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Section 5001 - Definitions.
As used in this chapter:
(1). "Consumer" means the purchaser, other than for
purposes of resale, of an
automobile; a person to whom an automobile is transferred during the
duration of an express warranty applicable to the automobile; or any
other
person entitled by the terms of the warranty to enforce the
obligations of
the warranty.
(2). "Dealer" means a person actively engaged in the
business of buying, selling
or exchanging automobiles at retail and who has an established place
of
business.
(3). "Manufacturer" means a person engaged in the business
of manufacturing,
assembling or distributing automobiles, who will, under normal
business
conditions during the year, manufacture, assemble or distribute to
dealers at
least 10 new automobiles.
(4). "Manufacturer's express warranty" or
"warranty" means the written
warranty of the manufacturer of a new automobile of its condition
and
fitness for use, including any terms or conditions precedent to the
enforcement of obligations under that warranty.
(5) "Automobile" means any passenger motor vehicle, except
motorcycles,
which is leased or bought in Delaware or registered by the Division
of
Motor Vehicles in the Department of Public Safety except the living
facilities of motor homes.
(6). "Nonconformity" means a defect or condition which
substantially impairs
the use, value or safety of an automobile.
(7). "Lien" means a security interest in an automobile.
(8). "Lienholder" means a person with a security interest
in an automobile
pursuant to a lien.
Section 5002 - Duty to repair nonconforming automobiles.
If a new automobile does not conform to the manufacturer's express
warranty, and
the consumer reports the nonconformity to the manufacturer or its
agent or dealer during
the term of the warranty or during the period of 1 year following
the date of original
delivery of an automobile to the consumer, whichever is earlier, the
manufacturer shall
make, or arrange with its dealer or agent to make, within a
reasonable period of time, all
repairs necessary to conform the new automobile to the warranty,
notwithstanding that
the repairs or corrections are made after the expiration of the term
of the warranty or the
1-year period.
Section 5003 - Remedies upon failure to repair.
(a). If the manufacturer, its agent or its authorized dealer does
not conform the
automobile to any applicable express warranty by repairing or
correcting
any nonconformity after a reasonable number of attempts, the
manufacturer
shall either replace the automobile with a comparable new automobile
acceptable to the consumer or repurchase the automobile from the
consumer and refund to the consumer the full purchase, including all
credits and allowances for any trade-in vehicle; provided, however,
that the
consumer shall have the unqualified right to decline a replacement
automobile and to demand instead a repurchase.
(b). In instances in which an automobile is replaced by a
manufacturer under
this section, said manufacturer shall accept return of the
automobile and
reimburse the consumer for any incidental costs, including dealer
preparation fees, fees for transfer of registration, sales taxes or
other
charges or fees incurred by the consumer as a result of such
replacement. In
instances in which an automobile which was financed by the
manufacturer
or its subsidiary or agent is replaced under this section, said
manufacturer,
subsidiary or agent shall not require the consumer to enter into any
refinancing agreement for a replacement automobile which would
create
any financial obligations upon such consumer beyond those created by
the
original financing agreement.
(c). In instances in which a refund is tendered under this section,
the
manufacturer shall accept return of the automobile from the consumer
and
shall reimburse the consumer for related purchase costs, including
sales
taxes, registration fees and dealer preparation fees, less:
(1). A reasonable allowance for the consumer's use of the
automobile,
not to exceed the full purchase price of the automobile multiplied
by
a fraction which consists of the number of miles driven before the
consumer first reported the nonconformity to the manufacturer, its
agent or dealer divided by 100,000 miles; and
(2). A reasonable allowance for damage not attributable to normal
wear
and tear, but not to include damage resulting from a nonconformity.
(d). Refunds shall be made to the consumer, and lienholder, if any,
as their
interests may appear.
(e). No authorized dealer shall be held liable by the manufacturer
for any
refunds or automobile replacements in the absence of evidence
indicating
that dealership repairs have been carried out in a manner
inconsistent with
the manufacturer's instructions.
Section 5004 - Presumptions.
(a). It shall be presumed that a reasonable number of attempts have
been
undertaken to conform a new automobile to the manufacturer's express
warranty if, within the warranty term or during the period of 1 year
following the date of original delivery of the motor vehicle to a
consumer,
whichever is the earlier date:
(1). Substantially the same nonconformity has been subject to repair
or
correction 4 or more times by the manufacturer, its agents or its
dealers and the nonconformity continues to exist; or
(2). The automobile is out of service by reason of repair or
correction of
a nonconformity by the manufacturer, its agents or its dealers for a
cumulative total of more than 30 calendar days since the original
delivery of the motor vehicle to the consumer. This 30-day limit
shall commence with the first day on which the consumer presents
the automobile to the manufacturer, its agent or dealer for service
of
the nonconformity and a written document describing the
nonconformity is prepared by the manufacturer, its agent or dealer.
The 30-day limit shall be extended only if repairs cannot be
performed due to conditions beyond the control of the manufacturer,
its agents or its dealers, including war, invasion, strike, fire,
flood or
other natural disaster.
(b). The presumption provided in this section shall not apply
against a
manufacturer unless the manufacturer has received prior direct
written
notification from or on behalf of the consumer and has had an
opportunity
to repair or correct the nonconformity; provided, however, that if
the
manufacturer does not directly attempt or arrange with its dealer or
agent to
repair or correct the nonconformity, the manufacturer may not defend
a
claim by a consumer under this chapter on the ground that the agent
or
dealer failed to properly repair or correct the nonconformity or
that the
repairs or corrections made by the agent or dealer caused or
contributed to
the nonconformity.
Section 5005 - Costs and attorney's fees in breach of warranty
actions.
In any court action brought under this chapter by a consumer against
the
manufacturer of an automobile, or the manufacturer's agent or
authorized dealer, based
upon the alleged breach of an express warranty made in connection
with the sale of such
automobile, the court, in its discretion, may award the plaintiff's
costs and reasonable
attorney's fees or, if the court determines that the action is
brought in bad faith or is
frivolous in nature, may award reasonable attorney's fees to the
defendant.
Section 5006 - Affirmative defense to claim.
It shall be an affirmative defense to a claim under this chapter
that the alleged
nonconformity does not substantially impair the use, value or safety
of the new
automobile or that the nonconformity is the result of abuse or
neglect or of unauthorized
modifications or alterations of the new automobile by anyone other
than the
manufacturer, its agent or dealer.
Section 5007 - Informal dispute settlement procedure.
(a). If a manufacturer has established an informal settlement
procedure that has
a certificate of approval by the Division of Consumer Protection,
the
remedies provided by this chapter shall not be available to any
consumer
who has not first resorted to such procedure. In the event a
manufacturer's
informal dispute settlement procedure does not have a certificate of
approval from the Division of Consumer Protection, a consumer may
immediately and directly seek the remedies provided by this chapter.
(b). The Division of Consumer Protection shall annually evaluate the
operation
of informal dispute settlement procedures established by
manufacturers and
shall issue an annual certificate of approval to those manufacturers
whose
procedures comply with Title 16, Code of Federal Regulations, Part
703
and with subsections (c), (d) and (e) of this section. The Division
of
Consumer Protection shall suspend the certification of, or
decertify, any
informal dispute settlement which no longer complies with said
provisions.
(c). Any manufacturer who has established an informal settlement
procedure
shall file with the Division of Consumer Protection a copy of each
decision
of the informal dispute settlement procedure within 30 days after
the
decision is rendered.
(d). In order to obtain the certification of the Division of
Consumer Protection,
a manufacturer's informal dispute settlement procedure shall not
convene
any informal dispute settlement hearing or meeting outside the State
and
shall refrain from any practices which:
(1). Delay a decision in any dispute beyond 65 days after the date
on
which the consumer initially resorts to the informal dispute
settlement procedure by written notification that a dispute exists;
or
(2). Delay performance of remedies awarded in a settlement beyond 30
days after receipt of notice of the consumer's acceptance of the
decision; provided, however, that such time limits shall not include
periods of time when the consumer or the consumer's car is
unavailable for the remedies specified in the settlement; or
(3). Require the consumer to make the automobile available more than
once for inspection by a manufacturer's representative or more than
once for repair of the same nonconformity; or
(4). Fail to consider in decisions any remedies provided by this
chapter,
such remedies to include:
(1) Repair, replacement and refund;
(2) Reimbursement for related purchase costs; or
(5). Require the consumer to take any action or assume any
obligation
not specifically authorized under the provisions of Title 16, Code
of
Federal Regulations, Part 703.
(e). A manufacturer desiring annual certification of an informal
dispute
settlement procedure shall make application to the Division of
Consumer
Protection on forms developed by, and shall provide such information
as
required by, the Division of Consumer Protection.
Section 5008 - Remedies cumulative.
Nothing in this chapter shall in any way limit the rights or
remedies available to a
consumer under Subtitle I of this title.
Section 5009 - Enforcement.
In addition to any remedies the consumer may have at law or in
equity, a violation
of this chapter shall be an unlawful practice as defined in Section
2513 of this title. The
Division of Consumer Protection shall promulgate rules and
regulations in order to
implement the purposes of this chapter. unauthorized work.
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These pamphlets are for general information purposes only. In order
to receive a free copy or if you have a consumer concern, call the
Attorney General's Consumer Protection Unit.
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