§ 4172. Enforcement of warranties

(a) Every new motor vehicle as defined in section 4171 of this title sold in this State must conform to all applicable warranties.

(b) It shall be the manufacturer's obligation under this chapter to ensure that all new motor vehicles sold, leased, or registered in this State conform with manufacturer's express warranties. The manufacturer may delegate responsibility to its agents or authorized dealers provided, however, in the event the manufacturer delegates its responsibility under this chapter to its agents or authorized dealers, it shall compensate the dealer for all work performed by the dealer in satisfaction of the manufacturer's responsibility under this chapter in the manner set forth in chapter 108 of this title known as the "Motor Vehicle Manufacturers, Distributors and Dealers' Franchising Practices Act" as that act may be from time to time amended.

(c) If a new motor vehicle does not conform to all applicable express warranties and the consumer reports the nonconformity to the manufacturer, its agent, or authorized dealer during the term of the warranty, the manufacturer shall cause whatever repairs are necessary to conform the vehicle to the warranties, notwithstanding the fact that the repairs are made after the expiration of a warranty term.

(d) A manufacturer, its agent, or authorized dealer shall not refuse to provide a consumer with a written repair order and shall provide to the consumer each time the consumer's vehicle is brought in for examination or repair of a defect, a written summary of the complaint and a fully itemized statement indicating all work performed on the vehicle including examination of the vehicle, parts, and labor.

(e)(1) If, after a reasonable number of attempts, the manufacturer, its agent, or authorized dealer or its delegate is unable to conform the motor vehicle to any express warranty by repairing or correcting any defect or condition covered by the warranty that substantially impairs the use, market value, or safety of the motor vehicle to the consumer, the manufacturer shall, at the option of the consumer within 30 days of the effective date of the Board's order, either:

(A) Replace the motor vehicle with a new motor vehicle from the same manufacturer, if available, of comparable worth to the same make and model with all options and accessories with appropriate adjustments being allowed for any model year differences.

(B) Accept return of the vehicle from the consumer and refund to the consumer the full purchase price or to the lessee in the case of leased vehicles, as provided in subsection (i) of this section. In those instances in which a refund is tendered, the manufacturer shall refund to the consumer the full purchase price as indicated in the purchase contract and all credits and allowances for any trade-in or downpayment, finance charges, credit charges, registration fees, and any similar charges and incidental and consequential damages or, in the case of leased vehicles, as provided in subsection (i) of this section. Refunds shall be made to the consumer and lienholder, if any, as their interests may appear or to the motor vehicle lessor and lessee as provided in subsection (i) of this section. A reasonable allowance for use shall be that amount directly attributable to use by the consumer prior to his or her first repair attempt and shall be calculated by multiplying the full purchase price of the vehicle by a fraction having as its denominator 100,000 and having as its numerator the number of miles that the vehicle traveled prior to the first attempt at repairing the vehicle. If the manufacturer refunds the purchase price or a portion of the price to the consumer, any Vermont motor vehicle purchase and use tax paid shall be refunded by the State to the consumer in the proportionate amount. To receive a refund, the consumer must file a claim with the Commissioner of Motor Vehicles within 90 days of the effective date of the order.

(2) In the case of a recreation vehicle, the warrantor of the chassis shall be responsible for any refund under subdivision (1)(B) of this subsection or under subsection (i) of this section, even if the consumer's or lessee's right to the refund results from a nonconformity caused by the final stage assembler of the completed recreation vehicle or by another warranted component subject to this chapter.

(f) It shall be an affirmative defense to any claim under this chapter that an alleged nonconformity does not substantially impair the use, market value, or safety, or that the nonconformity is the result of abuse, neglect, or unauthorized modifications or alterations of a motor vehicle by a consumer.

(g) It shall be presumed that a reasonable number of attempts have been undertaken to conform a motor vehicle to the applicable warranties if:

(1) the same nonconformity as identified in any written examination or repair order has been subject to repair at least three times by the manufacturer, its agent, or authorized dealer and at least the first repair attempt occurs within the express warranty term and the same nonconformity continues to exist; or

(2) the vehicle is out of service by reason of repair of one or more nonconformities, defects or conditions for a cumulative total of 30 or more calendar days during the term of the express warranty. The term of any warranty and the 30-day period shall be extended by any period of time during which repair services were not available to the consumer because of war, invasion, strike, fire, flood, or other natural disaster. If an extension of time is necessitated due to these conditions, the manufacturer shall cause provision for the free use of a vehicle to the consumer whose vehicle is out of service. A vehicle shall not be deemed out of service if it is available to the consumer for a major part of the day.

(h) In order for an attempt at repair to qualify for the presumptions of this section, the attempt at repair must be evidenced by a written examination or repair order issued by the manufacturer, its agent, or its authorized dealer. The presumptions of this section shall only apply to three attempts at repair evidenced by written examination or repair orders undertaken by the same agent or authorized dealer, unless the consumer shows good cause for taking the vehicle to a different agent or authorized dealer.

(i) In cases in which the lessee elects a replacement vehicle, a collateral change with appropriate adjustments for any model year difference or excess mileage, or both, shall be incorporated into an amended lease agreement. In cases in which a refund is tendered by a manufacturer for a leased motor vehicle under subsection (e) of this section, the refund and rights of the motor vehicle lessor, lessee, and manufacturer shall be in accordance with the following:

(1) The manufacturer shall provide to the lessee, the aggregate deposit and rental payments previously paid to the motor vehicle lessor by the lessee, and incidental and consequential damages, if applicable, minus a reasonable allowance for use and allocated payments for purchase and use tax. The aggregate deposit shall include, but not be limited to, all cash payments and trade-in allowances tendered by the lessee to the motor vehicle lessor under the lease agreement. The reasonable allowance for use shall be calculated by multiplying the aggregate deposit and rental payments made by the lessee on the motor vehicle by a fraction having as its denominator the number of miles allowed in the lease contract and having as its numerator the number of miles that the vehicle traveled prior to the first attempt at repairing the vehicle. Any miles in excess of those allowed in the lease contract shall be added to the mileage at the first repair attempt or first day out of service prior to calculating the reasonable allowance for use.

(2) The manufacturer shall provide to the motor vehicle lessor the aggregate of the following:

(A) the lessor's actual purchase cost, less payments made by the lessee;

(B) the freight cost, if applicable;

(C) the cost for dealer or manufacturer-installed accessories, if applicable;

(D) any fee paid to another to obtain the lease; and

(E) an amount equal to five percent of the lessor's actual purchase cost. The amount in this subdivision shall be instead of any early termination costs as defined in subdivision 4171(3) of this chapter or as described in the lease agreement.

(3) Vermont motor vehicle purchase and use tax shall be refunded by the State to whomever paid the tax. The party must file a claim with the Commissioner of Motor Vehicles within 90 days of the effective date of the order.

(4) The lessee's lease agreement with the motor vehicle lessor and all contractual obligations shall be terminated upon a decision of the Board in favor of the lessee as of the effective date of the order. The lessee shall not be liable for any further costs or charges to the manufacturer or motor vehicle lessor under the lease agreement.

(5) The motor vehicle lessor shall release the motor vehicle title to the manufacturer upon payment by the manufacturer under the provisions of this subsection.

(6) The Board shall give notice to the motor vehicle lessor of the lessee's filing of a request for arbitration under this chapter and shall notify the motor vehicle lessor of the date, time, and place scheduled for a hearing before the Board. The motor vehicle lessor shall provide testimony and evidence necessary to the arbitration proceedings. Any decision of the Board shall be binding upon the motor vehicle lessor. (Added 1983, No. 211 (Adj. Sess.), § 1; amended 1985, No. 260 (Adj. Sess.), § 2; 1987, No. 242 (Adj. Sess.),§§ 3, 4; 1989, No. 157 (Adj. Sess.), § 1, eff. April 30, 1990; 1999, No. 18, § 28, eff. May 13, 1999; 2017, No. 206 (Adj. Sess.), § 15.)