Section 8-21C-7

Duties of warrantors; warranty claims.

(a) Each warrantor shall do all of the following:

(1) Specify in writing each of its dealer obligations, if any, for preparation, delivery, and warranty service on its products.

(2) Compensate a dealer for warranty service required of the dealer by the warrantor.

(3) Provide a dealer the schedule of compensation to be paid and the time allowances for the performance of any work and service. The schedule of compensation shall include reasonable compensation for diagnostic work as well as warranty labor.

(b) Time allowances for the diagnosis and performance of warranty labor shall be reasonable for the work to be performed. In the determination of what constitutes reasonable compensation under this section, the principal factors to be given consideration shall be the actual wage rates being paid by the dealer and the actual retail labor rate being charged by the dealers in the community in which the dealer is doing business. The compensation of a dealer for warranty labor may not be less than the lowest retail labor rates actually charged by the dealer for like non-warranty labor as long as such rates are reasonable.

(c) The warrantor shall reimburse the dealer for warranty parts at actual wholesale cost plus a minimum 30 percent handling charge and the cost, if any, of freight to return warranty parts to the warrantor.

(d) Warranty audits of dealer records may be conducted by the warrantor on a reasonable basis, and dealer claims for warranty compensation may not be denied except for cause, such as performance of non-warranty repairs, material noncompliance with the warrantor's published policies and procedures, lack of material documentation, fraud, or misrepresentation.

(e) The dealer shall submit warranty claims within 30 days after completing work.

(f) The dealer shall immediately notify the warrantor in writing if the dealer is unable to perform any warranty repairs within 10 days of receipt of verbal or written complaints from a consumer.

(g) The warrantor shall disapprove warranty claims in writing within 30 days after the date of submission by the dealer in the manner and form prescribed by the warrantor. Claims not specifically disapproved in writing within 30 days shall be construed to be approved and shall be paid within 60 days of submission.

(h) It is a violation of this chapter for any warrantor to do any of the following:

(1) Fail to perform any of its warranty obligations with respect to its warranted products.

(2) Fail to include, in written notices of factory campaigns to recreational vehicle owners and dealers, the expected date by which necessary parts and equipment, including tires and chassis or chassis parts, will be available to dealers to perform the campaign work. The warrantor may ship parts to the dealer to effect the campaign work, and, if such parts are in excess of the dealer's requirements, the dealer may return unused parts to the warrantor for credit after completion of the campaign.

(3) Fail to compensate any of its dealers for authorized repairs effected by the dealer of merchandise damaged in manufacture or transit to the dealer, if the carrier is designated by the warrantor, factory branch, distributor, or distributor branch.

(4) Fail to compensate any of its dealers in accordance with the schedule of compensation provided to the dealer pursuant to this section if performed in a timely and competent manner.

(5) Intentionally misrepresent in any way to purchasers of recreational vehicles that warranties with respect to the manufacture, performance, or design of the vehicle are made by the dealer as warrantor or co-warrantor.

(6) Require the dealer to make warranties to customers in any manner related to the manufacture of the recreational vehicle.

(i) It is a violation of this chapter for any dealer to do any of the following:

(1) Fail to perform pre-delivery inspection functions, as specified by the warrantor, in a competent and timely manner so long as there are specific instructions from the manufacturer.

(2) Fail to perform warranty service work authorized by the warrantor in a reasonably competent and timely manner on any transient customer's vehicle of the same line-make.

(3) Fail to accurately document the time spent completing each repair, the total number of repair attempts conducted on a single unit, and the number of repair attempts for the same repair conducted on a single vehicle.

(4) Fail to notify the warrantor within 10 days of a second repair attempt which impairs the use, value, or safety of the vehicle.

(5) Fail to maintain written records, including a consumer's signature, regarding the amount of time a unit is stored for the consumer's convenience during a repair.

(6) Make fraudulent warranty claims or misrepresent the terms of any warranty.

(Act 2011-636, p. 1529, §7.)