manufacturer or dealer
representatives may not
participate in the
discussion or decision of
the dispute;
(5)
Consumers shall be given an
adequate opportunity to
contest a manufacturer's
assertion that a
nonconformity falls within
intended specifications for
the vehicle by having the
basis of the manufacturer's
claim appraised by a
technical expert selected
and paid for by the consumer
prior to the informal
dispute settlement hearing;
(6)
A consumer may not be
charged with a fee to
participate in an informal
dispute procedure; and
(7)
Any party to the dispute has
the right to be represented
by an attorney in an
informal dispute proceeding.
(c)
(1)
(A)
The informal dispute
procedure shall annually
submit a pool of not less
than six (6) members who
are appointed with the
advice and consent of the
Consumer Protection
Division of the Office of
the Attorney General.
(B)
Selected strictly by
rotation, one (1) member
shall hear disputes
scheduled for a particular
session unless the
consumer requests a panel
of three (3) members, in
which case three (3)
members shall hear
disputes scheduled for a
particular three-member
session.
(C)
If the informal dispute
procedure deems it
appropriate to require the
services of an independent
investigator, such
investigator shall be
selected from a pool of
not less than four (4)
members who are appointed
annually with the advice
and consent of the
Consumer Protection
Division of the Office of
the Attorney General and
from which the particular
investigator shall be
selected strictly by
rotation.
(2)
Upon notification to the
administrator of any
informal dispute procedure
that a determination has
been made by the Consumer
Protection Division of the
Office of the Attorney
General that a member of any
pool is not conforming to
standards of fairness and
impartiality, that member
shall be immediately removed
from the pool.
4-90-415
Enforcement - Exclusivity -
Costs and expenses.
(a) A
consumer may bring a civil
action to enforce this
subchapter in a court of
competent jurisdiction.
(b)
This subchapter does not limit
the rights and remedies that
are otherwise available to a
consumer under any applicable
provisions of law.
(c) A
consumer who prevails in any
legal proceeding under this
subchapter is entitled to
recover as part of the
judgment a sum equal to the
aggregate amount of costs and
expenses, including attorney's
fees based upon actual time
expended by the attorney,
determined by the court to
have been reasonably incurred
by the consumer for or in
connection with the
commencement and prosecution
of the action.
4-90-416
Time limitation for commencement
of action.
(a)
An action brought under this
subchapter must be commenced
within two (2) years following
the date the buyer first
reports the nonconformity to
the manufacturer, its agent,
or authorized dealer.
(b)
When the buyer has commenced
an informal dispute settlement
procedure described in
4-90-414, the two-year period
specified in subsection (a) of
this section begins to run at
the time the informal dispute
settlement procedure is being
commenced.
4-90-417
Deceptive trade practices.
A violation of
any of the provisions of this
subchapter shall be deemed a
deceptive trade practice under
4-88-101 et seq.
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