Illinois Compiled Statutes
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VEHICLES625 ILCS 5/5-102.5
(625 ILCS 5/) Illinois Vehicle Code.
(625 ILCS 5/5-102.5)
Used vehicle dealer prelicensing education program courses.
(a) An applicant for a license as a used vehicle
dealer shall complete a minimum of 8 hours of prelicensing
education program courses pursuant to this Section prior to
submitting an application to the Secretary of State.
(b) To meet the requirements of this Section, at least one
individual who is associated with the used vehicle
dealer as an owner, principal, corporate officer, director, or
member or partner of a limited liability company or limited
liability partnership shall complete the education program
(c) The education program courses shall be provided by public or private entities with an expertise in the area as approved by the Secretary of State. The Secretary of State must approve course curricula and instruction, in consultation with the Illinois Department of Transportation and any private entity with expertise in the area in the Secretary of State's discretion.
(d) Each person who successfully completes an approved prelicensing education program under this Section shall be issued a certificate by the education program provider of the course. The current certificate of completion, or a copy of the certificate, shall be posted conspicuously in the principal office of the licensee.
(e) The provisions of this Section apply to all used vehicle dealers including, but not limited to, individuals,
corporations, and partnerships, except for the following:
(1) Motor vehicle rental companies having a national
(2) National motor vehicle auction companies;
(3) Wholesale dealer-only auction companies;
(4) Used vehicle dealerships owned by a franchise
motor vehicle dealer; and
(5) Banks, credit unions, and savings and loan
(Source: P.A. 96-678, eff. 8-25-09.)
625 ILCS 5/5-102.7
(625 ILCS 5/5-102.7)
Dealer Recovery Trust Fund.
(a) The General Assembly finds that motor vehicle dealers that go out of business without fulfilling agreements to pay off the balance of their customers' liens on traded-in vehicles cause financial harm to those customers by leaving those customers liable for multiple vehicle loans and cause harm to the integrity of the motor vehicle retailing industry. It is the intent of the General Assembly to protect vehicle purchasers by creating a Dealer Recovery Trust Fund to reimburse these consumers.
(b) The Dealer Recovery Trust Fund shall be used solely for the limited purpose of
helping victims of dealership closings. Any interest accrued by moneys in the Fund shall be
deposited and become part of the Dealer Recovery Trust Fund and its purpose. The sole beneficiaries of the Dealer Recovery Trust Fund are victims of
(c) Except where the context otherwise requires, the following words and phrases, when used in this Section, have the meanings ascribed to them in this subsection (c):
"Applicant" means a person who applies for reimbursement from the Dealer Recovery Trust Fund Board.
"Board" means the Dealer Recovery Trust Fund Board created under this Section.
"Dealer" means a new vehicle dealer licensed under Section 5-101 or a used vehicle dealer licensed under Section 5-102, excepting a dealer who primarily sells mobile homes, recreational vehicles, or trailers.
"Fund" means the Dealer Recovery Trust Fund created under this Section.
"Fund Administrator" means the private entity, which shall be appointed by the Board, that administers the Dealer Recovery Trust Fund.
(d) Beginning October 1, 2011, each application or renewal for a new vehicle dealer's license and each application or renewal for a used vehicle dealer's license shall be accompanied by the applicable Annual Dealer Recovery Fund Fee under Section 5-101 or 5-102 of this Code. The fee shall be in addition to any other fees imposed under this Article, shall be submitted at the same time an application or renewal for a new vehicle dealer's license or used vehicle dealer's license is submitted, and shall be made payable to and remitted directly to the Dealer Recovery Trust Fund, a trust fund outside of the State Treasury which is hereby created. In addition, the Dealer Recovery Trust Fund may accept any federal, State, or private moneys for deposit into the Fund.
(e) The Fund Administrator shall maintain a list of all dealers who have paid the fee under subsection (d) of this Section for the current year, which shall be available to the Secretary of State and the Board. The Secretary of State shall revoke the dealer license of any dealer who does not pay the fee imposed under subsection (d) of this Section. The Secretary of State and the Fund Administrator may enter into information sharing agreements as needed to implement this Section.
(f) The Fund shall be audited annually by an independent auditor who is a certified public accountant and who has been selected by the Board. The independent auditor shall compile an annual report, which shall be filed with the Board and shall be a public record. The auditor shall be paid by the Fund, pursuant to an order of the Board.
(g) The Fund shall be maintained by the Fund Administrator, who shall keep current records of the amounts deposited into the Fund and the amounts paid out of the Fund pursuant to an order of the Board. These records shall be made available to all members of the Board upon reasonable request during normal business hours. The Fund Administrator shall report the balance in the Fund to the Board monthly, by the 15th day of each month. For purposes of determining the amount available to pay claims under this Section at any meeting of the Board, the Board shall use the Fund Administrator's most recent monthly report. The Fund Administrator shall purchase liability insurance to cover management of the Fund at a cost not to exceed 2% of the balance in the Fund as of January 15th of that year.
(h) In any year for which the balance in the Fund as of August 31st is greater than $3,500,000, the Fund Administrator shall notify the Secretary of State and the Secretary of State shall suspend collection of the fee for the following year for any dealer who has not had a claim paid from the Fund, has not had his or her license suspended or revoked, and has not been assessed any civil penalties under this Code during the 3 previous years.
(i) Moneys in the Dealer Recovery Trust Fund may be paid from the Fund only as directed by a written order of the Board and used only for the following purposes:
(i) to pay claims under a written order of the Board
as provided in this Section; or
(ii) to reimburse the Fund Administrator for its
expenses related to the administration of the Fund, provided that the reimbursement to the Fund Administrator in any year shall not exceed 2% of the balance in the Fund as of January 15th of that year.
(j) The Dealer Recovery Trust Fund Board is hereby created. The Board shall consist of the Secretary of State, or his or her designee, who shall serve as chair, the Attorney General, or his or her designee, who shall serve as secretary, and one person alternatively representing new and independent Illinois automobile dealers, selected collectively by the Attorney General, or his or her designee, and the Secretary of State, or his or her designee. The Secretary of State may propose procedures and employ personnel as necessary to implement this Section. The Board shall meet quarterly, and as needed, as directed by the chair. The Board may not pay out any claims before the balance deposited into the Fund exceeds $500,000. Board meetings shall be open to the public. The Board has the authority to take any action by at least a two-thirds majority vote.
(k) The following persons may apply to the Board for reimbursement from the Dealer Recovery Trust Fund:
(i) A retail customer who, on or after October 1,
2011, purchases a vehicle from a dealer who subsequently files for bankruptcy or whose vehicle dealer's license is subsequently revoked by the Secretary of State or otherwise terminated and, as part of the purchase transaction, trades in a vehicle with an outstanding lien to the dealer if lien satisfaction was a condition of the purchase agreement and the retail customer determines that the lien has not been satisfied;
(ii) A retail customer who, on or after October 1,
2011, purchases a vehicle with an undisclosed lien from a dealer who subsequently files for bankruptcy or whose vehicle dealer's license is subsequently revoked by the Secretary of State or otherwise terminated;
(iii) A dealer who, on or after October 1, 2011,
purchases a vehicle with an undisclosed lien from another dealer who subsequently files for bankruptcy or whose vehicle dealer's license is subsequently revoked by the Secretary of State or otherwise terminated.
(l) To be considered by the Board, an applicant must submit his or her claim to the Board within 2 years after the date of the transaction that gave rise to the claim.
(m) At each meeting of the Board, it shall consider all claims that are properly submitted to it on forms prescribed by the Secretary of State at least 30 days before the date of the Board's meeting. Before the Board may consider a claim against a dealer, it must make a written determination that the dealer has filed for bankruptcy under the provisions of 11 U.S.C. Chapter 7; that the Secretary of State has revoked his or her dealer's license; or that the license has been otherwise terminated. Once the Board has made this determination, it may consider the applicant's claim against the dealer. If a two-thirds majority of the Board determines that the dealer has committed a violation under subsection (k), it shall grant the applicant's claim. Except as otherwise provided in this Section, the maximum amount of any award for a claim under paragraph (i) of subsection (k) of this Section shall be equal to the amount of the unpaid balance of the lien that the dealer agreed to pay off on behalf of the applicant as shown on the bill of sale or the retail installment sales contract. The maximum amount of any claim under paragraph (ii) or (iii) of subsection (k) of this Section shall be equal to the amount of the undisclosed lien. However, no award for a claim under subsection (k) of this Section shall exceed $35,000.
(n) If the balance in the Fund at the time of any Board meeting is less than the amount of the total amount of all claims awarded at that meeting, then all awards made at that meeting shall be reduced, pro rata, so that the amount of claims does not exceed the balance in the Fund. Before it reviews new claims, the Board shall issue written orders to pay the remaining portion of any claims that were so reduced, provided that the balance in the Fund is sufficient to pay those claims.
(o) Whenever the balance of the Fund falls below $500,000, the Board may charge dealers
an additional assessment of up to $50 to bring the balance to at least $500,000.
Not more than one additional assessment may be made against a dealer in any 12-month period.
(p) If the total amount of claims awarded against any dealer exceeds 33% of the balance in the Fund, the Board may permanently reduce the amount of those claims, pro rata, so that those claims do not exceed 33% of the balance in the Fund.
(q) The Board shall issue a written order directing the Fund Administrator to pay an applicant's claim to a secured party where the Board has received a signed agreement between the applicant and the secured party holding the lien. The agreement must (i) state that the applicant and the secured party agree to accept payment from the Fund to the secured party as settlement in full of all claims against the dealer; and (ii) release the lien and the title, if applicable, to the vehicle that was the subject of the claim. The written order shall state the amount of the claim and the name and address of the secured party to whom the claim shall be paid. The Fund Administrator shall pay the claim within 30 days after it receives the Board's order.
(r) No dealer or principal associated with a dealer's license is eligible for licensure, renewal or relicensure until the full amount of reimbursement for an unpaid claim, plus interest as determined by the Board, is paid to the Fund. Nothing in this Section shall limit the authority of the Secretary of State to suspend, revoke, or levy civil penalties against a dealer, nor shall full repayment of the amount owed to the Fund nullify or modify the effect of any action by the Secretary.
(s) Nothing in this Section shall limit the right of any person to seek relief though civil action against any other person as an alternative to seeking reimbursement from the Fund.
(Source: P.A. 97-480, eff. 10-1-11; 98-450, eff. 1-1-14.)
625 ILCS 5/5-103
(625 ILCS 5/5-103)
(from Ch. 95 1/2, par. 5-103)
(a) Every new vehicle
manufacturer shall specify the delivery and
preparation obligations of its vehicle dealers prior to delivery of new
vehicles to retail buyers. A copy of the delivery and preparation
obligations of its dealers shall be filed with the Secretary of State by
every vehicle manufacturer and shall constitute the vehicle dealer's only
responsibility for product liability as between the dealer and the
manufacturer. A manufacturer's product or warranty liability to the dealer
shall extend to any mechanical, body or parts defect constituting a breach
of any express or implied warranty of the manufacturer. The manufacturer
shall reasonably compensate any authorized dealer who rectifies a defect
which constitutes a breach of any express or implied warranty of the
manufacturer and for preparation and delivery obligations. Every dealer
shall perform the preparation and get ready services specified by the
manufacturer to be performed prior to the delivery of the new vehicle to
(b) The owner of the vehicle may cause the vehicle to be inspected
according to this Section and have the original manufacturer's warranty
reinstated if the vehicle is a theft recovery that has been salvaged and is
recovered without structural damage or missing essential parts, excluding
wheels, damage to the steering column, and radios provided the owner:
(1) Submits the vehicle to a franchised dealer for a
complete inspection, including fluids, frame, essential parts, and other items deemed by the manufacturer as essential for verification of the condition of the vehicle at the time of recovery.
(2) Submits a copy of the police recovery report to
(3) Paid the inspection fee charged by the franchised
The manufacturer shall reinstate the original manufacturer's warranty if a
vehicle is certified by a franchised dealer as having complied with the
provisions of this Section. The manufacturer shall, in addition to reinstating
warranty, provide the owner with a written statement indicating that the
original manufacturer's warranty has been reinstated.
(c) Nothing in this Section shall affect a cause of action a buyer may have
against a dealer or manufacturer under present applicable statutory or case
(Source: P.A. 92-458, eff. 8-22-01.)
625 ILCS 5/5-104
(625 ILCS 5/5-104)
(from Ch. 95 1/2, par. 5-104)
(a) On and after January 1, 1976, each manufacturer
of a 1976 or later model year vehicle of the first division manufactured for sale in
this State, other than a motorcycle, shall clearly and conspicuously indicate, on the
price listing affixed to the vehicle pursuant to the "Automobile Information
Disclosure Act", (15 United States Code 1231 through 1233), the following, with the
appropriate gasoline mileage figure:
"In tests for fuel economy in city and highway driving conducted
by the United States Environmental Protection Agency, this passenger
vehicle obtained ....... miles per gallon of gasoline."
(Source: P.A. 79-747.)