HB3746 99TH GENERAL ASSEMBLY

LRB099 07271 JLS 27375 b

99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB3746

Introduced , by Rep. Rita Mayfield

SYNOPSIS AS INTRODUCED:

625 ILCS 5/5-102.6 new

Amends the Illinois Vehicle Code. Limits the ability of a used motor vehicle dealer to modify or disclaim an implied warranty of merchantability. Provides that a used motor vehicle dealer may not exclude, modify, or disclaim the warranty before the vehicle is driven 500 miles or the expiration of 15 days after delivery of the used motor vehicle, whichever occurs first. Sets forth remedies and defenses.

A BILL FOR

AN ACT concerning motor vehicles.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Vehicle Code is amended by adding Section 5-102.6 as follows:

(625 ILCS 5/5-102.6 new)

Sec. 5-102.6. Used motor vehicles; modification or disclaimer of implied warranty of merchantability limited.

(a) A used motor vehicle dealer may not exclude, modify, or disclaim the implied warranty of merchantability prescribed in Section 2-314 of the Uniform Commercial Code or limit the remedies for a breach of the warranty before midnight of the 15th calendar day after delivery of a used motor vehicle or until a used motor vehicle is driven 500 miles after delivery, whichever is earlier. In calculating time under this subsection, a day on which the warranty is breached and all subsequent days in which the used motor vehicle fails to conform with the implied warranty of merchantability are excluded. In calculating distance under this subsection, the miles driven to obtain or in connection with the repair, servicing, or testing of a used motor vehicle that fails to conform with the implied warranty of merchantability are excluded. An attempt to exclude, modify, or disclaim the implied warranty of merchantability or to limit the remedies for a breach of the warranty in violation of this subsection renders a purchase agreement voidable at the option of the purchaser.

(b) An implied warranty of merchantability is met if a used motor vehicle functions substantially free of a defect that significantly limits the use of the used motor vehicle for the ordinary purpose of transportation on any public highway. The implied warranty of merchantability expires at midnight of the 15th calendar day after delivery of a used motor vehicle or until a used motor vehicle is driven 500 miles after delivery, whichever is earlier. In calculating time, a day on which the implied warranty of merchantability is breached is excluded and all subsequent days in which the used motor vehicle fails to conform with the warranty are also excluded. In calculating distance, the miles driven to obtain or in connection with the repair, servicing, or testing of a used motor vehicle that fails to conform with the implied warranty of merchantability are excluded.

(c) An implied warranty of merchantability does not extend to damage that occurs after the sale of the used motor vehicle that results from:

(1) off-road use;

(2) racing;

(3) towing;

(4) abuse;

(5) misuse;

(6) neglect;

(7) failure to perform regular maintenance; and

(8) failure to maintain adequate oil, coolant, and other required fluids or lubricants.

(d) If the implied warranty of merchantability described in this Section is breached, the consumer shall give reasonable notice to the seller within 30 days after the date of the breach. Before the consumer exercises another remedy pursuant to Article 2 of the Uniform Commercial Code, the seller shall have a reasonable opportunity to repair the used motor vehicle. The consumer shall pay one-half of the cost of the first 2 repairs necessary to bring the used motor vehicle into compliance with the warranty. The payments by the consumer are limited to a maximum payment of $25 for each repair.

(e) The maximum liability of a seller pursuant to this Section is limited to the purchase price paid for the used motor vehicle, to be refunded to the consumer or lender, as applicable, in exchange for return of the vehicle, unless the seller knew or should have known of the defect given the circumstances in which the vehicle was acquired or sold and the seller did not disclose that defect.

(f) An agreement for the sale of a used motor vehicle by a used motor vehicle dealer is voidable at the option of the consumer unless it contains on its face the following conspicuous statement printed in boldface, 10-point or larger type set off from the body of the agreement:

"Illinois law requires that this vehicle will be fit for the ordinary purposes for which the vehicle is used for 15 days or 500 miles after delivery, whichever is earlier, except with regard to particular defects disclosed on the first page of this agreement. You (the consumer) will have to pay up to $25 for each of the first 2 repairs if the warranty is violated.".

(g) The inclusion in the agreement of the statement prescribed in subsection (f) of this Section does not create an express warranty.

(h) A consumer of a used motor vehicle may waive the implied warranty of merchantability only for a particular defect in the vehicle and only if all of the following conditions are satisfied:

(1) the used motor vehicle dealer fully and accurately discloses to the consumer that because of circumstances unusual to the business of the used motor vehicle dealer, the used motor vehicle has a particular defect;

(2) the consumer agrees to buy the used motor vehicle after disclosure of the defect; and

(3) before the sale, the consumer indicates agreement to the waiver by signing and dating the following conspicuous statement that is printed on the first page of the sales agreement in boldface 10-point or larger type and that is written in the language in which the presentation was made:

"Attention consumer: sign here only if the dealer has told you that this vehicle has the following problem or problems and you agree to buy the vehicle on those terms: 1. 2. 3. .".

(i) A used motor vehicle dealer has the burden to prove by a preponderance of the evidence that the dealer complied with subsection (h) of this Section.

(j) A consumer or seller that is aggrieved by a transaction pursuant to this Section and that seeks a legal remedy shall pursue an appropriate remedy prescribed in Article 2 of the Uniform Commercial Code and shall comply with the requirements prescribed in that Article.

(k) It shall be an affirmative defense to any claim under this Section that:

(1) an alleged nonconformity does not substantially impair the use and market value of the motor vehicle;

(2) a nonconformity is the result of abuse, neglect, or unauthorized modifications or alterations of the motor vehicle;

(3) a claim by a consumer was not filed in good faith; or

(4) any other affirmative defense allowed by law.