A08066 Summary:

BILL NOA08066
 
SAME ASNo Same As
 
SPONSORCrespo
 
COSPNSR
 
MLTSPNSR
 
Amd S415, V & T L
 
Requires used motor vehicle dealers to have a $20,000 surety bond if they sell 50 or less cars a year, and a $100,000 surety bond if they sell more than 50 cars a year.
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A08066 Actions:

BILL NOA08066
 
06/05/2015referred to transportation
01/06/2016referred to transportation
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A08066 Committee Votes:

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A08066 Floor Votes:

There are no votes for this bill in this legislative session.
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A08066 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          8066
 
                               2015-2016 Regular Sessions
 
                   IN ASSEMBLY
 
                                      June 5, 2015
                                       ___________
 
        Introduced by M. of A. CRESPO -- read once and referred to the Committee
          on Transportation
 
        AN  ACT to amend the vehicle and traffic law, in relation to surety bond
          requirements for car dealers
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1. Paragraphs a, b and c of subdivision 6-b of section 415 of
     2  the vehicle and traffic law, as amended by chapter  7  of  the  laws  of
     3  2000, paragraph a as further amended by section 104 of part A of chapter
     4  62 of the laws of 2011, are amended to read as follows:
     5    a.  As a condition to obtaining a registration certificate pursuant to
     6  this section, every new motor vehicle dealer applicant and every  quali-
     7  fied  dealer applicant shall obtain and continue in effect a surety bond
     8  in an amount of fifty thousand dollars  executed  by  a  surety  company
     9  authorized to transact business in the state by the department of finan-
    10  cial  services  of the state. As a condition to obtaining a registration
    11  certificate pursuant to this section, every  dealer  applicant  [who  is
    12  applying  for  a  registration  certificate in the first instance or who
    13  sold two hundred motor vehicles or fewer in the previous  calendar  year
    14  shall  obtain  and  continue in effect a surety bond in an amount of ten
    15  thousand dollars executed by a surety  company  authorized  to  transact
    16  business  in  the  state  by the department of financial services of the
    17  state. As a condition of obtaining a registration  certificate  pursuant
    18  to  this  section, every dealer applicant who sold more than two hundred
    19  motor vehicles in the previous calendar year shall obtain  and  continue
    20  in  effect  a  surety  bond in an amount of twenty-five thousand dollars
    21  executed by a surety company authorized  to  transact  business  in  the
    22  state  by  the  department of financial services of the state. The bonds
    23  shall be approved as to form by the commissioner  and  shall  be  condi-
    24  tioned  on the new motor vehicle dealer's, qualified dealer's, and deal-
    25  er's: payment of all valid bank drafts, including checks, drawn by  such

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD10954-04-5

        A. 8066                             2

     1  dealer  for  the  purchase  of motor vehicles; transfer of good title to
     2  each motor vehicle such dealer sells; safekeeping of all customer depos-
     3  its related to the sale of a motor vehicle between the time  of  receipt
     4  of  such  customer deposit and the transfer of good title to the vehicle
     5  to the customer; payment for all fines imposed upon the new motor  vehi-
     6  cle  dealer, qualified dealer, or dealer by the commissioner pursuant to
     7  the provisions of this chapter; and such dealer's repayment of any over-
     8  charges of a customer by such dealer for the  vehicle  registration  and
     9  titling  charges payable to the commissioner for registering and titling
    10  the sold vehicle], who is not a new motor vehicle dealer or a  qualified
    11  motor vehicle dealer, who is applying for a new registration certificate
    12  shall  obtain  and  continue in effect a surety bond in an amount of (i)
    13  twenty thousand dollars, for such dealers who sell fifty or  less  motor
    14  vehicles a year, and (ii) one hundred thousand dollars, for such dealers
    15  who  sell  more  than  fifty  motor vehicles a year executed by a surety
    16  company authorized to transact business in this state by the  department
    17  of  financial  services  of  the  state. Any such dealer which is bonded
    18  prior to the effective date of the chapter of the laws of  two  thousand
    19  fifteen  which  amended this paragraph, shall be required to comply with
    20  the amendments made by such chapter, on and  after  January  first,  two
    21  thousand sixteen.
    22    b.  Recovery  against  a  bond  may be made by a person, including the
    23  state, who obtains a judgment against  the  new  motor  vehicle  dealer,
    24  qualified dealer, or dealer for [an act or omission on which the bond is
    25  conditioned if the act or omission occurred during the term of the bond]
    26  any  claim  related  to  the  business of such new motor vehicle dealer,
    27  qualified dealer or dealer, including but not  limited  to,  contractual
    28  violations,  fraud, unfair and deceptive acts and practices in violation
    29  of section three hundred forty-nine of the general  business  law,  acts
    30  and  omissions,  the  amount  of the valid bank drafts (including checks
    31  drawn by the motor vehicle dealer), qualified checks drawn  by  the  new
    32  motor  vehicle  dealer,  qualified  dealer or dealer for the purchase of
    33  motor vehicles or the amount of overcharge by such dealer for  registra-
    34  tion  or title fees or the amount paid to such dealer or the deposit, as
    35  the case may be, for the motor vehicle for  which  good  title  was  not
    36  delivered,  and title claims, if the act or omission occurred during the
    37  term of the bond. The total liability imposed on the surety  under  this
    38  section  for  all  [breaches of the bond condition] claims is limited to
    39  the face amount of the bond. [Such liability may  include,  but  is  not
    40  limited to, the amount of the valid bank drafts, including checks, drawn
    41  by  the  new  motor  vehicle dealer, qualified dealer, or dealer for the
    42  purchase of motor vehicles or the amount of overcharge  by  such  dealer
    43  for  registration or title fees or the amount paid to such dealer or the
    44  deposit, as the case may be, for the motor vehicle for which good  title
    45  was not delivered.] In no event shall the surety on a bond be liable for
    46  total  claims  in excess of the bond amount, regardless of the number or
    47  nature of claims made against the bond or the number of years  the  bond
    48  remained  in  force, nor shall any such surety bond provide coverage for
    49  transactions involving sales of any motor vehicles for which a  bond  is
    50  not  required pursuant to the provisions of paragraph d of this subdivi-
    51  sion.
    52    c. Any surety issuing a bond pursuant to  this  subdivision  shall  be
    53  required  to provide sixty days' notice to the commissioner prior to the
    54  effective date of cancellation or lapse of the bond, and  shall  provide
    55  notice to the commissioner upon the date of the cancellation or lapse of
    56  such bond. Upon the cancellation or lapse of any surety bond required by

        A. 8066                             3
 
     1  this  subdivision,  the  commissioner  shall  within  five  days of such
     2  cancellation or lapse, verify that the dealer holds a surety bond  which
     3  meets the requirements of this subdivision.
     4    § 2. This act shall take effect on the one hundred eightieth day after
     5  it shall have become a law.
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