100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB4708

 

Introduced , by Rep. Sue Scherer

 

SYNOPSIS AS INTRODUCED:
 
815 ILCS 505/2L

    Amends the Consumer Fraud and Deceptive Business Practices Act. Provides that the prohibition against the modification or disclaimer of an implied warranty of merchantability regarding certain motor vehicle components for 15 days after the retail sale of a used vehicle to a consumer by a licensed dealer does not apply to a vehicle sold at an auction that is open to the general public if the auction company has conducted a mechanical inspection of the vehicle and given notice of any defects to prospective purchasers. Effective immediately.


LRB100 16738 JLS 31878 b

 

 

A BILL FOR

 

HB4708LRB100 16738 JLS 31878 b

1    AN ACT concerning business.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Consumer Fraud and Deceptive Business
5Practices Act is amended by changing Section 2L as follows:
 
6    (815 ILCS 505/2L)
7    (Text of Section before amendment by P.A. 100-512)
8    Sec. 2L. Used motor vehicles; modification or disclaimer of
9implied warranty of merchantability limited.
10    (a) Any retail sale of a used motor vehicle made after July
111, 2017 (the effective date of Public Act 99-768) this
12amendatory Act of the 99th General Assembly to a consumer by a
13licensed vehicle dealer within the meaning of Chapter 5 of the
14Illinois Vehicle Code or by an auction company at an auction
15that is open to the general public is made subject to this
16Section.
17    (b) This Section does not apply to any of the following:
18        (1) a vehicle with more than 150,000 miles at the time
19    of sale;
20        (2) a vehicle with a title that has been branded
21    "rebuilt" or "flood";
22        (3) a vehicle with a gross vehicle weight rating of
23    8,000 pounds or more; or

 

 

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1        (4) a vehicle that is an antique vehicle, as defined in
2    the Illinois Vehicle Code, or that is a collector motor
3    vehicle; or .
4        (5) a vehicle sold at an auction that is open to the
5    general public, provided that the auction company has
6    conducted a mechanical inspection of the vehicle and
7    provided notice of any defects to the vehicle to
8    prospective purchasers.
9    (b-5) This Section does not apply to the sale of any
10vehicle for which the dealer offers an express warranty that
11provides coverage that is equal to or greater than the limited
12implied warranty of merchantability required under this
13Section 2L.
14    (c) Except as otherwise provided in this Section 2L, any
15sale of a used motor vehicle as described in subsection (a) may
16not exclude, modify, or disclaim the implied warranty of
17merchantability created under this Section 2L or limit the
18remedies for a breach of the warranty hereunder before midnight
19of the 15th calendar day after delivery of a used motor vehicle
20or until a used motor vehicle is driven 500 miles after
21delivery, whichever is earlier. In calculating time under this
22Section, a day on which the warranty is breached and all
23subsequent days in which the used motor vehicle fails to
24conform with the implied warranty of merchantability are
25excluded. In calculating distance under this Section, the miles
26driven to obtain or in connection with the repair, servicing,

 

 

HB4708- 3 -LRB100 16738 JLS 31878 b

1or testing of a used motor vehicle that fails to conform with
2the implied warranty of merchantability are excluded. An
3attempt to exclude, modify, or disclaim the implied warranty of
4merchantability or to limit the remedies for a breach of the
5warranty in violation of this Section renders a purchase
6agreement voidable at the option of the purchaser.
7    (d) An implied warranty of merchantability is met if a used
8motor vehicle functions for the purpose of ordinary
9transportation on the public highway and substantially free of
10a defect in a power train component. As used in this Section,
11"power train component" means the engine block, head, all
12internal engine parts, oil pan and gaskets, water pump, intake
13manifold, transmission, and all internal transmission parts,
14torque converter, drive shaft, universal joints, rear axle and
15all rear axle internal parts, and rear wheel bearings.
16    (e) The implied warranty of merchantability expires at
17midnight of the 15th calendar day after delivery of a used
18motor vehicle or when a used motor vehicle is driven 500 miles
19after delivery, whichever is earlier. In calculating time, a
20day on which the implied warranty of merchantability is
21breached is excluded and all subsequent days in which the used
22motor vehicle fails to conform with the warranty are also
23excluded. In calculating distance, the miles driven to or by
24the seller to obtain or in connection with the repair,
25servicing, or testing of a used motor vehicle that fails to
26conform with the implied warranty of merchantability are

 

 

HB4708- 4 -LRB100 16738 JLS 31878 b

1excluded. An implied warranty of merchantability does not
2extend to damage that occurs after the sale of the used motor
3vehicle that results from:
4        (1) off-road use;
5        (2) racing;
6        (3) towing;
7        (4) abuse;
8        (5) misuse;
9        (6) neglect;
10        (7) failure to perform regular maintenance; and
11        (8) failure to maintain adequate oil, coolant, and
12    other required fluids or lubricants.
13    (f) If the implied warranty of merchantability described in
14this Section is breached, the consumer shall give reasonable
15notice to the seller no later than 2 business days after the
16end of the statutory warranty period. Before the consumer
17exercises another remedy pursuant to Article 2 of the Uniform
18Commercial Code, the seller shall have a reasonable opportunity
19to repair the used motor vehicle. The consumer shall pay
20one-half of the cost of the first 2 repairs necessary to bring
21the used motor vehicle into compliance with the warranty. The
22payments by the consumer are limited to a maximum payment of
23$100 for each repair; however, the consumer shall only be
24responsible for a maximum payment of $100 if the consumer
25brings in the vehicle for a second repair for the same defect.
26Reasonable notice as defined in this Section shall include, but

 

 

HB4708- 5 -LRB100 16738 JLS 31878 b

1not be limited to:
2        (1) text, provided the seller has provided the consumer
3    with a cell phone number;
4        (2) phone call or message to the seller's business
5    phone number provided on the seller's bill of sale for the
6    purchase of the motor vehicle;
7        (3) in writing to the seller's address provided on the
8    seller's bill of sale for the purchase of the motor
9    vehicle;
10        (4) in person at the seller's address provided on the
11    seller's bill of sale for the purchase of the motor
12    vehicle.
13    (g) The maximum liability of a seller for repairs pursuant
14to this Section is limited to the purchase price paid for the
15used motor vehicle, to be refunded to the consumer or lender,
16as applicable, in exchange for return of the vehicle.
17    (h) An agreement for the sale of a used motor vehicle
18subject to this Section is voidable at the option of the
19consumer, unless it contains on its face or in a separate
20document the following conspicuous statement printed in
21boldface 10-point or larger type set off from the body of the
22agreement:
23    "Illinois law requires that this vehicle will be free of a
24defect in a power train component for 15 days or 500 miles
25after delivery, whichever is earlier, except with regard to
26particular defects disclosed on the first page of this

 

 

HB4708- 6 -LRB100 16738 JLS 31878 b

1agreement. "Power train component" means the engine block,
2head, all internal engine parts, oil pan and gaskets, water
3pump, intake manifold, transmission, and all internal
4transmission parts, torque converter, drive shaft, universal
5joints, rear axle and all rear axle internal parts, and rear
6wheel bearings. You (the consumer) will have to pay up to $100
7for each of the first 2 repairs if the warranty is violated.".
8    (i) The inclusion in the agreement of the statement
9prescribed in subsection (h) of this Section does not create an
10express warranty.
11    (j) A consumer of a used motor vehicle may waive the
12implied warranty of merchantability only for a particular
13defect in the vehicle, including, but not limited to, a rebuilt
14or flood-branded title and only if all of the following
15conditions are satisfied:
16        (1) the seller subject to this Section fully and
17    accurately discloses to the consumer that because of
18    circumstances unusual to the business, the used motor
19    vehicle has a particular defect;
20        (2) the consumer agrees to buy the used motor vehicle
21    after disclosure of the defect; and
22        (3) before the sale, the consumer indicates agreement
23    to the waiver by signing and dating the following
24    conspicuous statement that is printed on the first page of
25    the sales agreement or on a separate document in boldface
26    10-point or larger type and that is written in the language

 

 

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1    in which the presentation was made:
2        "Attention consumer: sign here only if the seller has
3    told you that this vehicle has the following problem or
4    problems and you agree to buy the vehicle on those terms:
5    1. ......................................................
6    2. ..................................................
7    3. ...................................................".
8    (k) It shall be an affirmative defense to any claim under
9this Section that:
10        (1) an alleged nonconformity does not substantially
11    impair the use and market value of the motor vehicle;
12        (2) a nonconformity is the result of abuse, neglect, or
13    unauthorized modifications or alterations of the motor
14    vehicle;
15        (3) a claim by a consumer was not filed in good faith;
16    or
17        (4) any other affirmative defense allowed by law.
18    (l) Other than the 15-day, 500-mile implied warranty of
19merchantability identified herein, a seller subject to this
20Section is not required to provide any further express or
21implied warranties to a purchasing consumer unless:
22        (1) the seller is required by federal or State law to
23    provide a further express or implied warranty; or
24        (2) the seller fails to fully inform and disclose to
25    the consumer that the vehicle is being sold without any
26    further express or implied warranties, other than the 15

 

 

HB4708- 8 -LRB100 16738 JLS 31878 b

1    day, 500 mile implied warranty of merchantability
2    identified in this Section.
3    (m) Any person who violates this Section commits an
4unlawful practice within the meaning of this Act.
5(Source: P.A. 99-768, eff. 7-1-17; 100-4, eff. 7-1-17; revised
610-12-17.)
 
7    (Text of Section after amendment by P.A. 100-512)
8    Sec. 2L. Used motor vehicles; modification or disclaimer of
9implied warranty of merchantability limited.
10    (a) Any retail sale of a used motor vehicle made after July
111, 2017 (the effective date of Public Act 99-768) this
12amendatory Act of the 99th General Assembly to a consumer by a
13licensed vehicle dealer within the meaning of Chapter 5 of the
14Illinois Vehicle Code or by an auction company at an auction
15that is open to the general public is made subject to this
16Section.
17    (b) This Section does not apply to any of the following:
18        (1) a vehicle with more than 150,000 miles at the time
19    of sale;
20        (2) a vehicle with a title that has been branded
21    "rebuilt" or "flood";
22        (3) a vehicle with a gross vehicle weight rating of
23    8,000 pounds or more; or
24        (4) a vehicle that is an antique vehicle, as defined in
25    the Illinois Vehicle Code, or that is a collector motor

 

 

HB4708- 9 -LRB100 16738 JLS 31878 b

1    vehicle; or .
2        (5) a vehicle sold at an auction that is open to the
3    general public, provided that the auction company has
4    conducted a mechanical inspection of the vehicle and
5    provided notice of any defects to the vehicle to
6    prospective purchasers.
7    (b-5) This Section does not apply to the sale of any
8vehicle for which the dealer offers an express warranty that
9provides coverage that is equal to or greater than the limited
10implied warranty of merchantability required under this
11Section 2L.
12    (b-6) (b-5) This Section does not apply to forfeited
13vehicles sold at auction by or on behalf of the Department of
14State Police.
15    (c) Except as otherwise provided in this Section 2L, any
16sale of a used motor vehicle as described in subsection (a) may
17not exclude, modify, or disclaim the implied warranty of
18merchantability created under this Section 2L or limit the
19remedies for a breach of the warranty hereunder before midnight
20of the 15th calendar day after delivery of a used motor vehicle
21or until a used motor vehicle is driven 500 miles after
22delivery, whichever is earlier. In calculating time under this
23Section, a day on which the warranty is breached and all
24subsequent days in which the used motor vehicle fails to
25conform with the implied warranty of merchantability are
26excluded. In calculating distance under this Section, the miles

 

 

HB4708- 10 -LRB100 16738 JLS 31878 b

1driven to obtain or in connection with the repair, servicing,
2or testing of a used motor vehicle that fails to conform with
3the implied warranty of merchantability are excluded. An
4attempt to exclude, modify, or disclaim the implied warranty of
5merchantability or to limit the remedies for a breach of the
6warranty in violation of this Section renders a purchase
7agreement voidable at the option of the purchaser.
8    (d) An implied warranty of merchantability is met if a used
9motor vehicle functions for the purpose of ordinary
10transportation on the public highway and substantially free of
11a defect in a power train component. As used in this Section,
12"power train component" means the engine block, head, all
13internal engine parts, oil pan and gaskets, water pump, intake
14manifold, transmission, and all internal transmission parts,
15torque converter, drive shaft, universal joints, rear axle and
16all rear axle internal parts, and rear wheel bearings.
17    (e) The implied warranty of merchantability expires at
18midnight of the 15th calendar day after delivery of a used
19motor vehicle or when a used motor vehicle is driven 500 miles
20after delivery, whichever is earlier. In calculating time, a
21day on which the implied warranty of merchantability is
22breached is excluded and all subsequent days in which the used
23motor vehicle fails to conform with the warranty are also
24excluded. In calculating distance, the miles driven to or by
25the seller to obtain or in connection with the repair,
26servicing, or testing of a used motor vehicle that fails to

 

 

HB4708- 11 -LRB100 16738 JLS 31878 b

1conform with the implied warranty of merchantability are
2excluded. An implied warranty of merchantability does not
3extend to damage that occurs after the sale of the used motor
4vehicle that results from:
5        (1) off-road use;
6        (2) racing;
7        (3) towing;
8        (4) abuse;
9        (5) misuse;
10        (6) neglect;
11        (7) failure to perform regular maintenance; and
12        (8) failure to maintain adequate oil, coolant, and
13    other required fluids or lubricants.
14    (f) If the implied warranty of merchantability described in
15this Section is breached, the consumer shall give reasonable
16notice to the seller no later than 2 business days after the
17end of the statutory warranty period. Before the consumer
18exercises another remedy pursuant to Article 2 of the Uniform
19Commercial Code, the seller shall have a reasonable opportunity
20to repair the used motor vehicle. The consumer shall pay
21one-half of the cost of the first 2 repairs necessary to bring
22the used motor vehicle into compliance with the warranty. The
23payments by the consumer are limited to a maximum payment of
24$100 for each repair; however, the consumer shall only be
25responsible for a maximum payment of $100 if the consumer
26brings in the vehicle for a second repair for the same defect.

 

 

HB4708- 12 -LRB100 16738 JLS 31878 b

1Reasonable notice as defined in this Section shall include, but
2not be limited to:
3        (1) text, provided the seller has provided the consumer
4    with a cell phone number;
5        (2) phone call or message to the seller's business
6    phone number provided on the seller's bill of sale for the
7    purchase of the motor vehicle;
8        (3) in writing to the seller's address provided on the
9    seller's bill of sale for the purchase of the motor
10    vehicle;
11        (4) in person at the seller's address provided on the
12    seller's bill of sale for the purchase of the motor
13    vehicle.
14    (g) The maximum liability of a seller for repairs pursuant
15to this Section is limited to the purchase price paid for the
16used motor vehicle, to be refunded to the consumer or lender,
17as applicable, in exchange for return of the vehicle.
18    (h) An agreement for the sale of a used motor vehicle
19subject to this Section is voidable at the option of the
20consumer, unless it contains on its face or in a separate
21document the following conspicuous statement printed in
22boldface 10-point or larger type set off from the body of the
23agreement:
24    "Illinois law requires that this vehicle will be free of a
25defect in a power train component for 15 days or 500 miles
26after delivery, whichever is earlier, except with regard to

 

 

HB4708- 13 -LRB100 16738 JLS 31878 b

1particular defects disclosed on the first page of this
2agreement. "Power train component" means the engine block,
3head, all internal engine parts, oil pan and gaskets, water
4pump, intake manifold, transmission, and all internal
5transmission parts, torque converter, drive shaft, universal
6joints, rear axle and all rear axle internal parts, and rear
7wheel bearings. You (the consumer) will have to pay up to $100
8for each of the first 2 repairs if the warranty is violated.".
9    (i) The inclusion in the agreement of the statement
10prescribed in subsection (h) of this Section does not create an
11express warranty.
12    (j) A consumer of a used motor vehicle may waive the
13implied warranty of merchantability only for a particular
14defect in the vehicle, including, but not limited to, a rebuilt
15or flood-branded title and only if all of the following
16conditions are satisfied:
17        (1) the seller subject to this Section fully and
18    accurately discloses to the consumer that because of
19    circumstances unusual to the business, the used motor
20    vehicle has a particular defect;
21        (2) the consumer agrees to buy the used motor vehicle
22    after disclosure of the defect; and
23        (3) before the sale, the consumer indicates agreement
24    to the waiver by signing and dating the following
25    conspicuous statement that is printed on the first page of
26    the sales agreement or on a separate document in boldface

 

 

HB4708- 14 -LRB100 16738 JLS 31878 b

1    10-point or larger type and that is written in the language
2    in which the presentation was made:
3        "Attention consumer: sign here only if the seller has
4    told you that this vehicle has the following problem or
5    problems and you agree to buy the vehicle on those terms:
6    1. ......................................................
7    2. ..................................................
8    3. ...................................................".
9    (k) It shall be an affirmative defense to any claim under
10this Section that:
11        (1) an alleged nonconformity does not substantially
12    impair the use and market value of the motor vehicle;
13        (2) a nonconformity is the result of abuse, neglect, or
14    unauthorized modifications or alterations of the motor
15    vehicle;
16        (3) a claim by a consumer was not filed in good faith;
17    or
18        (4) any other affirmative defense allowed by law.
19    (l) Other than the 15-day, 500-mile implied warranty of
20merchantability identified herein, a seller subject to this
21Section is not required to provide any further express or
22implied warranties to a purchasing consumer unless:
23        (1) the seller is required by federal or State law to
24    provide a further express or implied warranty; or
25        (2) the seller fails to fully inform and disclose to
26    the consumer that the vehicle is being sold without any

 

 

HB4708- 15 -LRB100 16738 JLS 31878 b

1    further express or implied warranties, other than the 15
2    day, 500 mile implied warranty of merchantability
3    identified in this Section.
4    (m) Any person who violates this Section commits an
5unlawful practice within the meaning of this Act.
6(Source: P.A. 99-768, eff. 7-1-17; 100-4, eff. 7-1-17; 100-512,
7eff. 7-1-18; revised 10-12-17.)
 
8    Section 95. No acceleration or delay. Where this Act makes
9changes in a statute that is represented in this Act by text
10that is not yet or no longer in effect (for example, a Section
11represented by multiple versions), the use of that text does
12not accelerate or delay the taking effect of (i) the changes
13made by this Act or (ii) provisions derived from any other
14Public Act.
 
15    Section 99. Effective date. This Act takes effect upon
16becoming law.