16 TAC §§107.1-107.11
The Motor Vehicle Board of the Texas Department of Transportation
proposes amendments to §§107.1-107.11, Warranty Performance Obligations.
The Board also proposes the repeal of §107.12 and adoption of amendments
incorporating the substance of §107.12 into §107.7. The sections
set guidelines for filing a lemon law or warranty performance complaint and
for holding hearings on these matters.
The Appropriations Act of 1997, House Bill 1, Article IX, §167 requires
that each state agency review and consider readoption of each rule adopted
by that agency pursuant to the Government Code, Chapter 2001 (Administrative
Procedure Act). Such reviews shall include an assessment by the agency as
to whether the reason for adopting or readopting the rule continues to exist.
The Board conducted a review of Title 16, Chapter 107, relating to Warranty
Performance Obligations, at its June 10, 1999 meeting. As a result of its
review, the Board proposes these changes to Chapter 107.
General changes to rule language.
The Motor Vehicle Commission was renamed the Motor Vehicle Board in 1992.
The title of "executive director" was also changed to "director". The amendments
change all references from "Commission" to "Board" and "executive director"
to "director" throughout the chapter. Changes are also proposed throughout
the chapter to make it clear that the procedures in the chapter apply to complaints
filed under the lemon law for repurchase or replacement of a vehicle (§6.07
of the Motor Vehicle Commission Code) (Code) and to complaints filed for repair
of a vehicle under general warranty agreements (§3.08(i) of the Code).
Sections pertinent only to §6.07 or §3.08(i) are now clearly identified.
Other proposals correct grammar, add acronyms to avoid repetition, and remove
surplusage and gender-specific references.
Other changes specific to each section:
The>
to complaints filed under §3.08(i) because general warranty complaints
may be filed regarding used vehicles if they are still under warranty. Proposed
changes to §107.2 conform the section to the current practice of accepting
complaints even if they do not initially include necessary information. The
proposal adds converters and distributors as potential parties to a complaint,
as permitted by the Code. Suggested amendments also delete an obsolete filing
fee amount, add provisions clarifying no filing fee is due for complaints
filed under §3.08(i) and indicate failure to remit a fee under §6.07
may result in dismissal of the complaint.
Proposed amendments to §107.3 clarify procedure references and Code
provisions. Proposed changes to §§107.4 and §107.5 add converters
as entities who will be given notice and an opportunity to settle if a complaint
is filed and give the Board the option of requiring a response from dealers.
Section 107.6, Hearings, contains a proposal that deletes the specific
requirement that dealers be given notice of hearing, since all parties receive
notice of hearing. Other proposed changes make the section apply to warranty
performance complaints as well as lemon law complaints, increase the amount
of time to notify the Board of attorney appearances and clarify that evidence
presented is subject to admission by the hearing examiner so consumers will
understand that the right is not absolute. Additional changes delete the requirement
that an expert be independent to conform to current practice, and no longer
require the presence of the expert at the hearing.
Proposed changes to §§107.7(4) and 107.7(6) conform the sections
to Government Code amendments effective September 1, 1999. Other proposed
changes to §107.7 allow hearings under both the lemon law and general
warranty complaints and add language conforming the section to statutory time
limit and appeal provisions contained in the Government Code and the Motor
Vehicle Commission Code. Proposed amendments to §107.8 state that the
section only applies to lemon law (§6.07) complaints unless otherwise
indicated, and conforms the overall application of the section relating to
serious safety hazards to the language in the statute. Additional proposals
add the inventory tax as a reimbursable item and include converters and distributors
as entities who may have obligations under the section, as set out in the
statute. The proposed amendment to §107.8(9) conforms the section to
the current practice of allowing reconsideration of the repurchase price for
damage to the vehicle after the date of the hearing, instead of the date of
delivery to the owner, since damage between the date of delivery and the date
of hearing is considered at the hearing. Proposed changes to §107.8(10)
make it clear that the Board will issue a written order in both lemon law
and warranty performance complaints when a hearing is held.
Proposed amendments to §107.9 require that incidental expenses be
reasonable and verified and make it clear that incidental expenses are not
limited to the ones listed in the section. Other changes set out loss or damage
to personal property, service contracts, attorney fees if the Respondent is
represented by an attorney, and after-market items as incidental expenses
that may be reimbursable. A new provision provides guidance to the hearing
examiner in considering whether items or accessories should be reimbursed.
Proposed changes to §107.10 extends the disclosure requirement to
all vehicles reacquired by a manufacturer, converter or distributor. The proposed
amendments also delete the disclosure statement at Attachment 1 and allow
the Board or director to prescribe the manner and form for disclosing that
a vehicle has been reacquired. Additional changes clarify that manufacturers
must provide information on vehicles transferred from out-of-state and require
dealers to complete and return the disclosure statement within 60 days of
the sale of a reacquired vehicle. Other proposed changes remove non-original
equipment manufacturer items or accessories from manufacturer warranty requirements
and clarify that the Board, through its director, may provide or approve the
warranty form.
The proposed amendment to §107.11 clarifies that the director shall
provide the Board with information about complaints resolved before and after
hearings are set, rather than formal and informal resolutions of complaints.
Brett Bray, Director, Motor Vehicle Division, has determined that for the
first five-year period the sections are in effect, there will be no fiscal
implications for state or local government as a result of enforcing or administering
the sections.
Mr. Bray has also determined that for each year of the first five years
the sections are in effect, the anticipated public benefit of the amendments
to Chapter 107 will be to provide a clearer understanding of the hearings
process for lemon law and warranty performance complaints and conserve the
time and resources of the agency and entities appearing before it. The amendments
will also create better notification to consumers concerning reacquired vehicles.
There will be no effect on small businesses. Anticipated economic cost to
persons who are required to comply with the sections as proposed is indeterminate,
since manufacturers, converters and distributors may have to pay more to reimburse
incidental expenses on a case-by-case basis and will incur additional minimal
expense in meeting disclosure requirements for all reacquired vehicles instead
of only those vehicles reacquired pursuant to final order. Mr. Bray has also
certified that there will be no impact on local economies or overall employment
as a result of enforcing or administering the sections.
Comments (15 copies) may be submitted to Brett Bray, Director, Motor Vehicle
Division, Texas Department of Transportation, P. O. Box 2293, Austin, Texas
78768, (512) 416-4910. The Motor Vehicle Board will consider adoption of the
proposals at its meeting on September 9, 1999. The deadline for receipt of
comments on the proposed amendments is 5:00 p.m. on August 23, 1999.
The amendments are proposed under the Texas Motor Vehicle Commission
Code, §3.06, which provides the Board with authority to adopt rules as
necessary and convenient to effectuate the provisions of the Act and to govern
practice and procedure before the agency.
Motor Vehicle Commission Code §§3.08(i) and 6.07 are affected
by the proposed amendments.
§107.1.Objective.
It is the objective of these sections to implement the intent of the
legislature as declared in the Texas Motor Vehicle Commission Code
(TMVCC)
§3.06 and §6.07(e), by prescribing rules to provide a simplified
and fair procedure for the enforcement and implementation of the Texas lemon
law
(TMVCC, §6.07)
and consumer complaints covered by general
warranty agreements
(TMVCC, §3.08(i))
including the processing
of complaints, the conduct of hearings, and the disposition of complaints
filed by owners of [
new
] motor vehicles seeking relief under these
provisions of the Code.
§107.2.Filing of Complaints.
(a)
Complaints for relief under the lemon law must be in writing
and filed with the
Board
[
commission
] at its office
in Austin. Complaints may be in letter form or any other written format or
may be submitted on complaint forms provided by the
Board
[
commission
].
(b)
Complaints should state sufficient facts to enable the
Board
[
commission
] and the party complained against to know
the nature of the complaint and the specific problems or circumstances which
form the basis of the claim for relief under the lemon law.
(c)
Complaints
should
[
must
] provide
the following information:
(1)
name, address, and phone number of vehicle owner;
(2)
identification of vehicle by make, model, and year,
and manufacturer's vehicle identification number;
(3)
type of warranty coverage;
(4)
name and address of dealer, or other person, from
whom vehicle was purchased or leased, including the name and address of the
current lessor, if applicable;
(5)
date of delivery of vehicle to original owner; and
in the case of a demonstrator, the date the vehicle was placed into demonstrator
service;
(6)
vehicle mileage at time vehicle was purchased or leased,
mileage when problems with vehicle were first reported, name of dealer or
manufacturer's
, converter's,
or distributor's agent to whom problems
were first reported, and current mileage;
(7)
identification of existing problems and brief description
of history of problems and repairs on vehicle, including date and mileage
of each repair, with copies of repair orders where possible;
(8)
date on which written notification of complaint was
given to the vehicle manufacturer
, converter,
or distributor, and
if
the
vehicle has been inspected by manufacturer,
converter,
or distributor,
the date and results of such inspection;
(9)
any other information which the complainant believes
to be pertinent to the complaint.
(d)
The
Board's
[
commission's
] staff
will provide information concerning the complaint procedure and complaint
forms to any person requesting information or assistance.
(e)
The
Texas Motor Vehicle Commission Code (TMVCC) §6.07
[
lemon law
] complaint filing fee [
of $75
] should
be remitted with the complaint by check or money order [
payable to the
Texas Motor Vehicle Commission.
]
No filing fee is required for
a TMVCC §3.08(i) complaint.
The filing fee is nonrefundable, but
a complainant who prevails in a [
lemon law
] case is entitled to
reimbursement of the amount of the filing fee. Failure to remit the filing
fee with the complaint will result in delaying the commencement of the 150-day
requirement provided in §107.6(11) of this title (relating to Hearings)
and may result in dismissal of the complaint
.
§107.3.Review of Complaints.
All complaints will be reviewed promptly by the
Board's
[
commission's
] staff to determine whether they satisfy the requirements
of the
Texas Motor Vehicle Commission Code §§3.08(i) or 6.07
[
lemon law
].
(1)
If it cannot be determined whether a complaint satisfies
the requirements of
§§3.08(i) or 6.07,
[
the lemon
law,
] the complainant will be contacted for additional information.
(2)
If it is determined that the complaint does not meet
the requirements of
§§3.08(i) or 6.07,
[
the lemon
law,
] the complainant will be notified of this fact.
(3)
If it is determined that the complaint does meet the
requirements of
§§3.08(i) or 6.07,
[
the lemon law,
] the complaint will be processed in accordance with the [
following
] procedures [
in §§107.4-107.9 of this title (relating
to Notification of Manufacturer and Distributor; Mediation, Settlement; Hearings;
Hearing Officer's Report; Decisions; and Compliance)
]
set forth
in this chapter.
(4)
For purposes of §6.07(h), the commencement of
a proceeding means the filing of a complaint with the
Board,
[
commission,
] and the date of filing is determined by the date of receipt
by the
Board
[
commission
].
§107.4.Notification to Manufacturer , Converter, or [ and ] Distributor.
Upon receipt of a complaint for relief under the
Texas Motor Vehicle
Commission Code §§3.08(i) or 6.07,
[
the lemon law,
]
notification thereof, with a copy of the complaint, will be given to the appropriate
manufacturer,
converter,
or distributor [
against whom the
complaint is made
], and a response to the complaint will be requested.
A copy of the complaint and notification thereof will also be provided to
the selling dealer and any other dealers that have been involved with the
complaint and a response may be requested.
[
Notification of the
complaint and a request for a response will also be given to the selling dealer
and any other dealer that has been involved with the complaint.
]
§107.5.Mediation; Settlement.
If, from a review of the complaint and the responses received from
the manufacturer,
converter,
distributor, or dealer, it appears
to the
Board
[
commission
] staff that a settlement or
resolution of the complaint may be possible without the necessity for a hearing,
the
Board
[
commission
] staff will [
contact all
parties and
] attempt to effect a settlement or resolution of the complaint
[
in a manner satisfactory to the parties
].
§107.6.Hearings.
Complaints which satisfy the jurisdictional requirements of the Texas
Motor Vehicle Commission Code, §3.08(i) and §6.07, will be set for
hearing and notification of the date, time, and place
of
the hearing
will be given to all parties by certified mail.
(1)
Where possible, and subject to the availability of
Board
[
commission
] personnel and funds, hearings will be
held in the city where the complainant resides or at a location reasonably
convenient to the complainant.
(2)
Hearings will be scheduled at the earliest date possible,
provided that ten days prior notice, or as otherwise provided by law, must
be given to all parties. [
A notice of hearing will also be provided to
a dealer identified as a party who will be requested to have a representative
appear at the hearing.
]
(3)
Hearings will be conducted by
Board
[
commission
] staff hearing officers or by independent hearing officers
designated by the [
executive
] director of the
Board
[
commission
].
(4)
Hearings will be informal[
in nature
],
it being the intent of
this section
[
the lemon law
]
to provide a procedure and forum which does not necessitate the services of
attorneys and which does not involve strict legal formalities applicable to
trials in county or district court.
(5)
The parties have the right to be represented by attorneys
at a hearing, although attorneys are not necessary[
in hearings on lemon
law complaints
]. Any party who intends to be represented by an attorney
at a hearing must notify the
Board
[
commission
] and
the other party at least five
business
days prior to the hearing
and failure to do so will constitute grounds for postponement of the hearing
if requested by the other party.
(6)
The parties have the right to present their cases
in full, including testimony from witnesses; documentary evidence such as
repair orders, warranty documents, vehicle sales contract, etc.
, subject
to the hearing officer's rulings.
(7)
Each party will be subject to being questioned by
the other party, within limits to be governed by the hearing officer.
(8)
The complainant will be required to bring the vehicle
in question to the hearing for the purpose of having the vehicle inspected
and test driven, unless otherwise ordered by the hearing officer upon a showing
of good cause as to why the complainant should not be required to bring the
vehicle to the hearing.
(9)
The
Board
[
commission
] may have
the vehicle in question inspected prior to the hearing by an [
independent
] expert, where the opinion of such expert will be of assistance to
the hearing officer and the
Board
[
commission
] in arriving
at a decision. Any such inspection shall be made upon prior notice to all
parties who shall have the right to be present at such inspection, and copies
of any findings or report resulting from such inspection will be provided
to all parties prior to
, or at,
the hearing. [
Any such expert
will be present at the hearing to present his report on the inspection of
the vehicle and to respond to questions by the parties.
]
(10)
All hearings will be recorded on tape by the hearing
officer. Copies of the tape recordings of a hearing will be provided to any
party upon request and upon payment
as provided by law.
[
for the cost of the tapes.
]
(11)
All hearings will be conducted expeditiously. However,
if a
Board hearing
[
commission hearings
] officer has
not issued a [
proposal for
] decision within 150 days after the
Texas Motor Vehicle Commission Code §6.07
complaint and filing-fee
were received,
Board
[
commission
] staff shall notify
the parties by certified mail that complainant has a right to file a civil
action in state district court to pursue [
his
] rights under
§6.07
[
the lemon law
]. The 150-day period shall be extended
upon request of the complainant or if a delay in the proceeding is caused
by the complainant. The notice will inform
the
complainant of
the
[
his
] right
to elect
to continue
the
[
his
] lemon law complaint through the
Board.
[
commission if he chooses.
]
§107.7.Contested Cases: Decisions and Final Orders.
To expedite the resolution of
Texas Motor Vehicle Commission Code
§§3.08(i) and 6.07
[
lemon law
] cases, the [
executive
] director is authorized to
conduct hearings and issue
final orders for the enforcement of these sections, including the delegation
of this duty to hearing officers.
[
delegate final decision-making
authority to hearings officers.
] Review of the
hearing
[
hearings
] officers' decisions and final orders shall be according to
the procedures set forth as follows.
(1)
A
hearing
[
hearings
] officer will
prepare a written decision and final order as soon as possible but not later
than 60 days after the hearing is closed
, or as otherwise provided by
law.
The decision and order will include the
hearing
[
hearings
] officer's findings of fact and conclusions of law.
(2)
The decision and final order shall be sent to all
parties of record by certified mail.
(3)
The decision and order is final and binding on the
parties, in the absence of a timely motion for rehearing, on the expiration
of the period for filing a motion for rehearing.
(4)
A party who disagrees with the decision and final
order may file a motion for rehearing within 20 days from the date of the
notification
[
mailing
] of the final order. A motion for rehearing
must include all the specific reasons, exceptions, or grounds that are asserted
by a party as the basis of the request for a rehearing. It shall recite, if
applicable, the specific findings of fact, conclusions of law, or any other
portions of the decision to which the party objects. Replies to a motion for
rehearing must be filed with the agency within 30 days after the date of the
notification
[
mailing
] of the final order.
A party or
attorney of record notified by mail is presumed to have been notified on the
third day after the date on which the order was mailed.
(5)
A motion for rehearing may be directed either to the
[
executive
] director or to the
Board
[
commission
], as a body, at the election of the party filing the motion. If the
party filing the motion does not include a specific request for a rehearing
by the members of the
Board
[
commission
], the motion
shall be deemed to be a request for a rehearing by the [
executive
]
director.
(6)
The [
executive
] director or the
Board
[
commission
], as appropriate, must act on the motion within
45 days after the
date of notification
[
mailing
] of
the final order,
or as otherwise provided by law,
or it is overruled
by operation of law. The [
executive
] director or the
Board
[
commission
], as appropriate, may, by written order, extend
the period for filing, replying to, and taking action on a motion for rehearing,
not to exceed 90 days after the date of
notification of
[
mailing
] the final order. In the event of an extension of time, the
motion for rehearing is overruled by operation of law on the date fixed by
the written order of extension, or in the absence of a fixed date, 90 days
after the
date of notification
[
mailing
] of the final
order.
(7)
If the [
executive
] director or the
Board
[
commission
] grants a motion for rehearing, the parties
will be notified by first class mail. A rehearing before the [
executive
] director will be scheduled as promptly as possible. A rehearing before
the
Board
[
commission
] will be scheduled at the earliest
possible meeting of the
Board
[
commission
]. After rehearing,
the [
executive
] director or
Board
[
commission
]
shall issue a final order
and
any additional findings of fact or
conclusions of law necessary to support the decision
or order
.
The [
executive
] director or the
Board
[
commission
] may also issue an order granting
the
relief requested in
a motion for rehearing or replies thereto without the need for a rehearing.
If a motion for rehearing and the relief requested is denied, an order so
stating will be issued.
(8)
A
party
[
person
] who has exhausted
all administrative remedies, and who is aggrieved by a final decision in a
contested case from which appeal may be taken is entitled to judicial review
pursuant to Section 7.01 of the Texas Motor Vehicle Commission Code,
under the substantial evidence rule. The petition shall be filed in a district
court of Travis County
or in the Court of Appeals for the Third Court
of Appeals District
within 30 days after the decision or order of the
agency is final and appealable. A copy of the petition must be served on the
agency and any other parties of record. After service of the petition on the
agency and within the time permitted for filing an answer, the agency shall
transmit to the reviewing court the original or a certified copy of the entire
record of the proceeding. If the court orders new evidence to be presented
to the agency, the agency may modify its findings and decision or order by
reason of the new evidence, and shall transmit the additional record to the
court.
§107.8.Decisions.
Unless otherwise indicated, this section applies to decisions
made pursuant to Texas Motor Vehicle Commission Code §6.07.
[
Any decisions by the Board and recommended decision by a hearing officer
]
Decisions
shall give effect to the presumptions provided in the Texas
Motor Vehicle Commission Code, §6.07(d), where applicable.
(1)
If it is found that the manufacturer, distributor, or converter
is not able to conform the vehicle to an applicable express warranty by repairing
or correcting a defect in the complainant's vehicle
which creates a serious
safety hazard or
substantially impairs the use
or
market
value[
, or safety
] of the vehicle after a reasonable number of
attempts, and that the affirmative defenses provided under the Texas Motor
Vehicle Commission Code, §6.07(c), are not applicable, the
Board
[
commission
] shall order the manufacturer, distributor,
or converter to replace the vehicle with a comparable vehicle, or accept the
return of the vehicle from the owner and refund to the owner the full purchase
price of the vehicle, less a reasonable allowance for the owner's use of the
vehicle.
[
(A)
In a complaint involving a
defect or condition that creates a serious safety hazard in the vehicle, an
owner shall be deemed to have given the manufacturer, distributor, or converter
a reasonable number of attempts to repair the vehicle if he reported and allowed
an opportunity to repair the defect or condition at least once during the
period of 12 months or 12,000 miles, whichever occurs first, immediately following
the date of delivery and at least once more in the period of 12 months or
12,000 miles, whichever occurs first, following the first repair attempt.]
[
(B)
A defect or condition that
creates a serious safety hazard is one that results in a lifethreatening malfunction
or nonconformity that substantially impedes a person's ability to control
or operate a motor vehicle for ordinary use or intended purposes or that creates
a substantial risk of fire or explosion.]
(2)
In any decision in favor of the complainant,
the
Board
[
commission
] will accommodate the complainant's
request with respect to replacement or repurchase of the vehicle, to the extent
possible.
(3)
Where a refund of the purchase price of a vehicle
is ordered, the purchase price shall be the amount of the total purchase price
of the vehicle, and shall include the amount of the sales taxes and title,
registration,
inventory tax,
and documentary fees, but shall not
include the amount of any interest or finance charge or insurance premiums.
The award to the vehicle owner shall include reimbursement for the amount
of the lemon law complaint filing fee paid by or on behalf of the vehicle
owner. The refund shall be made payable to the vehicle owner and the lienholder,
if any, as their interests require.
(4)
Except in cases where clear and convincing evidence
shows that the vehicle has a longer or shorter expected useful life than 100,000
miles, the reasonable allowance for the owner's use of the vehicle shall be
that amount obtained by adding the following:
(A)
the product obtained by multiplying the purchase price
of the vehicle, as defined in paragraph (3) of this section, by a fraction
having as its denominator 100,000 and having as its numerator the number of
miles that the vehicle traveled from the time of delivery to the owner to
the first report of the defect or condition forming the basis of the repurchase
order; and
(B)
50% of the product obtained by multiplying the purchase
price by a fraction having as its denominator 100,000 and having as its numerator
the number of miles that the vehicle traveled after the first report of the
defect or condition forming the basis of the repurchase order. The number
of miles during the period covered in this paragraph shall be determined from
the date of the first report of the defect or condition forming the basis
of the repurchase order through the date of the TMVC hearing.
(5)
Except in cases where clear and convincing evidence
shows that the vehicle has a longer or shorter expected useful life than 120
months, the reasonable allowance for the owner's use of the towable recreational
vehicle shall be the greater of 10% of the purchase price, as defined in paragraph
(3) of this section, or that amount obtained by adding the following:
(A)
The product obtained by multiplying the purchase price
of the towable recreational vehicle, as defined in paragraph (3) of this section,
by a fraction having as its denominator 120 months, except the denominator
shall be 60 months, if the towable recreational vehicle is occupied on a full
time basis, and having as its numerator the number of months from the time
of delivery to the owner to the first report of the defect or condition forming
the basis of the repurchase order; and
(B)
50% of the product obtained by multiplying the purchase
price by a fraction having as its denominator 120 months, except the denominator
shall be 60 months, if the towable recreational vehicle is occupied on a full
time basis, and having as its numerator the number of months of ownership
after the first report of the defect or condition forming the basis of the
repurchase order. The number of months during the period covered in this paragraph
shall be determined from the date of the first report of the defect or condition
forming the basis of the repurchase order through the date of the Board hearing.
(6)
Except in cases involving unusual and extenuating
circumstances, supported by a preponderance of the evidence, where refund
of the purchase price of a leased vehicle is ordered, the purchase price shall
be allocated and paid to the lessee and the lessor, respectively as follows.
(A)
The lessee shall receive the total of:
(i)
all lease payments previously paid by him to the lessor
under the terms of the lease; and
(ii)
all sums previously paid by him to the lessor in connection
with the entering into the lease agreement, including, but not limited to,
any capitalized cost reduction, down payment, trade-in, or similar cost, plus
sales tax, license and registration fees, and other documentary fees, if applicable.
(B)
The lessor shall receive the total of:
(i)
the actual price paid by the lessor for the vehicle, including
tax, title, license, and documentary fees, if paid by lessor, and as evidenced
in a bill of sale, bank draft demand, tax collector's receipt, or similar
instrument; plus
(ii)
an additional 5.0% of such purchase price plus any amount
or fee, if any, paid by lessor to secure the lease or interest in the lease;
(iii)
provided, however, that a credit, reflecting all of the
payments made by the lessee, shall be deducted from the actual purchase price
which the manufacturer
, converter, or distributor
is required to
pay the lessor, as specified in causes (i) and (ii) of this subparagraph.
(C)
When the
Board
[
commission
] orders
a manufacturer
, converter, or distributor
to refund the purchase
price in a lease vehicle transaction, the vehicle shall be returned to the
manufacturer
, converter or distributor
with clear title upon payment
of the sums indicated in subparagraphs (A) and (B) of this paragraph. The
lessor shall transfer title of the vehicle to the manufacturer,
converter,
or distributor,
as necessary in order to effectuate the lessee's rights
under this rule. In addition, the lease shall be terminated without any penalty
to the lessee.
(D)
Refunds shall be made to the lessee, lessor, and any lienholders
as their interest may appear. The refund to the lessee under subparagraph
(A) of this paragraph shall be reduced by a reasonable allowance for the lessee's
use of the vehicle. A reasonable allowance for use shall be computed according
to the formula in paragraph (4) or (5) of this section, using the amount in
subparagraph (B) (i) of this paragraph as the applicable purchase price.
(7)
In any award in favor of a complainant, the [
executive
] director may require the dealer involved to reimburse the
complainant, manufacturer, [
distributor, or
]converter
, or
distributor,
for the cost of any items of options added to the vehicle
but only to the extent that one or more of such items or options contributed
to the defect that served as the basis for the order or repurchase or replacement.
In no event shall this paragraph be interpreted to mean that a manufacturer,
[
distributor, or
]converter
, or distributor,
will be
required to repurchase a vehicle due to a defect or condition that was solely
caused by a dealer add-on item or option.
(8)
If it is found by the
Board
[
commission
] that a complainant's vehicle does not qualify for replacement or repurchase,
then the
Board
[
commission
] shall enter an order dismissing
the complaint insofar as relief under the
Texas Motor Vehicle Commission
Code §6.07(c)
[
lemon law
] is concerned. However, the
Board
[
commission
] may enter an order in any proceeding,
where appropriate, requiring repair work to be performed or other action taken
to obtain compliance with the manufacturer's, [
distributor, or
]
converter's
, or distributor's,
warranty obligations.
(9)
If the vehicle is substantially damaged or there is
an adverse change in its condition, beyond ordinary wear and tear, from the
date of
the hearing
[
delivery to the owner
] to the date
of repurchase, and the parties are unable to agree on an amount of an allowance
for such damage or condition, either party shall have the right to request
reconsideration by the
Board
[
commission
] of the repurchase
price contained in the final order.
(10)
The
Board
[
commission
] will
issue a written order in each
Texas Motor Vehicle Commission Code §§3.08(i)
or 6.07
case in which a hearing is held and a copy of the order will
be sent to all parties.
§107.9.Incidental Expenses.
(a)
When a refund of the purchase price of a vehicle is ordered,
the complainant shall be reimbursed for certain incidental expenses incurred
by the complainant from loss of use of the motor vehicle because of the defect
or nonconformity which is the basis of the complaint. The expenses must be
reasonable and verified
[
verifiable
] through receipts or
similar written documents. Reimbursable incidental expenses include
but are not limited to the following costs
:
(1)
[
reasonable cost of
] alternate transportation;
(2)
[
charges for
] towing;
(3)
[
costs of
] telephone calls or mail charges
directly attributable to contacting the manufacturer, distributor, converter,
or dealer regarding the vehicle;
(4)
[
reasonable costs of
] meals and lodging
necessitated by the vehicle's failure during [
out-oftown
]
out - of - town
trips;
(5)
loss or damage to personal property;
(6)
service contracts;
(7)
attorney fees if Respondent is represented
by counsel; and
(8)
items or accessories added to the
vehicle at or after purchase.
(b)
[
Only reasonable incidental expenses shall be reimbursed
to a complainant.
] Incidental expenses shall be included in the final
repurchase price required to be paid by a manufacturer, [
distributor,
or
] converter
, or distributor
to a prevailing complainant
or in the case of a vehicle replacement, shall be tendered to the complainant
at the time of replacement.
(c)
In regards to the cost of items or accessories
presented under subsection (a)(8) of this section, the hearing officer shall
consider the permanent nature of items or accessories and the value they add
to the vehicle.
§107.10.Compliance with Order Granting Relief .
Compliance with the Board's order will be monitored by the Board.
(1)
A complainant is not bound by the
Board's
[
commission's
] decision and order and may either accept or reject the
decision.
(2)
If a complainant does not accept the
Board's
[
commission's
] final decision, the proceeding before the
Board
[
commission
] will be deemed concluded and the complaint
file closed.
(3)
If the complainant accepts the
Board's
[
commission's
] decision, then the manufacturer, [
distributor,
or
] converter
, or distributor
and the dealer to the extent
of the dealer's responsibility, if any, shall immediately take such action
as is necessary to implement the
Board's
[
commission's
]
decision and order.
(4)
If a manufacturer, converter, or distributor
replaces or repurchases a vehicle pursuant to a Board order, reacquires a
vehicle to settle a Texas Motor Vehicle Commission Code §§3.08(i)
or 6.07 complaint, or brings a vehicle into the state of Texas which has been
reacquired under the lemon law of another jurisdiction,
[
If complainant's
vehicle is replaced or repurchased pursuant to a Board order,
] the manufacturer,
[
distributor, or
] converter
, or distributor
shall, prior
to resale of such vehicle, issue a disclosure statement [
in the format
of Attachment 1 or
] on a form
provided by or
approved by
the Board
through its director
. In addition, the manufacturer,
[
distributor, or
] converter
, or distributor
repurchasing
or replacing the vehicle shall affix a disclosure label provided by or approved
by the Board through its director on an approved location in or on the vehicle.
Both the disclosure statement and the disclosure label shall accompany the
vehicle through the first retail purchase[
after the Board order
].
Neither the manufacturer, [
distributor, or
] converter
, or
distributor
nor any person holding a license or general distinguishing
number issued by the Board under the Code or Chapter 503, Transportation Code,
shall remove or cause the removal of the disclosure label until delivery of
the vehicle to the first retail purchaser. A manufacturer, [
distributor,
or
] converter
, or distributor
shall provide the Board, in
writing, the name, address and telephone number of
any
[
the
] transferee
, regardless of residence,
to whom the manufacturer,
distributor or converter, as the case may be, transfers the vehicle within
60 days of each transfer.
The selling dealer shall return the completed
disclosure statement to the Board within 60 days of the retail sale of a reacquired
vehicle.
Any manufacturer, [
distributor, or
] converter
, or distributor
or holder of a general distinguishing number who violates
this section is liable for a civil penalty or other sanctions prescribed by
the Code. In addition, the manufacturer, [
distributor, or
] converter
, or distributor
must repair the defect or condition in the vehicle
that resulted
in the vehicle being reacquired
[
in the repurchase
or replacement
] and issue, at a minimum, a basic warranty (12 months/12,000
mile, whichever comes first)
, except for non-original equipment manufacturer
items or accessories,
on a form provided by or approved by the Board
through its director,
which warranty shall be provided to the first
retail purchaser of the vehicle [
following the Board order
].
[
Figure: 16 TAC §107.10(4)
]
[
(5)
If a manufacturer, distributor,
or converter brings a vehicle into this state, which has been reacquired under
the lemon law of another jurisdiction, the manufacturer, distributor, or converter
shall, prior to the first retail sale, issue a disclosure statement on a form
provided by or approved by the Board. In addition, the manufacturer, distributor,
or converter repurchasing or replacing the vehicle shall affix a disclosure
label provided by or approved by the Board through its director on an approved
location in or on the vehicle. Both the disclosure statement and the disclosure
label shall accompany the vehicle through the first retail purchase. Neither
the manufacturer, distributor, converter nor any person holding a license
or general distinguishing number issued by the Board under the Code or Chapter
503, Transportation Code, shall remove or cause the removal of the disclosure
label until delivery to the first retail purchaser. Any manufacturer, distributor,
converter, or holder of a general distinguishing number who violates this
section is liable for a civil penalty or other sanction prescribed by the
Code.]
(5)
[
(6)
] In the event of any conflict
between this rule and the terms contained in a cease and desist order, the
terms of the cease and desist order shall prevail.
(6)
[
(7)
] The failure of any manufacturer,
[
distributor,
] converter
, distributor
or dealer to comply
with a decision and order of the Board within the time period prescribed in
the order may subject the manufacturer, [
distributor, or
] converter
, or distributor,
or dealer to formal action by the Board and the assessment
of civil penalties or other sanctions prescribed by the Texas Motor Vehicle
Commission Code for the failure to comply with an order of the Board.
§107.11.Reports to Board. [ Commission. ]
The [
executive
] director shall inform the
Board
[
commission
] concerning the administration and enforcement of the
lemon law.
The director
[
He
] shall provide monthly reports
to the
Board
[
commission
] which include data about the
number of complaints received, number of complaints resolved
before a
hearing is set and after a hearing is set,
[
informally and formally,
] pursuant to written orders, number of vehicles ordered repurchased,
and any other information that may be requested by the
Board
[
commission
].
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on July
9, 1999.
TRD-9904094
Brett Bray
Division Director
Texas Motor Vehicle Board
Proposed date of adoption: September 9, 1999
For further information, please call: (512) 416-4899
16 TAC §107.12
(Editor's note: The text of the following section proposed for
repeal will not be published. The section may be examined in the offices of
the Texas Motor Vehicle Board or in the Texas Register office, Room 245, James
Earl Rudder Building, 1019 Brazos Street, Austin.)
The Motor Vehicle Board of the Texas Department
of Transportation proposes the repeal of §107.12, Contested Cases under
General Warranty Provisions: Decisions and Final Orders.
The Appropriations Act of 1997, House Bill 1, Article IX, §167 requires
that each state agency review and consider readoption of each rule adopted
by that agency pursuant to the Government Code, Chapter 2001 (Administrative
Procedure Act). Such reviews shall include an assessment by the agency as
to whether the reason for adopting or readopting the rule continues to exist.
The Board conducted a review of Title 16, Chapter 107, relating to Warranty
Performance Obligations, at its June 10, 1999 meeting.
As a result of its review, the Board determined that §107.12, Contested
Cases under General Warranty Provisions: Decisions and Final Orders, is unnecessary,
since proposed amendments to §107.7 incorporate the authority contained
in §107.12. Section 107.12 states that the director has authority to
conduct hearings and issue final orders in warranty performance complaints
filed under Section 3.08(i) of the Texas Motor Vehicle Commission Code (Code).
Amendments to §107.7 now authorize the director to conduct hearings and
issue final orders in complaints filed under both §6.07 and §3.08(i)
of the Code, relating to lemon law and warranty performance complaints respectively,
making §107.12 redundant.
Brett Bray, Director, Motor Vehicle Division, has determined that for the
first five-year period the repeal is in effect, there will be no fiscal implications
for state or local government as a result of repeal of the section.
Mr. Bray has also determined that for each year of the first five years
the repeal is in effect, the anticipated public benefit of the repeal of §107.12
and simultaneous amendment of §107.7 will be to simplify the procedures
for filing and hearing a warranty performance complaint and conserve the time
and resources of the agency and entities appearing before it. There will be
no effect on small businesses and no anticipated economic cost to persons
who are required to comply with the repeal as proposed. Mr. Bray has also
certified that there will be no impact on local economies or overall employment
as a result of enforcing or administering the repeal.
Comments (15 copies) may be submitted to Brett Bray, Director, Motor Vehicle
Division, Texas Department of Transportation, P. O. Box 2293, Austin, Texas
78768, (512) 416-4910. The Motor Vehicle Board will consider adoption of the
repeal at its meeting on September 9, 1999. The deadline for receipt of comments
on the proposed repeal is 5:00 p.m. on August 23, 1999.
The repeal is proposed under the Texas Motor Vehicle Commission
Code, §3.06, which provides the Board with authority to adopt rules as
necessary and convenient to effectuate the provisions of the Act and to govern
practice and procedure before the agency.
Motor Vehicle Commission Code §§3.08(i) and 6.07 are affected
by the proposed repeal.
§107.12.Contested Cases under General Warranty Provisions: Decisions and Final Orders.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of the Secretary of State on July
9, 1999.
TRD-9904095
Brett Bray
Division Director
Texas Motor Vehicle Board
Proposed date of adoption: September 9, 1999
For further information, please call: (512) 416-4899