Bill Text: AZ HB2239 | 2019 | Fifty-fourth Legislature 1st Regular | Engrossed
Bill Title: Used vehicle sales; title; dealers
Spectrum: Partisan Bill (Republican 1-0)
Status: (Engrossed - Dead) 2019-05-24 - Senate motion to reconsider third reading [HB2239 Detail]
Download: Arizona-2019-HB2239-Engrossed.html
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Conference Engrossed |
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State of Arizona House of Representatives Fifty-fourth Legislature First Regular Session 2019
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HOUSE BILL 2239 |
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AN ACT
amending section 28‑2051, Arizona Revised Statutes; amending section 28‑4301, Arizona Revised Statutes, as amended by laws 2014, chapter 81, section 1; amending section 28‑4301, Arizona Revised Statutes, as amended by laws 2018, chapter 298, section 6; amending SECTIONs 28-4409 and 44‑1267, Arizona Revised Statutes; relating to motor vehicles.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 28-2051, Arizona Revised Statutes, is amended to read:
28-2051. Application for certificate of title; vision screening test
A. A person shall apply to the department on a form prescribed or authorized by the department for a certificate of title to a motor vehicle, trailer or semitrailer. The person shall make the application within fifteen days after the purchase or transfer of the vehicle, trailer or semitrailer except that a licensed motor vehicle dealer shall make the application within thirty sixty days after the purchase or transfer. All transferees shall sign the application, except that one transferee may sign the application if both of the following apply:
1. The application is for the purposes of converting an out‑of‑state certificate of title to a certificate of title issued pursuant to this article.
2. The ownership or legal status of the motor vehicle, trailer or semitrailer does not change.
B. The application shall contain:
1. The transferee's full name and either the driver license number of the transferee or a number assigned by the department.
2. The transferee's complete residence address.
3. A brief description of the vehicle to be issued a certificate of title.
4. The name of the manufacturer of the vehicle.
5. The serial number of the vehicle.
6. The last license plate number if applicable and if known and the state in which the license plate number was issued.
7. If the application is for a certificate of title to a new vehicle, the date of sale by the manufacturer or dealer to the person first operating the vehicle.
8. If the application is in the name of a lessor:
(a) The lessor shown on the application as the owner or transferee.
(b) At the option of the lessor, the lessee shown on the application as the registrant.
(c) The address of either the lessor or lessee.
(d) The signature of the lessor.
9. If the application is for a certificate of title to a specially constructed, reconstructed or foreign vehicle, a statement of that fact. For the purposes of this paragraph, "specially constructed vehicle" means a vehicle not originally constructed under a distinctive name, make, model or type by a generally recognized manufacturer of vehicles.
10. If an applicant rents or intends to rent the vehicle without a driver, a statement of that fact.
11. Other information required by the department.
C. Unless subsection B, paragraph 8 of this section applies, on request of an applicant, the department shall allow the applicant to provide on the certificate of title of a motor vehicle, trailer or semitrailer a post office box address that is regularly used by the applicant.
D. A person shall submit the following information with an application for a certificate of title:
1. To a vehicle previously registered:
(a) The odometer mileage disclosure statement prescribed by section 28‑2058.
(b) If the applicant is applying for a certificate of title pursuant to section 28‑2060, the applicant's statement of the odometer reading as of the date of application.
2. To a new vehicle:
(a) A manufacturer's certificate of origin showing the date of sale to the dealer or person first receiving the vehicle from the manufacturer. Before the department issues a certificate of title to a new vehicle, a manufacturer's certificate of origin shall be surrendered to the department.
(b) The name of the dealer or person.
(c) A description sufficient to identify the vehicle.
(d) A statement certifying that the vehicle was new when sold.
(e) If sold through a dealer, a statement by the dealer certifying that the vehicle was new when sold to the applicant.
E. The department may request that an applicant who appears in person for a certificate of title of a motor vehicle, trailer or semitrailer satisfactorily complete the vision screening test prescribed by the department.
Sec. 2. Section 28-4301, Arizona Revised Statutes, as amended by Laws 2014, chapter 81, section 1, is amended to read:
28-4301. Definitions
In this chapter, unless the context otherwise requires:
1. "Area of responsibility" means the area surrounding an individual dealer that the factory designates as that dealer's individual primary geographic territory for the purpose of marketing, promoting, selling and leasing new motor vehicles. In the absence of the factory designated area, the area of responsibility is that geographical area surrounding a dealer that lies closer to that dealer than to other dealers of the same line‑make.
2. "Automotive recycler" means a person who is engaged in the business of buying or acquiring a motor vehicle solely for the purpose of dismantling, selling or otherwise disposing of the parts or accessories and who dismantles six or more vehicles in a calendar year.
3. "Branch license" means a license that is issued by the director to a licensed motor vehicle dealer and that permits the licensee to sell motor vehicles from an established place of business within the same county but other than the original or principal place of business for which the license was issued.
4. "Broker" means a person who for any fee, commission or other valuable consideration offers to provide, provides or represents that the person will provide a service of arranging or assisting in effecting the purchase of a motor vehicle and who is not:
(a) A new motor vehicle dealer or an employee or agent of a new motor vehicle dealer.
(b) A used motor vehicle dealer or an employee or agent of a used motor vehicle dealer.
(c) A manufacturer or employee or agent of a manufacturer.
(d) An auctioneer or engaged in the auto auction business.
(e) A wholesale motor vehicle dealer.
5. "Community" means the relevant market area. For the purposes of this paragraph, "relevant market area" means the incorporated city or town in which the franchise is located.
6. "Distributor" means a person who either:
(a) Sells or distributes new motor vehicles to new motor vehicle dealers in this state.
(b) Maintains distributor representatives in this state.
7. "Distributor branch" means a branch office maintained or availed of by a distributor for either:
(a) The sale of new motor vehicles to new motor vehicle dealers in this state.
(b) Directing or supervising its representatives in this state.
8. "Established place of business":
(a) Means a permanent enclosed building or structure that is owned either in fee or leased with sufficient space to display two or more motor vehicles of a kind and type that the dealer is licensed to sell and that is devoted principally to the use of a motor vehicle dealer in the conduct of the business of the dealer.
(b) In the case of a used motor vehicle dealer, trailer dealer or semitrailer dealer:
(i) Need not be a permanent building or structure or part of a permanent building or structure.
(ii) May be a vacant lot or part of a vacant lot.
(iii) Does not mean or include a residence, tent, temporary stand or temporary quarters or permanent quarters occupied pursuant to a temporary arrangement.
(c) In the case of an automotive recycler, means a permanent site or location at which the business of an automotive recycler is or will be conducted.
9. "Exhibitor" means a manufacturer of new motor homes that exhibits new motor homes at a special event.
10. "Factory branch" means a branch office maintained or availed of by a manufacturer for either:
(a) The sale of new motor vehicles to distributors or the sale of new motor vehicles to new motor vehicle dealers in this state.
(b) Directing or supervising its representatives in this state.
11. "Financial institution" means a bank, trust company, savings and loan association, credit union, consumer lender, international banking facility or holding company that is licensed, regulated or insured by the department of financial institutions, the federal deposit insurance corporation, the office of thrift supervision, the comptroller of the currency, the national credit union share insurance fund or the national credit union administration.
12. "Franchise" means a contract between two or more persons if all of the following conditions are included:
(a) A commercial relationship of definite duration or continuing indefinite duration is involved.
(b) The franchisee is granted the right to offer, sell and service in this state new motor vehicles manufactured or distributed by the franchisor.
(c) The franchisee, as a separate business, constitutes a component of the franchisor's distribution system.
(d) The operation of the franchisee's business is substantially associated with the franchisor's trademark, service mark, trade name, advertising or other commercial symbol designating the franchisor.
(e) The operation of the franchisee's business is substantially reliant on the franchisor for the continued supply of new motor vehicles, parts and accessories.
13. "Franchisee" means a person who both:
(a) Receives new motor vehicles from the franchisor under a franchise.
(b) Offers and sells to and services new motor vehicles for the general public.
14. "Franchisor" means a person who both:
(a) Manufactures or distributes new motor vehicles.
(b) May enter into a franchise.
15. "Importer" means a person who transports or arranges for the transportation of a foreign manufactured new motor vehicle into the United States for sale in this state.
16. "Lead" means any retail consumer who satisfies all of the following:
(a) Responds to a factory‑directed program that obtains consumer contact information and that provides such information to one or more dealers.
(b) Expresses an interest to the factory in purchasing, leasing or acquiring any vehicle or product, service or financing available from the dealers of that factory.
(c) Does not qualify for any reasonable factory sponsored employee, retiree or vendor new vehicle purchase program or any other reasonable similar factory new vehicle purchase program.
17. "Line‑make" means those motor vehicles that are offered for sale, lease or distribution under a common name, trademark, service mark or brand name of the manufacturer of those same motor vehicles.
18. "Major component part" includes a motor vehicle or vehicle part that the manufacturer has assigned any factory, motor, serial or other identification number or mark.
19. "Manufacturer" means any person who either:
(a) Manufactures or assembles new motor vehicles.
(b) Manufactures or installs on previously assembled truck chassis special bodies or equipment that when installed forms an integral part of the new motor vehicle and that constitutes a major manufacturing alteration, excluding the installation of a camper on a pickup truck.
20. "Motor home" means a motor vehicle that is primarily designed as temporary living quarters and that:
(a) Is built onto as an integral part of, or is permanently attached to, a motor vehicle chassis.
(b) Contains at least four of the following independent life support systems if each is permanently installed and designed to be removed only for purposes of repair or replacement:
(i) A cooking facility with an onboard fuel source.
(ii) A gas or electric refrigerator.
(iii) A toilet with exterior evacuation.
(iv) A heating or air conditioning system with an onboard power or fuel source separate from the vehicle engine.
(v) A potable water supply system that includes at least a sink, a faucet and a water tank with an exterior service supply connection.
(vi) A 110‑125 volt electric power supply.
21. "Motor vehicle" means an automobile, motor bus, motorcycle, truck or truck tractor or any other self‑propelled vehicle, trailer or semitrailer.
22. "Motor vehicle dealer" means a new motor vehicle dealer, a used motor vehicle dealer, a public consignment auction dealer, a broker wholesale motor vehicle dealer or a wholesale motor vehicle auction dealer, excluding a person who comes into possession of a motor vehicle as an incident to the person's regular business and who sells, auctions or exchanges the motor vehicle.
23. "New house trailer dealer" means a person who buys, sells, exchanges or offers or attempts to negotiate a sale or exchange of an interest in, or who is engaged in the business of selling, new house trailers or used house trailers taken in trade on new house trailers. For the purposes of this paragraph, "house trailer" means a vehicle, other than a motor vehicle, that is built on a chassis designed for being drawn on the highways by a motor vehicle and that is designed for human habitation.
24. "New motor vehicle" means a motor vehicle, other than a used motor vehicle, that is held either for:
(a) Sale by the franchisee who first acquired the vehicle from the manufacturer or distributor of the vehicle.
(b) Sale by another franchisee of the same line‑make.
25. "New motor vehicle dealer" means a person who buys, sells, exchanges or offers or attempts to negotiate a sale or exchange of an interest in, or who is engaged in the business of selling, new motor vehicles or used motor vehicles taken in trade on new motor vehicles or used vehicles purchased for resale.
26. "Off‑premises display and sales" means a promotion or sale of motor vehicles for a period of time as specified by the director that both:
(a) Is sponsored by a licensed motor vehicle dealer, the licensed motor vehicle dealer's agents or the manufacturer.
(b) Takes place at a location within the same county but not at the licensee's established place of business.
27. "Off‑premises exhibition" means the exhibition of a motor vehicle for a period of time as specified by the director at a location within the same county but not at the established place of business of a licensed motor vehicle dealer and at which a solicitation or sale does not occur.
28. "Provisional automotive recycler's license" means a license that both:
(a) Is issued by the department only in conjunction with an application for an automotive recycler's license.
(b) Permits the applicant or applicants to conduct the business of an automotive recycler regulated by this chapter pending completion of the criminal records check pursuant to section 28‑4361.
29. "Provisional dealer's license" means a license that both:
(a) Is issued by the department only in conjunction with an application for a dealer's license.
(b) Permits the applicant or applicants to conduct the business of a motor vehicle dealer regulated by this chapter pending completion of the criminal records check pursuant to section 28‑4361.
30. "Public consignment auction dealer" means a person who at the public consignment auction dealer's established place of business or at an authorized off‑premises location pursuant to the requirements of section 28‑4401 is in the business of both of the following:
(a) Conducting live auctions with a licensed auctioneer verbally calling for and accepting bids.
(b) Providing live auction services to the public on a consignment contract basis.
31. "Retail consumer" means any person purchasing, leasing or acquiring or possibly purchasing, leasing or acquiring a vehicle or product, service or financing not for resale.
32. "Service" means any service that is sold, leased or provided to retail consumers and that directly relates to the ownership or leasing of a new or used motor vehicle, including extended service contracts or motor vehicle warranty and nonwarranty repairs or maintenance, including both parts and labor.
33. "Special event" means an exhibition of new motor homes by a motor vehicle dealer licensed to sell new motor homes or an exhibitor for a period of time specified by the director at a location in this state other than the licensee's or exhibitor's established place of business.
34. "Used motor vehicle" means a motor vehicle that has been sold, bargained, exchanged or given away or the title to the motor vehicle has been transferred from the person who first acquired the vehicle from the manufacturer, or importer, dealer or agent of the manufacturer or importer, and that has been placed in bona fide consumer use. For the purposes of this paragraph, "bona fide consumer use" means actual operation by an owner who acquired a new motor vehicle both:
(a) For use in the owner's business or for pleasure or otherwise.
(b) For which a certificate of title has been issued or that has been registered as provided by law.
35. "Used motor vehicle dealer" means a person, other than a new motor vehicle dealer, who buys, sells, auctions, exchanges or offers or attempts to negotiate a sale or exchange of an interest in, or who is engaged in the business of selling, seven or more used motor vehicles in a continuous twelve month period. Used motor vehicle dealer does not include a wholesale motor vehicle auction dealer or a public consignment auction dealer.
36. "Wholesale motor vehicle auction dealer" means a person who both:
(a) Is in the business of providing auction services solely in wholesale transactions to motor vehicle dealers licensed by this state or any other jurisdiction.
(b) Does not buy, sell or own the motor vehicles the auction dealer auctions in the ordinary course of business.
37. "Wholesale motor vehicle dealer" means a person who sells used motor vehicles only to licensed motor vehicle dealers.
Sec. 3. Section 28-4301, Arizona Revised Statutes, as amended by Laws 2018, chapter 298, section 6, is amended to read:
28-4301. Definitions
In this chapter, unless the context otherwise requires:
1. "Area of responsibility" means the area surrounding an individual dealer that the factory designates as that dealer's individual primary geographic territory for the purpose of marketing, promoting, selling and leasing new motor vehicles. In the absence of the factory designated area, the area of responsibility is that geographical area surrounding a dealer that lies closer to that dealer than to other dealers of the same line‑make.
2. "Branch license" means a license that is issued by the director to a licensed motor vehicle dealer and that permits the licensee to sell motor vehicles from an established place of business within the same county but other than the original or principal place of business for which the license was issued.
3. "Broker" means a person who for any fee, commission or other valuable consideration offers to provide, provides or represents that the person will provide a service of arranging or assisting in effecting the purchase of a motor vehicle and who is not:
(a) A new motor vehicle dealer or an employee or agent of a new motor vehicle dealer.
(b) A used motor vehicle dealer or an employee or agent of a used motor vehicle dealer.
(c) A manufacturer or employee or agent of a manufacturer.
(d) An auctioneer or engaged in the auto auction business.
(e) A wholesale motor vehicle dealer.
4. "Community" means the relevant market area. For the purposes of this paragraph, "relevant market area" means the incorporated city or town in which the franchise is located.
5. "Distributor" means a person who either:
(a) Sells or distributes new motor vehicles to new motor vehicle dealers in this state.
(b) Maintains distributor representatives in this state.
6. "Distributor branch" means a branch office maintained or availed of by a distributor for either:
(a) The sale of new motor vehicles to new motor vehicle dealers in this state.
(b) Directing or supervising its representatives in this state.
7. "Established place of business":
(a) Means a permanent enclosed building or structure that is owned either in fee or leased with sufficient space to display two or more motor vehicles of a kind and type that the dealer is licensed to sell and that is devoted principally to the use of a motor vehicle dealer in the conduct of the business of the dealer.
(b) In the case of a used motor vehicle dealer, trailer dealer or semitrailer dealer:
(i) Need not be a permanent building or structure or part of a permanent building or structure.
(ii) May be a vacant lot or part of a vacant lot.
(iii) Does not mean or include a residence, tent, temporary stand or temporary quarters or permanent quarters occupied pursuant to a temporary arrangement.
(c) In the case of an automotive recycler, means a permanent site or location at which the business of an automotive recycler is or will be conducted.
8. "Exhibitor" means a manufacturer of new motor homes that exhibits new motor homes at a special event.
9. "Factory branch" means a branch office maintained or availed of by a manufacturer for either:
(a) The sale of new motor vehicles to distributors or the sale of new motor vehicles to new motor vehicle dealers in this state.
(b) Directing or supervising its representatives in this state.
10. "Financial institution" means a bank, trust company, savings and loan association, credit union, consumer lender, international banking facility or holding company that is licensed, regulated or insured by the department of financial institutions, the federal deposit insurance corporation, the office of thrift supervision, the comptroller of the currency, the national credit union share insurance fund or the national credit union administration.
11. "Franchise" means a contract between two or more persons if all of the following conditions are included:
(a) A commercial relationship of definite duration or continuing indefinite duration is involved.
(b) The franchisee is granted the right to offer, sell and service in this state new motor vehicles manufactured or distributed by the franchisor.
(c) The franchisee, as a separate business, constitutes a component of the franchisor's distribution system.
(d) The operation of the franchisee's business is substantially associated with the franchisor's trademark, service mark, trade name, advertising or other commercial symbol designating the franchisor.
(e) The operation of the franchisee's business is substantially reliant on the franchisor for the continued supply of new motor vehicles, parts and accessories.
12. "Franchisee" means a person who both:
(a) Receives new motor vehicles from the franchisor under a franchise.
(b) Offers and sells to and services new motor vehicles for the general public.
13. "Franchisor" means a person who both:
(a) Manufactures or distributes new motor vehicles.
(b) May enter into a franchise.
14. "Importer" means a person who transports or arranges for the transportation of a foreign manufactured new motor vehicle into the United States for sale in this state.
15. "Lead" means any retail consumer who satisfies all of the following:
(a) Responds to a factory‑directed program that obtains consumer contact information and that provides such information to one or more dealers.
(b) Expresses an interest to the factory in purchasing, leasing or acquiring any vehicle or product, service or financing available from the dealers of that factory.
(c) Does not qualify for any reasonable factory sponsored employee, retiree or vendor new vehicle purchase program or any other reasonable similar factory new vehicle purchase program.
16. "Line‑make" means those motor vehicles that are offered for sale, lease or distribution under a common name, trademark, service mark or brand name of the manufacturer of those same motor vehicles.
17. "Major component part" includes a motor vehicle or vehicle part that the manufacturer has assigned any factory, motor, serial or other identification number or mark.
18. "Manufacturer" means any person who either:
(a) Manufactures or assembles new motor vehicles.
(b) Manufactures or installs on previously assembled truck chassis special bodies or equipment that when installed forms an integral part of the new motor vehicle and that constitutes a major manufacturing alteration, excluding the installation of a camper on a pickup truck.
19. "Motor home" means a motor vehicle that is primarily designed as temporary living quarters and that:
(a) Is built onto as an integral part of, or is permanently attached to, a motor vehicle chassis.
(b) Contains at least four of the following independent life support systems if each is permanently installed and designed to be removed only for purposes of repair or replacement:
(i) A cooking facility with an onboard fuel source.
(ii) A gas or electric refrigerator.
(iii) A toilet with exterior evacuation.
(iv) A heating or air conditioning system with an onboard power or fuel source separate from the vehicle engine.
(v) A potable water supply system that includes at least a sink, a faucet and a water tank with an exterior service supply connection.
(vi) A 110‑125 volt electric power supply.
20. "Motor vehicle" means an automobile, motor bus, motorcycle, truck or truck tractor or any other self‑propelled vehicle, trailer or semitrailer.
21. "Motor vehicle dealer" means a new motor vehicle dealer, a used motor vehicle dealer, a public consignment auction dealer, a broker wholesale motor vehicle dealer or a wholesale motor vehicle auction dealer, excluding a person who comes into possession of a motor vehicle as an incident to the person's regular business and who sells, auctions or exchanges the motor vehicle.
22. "New house trailer dealer" means a person who buys, sells, exchanges or offers or attempts to negotiate a sale or exchange of an interest in, or who is engaged in the business of selling, new house trailers or used house trailers taken in trade on new house trailers. For the purposes of this paragraph, "house trailer" means a vehicle, other than a motor vehicle, that is built on a chassis designed for being drawn on the highways by a motor vehicle and that is designed for human habitation.
23. "New motor vehicle" means a motor vehicle, other than a used motor vehicle, that is held either for:
(a) Sale by the franchisee who first acquired the vehicle from the manufacturer or distributor of the vehicle.
(b) Sale by another franchisee of the same line‑make.
24. "New motor vehicle dealer" means a person who buys, sells, exchanges or offers or attempts to negotiate a sale or exchange of an interest in, or who is engaged in the business of selling, new motor vehicles or used motor vehicles taken in trade on new motor vehicles or used vehicles purchased for resale.
25. "Off‑premises display and sales" means a promotion or sale of motor vehicles for a period of time as specified by the director that both:
(a) Is sponsored by a licensed motor vehicle dealer, the licensed motor vehicle dealer's agents or the manufacturer.
(b) Takes place at a location within the same county but not at the licensee's established place of business.
26. "Off‑premises exhibition" means the exhibition of a motor vehicle for a period of time as specified by the director at a location within the same county but not at the established place of business of a licensed motor vehicle dealer and at which a solicitation or sale does not occur.
27. "Provisional automotive recycler's license" means a license that both:
(a) Is issued by the department only in conjunction with an application for an automotive recycler's license.
(b) Permits the applicant or applicants to conduct the business of an automotive recycler regulated by this chapter pending completion of the criminal records check pursuant to section 28‑4361.
28. "Provisional dealer's license" means a license that both:
(a) Is issued by the department only in conjunction with an application for a dealer's license.
(b) Permits the applicant or applicants to conduct the business of a motor vehicle dealer regulated by this chapter pending completion of the criminal records check pursuant to section 28‑4361.
29. "Public consignment auction dealer" means a person who at the public consignment auction dealer's established place of business or at an authorized off‑premises location pursuant to the requirements of section 28‑4401 is in the business of both of the following:
(a) Conducting live auctions with a licensed auctioneer verbally calling for and accepting bids.
(b) Providing live auction services to the public on a consignment contract basis.
30. "Retail consumer" means any person purchasing, leasing or acquiring or possibly purchasing, leasing or acquiring a vehicle or product, service or financing not for resale.
31. "Service" means any service that is sold, leased or provided to retail consumers and that directly relates to the ownership or leasing of a new or used motor vehicle, including extended service contracts or motor vehicle warranty and nonwarranty repairs or maintenance, including both parts and labor.
32. "Special event" means an exhibition of new motor homes by a motor vehicle dealer licensed to sell new motor homes or an exhibitor for a period of time specified by the director at a location in this state other than the licensee's or exhibitor's established place of business.
33. "Used motor vehicle" means a motor vehicle that has been sold, bargained, exchanged or given away or the title to the motor vehicle has been transferred from the person who first acquired the vehicle from the manufacturer, or importer, dealer or agent of the manufacturer or importer, and that has been placed in bona fide consumer use. For the purposes of this paragraph, "bona fide consumer use" means actual operation by an owner who acquired a new motor vehicle both:
(a) For use in the owner's business or for pleasure or otherwise.
(b) For which a certificate of title has been issued or that has been registered as provided by law.
34. "Used motor vehicle dealer" means a person, other than a new motor vehicle dealer, who buys, sells, auctions, exchanges or offers or attempts to negotiate a sale or exchange of an interest in, or who is engaged in the business of selling, seven or more used motor vehicles in a continuous twelve month period. Used motor vehicle dealer does not include a wholesale motor vehicle auction dealer or a public consignment auction dealer.
35. "Wholesale motor vehicle auction dealer" means a person who both:
(a) Is in the business of providing auction services solely in wholesale transactions to motor vehicle dealers licensed by this state or any other jurisdiction.
(b) Does not buy, sell or own the motor vehicles the auction dealer auctions in the ordinary course of business.
36. "Wholesale motor vehicle dealer" means a person who sells used motor vehicles only to licensed motor vehicle dealers.
Sec. 4. Section 28-4409, Arizona Revised Statutes, is amended to read:
28-4409. Evidence of ownership requirement; exception
A. Except as provided in section 28‑4410, :
1. each dealer in motor vehicles, trailers and semitrailers, including manufacturers who sell to other than dealers, having possession of or offering for sale a motor vehicle, trailer or semitrailer shall have at the same time either:
(a) 1. Possession of a duly and regularly assigned certificate of title to the vehicle.
(b) 2. Reasonable indicia of ownership or right of possession as approved by the director.
2. A dealer or manufacturer shall not offer for sale or sell a motor vehicle, trailer or semitrailer until the dealer or manufacturer has obtained a certificate of title to the motor vehicle, trailer or semitrailer, except that a certificate of title is not required for a new motor vehicle sold by manufacturers to dealers.
B. A wholesale motor vehicle auction dealer is exempt from the requirement of having to possess a duly and regularly assigned certificate of title and from other requirements relating to the reassignment of certificate of title documents and disclosures to buyers. A wholesale motor vehicle auction dealer may buy or sell a motor vehicle at wholesale in the wholesale motor vehicle auction dealer's own name if the wholesale motor vehicle auction dealer complies with the provisions of this title relating to certificates of title, reassignments of certificate of title documents and disclosures to buyers.
C. A wholesale motor vehicle dealer must apply for a certificate of title in the name of the wholesale motor vehicle dealer any vehicle that the wholesale motor vehicle dealer acquires before the wholesale motor vehicle dealer transfers the vehicle to another licensed motor vehicle dealer.
Sec. 5. Section 44-1267, Arizona Revised Statutes, is amended to read:
44-1267. Used motor vehicles; implied warranty of merchantability disclaimer; waiver; burden of proof; remedies
A. Before the seller attempts to sell a used motor vehicle the seller shall possess the title to the used motor vehicle and the title shall be in the seller's name.
B. A. Except as provided in subsection I H of this section and in addition to the requirements of section 28‑4412, a used motor vehicle dealer shall not exclude, modify or disclaim the implied warranty of merchantability prescribed in section 47‑2314 or limit the remedies for a breach of that warranty, except as otherwise provided in this section, before midnight of the fifteenth calendar day after delivery of a used motor vehicle or until a used motor vehicle is driven five hundred miles after delivery, whichever is earlier. In calculating time under this subsection, a day on which the warranty is breached is excluded and all subsequent days in which the motor vehicle fails to conform with the implied warranty of merchantability are also excluded. In calculating distance under this subsection, the miles driven to obtain or in connection with the repair, servicing or testing of the motor vehicle that fails to conform with the implied warranty of merchantability are excluded. An attempt to exclude, modify or disclaim the implied warranty of merchantability or to limit the remedies for a breach of that warranty, except as otherwise provided in this section, in violation of this subsection renders a purchase agreement voidable at the option of the purchaser.
C. B. For the purposes of this section, the implied warranty of merchantability is met if the motor vehicle functions in a safe condition as provided in title 28, chapter 3, article 16 and is substantially free of any defect that significantly limits the use of the motor vehicle for the ordinary purpose of transportation on any public highway. The implied warranty of merchantability expires at midnight of the fifteenth calendar day after delivery of a used motor vehicle or when a used motor vehicle has been driven five hundred miles after delivery, whichever is earlier. In calculating time under this subsection, a day on which the warranty is breached is excluded and all subsequent days in which the motor vehicle fails to conform with the implied warranty of merchantability are also excluded. In calculating distance under this subsection, the miles driven to obtain or in connection with the repair, servicing or testing of the motor vehicle that fails to conform with the implied warranty of merchantability are excluded.
D. C. The implied warranty of merchantability described in this section does not extend to damage that occurs after the sale of the motor vehicle and that is the result of any abuse, misuse, neglect, failure to perform regular maintenance or to maintain adequate oil, coolant or other required fluid or lubricant or off road use, racing or towing.
E. D. If the implied warranty of merchantability described in this section is breached, the purchaser shall give reasonable notice to the seller. Before the purchaser exercises any other remedies under title 47, chapter 2, the seller shall have a reasonable opportunity to repair the vehicle. The purchaser shall pay one-half of the cost of the first two repairs necessary to bring the vehicle in compliance with the warranty. The purchaser's payments are limited to a maximum payment of twenty-five dollars $25 for each repair.
F. E. The maximum liability of the seller under this section is limited to the purchase price paid for the used motor vehicle.
G. F. An agreement for the sale of a used motor vehicle by a used motor vehicle dealer is voidable at the option of the purchaser unless it contains on its face the following conspicuous statement printed in bold‑faced ten point or larger type set off from the body of the agreement:
The seller hereby warrants that this vehicle will be fit for the ordinary purposes for which the vehicle is used for 15 days or 500 miles after delivery, whichever is earlier, except with regard to particular defects disclosed on the first page of this agreement. You (the purchaser) will have to pay up to $25.00 for each of the first two repairs if the warranty is violated.
H. G. The inclusion of the statement prescribed in subsection G F of this section in the agreement does not create an express warranty.
I. H. A purchaser of a used motor vehicle may waive the implied warranty of merchantability described in this section only for a particular defect in the vehicle and only if all of the following conditions are satisfied:
1. The used motor vehicle dealer fully and accurately discloses to the purchaser that because of circumstances unusual to the used motor vehicle dealer's business, the used motor vehicle has a particular defect.
2. The purchaser agrees to buy the used motor vehicle after disclosure of the defect.
3. Before the sale, the purchaser indicates agreement to the waiver by signing and dating the following conspicuous statement that is printed on the first page of the sales agreement in bold-faced ten point or larger type and that is written in the language in which the presentation was made:
Attention purchaser: sign here only if the dealer told you that this vehicle has the following problem(s) and that you agree to buy the vehicle on those terms:
1._______________________________
2._______________________________
3._______________________________
J. I. The dealer has the burden to prove by a preponderance of the evidence that the dealer complied with subsection I H of this section.
K. J. Any purchaser or seller who is aggrieved by a transaction pursuant to this section and who seeks a legal remedy shall pursue any appropriate remedy prescribed in title 47, chapter 2 and shall comply with the requirements prescribed in title 47, chapter 2.
Sec. 6. Effective date
Except as provided in section 7 of this act, this act is effective from and after December 31, 2019.
Sec. 7. Conditional enactment
Section 28‑4301, Arizona Revised Statutes, as amended by Laws 2018, chapter 298, section 6 and this act, becomes effective on the date prescribed by Laws 2018, chapter 298, section 12 but only on the occurrence of the condition prescribed by Laws 2018, chapter 298, section 12 and not before from and after December 31, 2019.
