93RD GENERAL ASSEMBLY
State of Illinois
2003 and 2004
HB4083

 

Introduced 1/15/2004, by Maria Antonia Berrios

 

SYNOPSIS AS INTRODUCED:
 
New Act
30 ILCS 105/5.625 new
35 ILCS 120/6   from Ch. 120, par. 445
625 ILCS 5/5-104.2
625 ILCS 5/5-501   from Ch. 95 1/2, par. 5-501
815 ILCS 380/8   from Ch. 121 1/2, par. 1208

    Creates the New Vehicle Buyer Protection Act of 2004. Provides that qualified third-party dispute resolution processes may be used to resolve certain disputes between certain new vehicle buyers and manufacturers concerning a nonconformity that substantially impairs the use, value, or safety of a new vehicle. Provides that, if a qualified third-party dispute resolution process does not exist, or the new vehicle buyer is dissatisfied with that third-party decision, or the manufacturer or its agent does not fulfill the terms of a decision after it is accepted by the buyer, the buyer may: (i) assert a presumption that a reasonable number of attempts have been made to conform the vehicle to the applicable express warranties in accordance with criteria set forth in the Act and (ii) seek replacement of the vehicle or restitution for the price of the vehicle and damages, attorney's fees, costs, and a civil penalty. Provides that no person may sell, lease, or transfer a motor vehicle that was returned to a manufacturer under the Act or a similar law of any other state unless the vehicle's nonconformity is clearly and conspicuously disclosed to the prospective buyer, lessee, or transferee, the nonconformity is corrected, and the manufacturer warrants to the new buyer, lessee, or transferee in writing for a period of one year that the motor vehicle is free of that nonconformity, except as otherwise specified. Provides that the Attorney General shall establish a program for certifying, reviewing, and decertifying third-party dispute resolution processes established by new vehicle manufacturers or their agents. Provides that the Secretary of State may suspend the license of a manufacturer or distributor for its failure to honor a decision of a qualified third-party dispute resolution process. Provides that the Secretary of State shall collect fees from manufacturers for the administration of the program and that the fees shall be deposited in the new Third-Party Dispute Resolution Fund. Applies to new motor vehicles beginning with the model year following the effective date of the Act. Amends the State Finance Act, the Retailers' Occupation Tax Act, and the Illinois Vehicle Code to conform to the new Act. Amends the existing New Vehicle Buyer Protection Act to provide that it does not apply to vehicles to which the new Act applies. Effective January 1, 2005.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB4083 LRB093 14547 WGH 40038 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
6     Section 1-1. Short title. This Act may be cited as the New
7 Vehicle Buyer Protection Act of 2004.
 
8
Article 5

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

 

 

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1 of demonstrating qualities and characteristics common to
2 vehicles of the same 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 of
6 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 of
13 the following occurs:
14         (1) The same nonconformity results in a condition that
15     is likely to cause death or serious bodily injury if the
16     vehicle is driven and the nonconformity has been subject to
17     repair 2 or more times by the manufacturer or its agents,
18     and the buyer or lessee has at least once directly notified
19     the manufacturer of the need for the repair of the
20     nonconformity.
21         (2) The same nonconformity has been subject to repair 4
22     or more times by the manufacturer or its agents and the
23     buyer has at least once directly notified the manufacturer
24     of the need for the repair of the nonconformity.
25         (3) The vehicle is out of service by reason of repair
26     of nonconformities by the manufacturer or its agents for a
27     cumulative total of more than 30 calendar days since
28     delivery of the vehicle to the buyer. The 30-day limit
29     shall be extended only if repairs cannot be performed due
30     to conditions beyond the control of the manufacturer or its
31     agents. The buyer shall be required to directly notify the
32     manufacturer under subdivisions (1) and (2) only if the
33     manufacturer has clearly and conspicuously disclosed to
34     the buyer, with the warranty or the owner's manual, the
35     provisions of this Act, including the requirement that the

 

 

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1     buyer must notify the manufacturer directly under
2     subdivisions (1) and (2). The notification, if required,
3     shall be sent to the address, if any, specified clearly and
4     conspicuously by the manufacturer in the warranty or
5     owner's manual. This presumption shall be a rebuttable
6     presumption affecting the burden of proof, and it may be
7     asserted by the buyer in any civil action, including an
8     action in small claims court, or other formal or informal
9     proceeding.
 
10     Section 5-15. Assertion of presumption; qualified
11 third-party dispute resolution process. If a qualified
12 third-party dispute resolution process exists, and the buyer
13 receives timely notification in writing of the availability of
14 that qualified third-party dispute resolution process with a
15 description of its operation and effect, the presumption in
16 Section 5-10 may not be asserted by the buyer until after the
17 buyer has initially resorted to the qualified third-party
18 dispute resolution process as required in Section 5-20.
19 Notification of the availability of the qualified third-party
20 dispute resolution process is not timely if the buyer suffers
21 any prejudice resulting from any delay in giving the
22 notification. If a qualified third-party dispute resolution
23 process does not exist, or if the buyer is dissatisfied with
24 that third-party decision, or if the manufacturer or its agent
25 neglects to promptly fulfill the terms of the qualified
26 third-party dispute resolution process decision after the
27 decision is accepted by the buyer, the buyer may assert the
28 presumption provided in Section 5-10 in an action to enforce
29 the buyer's rights under Section 5-30. The findings and
30 decision of a qualified third-party dispute resolution process
31 shall be admissible in evidence in the action without further
32 foundation. Any period of limitation of actions under any
33 federal or State law with respect to any person shall be
34 extended for a period equal to the number of days between the
35 date a complaint is filed with a third-party dispute resolution

 

 

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1 process and the date of its decision or the date before which
2 the manufacturer or its agent is required by the decision to
3 fulfill its terms if the decision is accepted by the buyer,
4 whichever occurs later.
 
5     Section 5-20. Elements of qualified third-party dispute
6 resolution process. A qualified third-party dispute resolution
7 process is one that does all of the following:
8         (1) Complies with the minimum requirements of the
9     Federal Trade Commission for informal dispute settlement
10     procedures as set forth in Part 703 of Title 16 of the Code
11     of Federal Regulations.
12         (2) Renders decisions that are binding on the
13     manufacturer if the buyer elects to accept the decision.
14         (3) Prescribes a reasonable time, not to exceed 30 days
15     after the decision is accepted by the buyer, within which
16     the manufacturer or its agent must fulfill the terms of its
17     decisions.
18         (4) Provides arbitrators who are assigned to decide
19     disputes with copies of, and instruction in, the provisions
20     of the Federal Trade Commission's regulations in Part 703
21     of Title 16 of the Code of Federal Regulations, Article 2
22     of the Uniform Commercial Code, and this Act.
23         (5) Requires the manufacturer, when the process
24     orders, under the terms of this Act, either that the
25     nonconforming motor vehicle be replaced if the buyer
26     consents to this remedy or that restitution be made to the
27     buyer, to replace the motor vehicle or make restitution in
28     accordance with Section 5-30.
29         (6) Provides, at the request of the arbitrator or a
30     majority of the arbitration panel, for an inspection and
31     written report on the condition of a nonconforming motor
32     vehicle, at no cost to the buyer, by an automobile expert
33     who is independent of the manufacturer.
34         (7) Takes into account, in rendering decisions, all
35     legal and equitable factors, including, but not limited to,

 

 

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1     the written warranty, the rights and remedies conferred in
2     regulations of the Federal Trade Commission contained in
3     Part 703 of Title 16 of the Code of Federal Regulations,
4     Article 2 of the Uniform Commercial Code, this Act, and any
5     other equitable considerations appropriate in the
6     circumstances. Nothing in this Act requires that, to be
7     certified as a qualified third-party dispute resolution
8     process under this Section, decisions of the process must
9     consider or provide remedies in the form of awards of
10     punitive damages, attorney's fees, or consequential
11     damages under Section 5-35 including, but not limited to,
12     reasonable repair, towing, and rental car costs actually
13     incurred by the buyer.
14         (8) Requires that no arbitrator deciding a dispute may
15     be a party to the dispute and that no other person,
16     including an employee, agent, or dealer for the
17     manufacturer, may be allowed to participate substantively
18     in the merits of any dispute with the arbitrator unless the
19     buyer is also allowed to participate. Nothing in this
20     subdivision (8) prohibits any member of an arbitration
21     board from deciding a dispute.
22         (9) Obtains and maintains certification under Article
23     10.
 
24     Section 5-25. Sale of transferred vehicles.
25     (a) Except as provided in subsection (b), no person may
26 sell, either at wholesale or retail, lease, or transfer a motor
27 vehicle transferred by a buyer or lessee to a manufacturer
28 under Section 5-30 or a similar law of any other state, unless
29 the nature of the nonconformity experienced by the original
30 buyer or lessee is clearly and conspicuously disclosed to the
31 prospective buyer, lessee, or transferee, the nonconformity is
32 corrected, and the manufacturer warrants to the new buyer,
33 lessee, or transferee in writing for a period of one year that
34 the motor vehicle is free of that nonconformity.
35     (b) Except for the requirement that the nature of the

 

 

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1 nonconformity be disclosed to the transferee, subsection (a)
2 does not apply to the transfer of a motor vehicle to an
3 educational institution if the purpose of the transfer is to
4 make the motor vehicle available for use in automotive repair
5 courses.
 
6     Section 5-30. Replacement or restitution.
7     (a) If the manufacturer or its representative in this State
8 is unable to service or repair a new motor vehicle to conform
9 to the applicable express warranties after a reasonable number
10 of attempts, the manufacturer shall either promptly replace the
11 new motor vehicle in accordance with subsection (b) or promptly
12 make restitution to the buyer in accordance with subsection
13 (c). However, the buyer may elect restitution in lieu of
14 replacement, and in no event shall the buyer be required by the
15 manufacturer to accept a replacement vehicle.
16     (b) In the case of replacement, the manufacturer shall
17 replace the buyer's vehicle with a new motor vehicle
18 substantially identical to the vehicle replaced. The
19 replacement vehicle shall be accompanied by all express and
20 implied warranties that normally accompany new motor vehicles
21 of that specific kind. The manufacturer also shall pay for, or
22 to, the buyer the amount of any use tax, license fees,
23 registration fees, and other official fees which the buyer is
24 obligated to pay in connection with the replacement, plus any
25 incidental damages to which the buyer is entitled under Section
26 5-35, including, but not limited to, reasonable repair, towing,
27 and rental car costs actually incurred by the buyer.
28     (c) In the case of restitution, the manufacturer shall make
29 restitution in an amount equal to the actual price paid or
30 payable by the buyer, including any charges for transportation
31 and manufacturer-installed options, but excluding
32 nonmanufacturer items installed by a dealer or the buyer, and
33 including any collateral charges such as use tax, license fees,
34 registration fees, and other official fees, plus any incidental
35 damages to which the buyer is entitled under Section 5-35,

 

 

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1 including, but not limited to, reasonable repair, towing, and
2 rental car costs actually incurred by the buyer.
3     (d) When the manufacturer replaces the new motor vehicle
4 under subsection (b), the buyer shall only be liable to pay the
5 manufacturer an amount directly attributable to use by the
6 buyer of the replaced vehicle before the buyer first delivered
7 the vehicle to the manufacturer or distributor, or its
8 authorized service and repair facility for correction of the
9 problem that gave rise to the nonconformity. When restitution
10 is made under subsection (c), the amount to be paid by the
11 manufacturer to the buyer may be reduced by the manufacturer by
12 that amount directly attributable to use by the buyer before
13 the buyer first delivered the vehicle to the manufacturer or
14 distributor, or its authorized service and repair facility for
15 correction of the problem that gave rise to the nonconformity.
16 The amount directly attributable to use by a buyer shall be
17 determined by multiplying the actual price of the new motor
18 vehicle paid or payable by the buyer, including any charges for
19 transportation and manufacturer-installed options, by a
20 fraction having as its denominator 120,000 and having as its
21 numerator the number of miles traveled by the new motor vehicle
22 before the buyer first delivered the vehicle to the
23 manufacturer or distributor, or its authorized service and
24 repair facility for correction of the problem that gave rise to
25 the nonconformity. Nothing in this Section in any way limits
26 the rights or remedies available to the buyer under any other
27 law.
 
28     Section 5-35. Damages; attorney's fees and costs; civil
29 penalty.
30     (a) Except as otherwise provided in this Section, if the
31 buyer establishes a violation of Section 5-30, the buyer shall
32 recover damages and reasonable attorney's fees and costs, and
33 may recover a civil penalty of up to 2 times the amount of
34 damages.
35     (b) If the manufacturer maintains a qualified third-party

 

 

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1 dispute resolution process which substantially complies with
2 this Act, the manufacturer shall not be liable for any civil
3 penalty under this Section.
4     (c) After the occurrence of the events giving rise to the
5 presumption established in Section 5-30, the buyer may serve
6 upon the manufacturer a written notice requesting that the
7 manufacturer comply with Section 5-30. If the buyer fails to
8 serve the notice, the manufacturer is not liable for a civil
9 penalty under this Section.
10     (d) If the buyer serves the notice described in subsection
11 (c) and the manufacturer complies with Section 5-30 within 30
12 days of the service of that notice, the manufacturer is not
13 liable for a civil penalty under this Section.
 
14
Article 10

 
15
16     Section 10-5. Definitions. As used in this Article, unless
17 the context requires otherwise:
18     Except as otherwise provided in Section 10-30, "new motor
19 vehicle" means a new motor vehicle as defined in Article 5.
20     "Manufacturer" a manufacturer or distributor as defined in
21 Section 5-109 of the Illinois Vehicle Code.
22     "Qualified third party dispute resolution process" means a
23 third party dispute resolution process which operates in
24 compliance with Section 5-20 and this Article and which has
25 been certified by the Attorney General under this Article.
 
26     Section 10-10. Program for certifying third-party dispute
27 resolution process. The Attorney General shall establish a
28 program for certifying each third-party dispute resolution
29 process used for the arbitration of disputes under Section
30 5-15. In establishing the program, the Attorney General shall
31 do all of the following:
32         (1) Prescribe and provide forms to be used to apply for
33     certification under this Article.

 

 

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1         (2) Establish a set of minimum standards which shall be
2     used to determine whether a third-party dispute resolution
3     process is in substantial compliance with Section 5-20 and
4     this Article.
5         (3) Prescribe the information which each manufacturer
6     or other entity that operates a third-party dispute
7     resolution process shall provide the Attorney General in
8     the application for certification. In prescribing the
9     information to accompany the application for
10     certification, the Attorney General shall require the
11     manufacturer or other entity to provide only that
12     information which the Attorney General finds is reasonably
13     necessary to enable the Attorney General to determine
14     whether the third-party dispute resolution process is in
15     substantial compliance with Section 5-20 and this Article.
16         (4) Prescribe the information that each qualified
17     third-party dispute resolution process shall provide the
18     Attorney General, and the time intervals at which the
19     information shall be required, to enable the Attorney
20     General to determine whether the qualified third-party
21     dispute resolution process continues to operate in
22     substantial compliance with Section 5-20 and this Article.
 
23     Section 10-15. Establishment of qualified third-party
24 dispute resolution process.
25     (a) Each manufacturer may establish, or otherwise make
26 available to buyers or lessees of new motor vehicles, a
27 qualified third-party dispute resolution process for the
28 resolution of disputes under Section 5-15. A manufacturer that
29 itself operates the third-party dispute resolution process
30 shall apply to the Attorney General for certification of that
31 process. If the manufacturer makes the third-party dispute
32 resolution process available to buyers or lessees of new motor
33 vehicles through contract or other arrangement with another
34 entity, that entity shall apply to the Attorney General for
35 certification. An entity that operates a third-party dispute

 

 

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1 resolution process for more than one manufacturer shall make a
2 separate application for certification for each manufacturer
3 that uses that entity's third-party dispute resolution
4 process. The application for certification shall be
5 accompanied by the information prescribed by the Attorney
6 General.
7     (b) The Attorney General shall review the application and
8 accompanying information and, after conducting an onsite
9 inspection, shall determine whether the third-party dispute
10 resolution process is in substantial compliance with Section
11 5-20 and this Article. If the Attorney General determines that
12 the process is in substantial compliance, the Attorney General
13 shall certify the process. If the Attorney General determines
14 that the process is not in substantial compliance, the Attorney
15 General shall deny certification and shall state, in writing,
16 the reasons for denial and the modifications in the operation
17 of the process that are required in order for the process to be
18 certified.
19     (c) The Attorney General shall make a final determination
20 whether to certify a third-party dispute resolution process or
21 to deny certification not later than 90 calendar days following
22 the date the Attorney General accepts the application for
23 certification as complete.
 
24     Section 10-20. Review.
25     (a) The Attorney General, in accordance with the time
26 intervals set forth in subdivision (4) of Section 10-10, but at
27 least once annually, shall review the operation and performance
28 of each qualified third-party dispute resolution process and
29 determine, using the information provided the Attorney General
30 under subdivision (4) of Section 10-10 and the monitoring and
31 inspection information described in subsection (c) of Section
32 10-25, whether the process is operating in substantial
33 compliance with Section 5-20 and this Article. If the Attorney
34 General determines that the process is in substantial
35 compliance, the certification shall remain in effect.

 

 

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1     (b) If the Attorney General determines that the process is
2 not in substantial compliance with Section 5-20 or this
3 Article, the Attorney General shall issue a notice of
4 decertification to the entity which operates the process and
5 shall send a copy of that notice to any manufacturer affected
6 by the decertification. The notice of decertification shall
7 state the reasons for the issuance of the notice and prescribe
8 the modifications in the operation of the process that are
9 required for the process to retain its certification.
10     (c) A notice of decertification shall take effect 180
11 calendar days following the date the notice is served on the
12 manufacturer or other entity which uses the process that the
13 Attorney General has determined is not in substantial
14 compliance with Section 5-20 or this Article. The Attorney
15 General shall withdraw the notice of decertification before its
16 effective date if the Attorney General determines, after a
17 public hearing, that the manufacturer or other entity which
18 uses the process has made the modifications in the operation of
19 the process required in the notice of decertification and is in
20 substantial compliance with Section 5-20 and this Article.
 
21     Section 10-25. Duties of Attorney General.
22     (a) In addition to any other requirements of this Article,
23 the Attorney General shall do all of the following:
24         (1) Establish procedures to assist owners or lessees of
25     new motor vehicles who have complaints regarding the
26     operation of a qualified third-party dispute resolution
27     process.
28         (2) Establish methods for measuring customer
29     satisfaction and to identify violations of this Article,
30     which shall include an annual random postcard or telephone
31     survey by the Attorney General of the customers of each
32     qualified third-party dispute resolution process.
33         (3) Monitor and inspect, on a regular basis, qualified
34     third-party dispute resolution processes to determine
35     whether they continue to meet the standards for

 

 

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1     certification. Monitoring and inspection shall include,
2     but not be limited to, all of the following:
3             (A) Onsite inspections of each qualified
4         third-party dispute resolution process not less
5         frequently than twice annually.
6             (B) Investigation of complaints from consumers
7         regarding the operation of qualified third-party
8         dispute resolution processes and analyses of
9         representative samples of complaints against each
10         process.
11             (C) Analyses of the annual surveys required by
12         subdivision (2).
13         (4) Notify the Secretary of State of the failure of a
14     manufacturer to honor a decision of a qualified third-party
15     dispute resolution process to enable the Secretary of State
16     to take appropriate enforcement action against the
17     manufacturer under Section 5-501 of the Illinois Vehicle
18     Code.
19         (5) Submit a biennial report to the General Assembly
20     evaluating the effectiveness of this Article, make
21     available to the public summaries of the statistics and
22     other information supplied by each qualified third-party
23     dispute resolution process, and publish educational
24     materials regarding the purposes of this Article.
25         (6) Adopt rules as necessary and appropriate to
26     implement this Article and Section 5-20.
27     (b) Protection of the public shall be the highest priority
28 for the Attorney General in exercising its certification,
29 regulatory, and disciplinary functions. Whenever the
30 protection of the public is inconsistent with other interests
31 sought to be promoted, the protection of the public shall be
32 paramount.
 
33     Section 10-30. Fees.
34     (a) The Secretary of State shall, in accordance with this
35 Section, administer the collection of fees for the purposes of

 

 

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1 fully funding the administration of this Article.
2     (b) Fees collected under this Section shall be deposited in
3 the Third-Party Dispute Resolution Fund, a special fund which
4 is created in the State treasury and shall be used, subject to
5 appropriation, exclusively to pay the expenses incurred by the
6 Attorney General in administering this Article and the expenses
7 incurred by the Secretary of State in collecting the fees.
8     (c) Beginning July 1, 2006, and on or before May 1 of each
9 calendar year thereafter, every manufacturer shall file with
10 the Secretary of State a statement of the number of motor
11 vehicles sold, leased, or otherwise distributed by or for the
12 manufacturer in this State during the preceding calendar year,
13 and shall, upon written notice delivered to the manufacturer by
14 certified mail, return receipt requested, pay to the Secretary
15 of State a fee, not to exceed $1 for each motor vehicle sold,
16 leased, or distributed by or for the manufacturer in this State
17 during the preceding calendar year. Not more than $1 shall be
18 charged, collected, or received from any one or more
19 manufacturers under this subsection (c) with respect to the
20 same motor vehicle.
21     (d) The fee required by subsection (c) is due and payable
22 not later than 30 days after the manufacturer has received
23 notice of the amount due and is delinquent after that time. A
24 penalty of 10% of the amount delinquent shall be added to that
25 amount if the delinquency continues for more than 30 days. If a
26 manufacturer fails to file the statement required by
27 subdivision (b) by the date specified, the Secretary of State
28 shall assess the amount due from the manufacturer by using as
29 the number of motor vehicles sold, leased, or otherwise
30 distributed by or for the manufacturer in this State during the
31 preceding calendar year the total number of new registrations
32 of all motor vehicles sold, leased, or otherwise distributed by
33 or for the manufacturer during the preceding calendar year.
34     (e) On or before February 1 of each year, the Attorney
35 General shall notify the Secretary of State of the dollar
36 amount necessary to fully fund the program established by this

 

 

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1 Article during the following fiscal year. The Secretary of
2 State shall use this information in calculating the amounts of
3 the fees to be collected from manufacturers under this Section.
4     (f) As used in this Section, "motor vehicle" means a new
5 passenger or commercial motor vehicle of a kind that is
6 required to be registered under the Illinois Vehicle Code, but
7 "motor vehicle" does not include a motorcycle, a motor home, or
8 any vehicle whose gross weight exceeds 10,000 pounds.
9     (g) The Secretary of State may adopt rules to implement
10 this Section. The rules shall include, at a minimum, a formula
11 for calculating the fee for each motor vehicle and the total
12 amount of fees to be collected from each manufacturer.
 
13
Article 80

 
14
15     Section 80-5. Applicability. This Act applies to new motor
16 vehicles beginning with the model year following the effective
17 date of this Act.
 
18
Article 90

 
19
20     Section 90-5. The State Finance Act is amended by adding
21 Section 5.625 as follows:
 
22     (30 ILCS 105/5.625 new)
23     Sec. 5.625. The Third-Party Dispute Resolution Fund.
 
24     Section 90-7. The Retailers' Occupation Tax Act is amended
25 by changing Section 6 as follows:
 
26     (35 ILCS 120/6)  (from Ch. 120, par. 445)
27     Sec. 6. Credit memorandum or refund. If it appears, after
28 claim therefor filed with the Department, that an amount of tax
29 or penalty or interest has been paid which was not due under

 

 

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1 this Act, whether as the result of a mistake of fact or an
2 error of law, except as hereinafter provided, then the
3 Department shall issue a credit memorandum or refund to the
4 person who made the erroneous payment or, if that person died
5 or became a person under legal disability, to his or her legal
6 representative, as such. For purposes of this Section, the tax
7 is deemed to be erroneously paid by a retailer when the
8 manufacturer of a motor vehicle sold by the retailer accepts
9 the return of that automobile and refunds to the purchaser the
10 selling price of that vehicle as provided in the New Vehicle
11 Buyer Protection Act or the New Vehicle Buyer Protection Act of
12 2004. When a motor vehicle is returned for a refund of the
13 purchase price under the New Vehicle Buyer Protection Act or
14 the New Vehicle Buyer Protection Act of 2004, the Department
15 shall issue a credit memorandum or a refund for the amount of
16 tax paid by the retailer under this Act attributable to the
17 initial sale of that vehicle. Claims submitted by the retailer
18 are subject to the same restrictions and procedures provided
19 for in this Act. If it is determined that the Department should
20 issue a credit memorandum or refund, the Department may first
21 apply the amount thereof against any tax or penalty or interest
22 due or to become due under this Act or under the Use Tax Act,
23 the Service Occupation Tax Act, the Service Use Tax Act, any
24 local occupation or use tax administered by the Department,
25 Section 4 of the Water Commission Act of 1985, subsections (b),
26 (c) and (d) of Section 5.01 of the Local Mass Transit District
27 Act, or subsections (e), (f) and (g) of Section 4.03 of the
28 Regional Transportation Authority Act, from the person who made
29 the erroneous payment. If no tax or penalty or interest is due
30 and no proceeding is pending to determine whether such person
31 is indebted to the Department for tax or penalty or interest,
32 the credit memorandum or refund shall be issued to the
33 claimant; or (in the case of a credit memorandum) the credit
34 memorandum may be assigned and set over by the lawful holder
35 thereof, subject to reasonable rules of the Department, to any
36 other person who is subject to this Act, the Use Tax Act, the

 

 

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1 Service Occupation Tax Act, the Service Use Tax Act, any local
2 occupation or use tax administered by the Department, Section 4
3 of the Water Commission Act of 1985, subsections (b), (c) and
4 (d) of Section 5.01 of the Local Mass Transit District Act, or
5 subsections (e), (f) and (g) of Section 4.03 of the Regional
6 Transportation Authority Act, and the amount thereof applied by
7 the Department against any tax or penalty or interest due or to
8 become due under this Act or under the Use Tax Act, the Service
9 Occupation Tax Act, the Service Use Tax Act, any local
10 occupation or use tax administered by the Department, Section 4
11 of the Water Commission Act of 1985, subsections (b), (c) and
12 (d) of Section 5.01 of the Local Mass Transit District Act, or
13 subsections (e), (f) and (g) of Section 4.03 of the Regional
14 Transportation Authority Act, from such assignee. However, as
15 to any claim for credit or refund filed with the Department on
16 and after each January 1 and July 1 no amount of tax or penalty
17 or interest erroneously paid (either in total or partial
18 liquidation of a tax or penalty or amount of interest under
19 this Act) more than 3 years prior to such January 1 and July 1,
20 respectively, shall be credited or refunded, except that if
21 both the Department and the taxpayer have agreed to an
22 extension of time to issue a notice of tax liability as
23 provided in Section 4 of this Act, such claim may be filed at
24 any time prior to the expiration of the period agreed upon.
25     No claim may be allowed for any amount paid to the
26 Department, whether paid voluntarily or involuntarily, if paid
27 in total or partial liquidation of an assessment which had
28 become final before the claim for credit or refund to recover
29 the amount so paid is filed with the Department, or if paid in
30 total or partial liquidation of a judgment or order of court.
31 No credit may be allowed or refund made for any amount paid by
32 or collected from any claimant unless it appears (a) that the
33 claimant bore the burden of such amount and has not been
34 relieved thereof nor reimbursed therefor and has not shifted
35 such burden directly or indirectly through inclusion of such
36 amount in the price of the tangible personal property sold by

 

 

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1 him or her or in any manner whatsoever; and that no
2 understanding or agreement, written or oral, exists whereby he
3 or she or his or her legal representative may be relieved of
4 the burden of such amount, be reimbursed therefor or may shift
5 the burden thereof; or (b) that he or she or his or her legal
6 representative has repaid unconditionally such amount to his or
7 her vendee (1) who bore the burden thereof and has not shifted
8 such burden directly or indirectly, in any manner whatsoever;
9 (2) who, if he or she has shifted such burden, has repaid
10 unconditionally such amount to his own vendee; and (3) who is
11 not entitled to receive any reimbursement therefor from any
12 other source than from his or her vendor, nor to be relieved of
13 such burden in any manner whatsoever. No credit may be allowed
14 or refund made for any amount paid by or collected from any
15 claimant unless it appears that the claimant has
16 unconditionally repaid, to the purchaser, any amount collected
17 from the purchaser and retained by the claimant with respect to
18 the same transaction under the Use Tax Act.
19     Any credit or refund that is allowed under this Section
20 shall bear interest at the rate and in the manner specified in
21 the Uniform Penalty and Interest Act.
22     In case the Department determines that the claimant is
23 entitled to a refund, such refund shall be made only from such
24 appropriation as may be available for that purpose. If it
25 appears unlikely that the amount appropriated would permit
26 everyone having a claim allowed during the period covered by
27 such appropriation to elect to receive a cash refund, the
28 Department, by rule or regulation, shall provide for the
29 payment of refunds in hardship cases and shall define what
30 types of cases qualify as hardship cases.
31     If a retailer who has failed to pay retailers' occupation
32 tax on gross receipts from retail sales is required by the
33 Department to pay such tax, such retailer, without filing any
34 formal claim with the Department, shall be allowed to take
35 credit against such retailers' occupation tax liability to the
36 extent, if any, to which such retailer has paid an amount

 

 

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1 equivalent to retailers' occupation tax or has paid use tax in
2 error to his or her vendor or vendors of the same tangible
3 personal property which such retailer bought for resale and did
4 not first use before selling it, and no penalty or interest
5 shall be charged to such retailer on the amount of such credit.
6 However, when such credit is allowed to the retailer by the
7 Department, the vendor is precluded from refunding any of that
8 tax to the retailer and filing a claim for credit or refund
9 with respect thereto with the Department. The provisions of
10 this amendatory Act shall be applied retroactively, regardless
11 of the date of the transaction.
12 (Source: P.A. 91-901, eff. 1-1-01.)
 
13     Section 90-10. The Illinois Vehicle Code is amended by
14 changing Sections 5-104.2 and 5-501 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
18 any motor vehicle that has been finally ordered, determined, or
19 adjudicated as having a nonconformity under the New Vehicle
20 Buyer Protection Act or a similar law of any state, territory,
21 or country, and that the manufacturer repurchased or replaced
22 because of the nonconformity, unless the manufacturer has
23 corrected the nonconformity and issues a disclosure statement
24 prior to resale stating that the vehicle was repurchased or
25 replaced under the New Vehicle Buyer Protection Act or similar
26 law of any other state, territory, or country; identifying the
27 nonconformity; and warranting that the nonconformity has been
28 corrected. The disclosure statement must accompany the vehicle
29 through the first retail purchase.
30     (b) "Nonconformity" refers to a new vehicle's failure to
31 conform to all express warranties applicable to the vehicle,
32 which failure substantially impairs the use, market value, or
33 safety of the vehicle.
34     (c) The disclosure statement referred to in subsection (a)

 

 

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1 shall be in substantially the same form as below:
2
"IMPORTANT
3     Vehicle Identification Number (VIN): (Insert VIN Number);
4     Year: (Insert Year); Make (Insert Make); Model: (Insert
5     Model). This vehicle was previously sold as new. It was
6     subsequently ordered as having a nonconformity by final
7     decision of court proceeding or State run arbitration. It
8     was subsequently repurchased by its manufacturer because
9     it did not conform to the manufacturer's express warranty
10     and the nonconformity was not cured within a reasonable
11     time as provided by Illinois law. The following
12     nonconformities have been corrected (a minimum of 5
13     numbered lines shall be provided to describe the
14     nonconformity or nonconformities)."
15 The customer shall sign the disclosure statement. This
16 disclosure language shall be in at least 8-point type.
17     (d) The sale, lease, or transfer of motor vehicles that
18 have been determined to have a nonconformity under the New
19 Vehicle Buyer Protection Act of 2004 shall be governed by that
20 Act.
21 (Source: P.A. 88-415.)
 
22     (625 ILCS 5/5-501)  (from Ch. 95 1/2, par. 5-501)
23     Sec. 5-501. Denial, suspension or revocation or
24 cancellation of a license. (a) The license of a person issued
25 under this Chapter may be denied, revoked or suspended if the
26 Secretary of State finds that the applicant, or the officer,
27 director, shareholder having a ten percent or greater ownership
28 interest in the corporation, owner, partner, trustee, manager,
29 employee or the licensee has:
30     1. Violated this Act;
31     2. Made any material misrepresentation to the Secretary of
32 State in connection with an application for a license, junking
33 certificate, salvage certificate, title or registration;
34     3. Committed a fraudulent act in connection with selling,
35 bartering, exchanging, offering for sale or otherwise dealing

 

 

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1 in vehicles, chassis, essential parts, or vehicle shells;
2     4. As a new vehicle dealer has no contract with a
3 manufacturer or enfranchised distributor to sell that new
4 vehicle in this State;
5     5. Not maintained an established place of business as
6 defined in this Code;
7     6. Failed to file or produce for the Secretary of State any
8 application, report, document or other pertinent books,
9 records, documents, letters, contracts, required to be filed or
10 produced under this Code or any rule or regulation made by the
11 Secretary of State pursuant to this Code;
12     7. Previously had, within 3 years, such a license denied,
13 suspended, revoked, or cancelled under the provisions of
14 subsection (c) (2) of this Section;
15     8. Has committed in any calendar year 3 or more violations,
16 as determined in any civil or criminal proceeding, of any one
17 or more of the following Acts:
18     a. the "Consumer Finance Act";
19     b. the "Consumer Installment Loan Act";
20     c. the "Retail Installment Sales Act";
21     d. the "Motor Vehicle Retail Installment Sales Act";
22     e. "An Act in relation to the rate of interest and other
23 charges in connection with sales on credit and the lending of
24 money", approved May 24, 1879, as amended;
25     f. "An Act to promote the welfare of wage-earners by
26 regulating the assignment of wages, and prescribing a penalty
27 for the violation thereof", approved July 1, 1935, as amended;
28     g. Part 8 of Article XII of the Code of Civil Procedure; or
29     h. the "Consumer Fraud Act";
30     9. Failed to pay any fees or taxes due under this Act, or
31 has failed to transmit any fees or taxes received by him for
32 transmittal by him to the Secretary of State or the State of
33 Illinois;
34     10. Converted an abandoned vehicle;
35     11. Used a vehicle identification plate or number assigned
36 to a vehicle other than the one to which originally assigned;

 

 

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1     12. Violated the provisions of Chapter 5 of this Act, as
2 amended;
3     13. Violated the provisions of Chapter 4 of this Act, as
4 amended;
5     14. Violated the provisions of Chapter 3 of this Act, as
6 amended;
7     15. Violated Section 21-2 of the Criminal Code of 1961,
8 Criminal Trespass to Vehicles;
9     16. Made or concealed a material fact in connection with
10 his application for a license;
11     17. Acted in the capacity of a person licensed or acted as
12 a licensee under this Chapter without having a license
13 therefor;
14     18. Failed to pay, within 90 days after a final judgment,
15 any fines assessed against the licensee pursuant to an action
16 brought under Section 5-404;
17     19. Willfully violated the terms of any warranty
18 responsibilities as set forth in the New Vehicle Buyer
19 Protection Act of 2004.
20     (b) In addition to other grounds specified in this Chapter,
21 the Secretary of State, on complaint of the Department of
22 Revenue, shall refuse the issuance of renewal of a license, or
23 suspend or revoke such license, for any of the following
24 violations of the "Retailers' Occupation Tax Act":
25     1. Failure to make a tax return;
26     2. The filing of a fraudulent return;
27     3. Failure to pay all or part of any tax or penalty finally
28 determined to be due;
29     4. Failure to comply with the bonding requirements of the
30 "Retailers' Occupation Tax Act".
31     (c) Cancellation of a license.
32     1. The license of a person issued under this Chapter may be
33 cancelled by the Secretary of State prior to its expiration in
34 any of the following situations:
35     A. When a license is voluntarily surrendered, by the
36 licensed person; or

 

 

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1     B. If the business enterprise is a sole proprietorship,
2 which is not a franchised dealership, when the sole proprietor
3 dies or is imprisoned for any period of time exceeding 30 days;
4 or
5     C. If the license was issued to the wrong person or
6 corporation, or contains an error on its face. If any person
7 above whose license has been cancelled wishes to apply for
8 another license, whether during the same license year or any
9 other year, that person shall be treated as any other new
10 applicant and the cancellation of the person's prior license
11 shall not, in and of itself, be a bar to the issuance of a new
12 license.
13     2. The license of a person issued under this Chapter may be
14 cancelled without a hearing when the Secretary of State is
15 notified that the applicant, or any officer, director,
16 shareholder having a 10 per cent or greater ownership interest
17 in the corporation, owner, partner, trustee, manager, employee
18 or member of the applicant or the licensee has been convicted
19 of any felony involving the selling, bartering, exchanging,
20 offering for sale, or otherwise dealing in vehicles, chassis,
21 essential parts, vehicle shells, or ownership documents
22 relating to any of the above 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.)
 
32
Article 99

 
33

 

 

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1     Section 99-5. Effective date. This Act takes effect on
2 January 1, 2005.