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REFERENCE TITLE: dealerships; loan payoff; trade-in vehicles |
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State of Arizona Senate Fifty-fourth Legislature Second Regular Session 2020
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SB 1417 |
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Introduced by Senator Farnsworth D
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AN ACT
amending title 44, chapter 9, article 15, Arizona Revised Statutes, by adding section 44‑1371.01; relating to motor vehicle transactions.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Title 44, chapter 9, article 15, Arizona Revised Statutes, is amended by adding section 44-1371.01, to read:
44-1371.01. Trade-in vehicles; prior credit or lease balance; agreements; rescission; definitions
A. If a motor vehicle dealer purchases or obtains a vehicle in trade in a retail sale or lease transaction and the vehicle is subject to a prior credit or lease balance, all of the following apply:
1. If the motor vehicle dealer agrees to pay a specified amount on the prior credit or lease balance owing on the vehicle purchased or obtained in trade and the agreement to pay the specified amount is contained in a written agreement documenting the transaction, the motor vehicle dealer shall tender the amount as provided in the written agreement to the lessor, the owner or the lessor's or owner's designee within twenty‑one CALENDAR days after purchasing or obtaining the VEHICLE in trade.
2. If the motor vehicle dealer does not set forth in a written agreement documenting the transaction an agreement regarding payment of a prior credit or lease balance owed on the vehicle purchased or obtained in trade, the motor vehicle dealer shall tender to the lessor, the owner or the lessor's or owner's designee an amount necessary to discharge the prior credit or lease balance owing on the vehicle purchased or obtained in trade within twenty‑one calendar days after purchasing or obtaining the vehicle.
3. The time period specified in paragraph 1 or 2 of this subsection may be shortened if the motor vehicle dealer and the lessor, the owner or the lessor or owner's designee agree in writing to a shorter time period.
4. A motor vehicle dealer may not sell, consign for sale or transfer an OWNERSHIP interest in the vehicle purchased or obtained in trade until an amount necessary to discharge the prior credit or lease balance owing on the vehicle is tendered to the lessor, the owner or the lessor's or owner's designee.
B. A motor vehicle dealer does not violate this section if the motor vehicle dealer reasonably and in good faith gives notice of rescission of the contract promptly but not later than twenty‑one days after the date on which the vehicle was purchased or obtained in trade and the contract is rescinded afterward because of any of the following:
1. All the parties agree to the rescission.
2. The consent of the dealer or of any party jointly contracting with the dealer was given by mistake or obtained through duress, menace, fraud or undue influence exercised by or with the connivance of the vehicle lessor or owner or of any other party to the contract jointly interested with the vehicle lessor or owner.
3. If the consideration for the motor vehicle dealer's obligation fails, in whole or in part, through the fault of the vehicle lessor or owner.
4. If the consideration for the motor vehicle dealer's obligation becomes entirely void from any cause.
5. If the consideration for the motor vehicle dealer's obligation, before it is rendered to the dealer, fails in a material respect from any cause.
6. If the contract is unlawful for causes that do not appear in its terms or conditions and the parties are not equally at fault.
7. If the public interest will be prejudiced by allowing the contract to stand.
8. Any other law providing for rescission.
C. For the purpose of this section:
1. "Designee" means the person who is designated by the lessor or owner of a vehicle that is purchased or obtained in trade.
2. "Motor vehicle dealer" has the same meaning prescribed in section 28-4301.
3. "Owner" means a person who is reflected on a vehicle's certificate of title.