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Public Act 92-0758
SB1851 Enrolled LRB9215626DHmg
AN ACT in relation to business transactions.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Motor Vehicle Franchise Act is amended by
changing Section 5 as follows:
(815 ILCS 710/5) (from Ch. 121 1/2, par. 755)
Sec. 5. Delivery and preparation obligations; damage
disclosures. Every manufacturer shall specify in writing to
the dealer the delivery and preparation obligations of its
motor vehicle dealers prior to delivery of new motor vehicles
to retail buyers. A copy of the delivery and preparation
obligations of its motor vehicle dealers and a schedule of
the compensation to be paid to its motor vehicle dealers for
the work and services they shall be required to perform in
connection with such delivery and preparation obligations
shall be presented to the dealer and the obligations
specified therein shall constitute any such dealer's only
predelivery obligations as between such dealer and such
manufacturer. The compensation as set forth on said schedule
shall be reasonable.
A manufacturer, factory branch, distributor, distributor
branch, or wholesaler of new motor vehicles sold or
transferred to a motor vehicle dealer in this State shall
disclose to the motor vehicle dealer, in writing, before
delivery of a vehicle to the motor vehicle dealer all
in-transit, post-manufacture, or other damage to the vehicle
that was sustained or incurred by the motor vehicle at any
time after the manufacturing process was complete but before
delivery of the vehicle to the dealer. This disclosure is
not required when the cost to repair does not exceed 6% of
the manufacturer's suggested retail price of the vehicle
based upon the dealer's actual retail repair cost, including
labor, parts, and materials if the damage is repaired or
retail estimate to repair if the vehicle is not repaired. New
motor vehicles that are repaired may be sold as new and shall
be fully warranted by the manufacturer.
For purposes of this Section, "manufacturer's suggested
retail price" means the retail price of the new motor vehicle
suggested by the manufacturer including the retail delivered
price suggested by the manufacturer for each separately
priced accessory or item of optional equipment physically
attached to the new motor vehicle at the time of delivery.
Whenever a new motor vehicle sustains or incurs any
in-transit, post-manufacture, or other damage at any time
after the manufacturing process is complete, but before
delivery of the vehicle to the motor vehicle dealer, the
dealer may within a reasonable period of time after delivery
of the motor vehicle notify the manufacturer or distributor
of that damage and either:
(1) revoke acceptance of the delivery of the new
motor vehicle whereby ownership of the motor vehicle
shall revert to the manufacturer, and the dealer shall
incur no obligations, financial, or otherwise for that
new motor vehicle; or
(2) request authorization from the manufacturer to
repair the damage sustained or incurred by the new motor
vehicle. If the manufacturer refuses or fails to
authorize repair of the damage within 3 days of the
request by the dealer, the dealer may then revoke
acceptance of the delivery of the new motor vehicle;
ownership shall revert to the manufacturer; and the
dealer shall incur no obligations, financial, or
otherwise for that new motor vehicle.
A motor vehicle dealer shall disclose to the purchaser
before delivery of the new motor vehicle, in writing, any
damage that the dealer has actual knowledge was sustained or
incurred by the motor vehicle at any time after the
manufacturing process was complete but before delivery of the
vehicle to the purchaser. This disclosure is not required
when the cost to repair does not exceed 6% of the
manufacturer's suggested retail price of the vehicle based
upon the dealer's actual retail repair cost, including labor,
parts, and materials if the damage is repaired or the retail
estimate to repair the vehicle if it is not repaired.
Damage to glass, tires, bumpers, video and telephonic
components, and in-dash audio equipment is not to be
considered in determining the cost of repair if replaced with
the manufacturer's original equipment.
If disclosure is not required under this Section, a
purchaser may not revoke or rescind a sales contract due to
the fact the new vehicle was damaged and repaired before
completion of the sale. In that circumstance, nondisclosure
does not constitute a misrepresentation or omission of fact.
A manufacturer, factory branch, distributor, distributor
branch, or wholesaler of new motor vehicles shall,
notwithstanding the terms of any franchise agreement,
indemnify and hold harmless the motor vehicle dealer
obtaining a new motor vehicle from the manufacturer, factory
branch, distributor, distributor branch, or wholesaler from
and against any liability, including reasonable attorney's
fees, expert witness fees, court costs, and other expenses
incurred in the litigation, so long as such fees and costs
are reasonable, that the motor vehicle dealer may be
subjected to by the purchaser of the vehicle because of
damage to the motor vehicle that occurred before delivery of
the vehicle to the dealer and that was not disclosed in
writing to the dealer prior to delivery of the vehicle. This
indemnity obligation of the manufacturer, factory branch,
distributor, distributor branch, or wholesaler applies
regardless of whether the damage falls below the 6% threshold
under this Section. The failure of the manufacturer, factory
branch, distributor, distributor branch, or wholesaler to
indemnify and hold harmless the motor vehicle dealer is a
violation of this Section.
(Source: P.A. 91-485, eff. 1-1-00.)
Passed in the General Assembly May 08, 2002.
Approved August 02, 2002.
Effective January 01, 2003.
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