§ 31-5.2-1 Definitions. As used in this chapter:
(1) "Consumer" means a buyer, other than for purposes of resale,
of a motor vehicle, any person to whom that motor vehicle is transferred
for the same purposes during the duration of any express or implied
warranty applicable to that motor vehicle, and any other person
entitled by the terms of that warranty to enforce its obligations.
(2) "Dealer" means any person engaged in the business of selling,
offering to sell, soliciting, or advertising the sale of new motor
(3) "Lease price" means the aggregate of:
(i) Lessor's actual purchase costs.
(ii) Collateral charges, if applicable.
(iii) Any fee paid to another to obtain the lease.
(iv) Any insurance or other costs expended by the lessor for
the benefit of the lessee.
(v) An amount equal to state and local sales taxes not otherwise
included as collateral charges, paid by the lessor when the
vehicle was initially purchased.
(vi) An amount equal to five percent (5%) of the lessor's
actual purchase costs.
(4) "Lessee" means any consumer who leases a motor vehicle for
one year or more pursuant to a written lease agreement which provides
that the lessee is responsible for repairs to such motor vehicle
or any consumer who leases a motor vehicle pursuant to a lease-purchase
(5) "Lessee cost" means the aggregate deposit and rental payments
previously paid to the lessor for the leased vehicle.
(6) "Lessor" means a person who holds title to a motor vehicle
leased to a lessee under a written lease agreement or who holds
the lessor's rights under such agreement.
(7) "Manufacturer" means any person, partnership, firm, association,
corporation, or trust, resident or nonresident, which is engaged
in the business of manufacturing or assembling new motor vehicles,
or which is engaged in the business of importing new motor vehicles
which are manufactured or assembled outside of the United States.
(8) "Motor vehicle" or "vehicle" means an automobile, truck,
motorcycle, or van having a registered gross vehicle weight of
less than ten thousand pounds (10,000 lbs.), sold, leased, or
replaced by a dealer or manufacturer after May 11, 1984, except
that it shall not include a motorized camper as defined in §
(9) "Nonconformity" means any specific or generic defect or
malfunction, or any concurrent combination of such defects or
malfunctions, that substantially impairs the use, market value,
or safety of a motor vehicle.
(10) "Term of protection" means one year or fifteen thousand
(15,000) miles of use from the date of original delivery of a
new motor vehicle to the consumer, whichever comes first; or,
in the case of a replacement vehicle provided by a manufacturer
to a consumer under this chapter, one year or fifteen thousand
(15,000) miles from the date of delivery to the consumer of that
replacement vehicle, whichever comes first.
§ 31-5.2-2 Manufacturers' obligation to fulfill warranties.
If a motor vehicle does not conform to any applicable
express or implied warranties, including, but not limited to, the
implied warranty of merchantability as defined in § 6A-2-314
and the implied warranty of fitness for a particular purpose as
defined in § 6A-2-315, and the consumer or lessee reports the
nonconformity to the manufacturer of the vehicle, its agent, or
its authorized dealer or lessor during the term of protection, the
manufacturer, its agent or its authorized dealer shall effect such
repairs as are necessary to conform the vehicle to the warranty,
notwithstanding the fact that those repairs are made after the expiration
of the term.
§ 31-5.2-3 Replacement of nonconforming vehicle.
(a) If the manufacturer, its agent, or its authorized dealer
or lessor does not conform the motor vehicle to any applicable express
or implied warranty by curing any nonconformity after a reasonable
number of attempts, the manufacturer shall accept return of the
vehicle from the consumer or lessee and, at the consumer's or lessee's
option, refund the full contract price or lease price of the vehicle
including all credits and allowances for any trade-in vehicle, less
a reasonable allowance for use, or replace it with a comparable
new motor vehicle in good working order.
(2) A manufacturer replacing a motor vehicle shall have thirty
(30) calendar days from the date of return of the motor vehicle
under the provisions of this chapter to deliver a comparable motor
vehicle. If, within that thirty (30) days, no comparable motor
vehicle has been delivered, the manufacturer shall refund the
full contract price or lease price less a reasonable allowance
(3) In instances in which a vehicle is replaced by a manufacturer
under the provisions of this chapter, the manufacturer shall reimburse
the consumer or lessee for any fees for the transfer of registration
or any sales tax incurred by the consumer or lessee as a result
of that replacement.
(ii) In instances in which a vehicle which was financed by
the manufacturer or its subsidiary or agent is replaced under
the provisions of this chapter, the manufacturer, subsidiary,
or agent shall not require the consumer or lessee to enter into
any refinancing agreement with an interest rate or other financial
terms which are less favorable to the consumer or lessee than
those stated in the original financing agreement.
(iii) In instances in which a refund is tendered under the
provisions of this chapter, the manufacturer shall also reimburse
the consumer or lessee for incidental costs including sales
tax, registration fee, finance charges, and any cost of nonremovable
options added by an authorized dealer or lessor.
iv) Whenever a vehicle is replaced or refunded under the provisions
of this chapter, in instances in which towing services and rental
vehicles of comparable year and size were not made available
at no cost to the consumer or lessee, the manufacturer shall
also reimburse the consumer or lessee for towing and reasonable
rental costs that were a direct result of vehicle nonconformity.
(4) Refunds shall be made to the consumer or lessee and to the
lienholder, if any, as their interests may appear.
(5) A reasonable allowance for use shall be obtained by multiplying
the total contract price or lessee cost of the vehicle by a fraction
having as its denominator one hundred thousand (100,000) and having
as its numerator the number of miles that the vehicle travelled
prior to the consumer's first report of the nonconformity to the
manufacturer, its agent, or its dealer or lessor plus the number
of miles that it travelled during any subsequent period when the
vehicle was not out of service by reason of repair.
(6) A consumer or lessee shall have the option of retaining
the use of any vehicle returned under the provisions of this chapter
until such time as the consumer or lessee has been tendered a
full refund or replacement vehicle acceptable to the consumer
or lessee. The use of any vehicle retained by a consumer or lessee
after its return to a manufacturer under the provisions of this
chapter shall, in instances in which a refund is tendered, be
reflected in the above mentioned reasonable allowance for use.
(b) If applicable, refunds shall be made to the lessor and lessee
as their interests may appear on the records of ownership as follows:
the lessee shall receive the lessee cost and the lessor shall receive
the lease price less the aggregate deposit and rental payments previously
paid to the lessor for the leased vehicle. If it is determined that
the lessee is entitled to a refund pursuant to this chapter, the
consumer's lease agreement with the lessor shall be terminated upon
payment of the refund and no penalty for early termination shall
§ 31-5.2-4 Affirmative defenses. It is an affirmative
defense to any claim under this section:
(1) that an alleged nonconformity does not substantially impair
the use, market value, or safety of the vehicle, or
(2) that a nonconformity is the result of abuse, neglect, or
unauthorized substantial modification or alteration of the vehicle
by the consumer or lessee.
§ 31-5.2-5 Time allowed for correction of nonconformity.
(a) A reasonable number of attempts shall be presumed
to have been undertaken to conform a motor vehicle to any applicable
express or implied warranties if:
(1) the same nonconformity has been subject to repair four (4)
or more times by the manufacturer or its agents or authorized
dealers or lessors within the term of protection, but the nonconformity
continues to exist or the nonconformity has recurred within the
term of protection, or
(2) the vehicle is out of service by reason of the repair of
any nonconformity for a cumulative total of thirty (30) or more
calendar days during the term of protection; provided, however,
that the manufacturer shall be afforded one additional opportunity,
not to exceed seven (7) calendar days, to cure any nonconformity
arising during the term of protection, notwithstanding the fact
that the additional opportunity to cure commences after the term
(b) The additional opportunity to cure shall commence on the day
the manufacturer first knows or should have known that the limits
specified in subsection (a)(1) or (a)(2) have been met or exceeded.
The term of protection, the thirty (30) calendar day period specified
in subsection (a)(2) and the additional opportunity to cure shall
be extended by any period of time during which repair services are
not available to the consumer or lessee as a direct result of a
war, invasion, fire, flood or other natural disaster. The term of
protection, the thirty (30) calendar day period and the additional
opportunity to cure shall also be extended by that period of time
during which repair services are not available as a direct result
of a strike; provided, however, that the manufacturer, its agent,
or its authorized dealer or lessor makes provision for the free
use of a vehicle of comparable year and size by any consumer or
lessee whose vehicle is out of service by reason of repair during
a strike. The burden shall be on the manufacturer to show that any
event claimed as a reason for an extension under the provisions
of this section was the direct cause for the failure of the manufacturer,
its agent or lessor, or its authorized dealer to cure any nonconformity
during the time of that event. Extensions for concurrent events
shall not be cumulative.
§ 31-5.2-6 Rights and remedies cumulative.
Nothing in this chapter shall be construed to limit the rights or
remedies which are otherwise available to a consumer or lessee under
§ 31-5.2-7 Informal dispute settlement procedures.
If a manufacturer has established an informal dispute settlement
procedure which complies in all respects with the provisions of
title 16, Code of Federal Regulations, part 703, as from time to
time amended, or which has been approved by the federal trade commission
or by the attorney general of this state, the provisions of §
31-5.2-3 concerning refunds or replacement shall not apply to any
consumer or lessee who has not first resorted to the procedure or
the procedure set forth in § 31-5.2-7.1. This section shall
not apply unless the manufacturer, its agents, or its authorized
dealer or lessor shall have provided the consumer or lessee with
clear and conspicuous written notice of the procedure at the time
of delivery of the motor vehicle. A decision resulting from such
an informal dispute settlement procedure shall be binding upon the
manufacturer if the consumer or lessee elects to accept the decision.
The manufacturer shall perform its obligations as set forth in said
decision within a reasonable period of time not to exceed thirty
(30) calendar days from the rendering of the decision. In no event
shall a consumer or lessee who has resorted to an informal dispute
settlement procedure be precluded from seeking the rights and/or
remedies provided by this chapter. Any applicable statute of limitation
including but not limited to that set forth in § 31-5.2-12
shall be tolled during the period from the initiation of a dispute
settlement procedure until thirty (30) days following the rendering
of a final decision in said process.
§ 31-5.2-7.1 Procedure. (a) In addition to
any settlement procedure provided for in § 31-5.2-7, the consumers'
council shall provide an independent arbitration procedure for the
settlement of disputes between consumers or lessees and manufacturers
concerning motor vehicles which do not conform to all applicable
express or implied warranties. The director of the consumers' council
shall establish one or more automobile dispute settlement panels
which shall consist of three (3) members appointed by the director,
only one of whom shall be directly involved in the manufacture,
distribution, sale, lease, or service of any automobile product.
Members shall be persons interested in consumer disputes, and shall
serve without compensation at the discretion of the director.
(b) An owner or lessee of any motor vehicle purchased or leased
which fails to conform to the applicable express or implied warranties
may either initiate a request for arbitration by the consumers'
council or take part in the settlement procedure set forth in §
31-5.2-7. The consumer or lessee shall set forth, on a complaint
form prescribed by the director, any information relevant to the
resolution of the dispute, and shall file the complaint with a nonrefundable
filing fee of twenty dollars ($20.00). The director shall decide
if the complaint is eligible under this chapter. Upon acceptance
of the complaint, the director shall notify the manufacturer of
the filing of a request for arbitration and shall obtain from the
manufacturer, in writing on a form prescribed by the director, any
information the manufacturer deems relevant to the resolution of
the dispute. The manufacturer shall return the form, along with
a non-refundable fifty dollar ($50.00) filing fee, within twenty
(20) days of receipt. The director shall then refer the matter to
a panel created pursuant to subsection (a) of this section.
(c) The panel shall investigate, gather, and organize all information
necessary for a fair and timely decision in each dispute. The director
may issue subpoenas on behalf of any arbitration panel to compel
the attendance of witnesses and the production of documents, papers,
and records relevant to the dispute.
(d) At all arbitration proceedings the parties may present oral
or written testimony, present witnesses and evidence relevant to
the dispute, cross examine witnesses, and be represented by counsel.
(e) The consumers' council may forward a copy of all written testimony,
including all documentary evidence, to an independent technical
expert, who shall review the material and be able to advise and
consult with, the arbitration panel. An expert shall sit as a non-voting
member of an arbitration panel whenever oral testimony is presented.
(f) The panel shall grant the relief specified in § 31-5.2-3 and
any other relief available under the applicable warranties or the
Magnuson-Moss Warranty Federal Trade Commission Improvement Act,
88 Stat. 2183 (1975), 15 U.S.C. 2301 et seq., to the consumer or
lessee if a reasonable number of attempts have been undertaken to
correct one or more nonconformities that substantially impair the
motor vehicle. The panel shall dismiss the dispute if the panel
finds, after considering all the evidence presented, that the consumer
or lessee is not entitled to relief under this chapter.
(g) The panel shall, as expeditiously as possible, but not later
than ninety (90) days from the date the director deems the dispute
eligible for arbitration, render a fair decision based on the information
gathered and disclose its findings and the reasons for the decision
to the parties involved. The consumer or lessee shall accept or
reject the decision within five (5) days of its filing.
(2) If the decision is favorable to the consumer or lessee and
that person accepts it, the manufacturer must, comply with the
terms of the decision within thirty (30) days after it has been
rendered. The consumers' council shall contact the consumer or
lessee, within ten (10) working days after the date for performance,
to determine whether performance has occurred.
(h) The director shall maintain the records of each dispute as
deemed necessary, including an index of disputes by brand name and
model. The director shall, at intervals of no more than six (6)
months, compile and maintain statistics indicating the record of
manufacturer compliance with arbitration decisions and the number
of refunds or replacements awarded. The summary is a public record.
(i) The consumers' council automobile dispute settlement procedure
shall be prominently posted in the place of business of each new
car dealer or lessor licensed by the department of transportation
to engage in the sale or lease of that manufacturer's new motor
vehicles. The display of this public notice shall be a condition
of licensure under the general laws. The director shall determine
the size, type face, form, and wording of the sign required by this
section, which shall include the telephone number and the address
to which requests for the consumers' council's arbitration services
may be sent.
(j) The director shall adopt regulations, in accordance with the
provisions of the general laws, to carry out the purposes of this
section. Written copies of the regulations and appropriate arbitration
hearing procedures shall be provided to any person upon request.
§ 31-5.2-8 Waiver of rights prohibited.
Any agreement entered into by a consumer or lessee for the
purchase or lease of a new motor vehicle which waives, limits, or
disclaims the rights set forth in this chapter shall be void as
contrary to public policy. These rights shall inure to a subsequent
transferee of the motor vehicle.
§ 31-5.2-9 Disclosure of nonconformity prior
to resale. No motor vehicle that is returned to the
manufacturer under the provisions of this chapter shall be resold
or re-leased in the state without clear and conspicuous written
disclosure to the prospective purchaser or lessee prior to resale
of the fact that it was so returned due to a nonconformity. The
attorney general shall prescribe the exact form and content of the
§ 31-5.2-10 Cause of action. An
aggrieved consumer or lessee may bring an action under the Rules
of Civil Procedure in the superior court to enforce the provisions
of this chapter.
§ 31-5.2-11 Attorney's fees. The
court hearing a complaint brought by a consumer or lessee aggrieved
by a violation of this chapter shall award reasonable attorney's
fees to a prevailing plaintiff.
§ 31-5.2-12 Commencement of action.
Any action brought pursuant to this chapter shall be commenced within
three (3) years of the date of original delivery of the motor vehicle
to the consumer or lessee or within two (2) years of the date on
which the mileage on the motor vehicle reached fifteen thousand
(15,000) miles, whichever is earlier.
§ 31-5.2-13 Deceptive trade practice.
A manufacturer's failure to comply with any of the provisions
of this chapter shall constitute a deceptive trade practice under
the terms of chapter 13.1 of title 6. All of the public and private
remedies provided for in chapter 13.1 of title 6 shall be available
to enforce the provisions of this chapter.