102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB4108

 

Introduced 9/3/2021, by Rep. Jonathan Carroll

 

SYNOPSIS AS INTRODUCED:
 
New Act
30 ILCS 105/5.935 new
35 ILCS 120/6  from Ch. 120, par. 445
625 ILCS 5/5-104.2
815 ILCS 380/Act rep.

    Creates the New Vehicle Buyer Protection Act of 2021. Provides that if a manufacturer is unable to service or repair a new motor vehicle to conform to the applicable written warranties after a reasonable number of attempts, the manufacturer shall either promptly replace the new motor vehicle or make restitution to the buyer. Provides that it shall be presumed that a reasonable number of attempts have been made to conform a new motor vehicle to the applicable express warranties if, within 18 months from delivery to the buyer or 18,000 miles on the odometer of the vehicle: (1) the same nonconformity results in a condition that is likely to cause death or serious bodily injury if the vehicle is driven after 2 or more repairs; (2) the same nonconformity has been subject to repair 4 or more times; or (3) the vehicle is out of service by reason of repair for more than 30 calendar days since delivery of the vehicle to the buyer. Requires a buyer to initiate a qualified third-party dispute resolution process, if available, before asserting the presumption that a reasonable number of attempts have been made to repair the nonconformity. Prohibits a person from selling a motor vehicle without first disclosing to the prospective buyer that the vehicle had a nonconformity and the nonconformity was corrected. Contains provisions concerning a "Lemon Law Buyback" decal; a warranty buyback notice; remedies; a manufacturer's fee for each vehicle sold; sales and use tax reimbursements; and other matters. Amends the Retailers' Occupation Tax Act and the Illinois Vehicle Code. Changes references to "New Vehicle Buyer Protection Act" to "New Vehicle Buyer Protection Act of 2021". Amends the State Finance Act. Creates the Motor Vehicle Dispute Resolution Certification Fund. Repeals the New Vehicle Buyer Protection Act.


LRB102 19025 KMF 27789 b

 

 

A BILL FOR

 

HB4108LRB102 19025 KMF 27789 b

1    AN ACT concerning business.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the New
5Vehicle Buyer Protection Act of 2021.
 
6    Section 3. Definitions. As used in this Act:
7    "Buyer" or "retail buyer" means any individual or entity
8who buys a new motor vehicle from a person, including a
9partnership, limited liability company, corporation,
10association, or any other legal entity, engaged in the
11business of manufacturing, distributing, or selling vehicles
12at retail.
13    "Distributor" means any individual, partnership,
14corporation, association, or other legal relationship that
15stands between the manufacturer and the retail seller in
16purchases, consignments, or contracts for sale of motor
17vehicles.
18    "Lease" means any contract for the lease or bailment for
19the use of a motor vehicle by an individual, for a term
20exceeding 4 months, primarily for personal, family, or
21household purposes, whether or not it is agreed that the
22lessee bears the risk of the vehicles' depreciation.
23    "Lessee" means an individual who leases a motor vehicle

 

 

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1under a lease.
2    "Manufacturer" means any individual, partnership,
3corporation, association, or other legal relationship that
4manufactures, assembles, or produces motor vehicles.
5    "Motor home" means a vehicular unit built on, or
6permanently attached to, a self-propelled motor vehicle
7chassis, chassis cab, or van, which becomes an integral part
8of the completed vehicle, designed for human habitation for
9recreational or emergency occupancy.
10    "New motor vehicle" means a new motor vehicle that is
11bought or used primarily for personal, family, or household
12purposes. "New motor vehicle" also means a new motor vehicle
13with a gross vehicle weight under 10,000 pounds that is bought
14or used primarily for business purposes by a person, including
15a partnership, limited liability company, corporation,
16association, or any other legal entity, to which not more than
175 motor vehicles are registered in this State. "New motor
18vehicle" includes the chassis, cab, and that portion of a
19motor home devoted to its propulsion, but does not include any
20portion designed, used, or maintained primarily for human
21habitation, a dealer-owned vehicle, and a "demonstrator" or
22other motor vehicle sold with a manufacturer's new car
23warranty, but does not include a motorcycle or a motor vehicle
24which is not registered under the Illinois Vehicle Code
25because it is to be operated or used exclusively off the
26highways. A demonstrator is a vehicle assigned by a dealer for

 

 

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1the purpose of demonstrating qualities and characteristics
2common to vehicles of the same or similar model and type.
3    "Nonconformity" means a nonconformity which substantially
4impairs the use, value, or safety of the new motor vehicle to
5the buyer or lessee.
6    "Retail seller" or "retailer" means any individual,
7partnership, corporation, association, or other legal
8relationship that engages in the business of selling or
9leasing motor vehicles to retail buyers.
10    "Service contract" means a contract in writing to perform,
11over a fixed period of time or for a specified duration,
12services relating to the maintenance or repair of a motor
13vehicle, except that this term does not include a policy of
14automobile insurance as defined in Section 143.13 of the
15Illinois Insurance Code.
16    "Supplier" means any person engaged in the business of
17making a motor home or new motor vehicle directly or
18indirectly available to a buyer.
19    "Written warranty" means any undertaking in writing in
20connection with the sale by a supplier of a consumer product to
21refund, repair, replace, or take other remedial action with
22respect to the product if the product fails to meet the
23specifications set forth in the undertaking.
 
24    Section 5. Failure to service or repair. If a manufacturer
25or its representative in this State is unable to service or

 

 

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1repair a new motor vehicle or motor home to conform to the
2applicable written warranties after a reasonable number of
3attempts, the manufacturer shall either promptly replace the
4new motor vehicle or motor home in accordance with paragraph
5(1) or promptly make restitution to the buyer in accordance
6with paragraph (2). However, the buyer shall be free to elect
7restitution in lieu of replacement, and in no event shall the
8buyer be required by the manufacturer to accept a replacement
9vehicle.
10        (1) In the case of replacement, the manufacturer shall
11    replace the buyer's vehicle with a new motor vehicle or
12    motor home substantially identical to the new motor
13    vehicle or motor home replaced. The replacement vehicle
14    shall be accompanied by all written and implied warranties
15    that normally accompany new motor vehicles or motor homes
16    of that specific kind. The manufacturer also shall pay
17    for, or to, the buyer the amount of any sales or use tax,
18    license fees, registration fees, and other official fees
19    which the buyer is obligated to pay in connection with the
20    replacement, plus any incidental damages to which the
21    buyer is entitled under Section 30, including, but not
22    limited to, reasonable repair, towing, and rental car
23    costs actually incurred by the buyer.
24        (2) In the case of restitution, the manufacturer shall
25    make restitution in an amount equal to the actual price
26    paid or payable by the buyer, including any charges for

 

 

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1    transportation and manufacturer-installed options, but
2    excluding non-manufacturer items installed by a dealer or
3    the buyer, and including any collateral charges such as
4    sales or use tax, license fees, registration fees, finance
5    interest charges, and other official fees, plus any
6    incidental damages to which the buyer is entitled under
7    Section 30, including, but not limited to, reasonable
8    repair, towing, and rental car costs actually incurred by
9    the buyer.
10        (3) When the manufacturer replaces the new motor
11    vehicle or motor home pursuant to paragraph (1), the buyer
12    shall only be liable to pay the manufacturer an amount
13    directly attributable to use by the buyer of the replaced
14    vehicle prior to the time the buyer first delivered the
15    vehicle to the manufacturer or distributor, or its
16    authorized service and repair facility for correction of
17    the problem that gave rise to the nonconformity. When
18    restitution is made pursuant to paragraph (2), the amount
19    to be paid by the manufacturer to the buyer may be reduced
20    by the manufacturer by that amount directly attributable
21    to use by the buyer prior to the time the buyer first
22    delivered the vehicle to the manufacturer or distributor,
23    or its authorized service and repair facility for
24    correction of the problem that gave rise to the
25    nonconformity. The amount directly attributable to use by
26    the buyer shall be determined by multiplying the actual

 

 

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1    price of the new motor vehicle or motor home paid or
2    payable by the buyer, including any charges for
3    transportation and manufacturer-installed options, by a
4    fraction having as its denominator 120,000 and having as
5    its numerator the number of miles traveled by the new
6    motor vehicle or motor home prior to the time the buyer
7    first delivered the new motor vehicle or motor home to the
8    manufacturer or distributor, or its authorized service and
9    repair facility for correction of the problem that gave
10    rise to the nonconformity. Nothing in this paragraph shall
11    in any way limit the rights or remedies available to the
12    buyer under any other law.
13        (4) A buyer of a new motor vehicle or motor home shall
14    also include a lessee of a new motor vehicle or motor home.
 
15    Section 10. Nonconformity.
16    (a) It shall be presumed that a reasonable number of
17attempts have been made to conform a new motor vehicle or motor
18home to the applicable written warranties if, within 18 months
19from delivery to the buyer or 18,000 miles on the odometer of
20the vehicle, whichever occurs first, one or more of the
21following occurs:
22        (1) The same nonconformity results in a condition that
23    is likely to cause death or serious bodily injury if the
24    new motor vehicle or motor home is driven and the
25    nonconformity has been subject to repair 2 or more times

 

 

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1    by the manufacturer or its agents, and the buyer or lessee
2    has at least once directly notified the manufacturer of
3    the need for the repair of the nonconformity.
4        (2) The same nonconformity has been subject to repair
5    4 or more times by the manufacturer or its agents and the
6    buyer has at least once directly notified the manufacturer
7    of the need for the repair of the nonconformity.
8        (3) The vehicle is out of service by reason of repair
9    of nonconformities by the manufacturer or its agents for a
10    cumulative total of more than 30 calendar days since
11    delivery of the new motor vehicle or motor home to the
12    buyer. The 30-day limit shall be extended only if repairs
13    cannot be performed due to conditions beyond the control
14    of the manufacturer or its agents. The buyer shall be
15    required to directly notify the manufacturer pursuant to
16    paragraphs (1) and (2) only if the manufacturer has
17    clearly and conspicuously disclosed to the buyer, with the
18    warranty or the owner's manual, the provisions of this
19    Section and that of Section 5, including the requirement
20    that the buyer must notify the manufacturer directly
21    pursuant to paragraphs (1) and (2). The notification, if
22    required, shall be sent to the address, if any, specified
23    clearly and conspicuously by the manufacturer in the
24    written warranty or owner's manual. This presumption shall
25    be a rebuttable presumption affecting the burden of proof,
26    and it may be asserted by the buyer in any civil action,

 

 

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1    including an action in small claims court, or other formal
2    or informal proceeding.
3    (b) If a qualified third-party dispute resolution process
4exists, and the buyer receives timely notification in writing
5of the availability of that qualified third-party dispute
6resolution process with a description of its operation and
7effect, the presumption in subsection (a) may not be asserted
8by the buyer until after the buyer has initially resorted to
9the qualified third-party dispute resolution process as
10required in subsection (c). Notification of the availability
11of the qualified third-party dispute resolution process is not
12timely if the buyer suffers any prejudice resulting from any
13delay in giving the notification. If a qualified third-party
14dispute resolution process does not exist, or if the buyer is
15dissatisfied with that third-party decision, or if the
16manufacturer or its agent neglects to promptly fulfill the
17terms of the qualified third-party dispute resolution process
18decision after the decision is accepted by the buyer, the
19buyer may assert the presumption provided in subsection (a) in
20an action to enforce the buyer's rights under Section 5. The
21findings and decision of a qualified third-party dispute
22resolution process shall be admissible in evidence in the
23action without further foundation. Any period of limitation of
24actions under any federal or State laws with respect to any
25person shall be extended for a period equal to the number of
26days between the date a complaint is filed with a third-party

 

 

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1dispute resolution process and the date of its decision or the
2date before which the manufacturer or its agent is required by
3the decision to fulfill its terms if the decision is accepted
4by the buyer, whichever occurs later.
5    (c) A qualified third-party dispute resolution process
6shall be one that does all of the following:
7        (1) Complies with the minimum requirements of the
8    Federal Trade Commission for informal dispute settlement
9    procedures as set forth in Part 703 of Title 16 of the Code
10    of Federal Regulations, as those regulations read on
11    January 1, 1987.
12        (2) Renders decisions which are binding on the
13    manufacturer if the buyer elects to accept the decision.
14        (3) Prescribes a reasonable time, not to exceed 30
15    days after the decision is accepted by the buyer, within
16    which the manufacturer or its agent must fulfill the terms
17    of its decisions.
18        (4) Provides arbitrators who are assigned to decide
19    disputes with copies of, and instruction in, the
20    provisions of the Federal Trade Commission's regulations
21    in Part 703 of Title 16 of the Code of Federal Regulations
22    as those regulations read on January 1, 1987, Article 2 of
23    the Uniform Commercial Code, and this Act.
24        (5) Requires the manufacturer, when the process
25    orders, under the terms of this Act, either that the
26    nonconforming new motor vehicle or motor home be replaced

 

 

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1    if the buyer consents to this remedy or that restitution
2    be made to the buyer, to replace the new motor vehicle or
3    motor home or make restitution in accordance with Section
4    5.
5        (6) Provides, at the request of the arbitrator or a
6    majority of the arbitration panel, for an inspection and
7    written report on the condition of a nonconforming new
8    motor vehicle, or motor home, at no cost to the buyer, by
9    an automobile expert who is independent of the
10    manufacturer.
11        (7) Takes into account, in rendering decisions, all
12    legal and equitable factors, including, but not limited
13    to, the written warranty, the rights and remedies
14    conferred in regulations of the Federal Trade Commission
15    contained in Part 703 of Title 16 of the Code of Federal
16    Regulations as those regulations read on January 1, 1987,
17    Article 2 of the Uniform Commercial Code, this Act, and
18    any other equitable considerations appropriate in the
19    circumstances. Nothing in this Act requires that, to be
20    certified as a qualified third-party dispute resolution
21    process pursuant to this Section, decisions of the process
22    must consider or provide remedies in the form of awards of
23    punitive damages or multiple damages, under subsection (c)
24    of Section 30, or of attorney's fees under subsection (d)
25    of Section 30, or of consequential damages other than as
26    provided in subsections (a) and (b) of Section 30,

 

 

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1    including, but not limited to, reasonable repair, towing,
2    and rental car costs actually incurred by the buyer.
3        (8) Requires that no arbitrator deciding a dispute may
4    be a party to the dispute and that no other person,
5    including an employee, agent, or dealer for the
6    manufacturer, may be allowed to participate substantively
7    in the merits of any dispute with the arbitrator unless
8    the buyer is allowed to participate as well. Nothing in
9    this subsection prohibits any member of an arbitration
10    from deciding a dispute.
11        (9) Obtains and maintains certification by the
12    Attorney General as provided in Section 35.
13    (d) (1) Except as provided in paragraph (2), no person
14shall sell, either at wholesale or retail, lease, or transfer
15a new motor vehicle or motor home transferred by a buyer or
16lessee to a manufacturer pursuant to Section 5 or a similar
17statute of any other state, unless the nature of the
18nonconformity experienced by the original buyer or lessee is
19clearly and conspicuously disclosed to the prospective buyer,
20lessee, or transferee, the nonconformity is corrected, and the
21manufacturer warrants to the new buyer, lessee, or transferee
22in writing for a period of one year that the new motor vehicle
23or motor home is free of that nonconformity.
24    (2) Except for the requirement that the nature of the
25nonconformity be disclosed to the transferee, paragraph (1)
26does not apply to the transfer of a new motor vehicle or motor

 

 

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1home to an educational institution if the purpose of the
2transfer is to make the new motor vehicle or motor home
3available for use in automotive repair courses.
 
4    Section 15. Automotive consumer notification.
5    (a) The General Assembly finds and declares all of the
6following:
7        (1) That the expansion of state warranty laws covering
8    new and used motor vehicles and motor homes has given
9    important and valuable protection to consumers.
10        (2) That, in states without this valuable warranty
11    protection, used and new motor vehicles and motor homes
12    are being resold in the marketplace without notice to the
13    subsequent purchaser.
14        (3) That other states have addressed this problem by
15    requiring notices on the title of new motor vehicles and
16    motor homes or other notice procedures to warn consumers
17    that the new motor vehicles or motor homes were
18    repurchased by a dealer or manufacturer because the new
19    motor vehicle or motor home could not be repaired in a
20    reasonable length of time or a reasonable number of repair
21    attempts or the dealer or manufacturer was not willing to
22    repair the new motor vehicle or motor home.
23        (4) That these notices serve the interests of
24    consumers who have a right to information relevant to
25    their buying decisions.

 

 

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1        (5) That the disappearance of these notices upon the
2    transfer of title from another state to this State
3    encourages the transport of "lemons" to this State for
4    sale to the drivers of this State.
5    (b) As used in this Section, "dealer" means any person
6engaged in the business of selling, offering for sale, or
7negotiating the retail sale of, a used motor vehicle or motor
8home or selling new motor vehicles or motor homes as a broker
9or agent for another, including the officers, agents, and
10employees of the person and any combination or association of
11dealers.
12    (c) Any manufacturer who reacquires or assists a dealer or
13lienholder to reacquire a new motor vehicle or motor home
14registered in this State, any other state, or a federally
15administered district shall, prior to any sale, lease, or
16transfer of the new motor vehicle or motor home in this State,
17or prior to exporting the new motor vehicle or motor home to
18another state for sale, lease, or transfer if the new motor
19vehicle or motor home was registered in this State and
20reacquired pursuant to Section 5, cause the new motor vehicle
21or motor home to be retitled in the name of the manufacturer,
22request the Secretary of State to inscribe the manufacturer's
23certificate of title with the notation "Lemon Law Buyback",
24and affix a decal to the new motor vehicle or motor home in
25accordance with Section 25 if the manufacturer knew or should
26have known that the new motor vehicle or motor home is required

 

 

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1by law to be replaced, accepted for restitution due to the
2failure of the manufacturer to conform the new motor vehicle
3or motor home to applicable written warranties pursuant to
4Section 5, or accepted for restitution by the manufacturer due
5to the failure of the manufacturer to conform the new motor
6vehicle or motor home to written warranties required by any
7other applicable law of the State, any other state, or federal
8law.
9    (d) Any manufacturer who reacquires or assists a dealer or
10lienholder to reacquire a new motor vehicle or motor home in
11response to a request by the buyer or lessee that the new motor
12vehicle or motor home be either replaced or accepted for
13restitution because the new motor vehicle or motor home did
14not conform to written warranties shall, prior to the sale,
15lease, or other transfer of the new motor vehicle or motor
16home, execute and deliver to the subsequent transferee a
17notice and obtain the transferee's written acknowledgment of a
18notice, as prescribed by Section 20.
19    (e) Any person, including any dealer, who acquires a new
20motor vehicle or motor home for resale and knows or should have
21known that the new motor vehicle or motor home was reacquired
22by the manufacturer of the new motor vehicle or motor home in
23response to a request by the last retail owner or lessee of the
24new motor vehicle or motor home that it be replaced or accepted
25for restitution because the new motor vehicle or motor home
26did not conform to written warranties shall, prior to the

 

 

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1sale, lease, or other transfer, execute and deliver to the
2subsequent transferee a notice and obtain the transferee's
3written acknowledgment of a notice, as prescribed by Section
420.
5    (f) Any person, including any manufacturer or dealer, who
6sells, leases, or transfers ownership of a new motor vehicle
7or motor home when the new motor vehicle's or motor home's
8certificate of title is inscribed with the notation "Lemon Law
9Buyback" shall, prior to the sale, lease, or ownership
10transfer of the new motor vehicle or motor home, provide the
11transferee with a disclosure statement signed by the
12transferee that states: "THIS NEW MOTOR VEHICLE OR MOTOR HOME
13WAS REPURCHASED BY ITS MANUFACTURER DUE TO A DEFECT IN THE NEW
14MOTOR VEHICLE OR MOTOR HOME VEHICLE PURSUANT TO CONSUMER
15WARRANTY LAWS. THE TITLE TO THIS NEW MOTOR VEHICLE OR MOTOR
16HOME HAS BEEN PERMANENTLY BRANDED WITH THE NOTATION "LEMON LAW
17BUYBACK"."
18    (g) The disclosure requirements in subsections (d), (e),
19and (f) are cumulative with all other consumer notice
20requirements and do not relieve any person, including any
21dealer or manufacturer, from complying with any other
22applicable law, including any requirement of subsection (d) of
23Section 10.
 
24    Section 20. Warranty buyback notice.
25    (a) The notice required in subsections (d) and (e) of

 

 

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1Section 15 shall be prepared by the manufacturer of the
2reacquired new motor vehicle a motor home and shall disclose
3all of the following:
4        (1) Year, make, model, and vehicle identification
5    number of the new motor vehicle or motor home.
6        (2) Whether the title to the new motor vehicle or
7    motor home has been inscribed with the notation "Lemon Law
8    Buyback".
9        (3) The nature of each nonconformity reported by the
10    original buyer or lessee of the new motor vehicle or motor
11    home.
12        (4) Repairs, if any, made to the new motor vehicle or
13    motor home in an attempt to correct each nonconformity
14    reported by the original buyer or lessee.
15    (b) The notice shall be on a form 8 1/2 x 11 inches in size
16and printed in no smaller than 10-point black type on a white
17background. The form shall only contain the following
18information prior to it being filled out by the manufacturer:
 
19
WARRANTY BUYBACK NOTICE
20(Check One)
21/. . ./ This new motor vehicle or motor home was repurchased by
22the manufacturer after the last retail owner or lessee
23requested its repurchase due to the problem(s) listed below.
24/. . ./ THIS VEHICLE WAS REPURCHASED BY ITS MANUFACTURER DUE TO
25A DEFECT IN THE VEHICLE PURSUANT TO CONSUMER WARRANTY LAWS.

 

 

 

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1THE TITLE TO THIS VEHICLE HAS BEEN PERMANENTLY BRANDED WITH
2THE NOTATION "LEMON LAW BUYBACK." Under Illinois law, the
3manufacturer must warrant to you, for a one-year period, that
4the vehicle is free of the problem(s) listed below.
 
5V.I.N: ........... Year: ..... Make: ...... Model: ......
 
6Problem(s) Reported by Repairs Made, if any, to
7Original Owner Correct Reported Problem(s)
8.......................... ..........................
9.......................... ..........................
10.......................... ..........................
11.......................... ..........................
12.......................... ..........................
13.......................... ..........................
14Signature of ManufacturerDate
15.......................... ..........................
16Signature of Dealer(s)Date
17.......................... ..........................
18.......................... ..........................
19.......................... ..........................
20Signature of Retail Buyer or
21LesseeDate
22.......................... ..........................
23.......................... ..........................

 

 

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1    (c) The manufacturer shall provide an executed copy of the
2notice to the manufacturer's transferee. Each transferee,
3including a dealer, to whom the new motor vehicle or motor home
4is transferred prior to its sale to a retail buyer or lessee
5shall be provided an executed copy of the notice by the
6previous transferor.
 
7    Section 25. Lemon decal.
8    (a) The decal required by subsection (c) of Section 15 to
9be affixed by a manufacturer to a new motor vehicle or motor
10home, shall be affixed to the left front door frame of the new
11motor vehicle or motor home, or, if the new motor vehicle or
12motor home does not have a left front door frame, it shall be
13affixed in a location designated by the Secretary of State.
14The decal shall specify that title to new the motor vehicle or
15motor home has been inscribed with the notation "Lemon Law
16Buyback" and shall be affixed to the new motor vehicle or motor
17home in a manner prescribed by the Secretary of State.
18    (b) No person shall knowingly remove or alter any decal
19affixed to a new motor vehicle or motor home pursuant to
20subsection (a), whether or not licensed under the Illinois
21Vehicle Code.
 
22    Section 30. Remedies.
23    (a) Any buyer of consumer goods who is damaged by a failure
24to comply with any obligation under this Act or under an

 

 

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1implied or written warranty or service contract may bring an
2action for the recovery of damages and other legal and
3equitable relief.
4    (b) The measure of the buyer's damages in an action under
5this Section shall include the rights of replacement or
6reimbursement as set forth in Section 5, and the following:
7        (1) Where the buyer has rightfully rejected or
8    justifiably revoked acceptance of the goods or has
9    exercised any right to cancel the sale, Sections 2-711,
10    2-712, and 2-713 of the Uniform Commercial Code shall
11    apply.
12        (2) Where the buyer has accepted the goods, Sections
13    2-714 and 2-715 of the Uniform Commercial Code shall
14    apply, and the measure of damages shall include the cost
15    of repairs necessary to make the goods conform.
16    (c) If the buyer establishes that the failure to comply
17was willful, the judgment may include, in addition to the
18amounts recovered under subsection (a), a civil penalty which
19shall not exceed 2 times the amount of actual damages. This
20subsection shall not apply in any class action under Section
212-404 of the Code of Civil Procedure or with respect to a claim
22based solely on a breach of an implied warranty.
23    (d) If the buyer prevails in an action under this Section,
24including before a qualified third-party dispute resolution
25process, the buyer shall be allowed by the court to recover as
26part of the judgment a sum equal to the aggregate amount of

 

 

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1costs and expenses, including attorney's fees based on actual
2time expended, determined by the court to have been reasonably
3incurred by the buyer in connection with the commencement and
4prosecution of such action.
5    (e) (1) Except as otherwise provided in this subsection,
6if the buyer establishes a violation of Section 5, the buyer
7shall recover damages and reasonable attorney's fees and
8costs, and may recover a civil penalty of up to 2 times the
9amount of damages.
10    (2) If the manufacturer maintains a qualified third-party
11dispute resolution process which substantially complies with
12Section 10, the manufacturer shall not be liable for any civil
13penalty pursuant to this subsection.
14    (3) After the occurrence of the events giving rise to the
15presumption established in subsection (a) of Section 10, the
16buyer may serve upon the manufacturer a written notice
17requesting that the manufacturer comply with Section 5. If the
18buyer fails to serve the notice, the manufacturer shall not be
19liable for a civil penalty pursuant to this subsection.
20    (4) If the buyer serves the notice described in paragraph
21(3) and the manufacturer complies with Section 5 within 30
22days of the service of that notice, the manufacturer shall not
23be liable for a civil penalty pursuant to this subsection.
24    (5) If the buyer recovers a civil penalty under subsection
25(c), the buyer may not also recover a civil penalty under this
26subsection for the same violation.
 

 

 

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1    Section 35. Third-party dispute resolution process
2certification program; fund.
3    (a) The Attorney General shall establish a program for
4certifying each third-party dispute resolution process used
5for the arbitration of disputes pursuant to subsection (b) of
6Section 10. In establishing the program, the Attorney General
7shall do all of the following:
8        (1) Prescribe and provide forms to be used to apply
9    for certification under this Act.
10        (2) Establish a set of minimum standards which shall
11    be used to determine whether a third-party dispute
12    resolution process is in substantial compliance with
13    subsection (c) of Section 10.
14        (3) Prescribe the information which each manufacturer,
15    or other entity, that operates a third-party dispute
16    resolution process shall provide the Attorney General in
17    the application for certification. In prescribing the
18    information to accompany the application for
19    certification, the Attorney General shall require the
20    manufacturer, or other entity, to provide only that
21    information which the Attorney General finds is reasonably
22    necessary to enable the Attorney General to determine
23    whether the third-party dispute resolution process is in
24    substantial compliance with subsection (c) of Section 10.
25        (4) Prescribe the information that each qualified

 

 

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1    third-party dispute resolution process shall provide the
2    Attorney General, and the time intervals at which the
3    information shall be required, to enable the Attorney
4    General to determine whether the qualified third-party
5    dispute resolution process continues to operate in
6    substantial compliance with subsection (c) of Section 10.
7    (b)(1) Each manufacturer may establish, or otherwise make
8available to buyers or lessees of new motor vehicles or motor
9homes, a qualified third-party dispute resolution process for
10the resolution of disputes pursuant to subsection (b) of
11Section 10. A manufacturer that itself operates the
12third-party dispute resolution process shall apply to the
13Attorney General for certification of that process. If the
14manufacturer makes the third-party dispute resolution process
15available to buyers or lessees of new motor vehicles or motor
16homes through contract or other arrangement with another
17entity, that entity shall apply to the Attorney General for
18certification. An entity that operates a third-party dispute
19resolution process for more than one manufacturer shall make a
20separate application for certification for each manufacturer
21that uses that entity's third-party dispute resolution
22process. The application for certification shall be
23accompanied by the information prescribed by the Attorney
24General.
25    (2) The Attorney General shall review the application and
26accompanying information and, after conducting an onsite

 

 

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1inspection, shall determine whether the third-party dispute
2resolution process is in substantial compliance with
3subsection (c) of Section 10 and this Section. If the Attorney
4General determines that the process is in substantial
5compliance, the Attorney General shall certify the process. If
6the Attorney General determines that the process is not in
7substantial compliance, the Attorney General shall deny
8certification and shall state, in writing, the reasons for
9denial and the modifications in the operation of the process
10that are required in order for the process to be certified.
11    (3) The Attorney General shall make a final determination
12whether to certify a third-party dispute resolution process or
13to deny certification not later than 90 calendar days
14following the date the Attorney General accepts the
15application for certification as complete.
16    (c)(1) The Attorney General, in accordance with the time
17intervals prescribed pursuant to paragraph (4) of subsection
18(a), but at least once annually, shall review the operation
19and performance of each qualified third-party dispute
20resolution process and determine, using the information
21provided the Attorney General as prescribed pursuant to
22paragraph (4) of subsection (a) and the monitoring and
23inspection information described in paragraph (3) of
24subsection (d), whether the process is operating in
25substantial compliance with subsection (c) of Section 10 and
26this Section. If the Attorney General determines that the

 

 

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1process is in substantial compliance, the certification shall
2remain in effect.
3    (2) If the Attorney General determines that the process is
4not in substantial compliance with subsection (c) of Section
510 or this Section, the Attorney General shall issue a notice
6of decertification to the entity which operates the process
7and shall send a copy of that notice to any manufacturer
8affected by the decertification. The notice of decertification
9shall state the reasons for the issuance of the notice and
10prescribe the modifications in the operation of the process
11that are required in order for the process to retain its
12certification.
13    (3) A notice of decertification shall take effect 180
14calendar days following the date the notice is served on the
15manufacturer, or other entity, which uses the process that the
16Attorney General has determined is not in substantial
17compliance with subsection (c) of Section 10 or this Section.
18The Attorney General shall withdraw the notice of
19decertification prior to its effective date if the Attorney
20General determines, after a public hearing, that the
21manufacturer, or other entity, which uses the process has made
22the modifications in the operation of the process required in
23the notice of decertification and is in substantial compliance
24with subsection (c) of Section 10 and this Section.
25    (d) In addition to any other requirements of this Section,
26the Attorney General shall do all of the following:

 

 

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1        (1) Establish procedures to assist owners or lessees
2    of new motor vehicles or motor homes who have complaints
3    regarding the operation of a qualified third-party dispute
4    resolution process.
5        (2) Establish methods for measuring customer
6    satisfaction and to identify violations of this Section,
7    which shall include an annual random postcard or telephone
8    survey by the Attorney General of the customers of each
9    qualified third-party dispute resolution process.
10        (3) Monitor and inspect, on a regular basis, qualified
11    third-party dispute resolution processes to determine
12    whether they continue to meet the standards for
13    certification. Monitoring and inspection shall include,
14    but not be limited to, all of the following:
15            (A) Onsite inspections of each qualified
16        third-party dispute resolution process not less
17        frequently than twice annually.
18            (B) Investigation of complaints from consumers
19        regarding the operation of qualified third-party
20        dispute resolution processes and analyses of
21        representative samples of complaints against each
22        process.
23            (C) Analyses of the annual surveys required by
24        paragraph (2).
25        (5) Submit a biennial report to the General Assembly
26    evaluating the effectiveness of this Section, make

 

 

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1    available to the public summaries of the statistics and
2    other information supplied by each qualified third-party
3    dispute resolution process, and publish educational
4    materials regarding the purposes of this Section.
5        (6) Adopt rules as necessary and appropriate to
6    implement this Section and subsection (c) of Section 10.
7        (7) Protection of the public shall be the highest
8    priority for the Attorney General in exercising its
9    certification, regulatory, and disciplinary functions.
10    Whenever the protection of the public is inconsistent with
11    other interests sought to be promoted, the protection of
12    the public shall be paramount.
13    (e) The Secretary of State shall, in accordance with the
14procedures prescribed in this subsection, administer the
15collection of fees for the purposes of fully funding the
16administration of this subsection.
17        (1) Fees collected pursuant to this subsection shall
18    be deposited into the Motor Vehicle Dispute Resolution
19    Certification Fund, a special fund created in the State
20    treasury, and shall be available, upon appropriation by
21    the General Assembly, exclusively to pay the expenses
22    incurred by the Attorney General in administering this
23    Section. If, at the conclusion of any fiscal year, the
24    amount of fees collected exceeds the amount of
25    expenditures for that purpose during that fiscal year, the
26    surplus in the Dispute Resolution Certification Fund shall

 

 

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1    be carried forward into the succeeding fiscal year.
2        (2) Beginning July 1, 2022, and on or before May 1 of
3    each calendar year thereafter, every manufacturer shall
4    file with the Secretary of State a statement of the number
5    of new motor vehicles and motor homes sold, leased, or
6    otherwise distributed by or for the manufacturer in this
7    State during the preceding calendar year, and shall, upon
8    written notice delivered to the manufacturer by certified
9    mail, return receipt requested, pay to the Secretary of
10    State a fee, not to exceed $1 for each new motor vehicle or
11    motor home sold, leased, or distributed by or for the
12    manufacturer in this State during the preceding calendar
13    year. The total fee paid by each manufacturer shall be
14    rounded to the nearest dollar. Not more than $1 shall be
15    charged, collected, or received from any one or more
16    manufacturers pursuant to this subsection with respect to
17    the same new motor vehicle or motor home.
18        (3) The fee required by paragraph (2) is due and
19    payable not later than 30 days after the manufacturer has
20    received notice of the amount due and is delinquent after
21    that time. A penalty of 10% of the amount delinquent shall
22    be added to that amount, if the delinquency continues for
23    more than 30 days. If a manufacturer fails to file the
24    statement required by paragraph (2) by the date specified,
25    the Secretary of State shall assess the amount due from
26    the manufacturer by using as the number of new motor

 

 

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1    vehicles or motor homes sold, leased, or otherwise
2    distributed by or for the manufacturer in this State
3    during the preceding calendar year the total number of new
4    registrations of all new motor vehicles or motor homes
5    sold, leased, or otherwise distributed by or for the
6    manufacturer during the preceding calendar year.
7        (4) On or before February 1 of each year, the Attorney
8    General shall notify the Secretary of State of the dollar
9    amount necessary to fully fund the program established by
10    this Section during the following fiscal year. The
11    Secretary of State shall use this information in
12    calculating the amounts of the fees to be collected from
13    manufacturers pursuant to this subsection.
14        (5) The Secretary of State may adopt rules to
15    implement this subsection. The rules shall include, at a
16    minimum, a formula for calculating the fee, established
17    pursuant to paragraph (2), for each new motor vehicle and
18    motor home and the total amount of fees to be collected
19    from each manufacturer.
20    As used in this subsection, "new motor vehicle" means a
21new passenger or commercial motor vehicle of a kind that is
22required to be registered under the Illinois Vehicle Code, but
23the term does not include a motorcycle, a motor home, or any
24vehicle whose gross weight exceeds 10,000 pounds.
 
25    Section 40. Sales and use tax reimbursement.

 

 

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1    (a) Notwithstanding any applicable provisions imposing a
2tax amount on manufacturers under the Retailers' Occupation
3Tax Act, the Use Tax Act, the Service Occupation Tax Act, or
4the Service Use Tax Act, the Department of Revenue shall
5reimburse the manufacturer of a new motor vehicle or motor
6home for an amount equal to the sales tax or use tax which the
7manufacturer pays to or for the buyer or lessee when providing
8a replacement vehicle pursuant to paragraph (1) of Section 5
9or includes in making restitution to the buyer or lessee
10pursuant to paragraph (2) of Section 5 when the manufacturer
11provides satisfactory proof that it has complied with
12subsection (c) of Section 15, and satisfactory proof is
13provided for one of the following:
14        (1) The retailer of the new motor vehicle or motor
15    home for which the manufacturer is making restitution has
16    reported and paid the sales tax on the gross receipts from
17    the sale of that motor vehicle.
18        (2) The buyer of the new motor vehicle or motor home
19    has paid the use tax on the sales price for the storage,
20    use, or other consumption of that new motor vehicle or
21    motor home in this State.
22        (3) The lessee of the new motor vehicle or motor home
23    has paid the use tax on the rentals payable from the lease
24    of that new motor vehicle or motor home.
25    (b) The Department of Revenue may adopt rules and
26regulations to carry out, facilitate compliance with, or

 

 

HB4108- 30 -LRB102 19025 KMF 27789 b

1prevent circumvention or evasion of this Section.
2    (c) This Section shall not change the application of the
3sales and use tax to the gross receipts, the rentals payable,
4and the sales price from the sale, lease, and the storage, use,
5or other consumption, in this State, of tangible personal
6property pursuant to the Retailers' Occupation Tax Act, the
7Use Tax Act, the Service Occupation Tax Act, or the Service Use
8Tax Act.
9    (d) The manufacturer's claim for reimbursement and the
10Department of Revenue's approval or denial of the claim shall
11be subject to the applicable provisions under the Retailers'
12Occupation Tax Act, the Use Tax Act, the Service Occupation
13Tax Act, or the Service Use Tax Act concerning claims for a
14credit or refund of erroneously paid amounts, except
15provisions relating to accrued interest at the rate and in the
16manner specified in the Uniform Penalty and Interest Act,
17insofar as those provisions are not inconsistent with this
18Section.
19    (e) For purposes of this Section, the amount of use tax
20that the Department of Revenue is required to reimburse the
21manufacturer shall be limited to the amount of use tax the
22manufacturer is required to pay to or for the lessee pursuant
23to Section 5.
 
24    Section 45. Prohibitions.
25    (a) Any automobile manufacturer, importer, distributor,

 

 

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1dealer, or lienholder who reacquires, or who assists in
2reacquiring, a new motor vehicle or motor home, whether by
3judgment, decree, arbitration award, settlement agreement, or
4voluntary agreement, is prohibited from doing either of the
5following:
6        (1) Requiring, as a condition of the reacquisition of
7    the new motor vehicle or motor home, that a buyer or lessee
8    who is a resident of this State agree not to disclose the
9    problems with the new motor vehicle or motor home
10    experienced by the buyer or lessee or the nonfinancial
11    terms of the reacquisition.
12        (2) Including, in any release or other agreement,
13    whether prepared by the manufacturer, importer,
14    distributor, dealer, or lienholder, for signature by the
15    buyer or lessee, a confidentiality clause, gag clause, or
16    similar clause prohibiting the buyer or lessee from
17    disclosing information to anyone about the problems with
18    the new motor vehicle or motor home, or the nonfinancial
19    terms of the reacquisition of the new motor vehicle or
20    motor home by the manufacturer, importer, distributor,
21    dealer, or lienholder.
22    (b) Any confidentiality clause, gag clause, or similar
23clause in such a release or other agreement in violation of
24this Section shall be null and void as against the public
25policy of this State.
26    (c) Nothing in this Section is intended to prevent any

 

 

HB4108- 32 -LRB102 19025 KMF 27789 b

1confidentiality clause, gag clause, or similar clause
2regarding the financial terms of the reacquisition of the new
3motor vehicle or motor home.
 
4    Section 900. The State Finance Act is amended by adding
5Section 5.935 as follows:
 
6    (30 ILCS 105/5.935 new)
7    Sec. 5.935. The Motor Vehicle Dispute Resolution
8Certification Fund.
 
9    Section 905. The Retailers' Occupation Tax Act is amended
10by changing Section 6 as follows:
 
11    (35 ILCS 120/6)  (from Ch. 120, par. 445)
12    Sec. 6. Credit memorandum or refund. If it appears, after
13claim therefor filed with the Department, that an amount of
14tax or penalty or interest has been paid which was not due
15under this Act, whether as the result of a mistake of fact or
16an error of law, except as hereinafter provided, then the
17Department shall issue a credit memorandum or refund to the
18person who made the erroneous payment or, if that person died
19or became a person under legal disability, to his or her legal
20representative, as such. For purposes of this Section, the tax
21is deemed to be erroneously paid by a retailer when the
22manufacturer of a new motor vehicle or motor home sold by the

 

 

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1retailer accepts the return of that new motor vehicle or motor
2home automobile and refunds to the purchaser the selling price
3of that new motor vehicle or motor home as provided in the New
4Vehicle Buyer Protection Act of 2021. When a new motor vehicle
5or motor home is returned for a refund of the purchase price
6under the New Vehicle Buyer Protection Act of 2021, the
7Department shall issue a credit memorandum or a refund for the
8amount of tax paid by the retailer under this Act attributable
9to the initial sale of that new motor vehicle or motor home.
10Claims submitted by the retailer are subject to the same
11restrictions and procedures provided for in this Act. If it is
12determined that the Department should issue a credit
13memorandum or refund, the Department may first apply the
14amount thereof against any tax or penalty or interest due or to
15become due under this Act or under the Use Tax Act, the Service
16Occupation Tax Act, the Service Use Tax Act, any local
17occupation or use tax administered by the Department, Section
184 of the Water Commission Act of 1985, subsections (b), (c) and
19(d) of Section 5.01 of the Local Mass Transit District Act, or
20subsections (e), (f) and (g) of Section 4.03 of the Regional
21Transportation Authority Act, from the person who made the
22erroneous payment. If no tax or penalty or interest is due and
23no proceeding is pending to determine whether such person is
24indebted to the Department for tax or penalty or interest, the
25credit memorandum or refund shall be issued to the claimant;
26or (in the case of a credit memorandum) the credit memorandum

 

 

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1may be assigned and set over by the lawful holder thereof,
2subject to reasonable rules of the Department, to any other
3person who is subject to this Act, the Use Tax Act, the Service
4Occupation Tax Act, the Service Use Tax Act, any local
5occupation or use tax administered by the Department, Section
64 of the Water Commission Act of 1985, subsections (b), (c) and
7(d) of Section 5.01 of the Local Mass Transit District Act, or
8subsections (e), (f) and (g) of Section 4.03 of the Regional
9Transportation Authority Act, and the amount thereof applied
10by the Department against any tax or penalty or interest due or
11to become due under this Act or under the Use Tax Act, the
12Service Occupation Tax Act, the Service Use Tax Act, any local
13occupation or use tax administered by the Department, Section
144 of the Water Commission Act of 1985, subsections (b), (c) and
15(d) of Section 5.01 of the Local Mass Transit District Act, or
16subsections (e), (f) and (g) of Section 4.03 of the Regional
17Transportation Authority Act, from such assignee. However, as
18to any claim for credit or refund filed with the Department on
19and after each January 1 and July 1 no amount of tax or penalty
20or interest erroneously paid (either in total or partial
21liquidation of a tax or penalty or amount of interest under
22this Act) more than 3 years prior to such January 1 and July 1,
23respectively, shall be credited or refunded, except that if
24both the Department and the taxpayer have agreed to an
25extension of time to issue a notice of tax liability as
26provided in Section 4 of this Act, such claim may be filed at

 

 

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1any time prior to the expiration of the period agreed upon.
2    No claim may be allowed for any amount paid to the
3Department, whether paid voluntarily or involuntarily, if paid
4in total or partial liquidation of an assessment which had
5become final before the claim for credit or refund to recover
6the amount so paid is filed with the Department, or if paid in
7total or partial liquidation of a judgment or order of court.
8No credit may be allowed or refund made for any amount paid by
9or collected from any claimant unless it appears (a) that the
10claimant bore the burden of such amount and has not been
11relieved thereof nor reimbursed therefor and has not shifted
12such burden directly or indirectly through inclusion of such
13amount in the price of the tangible personal property sold by
14him or her or in any manner whatsoever; and that no
15understanding or agreement, written or oral, exists whereby he
16or she or his or her legal representative may be relieved of
17the burden of such amount, be reimbursed therefor or may shift
18the burden thereof; or (b) that he or she or his or her legal
19representative has repaid unconditionally such amount to his
20or her vendee (1) who bore the burden thereof and has not
21shifted such burden directly or indirectly, in any manner
22whatsoever; (2) who, if he or she has shifted such burden, has
23repaid unconditionally such amount to his own vendee; and (3)
24who is not entitled to receive any reimbursement therefor from
25any other source than from his or her vendor, nor to be
26relieved of such burden in any manner whatsoever. No credit

 

 

HB4108- 36 -LRB102 19025 KMF 27789 b

1may be allowed or refund made for any amount paid by or
2collected from any claimant unless it appears that the
3claimant has unconditionally repaid, to the purchaser, any
4amount collected from the purchaser and retained by the
5claimant with respect to the same transaction under the Use
6Tax Act.
7    Any credit or refund that is allowed under this Section
8shall bear interest at the rate and in the manner specified in
9the Uniform Penalty and Interest Act.
10    In case the Department determines that the claimant is
11entitled to a refund, such refund shall be made only from the
12Aviation Fuel Sales Tax Refund Fund or from such appropriation
13as may be available for that purpose, as appropriate. If it
14appears unlikely that the amount available would permit
15everyone having a claim allowed during the period covered by
16such appropriation or from the Aviation Fuel Sales Tax Refund
17Fund, as appropriate, to elect to receive a cash refund, the
18Department, by rule or regulation, shall provide for the
19payment of refunds in hardship cases and shall define what
20types of cases qualify as hardship cases.
21    If a retailer who has failed to pay retailers' occupation
22tax on gross receipts from retail sales is required by the
23Department to pay such tax, such retailer, without filing any
24formal claim with the Department, shall be allowed to take
25credit against such retailers' occupation tax liability to the
26extent, if any, to which such retailer has paid an amount

 

 

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1equivalent to retailers' occupation tax or has paid use tax in
2error to his or her vendor or vendors of the same tangible
3personal property which such retailer bought for resale and
4did not first use before selling it, and no penalty or interest
5shall be charged to such retailer on the amount of such credit.
6However, when such credit is allowed to the retailer by the
7Department, the vendor is precluded from refunding any of that
8tax to the retailer and filing a claim for credit or refund
9with respect thereto with the Department. The provisions of
10this amendatory Act shall be applied retroactively, regardless
11of the date of the transaction.
12(Source: P.A. 101-10, eff. 6-5-19.)
 
13    Section 910. The Illinois Vehicle Code is amended by
14changing Section 5-104.2 as follows:
 
15    (625 ILCS 5/5-104.2)
16    Sec. 5-104.2. Nonconforming vehicles; sale.
17    (a) Every manufacturer shall be prohibited from reselling
18any new motor vehicle or motor home that has been finally
19ordered, determined, or adjudicated as having a nonconformity
20under the New Vehicle Buyer Protection Act, the New Vehicle
21Buyer Protection Act of 2021, or a similar law of any state,
22territory, or country, and that the manufacturer repurchased
23or replaced because of the nonconformity, unless the
24manufacturer has corrected the nonconformity and issues a

 

 

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1disclosure statement prior to resale stating that the new
2motor vehicle or motor home was repurchased or replaced under
3the New Vehicle Buyer Protection Act, the New Vehicle Buyer
4Protection Act of 2021, or similar law of any other state,
5territory, or country; identifying the nonconformity; and
6warranting that the nonconformity has been corrected. The
7disclosure statement must accompany the new motor vehicle or
8motor home through the first retail purchase.
9    (b) "Nonconformity" refers to a new motor vehicle's or
10motor home's failure to conform to all written express
11warranties applicable to the new motor vehicle or motor home,
12which failure substantially impairs the use, market value, or
13safety of the new motor vehicle or motor home.
14    (c) The disclosure statement referred to in subsection (a)
15shall be in substantially the same form as below:
16
"IMPORTANT
17    Vehicle Identification Number (VIN): (Insert VIN Number);
18    Year: (Insert Year); Make (Insert Make); Model: (Insert
19    Model). This vehicle was previously sold as new. It was
20    subsequently ordered as having a nonconformity by final
21    decision of court proceeding or State run arbitration. It
22    was subsequently repurchased by its manufacturer because
23    it did not conform to the manufacturer's written express
24    warranty and the nonconformity was not cured within a
25    reasonable time as provided by Illinois law. The following
26    nonconformities have been corrected (a minimum of 5

 

 

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1    numbered lines shall be provided to describe the
2    nonconformity or nonconformities)."
3The customer shall sign the disclosure statement. This
4disclosure language shall be in at least 8-point type.
5(Source: P.A. 88-415.)
 
6    (815 ILCS 380/Act rep.)
7    Section 915. The New Vehicle Buyer Protection Act is
8repealed.