|
Arkansas Lemon Law
Arkansas
Code, §4-90-401 to 417
§ 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
warrantiesprovided 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,
lienholder, 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 lienholder 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 less
or 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
disputesettlement procedure into the terms of
the written warranty to which the
motorvehicle 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 casethe 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.
|
