093_HB3820

                                     LRB093 12229 WGH 17411 b

 1        AN ACT concerning motor vehicles.

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

 4                              Article 1

 5        Section  1-1.  Short  title. This Act may be cited as the
 6    New Vehicle Buyer Protection Act of 2004.

 7                              Article 5

 8        Section 5-5.  Definitions. As used in this Article:
 9        "Nonconformity" means a nonconformity that  substantially
10    impairs the use, value, or safety of the new motor vehicle to
11    the buyer or lessee.
12        "New  motor  vehicle"  means  a new motor vehicle that is
13    bought or used primarily for personal, family,  or  household
14    purposes.  "New motor vehicle" also means a new motor vehicle
15    with a gross vehicle  weight  under  10,000  pounds  that  is
16    bought  or  used primarily for business purposes by a person,
17    including   a   partnership,   limited   liability   company,
18    corporation, association, or any other legal entity, to which
19    not more than 5 motor vehicles are registered in this  State.
20    "New  motor  vehicle"  includes the chassis, chassis cab, and
21    that portion of a motor home devoted to its  propulsion,  but
22    does  not  include  any portion designed, used, or maintained
23    primarily for human habitation, a dealer-owned vehicle and  a
24    "demonstrator"   or   other   motor   vehicle   sold  with  a
25    manufacturer's new  car  warranty  but  does  not  include  a
26    motorcycle  or  a  motor vehicle that is not registered under
27    the Illinois Vehicle Code because it is  to  be  operated  or
28    used  exclusively  off  the  highways.  A  demonstrator  is a
29    vehicle assigned by a dealer for the purpose of demonstrating



 
                            -2-      LRB093 12229 WGH 17411 b
 1    qualities and characteristics common to vehicles of the  same
 2    or similar model and type.
 3        "Motor   home"  means  a  vehicular  unit  built  on,  or
 4    permanently  attached  to,  a  self-propelled  motor  vehicle
 5    chassis, chassis cab, or van, which becomes an integral  part
 6    of  the  completed vehicle, designed for human habitation for
 7    recreational or emergency occupancy.

 8        Section 5-10.  Presumption. It shall be presumed  that  a
 9    reasonable number of attempts have been made to conform a new
10    motor vehicle to the applicable express warranties if, within
11    18  months  from delivery to the buyer or 18,000 miles on the
12    odometer of the vehicle, whichever occurs first, one or  more
13    of the following occurs:
14             (1)  The  same  nonconformity results in a condition
15        that is likely to cause death or serious bodily injury if
16        the vehicle is driven  and  the  nonconformity  has  been
17        subject  to repair 2 or more times by the manufacturer or
18        its agents, and the buyer or lessee  has  at  least  once
19        directly  notified  the  manufacturer of the need for the
20        repair of the nonconformity.
21             (2)  The same  nonconformity  has  been  subject  to
22        repair  4 or more times by the manufacturer or its agents
23        and the buyer has at least  once  directly  notified  the
24        manufacturer   of   the   need  for  the  repair  of  the
25        nonconformity.
26             (3)  The vehicle is out  of  service  by  reason  of
27        repair  of  nonconformities  by  the  manufacturer or its
28        agents for a cumulative total of more  than  30  calendar
29        days  since  delivery  of  the  vehicle to the buyer. The
30        30-day limit shall be extended only if repairs cannot  be
31        performed  due  to  conditions  beyond the control of the
32        manufacturer or its agents. The buyer shall  be  required
33        to  directly  notify  the manufacturer under subdivisions
 
                            -3-      LRB093 12229 WGH 17411 b
 1        (1) and (2) only if  the  manufacturer  has  clearly  and
 2        conspicuously  disclosed  to the buyer, with the warranty
 3        or the  owner's  manual,  the  provisions  of  this  Act,
 4        including  the requirement that the buyer must notify the
 5        manufacturer directly under subdivisions (1) and (2). The
 6        notification, if required, shall be sent to the  address,
 7        if  any,  specified  clearly  and  conspicuously  by  the
 8        manufacturer  in  the  warranty  or  owner's manual. This
 9        presumption shall be a rebuttable  presumption  affecting
10        the  burden of proof, and it may be asserted by the buyer
11        in any civil action, including an action in small  claims
12        court, or other formal or informal proceeding.

13        Section   5-15.  Assertion   of   presumption;  qualified
14    third-party  dispute  resolution  process.  If  a   qualified
15    third-party  dispute resolution process exists, and the buyer
16    receives timely notification in writing of  the  availability
17    of that qualified third-party dispute resolution process with
18    a description of its operation and effect, the presumption in
19    Section 5-10 may not be asserted by the buyer until after the
20    buyer  has  initially  resorted  to the qualified third-party
21    dispute resolution  process  as  required  in  Section  5-20.
22    Notification of the availability of the qualified third-party
23    dispute resolution process is not timely if the buyer suffers
24    any   prejudice  resulting  from  any  delay  in  giving  the
25    notification. If a qualified third-party  dispute  resolution
26    process  does not exist, or if the buyer is dissatisfied with
27    that third-party decision, or  if  the  manufacturer  or  its
28    agent neglects to promptly fulfill the terms of the qualified
29    third-party  dispute  resolution  process  decision after the
30    decision is accepted by the buyer, the buyer may  assert  the
31    presumption  provided in Section 5-10 in an action to enforce
32    the buyer's rights  under  Section  5-30.  The  findings  and
33    decision   of  a  qualified  third-party  dispute  resolution
 
                            -4-      LRB093 12229 WGH 17411 b
 1    process shall be admissible in evidence in the action without
 2    further foundation. Any period of limitation of actions under
 3    any federal or State law with respect to any person shall  be
 4    extended for a period equal to the number of days between the
 5    date   a  complaint  is  filed  with  a  third-party  dispute
 6    resolution process and the date of its decision or  the  date
 7    before which the manufacturer or its agent is required by the
 8    decision  to fulfill its terms if the decision is accepted by
 9    the buyer, whichever occurs later.

10        Section 5-20.  Elements of qualified third-party  dispute
11    resolution   process.   A   qualified   third-party   dispute
12    resolution process is one that does all of the following:
13             (1)  Complies  with  the minimum requirements of the
14        Federal Trade Commission for informal dispute  settlement
15        procedures  as  set  forth in Part 703 of Title 16 of the
16        Code of Federal Regulations.
17             (2)  Renders  decisions  that  are  binding  on  the
18        manufacturer if the buyer elects to accept the decision.
19             (3)  Prescribes a reasonable time, not to exceed  30
20        days  after the decision is accepted by the buyer, within
21        which the manufacturer or  its  agent  must  fulfill  the
22        terms of its decisions.
23             (4)  Provides arbitrators who are assigned to decide
24        disputes   with   copies  of,  and  instruction  in,  the
25        provisions of the Federal Trade Commission's  regulations
26        in   Part  703  of  Title  16  of  the  Code  of  Federal
27        Regulations, Article 2 of the  Uniform  Commercial  Code,
28        and this Act.
29             (5)  Requires  the  manufacturer,  when  the process
30        orders, under the terms of  this  Act,  either  that  the
31        nonconforming  motor  vehicle  be  replaced  if the buyer
32        consents to this remedy or that restitution  be  made  to
33        the   buyer,   to  replace  the  motor  vehicle  or  make
 
                            -5-      LRB093 12229 WGH 17411 b
 1        restitution in accordance with Section 5-30.
 2             (6)  Provides, at the request of the arbitrator or a
 3        majority of the arbitration panel, for an inspection  and
 4        written  report on the condition of a nonconforming motor
 5        vehicle, at no cost to the buyer, by an automobile expert
 6        who is independent of the manufacturer.
 7             (7)  Takes into account, in rendering decisions, all
 8        legal and equitable factors, including, but  not  limited
 9        to,   the  written  warranty,  the  rights  and  remedies
10        conferred in regulations of the Federal Trade  Commission
11        contained  in Part 703 of Title 16 of the Code of Federal
12        Regulations, Article 2 of the  Uniform  Commercial  Code,
13        this   Act,   and   any  other  equitable  considerations
14        appropriate in the circumstances.  Nothing  in  this  Act
15        requires that, to be certified as a qualified third-party
16        dispute  resolution process under this Section, decisions
17        of the process must consider or provide remedies  in  the
18        form  of  awards of punitive damages, attorney's fees, or
19        consequential damages under Section 5-35  including,  but
20        not limited to, reasonable repair, towing, and rental car
21        costs actually incurred by the buyer.
22             (8)  Requires  that no arbitrator deciding a dispute
23        may be a party to the dispute and that no  other  person,
24        including   an   employee,   agent,  or  dealer  for  the
25        manufacturer, may be allowed to participate substantively
26        in the merits of any dispute with the  arbitrator  unless
27        the buyer is also allowed to participate. Nothing in this
28        subdivision  (8)  prohibits  any member of an arbitration
29        board from deciding a dispute.
30             (9)  Obtains  and  maintains   certification   under
31        Article 10.

32        Section 5-25.  Sale of transferred vehicles.
33        (a)  Except  as provided in subsection (b), no person may
 
                            -6-      LRB093 12229 WGH 17411 b
 1    sell, either at wholesale or retail,  lease,  or  transfer  a
 2    motor   vehicle  transferred  by  a  buyer  or  lessee  to  a
 3    manufacturer under Section 5-30 or a similar law of any other
 4    state, unless the nature of the nonconformity experienced  by
 5    the  original  buyer  or  lessee is clearly and conspicuously
 6    disclosed to the prospective buyer,  lessee,  or  transferee,
 7    the nonconformity is corrected, and the manufacturer warrants
 8    to  the  new  buyer,  lessee,  or transferee in writing for a
 9    period of one year that the motor vehicle  is  free  of  that
10    nonconformity.
11        (b)  Except  for  the  requirement that the nature of the
12    nonconformity be disclosed to the transferee, subsection  (a)
13    does  not  apply  to  the  transfer  of a motor vehicle to an
14    educational institution if the purpose of the transfer is  to
15    make the motor vehicle available for use in automotive repair
16    courses.

17        Section 5-30.  Replacement or restitution.
18        (a)  If  the  manufacturer  or its representative in this
19    State is unable to service or repair a new motor  vehicle  to
20    conform   to   the  applicable  express  warranties  after  a
21    reasonable number of attempts, the manufacturer shall  either
22    promptly  replace  the  new  motor vehicle in accordance with
23    subsection (b) or promptly make restitution to the  buyer  in
24    accordance  with subsection (c). However, the buyer may elect
25    restitution in lieu of replacement, and in no event shall the
26    buyer be required by the manufacturer to accept a replacement
27    vehicle.
28        (b)  In the case of replacement, the  manufacturer  shall
29    replace   the  buyer's  vehicle  with  a  new  motor  vehicle
30    substantially  identical  to  the   vehicle   replaced.   The
31    replacement  vehicle  shall be accompanied by all express and
32    implied warranties that normally accompany new motor vehicles
33    of that specific kind. The manufacturer also shall  pay  for,
 
                            -7-      LRB093 12229 WGH 17411 b
 1    or  to,  the  buyer  the amount of any use tax, license fees,
 2    registration fees, and other official fees which the buyer is
 3    obligated to pay in connection with the replacement, plus any
 4    incidental damages to  which  the  buyer  is  entitled  under
 5    Section  5-35,  including,  but  not  limited  to, reasonable
 6    repair, towing, and rental car costs actually incurred by the
 7    buyer.
 8        (c)  In the case of restitution, the  manufacturer  shall
 9    make  restitution in an amount equal to the actual price paid
10    or  payable  by  the  buyer,  including   any   charges   for
11    transportation   and   manufacturer-installed   options,  but
12    excluding nonmanufacturer items installed by a dealer or  the
13    buyer,  and including any collateral charges such as use tax,
14    license fees, registration fees,  and  other  official  fees,
15    plus  any  incidental  damages to which the buyer is entitled
16    under Section 5-35, including, but not limited to, reasonable
17    repair, towing, and rental car costs actually incurred by the
18    buyer.
19        (d)  When the manufacturer replaces the new motor vehicle
20    under subsection (b), the buyer shall only be liable  to  pay
21    the  manufacturer  an  amount directly attributable to use by
22    the buyer of the replaced  vehicle  before  the  buyer  first
23    delivered  the vehicle to the manufacturer or distributor, or
24    its authorized service and repair facility for correction  of
25    the  problem  that  gave  rise  to  the  nonconformity.  When
26    restitution  is  made  under subsection (c), the amount to be
27    paid by the manufacturer to the buyer may be reduced  by  the
28    manufacturer  by  that amount directly attributable to use by
29    the buyer before the buyer first delivered the vehicle to the
30    manufacturer or distributor, or its  authorized  service  and
31    repair  facility for correction of the problem that gave rise
32    to the nonconformity. The amount directly attributable to use
33    by a buyer shall be  determined  by  multiplying  the  actual
34    price  of the new motor vehicle paid or payable by the buyer,
 
                            -8-      LRB093 12229 WGH 17411 b
 1    including    any    charges    for     transportation     and
 2    manufacturer-installed  options,  by a fraction having as its
 3    denominator 120,000 and having as its numerator the number of
 4    miles traveled by the new  motor  vehicle  before  the  buyer
 5    first   delivered   the   vehicle   to  the  manufacturer  or
 6    distributor, or its authorized service  and  repair  facility
 7    for   correction  of  the  problem  that  gave  rise  to  the
 8    nonconformity. Nothing in this Section in any way limits  the
 9    rights  or  remedies  available  to the buyer under any other
10    law.

11        Section 5-35.  Damages; attorney's fees and costs;  civil
12    penalty.
13        (a)  Except as otherwise provided in this Section, if the
14    buyer  establishes  a  violation  of  Section 5-30, the buyer
15    shall recover damages  and  reasonable  attorney's  fees  and
16    costs,  and  may recover a civil penalty of up to 2 times the
17    amount of damages.
18        (b)  If   the   manufacturer   maintains   a    qualified
19    third-party  dispute  resolution  process which substantially
20    complies with this Act, the manufacturer shall not be  liable
21    for any civil penalty under this Section.
22        (c)  After  the  occurrence  of the events giving rise to
23    the presumption established in Section 5-30,  the  buyer  may
24    serve  upon the manufacturer a written notice requesting that
25    the manufacturer comply with Section 5-30. If the buyer fails
26    to serve the notice, the manufacturer is  not  liable  for  a
27    civil penalty under this Section.
28        (d)  If   the   buyer  serves  the  notice  described  in
29    subsection (c) and the  manufacturer  complies  with  Section
30    5-30  within  30  days  of  the  service  of that notice, the
31    manufacturer is not liable for a  civil  penalty  under  this
32    Section.
 
                            -9-      LRB093 12229 WGH 17411 b
 1                             Article 10

 2        Section  10-5.  Definitions.  As  used  in  this Article,
 3    unless the context requires otherwise:
 4        Except as otherwise provided in Section 10-30, "new motor
 5    vehicle" means a new motor vehicle as defined in Article 5.
 6        "Manufacturer" a manufacturer or distributor  as  defined
 7    in Section 5-109 of the Illinois Vehicle Code.
 8        "Qualified  third party dispute resolution process" means
 9    a third party dispute resolution process  which  operates  in
10    compliance  with  Section 5-20 and this Article and which has
11    been certified by the Attorney General under this Article.

12        Section  10-10.  Program   for   certifying   third-party
13    dispute   resolution  process.  The  Attorney  General  shall
14    establish a program for certifying each  third-party  dispute
15    resolution process used for the arbitration of disputes under
16    Section  5-15.  In  establishing  the  program,  the Attorney
17    General shall do all of the following:
18             (1)  Prescribe and provide forms to be used to apply
19        for certification under this Article.
20             (2)  Establish a  set  of  minimum  standards  which
21        shall  be used to determine whether a third-party dispute
22        resolution process  is  in  substantial  compliance  with
23        Section 5-20 and this Article.
24             (3)  Prescribe    the    information    which   each
25        manufacturer or other entity that operates a  third-party
26        dispute  resolution  process  shall  provide the Attorney
27        General  in  the  application   for   certification.   In
28        prescribing  the information to accompany the application
29        for certification, the Attorney General shall require the
30        manufacturer  or  other  entity  to  provide  only   that
31        information   which   the   Attorney   General  finds  is
32        reasonably necessary to enable the  Attorney  General  to
 
                            -10-     LRB093 12229 WGH 17411 b
 1        determine  whether  the  third-party  dispute  resolution
 2        process  is  in  substantial compliance with Section 5-20
 3        and this Article.
 4             (4)  Prescribe the information that  each  qualified
 5        third-party  dispute resolution process shall provide the
 6        Attorney General, and the time  intervals  at  which  the
 7        information  shall  be  required,  to enable the Attorney
 8        General to determine whether  the  qualified  third-party
 9        dispute   resolution  process  continues  to  operate  in
10        substantial  compliance  with  Section  5-20   and   this
11        Article.

12        Section  10-15.  Establishment  of  qualified third-party
13    dispute resolution process.
14        (a)  Each manufacturer may establish, or  otherwise  make
15    available  to  buyers  or  lessees  of  new motor vehicles, a
16    qualified third-party  dispute  resolution  process  for  the
17    resolution  of  disputes  under  Section 5-15. A manufacturer
18    that  itself  operates  the  third-party  dispute  resolution
19    process shall apply to the Attorney General for certification
20    of that process. If the manufacturer  makes  the  third-party
21    dispute  resolution process available to buyers or lessees of
22    new motor vehicles through contract or other arrangement with
23    another entity, that  entity  shall  apply  to  the  Attorney
24    General   for   certification.  An  entity  that  operates  a
25    third-party dispute resolution  process  for  more  than  one
26    manufacturer   shall   make   a   separate   application  for
27    certification for each manufacturer that uses  that  entity's
28    third-party  dispute  resolution process. The application for
29    certification  shall  be  accompanied  by   the   information
30    prescribed by the Attorney General.
31        (b)  The  Attorney  General  shall review the application
32    and accompanying information and, after conducting an  onsite
33    inspection,  shall  determine whether the third-party dispute
 
                            -11-     LRB093 12229 WGH 17411 b
 1    resolution process is in substantial compliance with  Section
 2    5-20  and  this  Article.  If the Attorney General determines
 3    that the process is in substantial compliance,  the  Attorney
 4    General  shall  certify  the process. If the Attorney General
 5    determines that the process is not in substantial compliance,
 6    the Attorney  General  shall  deny  certification  and  shall
 7    state,   in   writing,   the   reasons  for  denial  and  the
 8    modifications in  the  operation  of  the  process  that  are
 9    required in order for the process to be certified.
10        (c)  The    Attorney   General   shall   make   a   final
11    determination  whether  to  certify  a  third-party   dispute
12    resolution process or to deny certification not later than 90
13    calendar days following the date the Attorney General accepts
14    the application for certification as complete.

15        Section 10-20.  Review.
16        (a)  The  Attorney  General,  in accordance with the time
17    intervals set forth in subdivision (4) of Section 10-10,  but
18    at  least  once  annually,  shall  review  the  operation and
19    performance of each qualified third-party dispute  resolution
20    process  and  determine,  using  the information provided the
21    Attorney General under subdivision (4) of Section  10-10  and
22    the   monitoring  and  inspection  information  described  in
23    subsection (c) of  Section  10-25,  whether  the  process  is
24    operating  in  substantial  compliance  with Section 5-20 and
25    this Article. If the Attorney  General  determines  that  the
26    process is in substantial compliance, the certification shall
27    remain in effect.
28        (b)  If  the Attorney General determines that the process
29    is not in substantial compliance with Section  5-20  or  this
30    Article,  the  Attorney  General  shall  issue  a  notice  of
31    decertification  to the entity which operates the process and
32    shall send a copy of that notice to any manufacturer affected
33    by the decertification. The notice of  decertification  shall
 
                            -12-     LRB093 12229 WGH 17411 b
 1    state  the  reasons  for  the  issuance  of  the  notice  and
 2    prescribe  the  modifications in the operation of the process
 3    that  are  required   for   the   process   to   retain   its
 4    certification.
 5        (c)  A  notice  of  decertification shall take effect 180
 6    calendar days following the date the notice is served on  the
 7    manufacturer  or other entity which uses the process that the
 8    Attorney  General  has  determined  is  not  in   substantial
 9    compliance  with  Section  5-20 or this Article. The Attorney
10    General shall withdraw the notice of  decertification  before
11    its  effective date if the Attorney General determines, after
12    a public hearing, that the manufacturer or other entity which
13    uses the process has made the modifications in the  operation
14    of  the process required in the notice of decertification and
15    is in substantial  compliance  with  Section  5-20  and  this
16    Article.

17        Section 10-25.  Duties of Attorney General.
18        (a)  In  addition  to  any  other  requirements  of  this
19    Article, the Attorney General shall do all of the following:
20             (1)  Establish   procedures   to  assist  owners  or
21        lessees  of  new  motor  vehicles  who  have   complaints
22        regarding   the  operation  of  a  qualified  third-party
23        dispute resolution process.
24             (2)  Establish  methods   for   measuring   customer
25        satisfaction  and to identify violations of this Article,
26        which  shall  include  an  annual  random   postcard   or
27        telephone survey by the Attorney General of the customers
28        of each qualified third-party dispute resolution process.
29             (3)  Monitor   and  inspect,  on  a  regular  basis,
30        qualified third-party  dispute  resolution  processes  to
31        determine whether they continue to meet the standards for
32        certification.  Monitoring  and inspection shall include,
33        but not be limited to, all of the following:
 
                            -13-     LRB093 12229 WGH 17411 b
 1                  (A)  Onsite  inspections  of   each   qualified
 2             third-party  dispute  resolution  process  not  less
 3             frequently than twice annually.
 4                  (B)  Investigation of complaints from consumers
 5             regarding  the  operation  of  qualified third-party
 6             dispute  resolution  processes   and   analyses   of
 7             representative  samples  of  complaints against each
 8             process.
 9                  (C)  Analyses of the annual surveys required by
10             subdivision (2).
11             (4)  Notify the Secretary of State of the failure of
12        a  manufacturer  to  honor  a  decision  of  a  qualified
13        third-party dispute  resolution  process  to  enable  the
14        Secretary of State to take appropriate enforcement action
15        against  the  manufacturer  under  Section  5-501  of the
16        Illinois Vehicle Code.
17             (5)  Submit  a  biennial  report  to   the   General
18        Assembly  evaluating  the  effectiveness of this Article,
19        make available to the public summaries of the  statistics
20        and   other   information   supplied  by  each  qualified
21        third-party  dispute  resolution  process,  and   publish
22        educational  materials  regarding  the  purposes  of this
23        Article.
24             (6)  Adopt rules as  necessary  and  appropriate  to
25        implement this Article and Section 5-20.
26        (b)  Protection  of  the  public  shall  be  the  highest
27    priority   for   the   Attorney  General  in  exercising  its
28    certification,  regulatory,   and   disciplinary   functions.
29    Whenever  the  protection  of the public is inconsistent with
30    other interests sought to be promoted, the protection of  the
31    public shall be paramount.

32        Section 10-30.  Fees.
33        (a)  The  Secretary  of  State  shall, in accordance with
 
                            -14-     LRB093 12229 WGH 17411 b
 1    this Section, administer  the  collection  of  fees  for  the
 2    purposes of fully funding the administration of this Article.
 3        (b)  Fees collected under this Section shall be deposited
 4    in  the  Third-Party  Dispute Resolution Fund, a special fund
 5    which is created in the State treasury  and  shall  be  used,
 6    subject  to  appropriation,  exclusively  to pay the expenses
 7    incurred  by  the  Attorney  General  in  administering  this
 8    Article and the expenses incurred by the Secretary  of  State
 9    in collecting the fees.
10        (c)  Beginning  July  1,  2006, and on or before May 1 of
11    each calendar year thereafter, every manufacturer shall  file
12    with  the  Secretary  of  State  a statement of the number of
13    motor vehicles sold, leased, or otherwise distributed  by  or
14    for  the  manufacturer  in  this  State  during the preceding
15    calendar year, and shall, upon written  notice  delivered  to
16    the manufacturer by certified mail, return receipt requested,
17    pay  to  the  Secretary  of State a fee, not to exceed $1 for
18    each motor vehicle sold, leased, or distributed by or for the
19    manufacturer in this  State  during  the  preceding  calendar
20    year.  Not  more  than  $1  shall  be  charged, collected, or
21    received from  any  one  or  more  manufacturers  under  this
22    subsection (c) with respect to the same motor vehicle.
23        (d)  The  fee  required  by  subsection  (c)  is  due and
24    payable not later than 30 days  after  the  manufacturer  has
25    received  notice  of  the  amount due and is delinquent after
26    that time. A penalty of 10% of the amount delinquent shall be
27    added to that amount if the delinquency  continues  for  more
28    than  30  days. If a manufacturer fails to file the statement
29    required by  subdivision  (b)  by  the  date  specified,  the
30    Secretary  of  State  shall  assess  the  amount due from the
31    manufacturer by using as the number of motor  vehicles  sold,
32    leased,  or  otherwise distributed by or for the manufacturer
33    in this State during the preceding calendar  year  the  total
34    number  of  new  registrations  of  all  motor vehicles sold,
 
                            -15-     LRB093 12229 WGH 17411 b
 1    leased, or otherwise distributed by or for  the  manufacturer
 2    during the preceding calendar year.
 3        (e)  On  or  before February 1 of each year, the Attorney
 4    General shall notify the Secretary of  State  of  the  dollar
 5    amount  necessary  to  fully  fund the program established by
 6    this Article during the following fiscal year. The  Secretary
 7    of  State  shall  use  this  information  in  calculating the
 8    amounts of the fees to be collected from manufacturers  under
 9    this Section.
10        (f)  As used in this Section, "motor vehicle" means a new
11    passenger  or  commercial  motor  vehicle  of  a kind that is
12    required to be registered under the  Illinois  Vehicle  Code,
13    but  "motor  vehicle"  does not include a motorcycle, a motor
14    home, or  any  vehicle  whose  gross  weight  exceeds  10,000
15    pounds.
16        (g)  The  Secretary of State may adopt rules to implement
17    this Section. The  rules  shall  include,  at  a  minimum,  a
18    formula  for  calculating  the fee for each motor vehicle and
19    the  total  amount  of  fees  to  be  collected   from   each
20    manufacturer.

21                             Article 80

22        Section  80-5.  Applicability.  This  Act  applies to new
23    motor vehicles beginning with the model  year  following  the
24    effective date of this Act.

25                             Article 90

26        Section 90-5.  The State Finance Act is amended by adding
27    Section 5.595 as follows:

28        (30 ILCS 105/5.595 new)
29        Sec. 5.595.  The Third-Party Dispute Resolution Fund.
 
                            -16-     LRB093 12229 WGH 17411 b
 1        Section  90-7.   The  Retailers'  Occupation  Tax  Act is
 2    amended by changing Section 6 as follows:

 3        (35 ILCS 120/6) (from Ch. 120, par. 445)
 4        Sec. 6. Credit memorandum or refund. If it appears, after
 5    claim therefor filed with the Department, that an  amount  of
 6    tax  or  penalty  or interest has been paid which was not due
 7    under this Act, whether as the result of a mistake of fact or
 8    an error of law, except as  hereinafter  provided,  then  the
 9    Department  shall  issue a credit memorandum or refund to the
10    person who made the erroneous payment or, if that person died
11    or became a person under legal  disability,  to  his  or  her
12    legal  representative, as such. For purposes of this Section,
13    the tax is deemed to be erroneously paid by a  retailer  when
14    the  manufacturer  of  a  motor  vehicle sold by the retailer
15    accepts the return of that  automobile  and  refunds  to  the
16    purchaser  the  selling  price of that vehicle as provided in
17    the New Vehicle Buyer Protection Act or the New Vehicle Buyer
18    Protection Act of 2004. When a motor vehicle is returned  for
19    a  refund  of  the purchase price under the New Vehicle Buyer
20    Protection Act or the New Vehicle  Buyer  Protection  Act  of
21    2004,  the  Department  shall  issue a credit memorandum or a
22    refund for the amount of tax paid by the retailer under  this
23    Act  attributable to the initial sale of that vehicle. Claims
24    submitted  by  the  retailer  are   subject   to   the   same
25    restrictions  and  procedures provided for in this Act. If it
26    is determined that  the  Department  should  issue  a  credit
27    memorandum  or  refund,  the  Department  may first apply the
28    amount thereof against any tax or penalty or interest due  or
29    to  become  due  under this Act or under the Use Tax Act, the
30    Service Occupation Tax Act, the  Service  Use  Tax  Act,  any
31    local  occupation  or use tax administered by the Department,
32    Section 4 of the Water Commission Act  of  1985,  subsections
33    (b),  (c)  and  (d) of Section 5.01 of the Local Mass Transit
 
                            -17-     LRB093 12229 WGH 17411 b
 1    District Act, or subsections (e), (f) and (g) of Section 4.03
 2    of the Regional Transportation Authority Act, from the person
 3    who made the erroneous payment.  If  no  tax  or  penalty  or
 4    interest  is  due  and  no proceeding is pending to determine
 5    whether such person is indebted to the Department for tax  or
 6    penalty or interest, the credit memorandum or refund shall be
 7    issued  to  the  claimant;  or  (in  the  case  of  a  credit
 8    memorandum)  the  credit  memorandum  may be assigned and set
 9    over by the lawful  holder  thereof,  subject  to  reasonable
10    rules  of  the Department, to any other person who is subject
11    to this Act, the Use Tax Act, the Service Occupation Tax Act,
12    the Service Use Tax Act, any  local  occupation  or  use  tax
13    administered  by  the  Department,  Section  4  of  the Water
14    Commission Act of 1985,  subsections  (b),  (c)  and  (d)  of
15    Section  5.01  of  the  Local  Mass  Transit District Act, or
16    subsections (e), (f) and (g) of Section 4.03 of the  Regional
17    Transportation  Authority Act, and the amount thereof applied
18    by the Department against any tax or penalty or interest  due
19    or to become due under this Act or under the Use Tax Act, the
20    Service  Occupation  Tax  Act,  the  Service Use Tax Act, any
21    local occupation or use tax administered by  the  Department,
22    Section  4  of  the Water Commission Act of 1985, subsections
23    (b), (c) and (d) of Section 5.01 of the  Local  Mass  Transit
24    District Act, or subsections (e), (f) and (g) of Section 4.03
25    of  the  Regional  Transportation  Authority  Act,  from such
26    assignee.  However, as to any  claim  for  credit  or  refund
27    filed  with  the  Department  on and after each January 1 and
28    July 1 no amount of tax or penalty  or  interest  erroneously
29    paid  (either  in  total  or  partial liquidation of a tax or
30    penalty or amount of interest under this  Act)  more  than  3
31    years prior to such January 1 and July 1, respectively, shall
32    be  credited  or refunded, except that if both the Department
33    and the taxpayer have agreed to an extension of time to issue
34    a notice of tax liability as provided in Section  4  of  this
 
                            -18-     LRB093 12229 WGH 17411 b
 1    Act,  such  claim  may  be  filed  at  any  time prior to the
 2    expiration of the period agreed upon.
 3        No claim may be  allowed  for  any  amount  paid  to  the
 4    Department,  whether  paid  voluntarily  or involuntarily, if
 5    paid in total or partial liquidation of an  assessment  which
 6    had  become  final  before  the claim for credit or refund to
 7    recover the amount so paid is filed with the  Department,  or
 8    if  paid  in  total  or  partial liquidation of a judgment or
 9    order of court. No credit may be allowed or refund  made  for
10    any  amount  paid by or collected from any claimant unless it
11    appears (a) that the claimant bore the burden of such  amount
12    and has not been relieved thereof nor reimbursed therefor and
13    has  not  shifted  such burden directly or indirectly through
14    inclusion of  such  amount  in  the  price  of  the  tangible
15    personal  property  sold  by  him  or  her  or  in any manner
16    whatsoever; and that no understanding or  agreement,  written
17    or  oral,  exists  whereby  he  or  she  or  his or her legal
18    representative may be relieved of the burden of such  amount,
19    be  reimbursed  therefor  or may shift the burden thereof; or
20    (b) that he or she or his or  her  legal  representative  has
21    repaid  unconditionally  such amount to his or her vendee (1)
22    who bore the burden thereof and has not shifted  such  burden
23    directly or indirectly, in any manner whatsoever; (2) who, if
24    he or she has shifted such burden, has repaid unconditionally
25    such amount to his own vendee; and (3) who is not entitled to
26    receive any reimbursement therefor from any other source than
27    from  his or her vendor, nor to be relieved of such burden in
28    any manner whatsoever. No credit may  be  allowed  or  refund
29    made  for  any  amount paid by or collected from any claimant
30    unless it  appears  that  the  claimant  has  unconditionally
31    repaid,  to  the  purchaser,  any  amount  collected from the
32    purchaser and retained by the claimant with  respect  to  the
33    same transaction under the Use Tax Act.
34        Any  credit  or refund that is allowed under this Section
 
                            -19-     LRB093 12229 WGH 17411 b
 1    shall bear interest at the rate and in the  manner  specified
 2    in the Uniform Penalty and Interest Act.
 3        In  case  the  Department determines that the claimant is
 4    entitled to a refund, such refund shall  be  made  only  from
 5    such  appropriation  as may be available for that purpose. If
 6    it appears unlikely that the amount appropriated would permit
 7    everyone having a claim allowed during the period covered  by
 8    such  appropriation  to  elect  to receive a cash refund, the
 9    Department, by rule or  regulation,  shall  provide  for  the
10    payment  of  refunds  in hardship cases and shall define what
11    types of cases qualify as hardship cases.
12        If a retailer who has failed to pay retailers' occupation
13    tax on gross receipts from retail sales is  required  by  the
14    Department to pay such tax, such retailer, without filing any
15    formal  claim  with  the Department, shall be allowed to take
16    credit against such retailers' occupation  tax  liability  to
17    the extent, if any, to which such retailer has paid an amount
18    equivalent  to  retailers' occupation tax or has paid use tax
19    in error to his or her vendor or vendors of the same tangible
20    personal property which such retailer bought for  resale  and
21    did  not  first  use  before  selling  it,  and no penalty or
22    interest shall be charged to such retailer on the  amount  of
23    such  credit.  However,  when  such  credit is allowed to the
24    retailer by the Department,  the  vendor  is  precluded  from
25    refunding  any of that tax to the retailer and filing a claim
26    for  credit  or  refund  with  respect   thereto   with   the
27    Department.  The  provisions  of this amendatory Act shall be
28    applied  retroactively,  regardless  of  the  date   of   the
29    transaction.
30    (Source: P.A. 91-901, eff. 1-1-01.)

31        Section  90-10.  The  Illinois Vehicle Code is amended by
32    changing Sections 5-104.2 and 5-501 as follows:
 
                            -20-     LRB093 12229 WGH 17411 b
 1        (625 ILCS 5/5-104.2)
 2        Sec. 5-104.2.  Nonconforming vehicles; sale.
 3        (a)  Every  manufacturer   shall   be   prohibited   from
 4    reselling  any  motor  vehicle that has been finally ordered,
 5    determined, or adjudicated as having  a  nonconformity  under
 6    the  New Vehicle Buyer Protection Act or a similar law of any
 7    state, territory,  or  country,  and  that  the  manufacturer
 8    repurchased  or replaced because of the nonconformity, unless
 9    the manufacturer has corrected the nonconformity and issues a
10    disclosure statement prior to resale stating that the vehicle
11    was repurchased or  replaced  under  the  New  Vehicle  Buyer
12    Protection  Act or similar law of any other state, territory,
13    or country; identifying  the  nonconformity;  and  warranting
14    that  the  nonconformity  has been corrected.  The disclosure
15    statement must accompany the vehicle through the first retail
16    purchase.
17        (b)  "Nonconformity" refers to a new vehicle's failure to
18    conform to all express warranties applicable to the  vehicle,
19    which failure substantially impairs the use, market value, or
20    safety of the vehicle.
21        (c)  The  disclosure  statement referred to in subsection
22    (a) shall be in substantially the same form as below:
23                             "IMPORTANT
24        Vehicle Identification Number (VIN): (Insert VIN Number);
25        Year: (Insert Year); Make (Insert Make);  Model:  (Insert
26        Model).  This vehicle was previously sold as new.  It was
27        subsequently  ordered  as having a nonconformity by final
28        decision of court proceeding or  State  run  arbitration.
29        It  was  subsequently  repurchased  by  its  manufacturer
30        because  it did not conform to the manufacturer's express
31        warranty and the nonconformity was  not  cured  within  a
32        reasonable   time   as  provided  by  Illinois  law.  The
33        following nonconformities have been corrected (a  minimum
34        of  5  numbered  lines  shall be provided to describe the
 
                            -21-     LRB093 12229 WGH 17411 b
 1        nonconformity or nonconformities)."
 2    The  customer  shall  sign  the  disclosure  statement.  This
 3    disclosure language shall be in at least 8-point type.
 4        (d)  The sale, lease, or transfer of motor vehicles  that
 5    have  been  determined  to have a nonconformity under the New
 6    Vehicle Buyer Protection Act of 2004  shall  be  governed  by
 7    that Act.
 8    (Source: P.A. 88-415.)

 9        (625 ILCS 5/5-501) (from Ch. 95 1/2, par. 5-501)
10        Sec.   5-501.    Denial,   suspension  or  revocation  or
11    cancellation of a license. (a) The license of a person issued
12    under this Chapter may be denied, revoked or suspended if the
13    Secretary of State finds that the applicant, or the  officer,
14    director,   shareholder  having  a  ten  percent  or  greater
15    ownership  interest  in  the  corporation,  owner,   partner,
16    trustee, manager, employee or the licensee has:
17        1.  Violated this Act;
18        2.   Made any material misrepresentation to the Secretary
19    of State in connection with an  application  for  a  license,
20    junking    certificate,   salvage   certificate,   title   or
21    registration;
22        3.   Committed  a  fraudulent  act  in  connection   with
23    selling,   bartering,   exchanging,   offering  for  sale  or
24    otherwise dealing in vehicles, chassis, essential  parts,  or
25    vehicle shells;
26        4.  As  a  new  vehicle  dealer  has  no  contract with a
27    manufacturer or enfranchised distributor  to  sell  that  new
28    vehicle in this State;
29        5.  Not  maintained  an  established place of business as
30    defined in this Code;
31        6.  Failed to file or produce for the Secretary of  State
32    any  application,  report, document or other pertinent books,
33    records, documents, letters, contracts, required to be  filed
 
                            -22-     LRB093 12229 WGH 17411 b
 1    or produced under this Code or any rule or regulation made by
 2    the Secretary of State pursuant to this Code;
 3        7.  Previously  had,  within  3  years,  such  a  license
 4    denied, suspended, revoked, or cancelled under the provisions
 5    of subsection (c) (2) of this Section;
 6        8.  Has   committed  in  any  calendar  year  3  or  more
 7    violations,  as  determined  in   any   civil   or   criminal
 8    proceeding, of any one or more of the following Acts:
 9        a.  the "Consumer Finance Act";
10        b.  the "Consumer Installment Loan Act";
11        c.  the "Retail Installment Sales Act";
12        d.  the "Motor Vehicle Retail Installment Sales Act";
13        e.  "An Act in relation to the rate of interest and other
14    charges in connection with sales on credit and the lending of
15    money", approved May 24, 1879, as amended;
16        f.  "An  Act  to  promote  the welfare of wage-earners by
17    regulating the assignment of wages, and prescribing a penalty
18    for  the  violation  thereof",  approved  July  1,  1935,  as
19    amended;
20        g.  Part 8 of Article XII of the Code of Civil Procedure;
21    or
22        h.  the "Consumer Fraud Act";
23        9.  Failed to pay any fees or taxes due under  this  Act,
24    or  has  failed to transmit any fees or taxes received by him
25    for transmittal by him to the Secretary of State or the State
26    of Illinois;
27        10.  Converted an abandoned vehicle;
28        11.  Used  a  vehicle  identification  plate  or   number
29    assigned  to a vehicle other than the one to which originally
30    assigned;
31        12.  Violated the provisions of Chapter 5 of this Act, as
32    amended;
33        13.  Violated the provisions of Chapter 4 of this Act, as
34    amended;

 
                            -23-     LRB093 12229 WGH 17411 b
 1        14.  Violated the provisions of Chapter 3 of this Act, as
 2    amended;
 3        15.  Violated Section 21-2 of the Criminal Code of  1961,
 4    Criminal Trespass to Vehicles;
 5        16.  Made or concealed a material fact in connection with
 6    his application for a license;
 7        17.  Acted  in the capacity of a person licensed or acted
 8    as a licensee under this Chapter  without  having  a  license
 9    therefor;
10        18.  Failed   to  pay,  within  90  days  after  a  final
11    judgment, any fines assessed against the licensee pursuant to
12    an action brought under Section 5-404;
13        19.  Willfully  violated  the  terms  of   any   warranty
14    responsibilities  as  set  forth  in  the  New  Vehicle Buyer
15    Protection Act of 2004.
16        (b)  In addition  to  other  grounds  specified  in  this
17    Chapter,   the  Secretary  of  State,  on  complaint  of  the
18    Department of Revenue, shall refuse the issuance  of  renewal
19    of  a  license, or suspend or revoke such license, for any of
20    the following violations of the  "Retailers'  Occupation  Tax
21    Act":
22        1.  Failure to make a tax return;
23        2.  The filing of a fraudulent return;
24        3.  Failure  to  pay  all  or  part of any tax or penalty
25    finally determined to be due;
26        4.  Failure to comply with the  bonding  requirements  of
27    the "Retailers' Occupation Tax Act".
28        (c)  Cancellation of a license.
29        1.  The license of a person issued under this Chapter may
30    be   cancelled  by  the  Secretary  of  State  prior  to  its
31    expiration in any of the following situations:
32        A.  When a license is  voluntarily  surrendered,  by  the
33    licensed person; or
34        B.  If  the business enterprise is a sole proprietorship,
 
                            -24-     LRB093 12229 WGH 17411 b
 1    which  is  not  a  franchised  dealership,  when   the   sole
 2    proprietor  dies  or  is  imprisoned  for any period of  time
 3    exceeding 30 days; or
 4        C.  If the license was issued  to  the  wrong  person  or
 5    corporation, or contains an error on its face.  If any person
 6    above  whose  license  has been cancelled wishes to apply for
 7    another license, whether during the same license year or  any
 8    other  year,  that  person  shall be treated as any other new
 9    applicant and the cancellation of the person's prior  license
10    shall  not,  in  and of itself, be a bar to the issuance of a
11    new license.
12        2.  The license of a person issued under this Chapter may
13    be cancelled without a hearing when the Secretary of State is
14    notified  that  the  applicant,  or  any  officer,  director,
15    shareholder  having  a  10  per  cent  or  greater  ownership
16    interest  in  the  corporation,  owner,   partner,   trustee,
17    manager,  employee or member of the applicant or the licensee
18    has been convicted  of  any  felony  involving  the  selling,
19    bartering,   exchanging,  offering  for  sale,  or  otherwise
20    dealing  in  vehicles,  chassis,  essential  parts,   vehicle
21    shells,  or  ownership documents relating to any of the above
22    items.
23    (Source: P.A. 86-820.)

24        Section 90-15.  The New Vehicle Buyer Protection  Act  is
25    amended by changing Section 8 as follows:

26        (815 ILCS 380/8) (from Ch. 121 1/2, par. 1208)
27        Sec. 8.  This Act shall apply to motor vehicles beginning
28    with the model year following the effective date of this Act,
29    except  that  this Act does not apply to any motor vehicle to
30    which the New Vehicle Buyer Protection Act of 2004 applies.
31    (Source: P.A. 83-768.)
 
                            -25-     LRB093 12229 WGH 17411 b
 1                             Article 99

 2        Section 99-5.  Effective date. This Act takes  effect  on
 3    January 1, 2005.
 
                            -26-     LRB093 12229 WGH 17411 b
 1                                INDEX
 2               Statutes amended in order of appearance
 3                              SEE INDEX
 4    New Act
 5    30 ILCS 105/5.595 new
 6    35 ILCS 120/6             from Ch. 120, par. 445
 7    625 ILCS 5/5-104.2
 8    625 ILCS 5/5-501          from Ch. 95 1/2, par. 5-501
 9    815 ILCS 380/8            from Ch. 121 1/2, par. 1208