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AS PASSED BY SENATE S.17

    1999 Page 1

    S.17 AN ACT RELATING TO MOTOR VEHICLE DEALERS

    Sec. 1. 23 V.S.A. ? 4(8) is amended to read:

    (8) "Dealer" includes "new car dealer," "used car dealer," "finance car

    dealer" as well as other types of motor vehicle dealers; “Dealer” shall mean a

    person, partnership, or corporation who is engaged in the business of buying,

    selling or exchanging new or used motor vehicles, as well as other types of

    motor vehicle dealers, except finance and auction dealer and transporter

    (A) "New car dealer" or "used car dealer" means a person whose primary activity is in the business of buying, selling or exchanging new or used

    motor vehicles and who may, as part of or incidental to such business, repair

    such vehicles, sell motor vehicle parts and accessories or lease or rent motor vehicles and who:

    (i) Has had no previous record of willful violations of dealer laws

    or regulations in this or any other jurisdiction;

    (ii) Has had no previous record of criminal convictions for

    extortion, forgery, fraud, larceny or embezzlement in this or any other

    jurisdiction;

    (ii)(iii) Has no unsatisfied judgments against him or her arising

    out of violations of consumer protection laws in this or any other jurisdiction;

AS PASSED BY SENATE S.17

    1999 Page 2

    (iii)(iv) Presents proof of compliance with the provisions of 23

    V.S.A. ? 800 at the time application for registration is made;

    (iv)(v) Is open for business at least 104 days during the calendar

    year. When the application for registration as a new car dealer or used car

    dealer is made, the applicant shall provide the commissioner with the hours of

    operation of the business which the person shall maintain during the

    registration period. ;

    (v)(vi) Owns real estate (as defined in section 132 of Title 1) as

    his or her place of business or has a lease with an expiration date not earlier

    than the last day of the registration year for which registration is sought under

    the provisions of subchapter 4 of chapter 7 of this title which has an appraised

    value (as defined in section 3481 of Title 32) of not less than ten thousand

    dollars and includes a building which has suitable and adequate facilities for

    the repair of motor vehicles, and has inside storage facilities for at least five

    standard sized pleasure cars. The building shall have adequate facilities for

    the maintenance of the records required by law to be kept including, but not

    limited to, those required by section 466 of this title and for the transfer of

    motor vehicles.

    (B) "New car dealer" shall mean a person who, in addition to satisfying all of the requirements set forth in subdivision (8)(A) of this section,

    has a valid sales and service agreement, franchise or contract with a

AS PASSED BY SENATE S.17

    1999 Page 3

manufacturer, assembler, importer or distributor of new motor vehicles for the

    retail sale of new motor vehicles.

    (C) "Finance dealer" means a person who is authorized to do business in this state and is actively engaged in and devoting a principal

    portion of his or her time to the wholesale and retail financing of motor vehicle

    sales by and through direct wholesale loans to those who are registered motor

    vehicle dealers under subdivisions (A) or (B) above chapter 7 of this title or the

    purchase of retail conditional sales contracts from the dealers. A person

    entitled to dealer registration under this subdivision shall be deemed a dealer

    only to the extent of moving or operating under dealer registration a motor

    vehicle which he or she is repossessing in the regular course of his or her

    business. A person entitled to dealer registration under this subdivision shall

    also be entitled to demonstrate repossessed motor vehicles.

    (D) "Auction dealer" means a person who is authorized to do business in this state and is engaged in the sale of motor vehicles at public

    auction subject to the provisions of sections 451, 458, 459, 463, 466, 467 and

    468 of this title. A motor vehicle owned by the auction dealer and to be sold

    at public auction by the auction dealer may be transported to the place of

    auction for a period of up to 30 days prior to the date of auction on auction

    dealer plates and then only by the dealer or his or her employee. A motor

    vehicle sold by an auction dealer may only be operated on auction dealer plates

AS PASSED BY SENATE S.17

    1999 Page 4

on the date of sale and then only by the dealer or his or her employee or by the

    purchaser when accompanied by the dealer or employee within ten miles of the

    place of auction.

    (E) A person shall not be considered to have as his or her primary

    activity the business of buying, selling or exchanging new or used motor

    vehicles so as to qualify him or her for new or used car dealer registration

    under the provisions of 23 V.S.A. ? 451 unless, during the immediately

    preceding registration year, he or she has sold not less than 12 pleasure cars or

    trucks not owned and registered by him or her, or has sold not less than 12

    pleasure cars or trucks owned or registered, or both, by him or her which have

    been used in lease or rental service. Any vehicle sold by a leasing or rental

    company to a registered new or used car dealer shall not count toward the 12

    vehicles required for registration as a dealer. The requirements of this subdivision shall not prevent the registration of a person who has not

    previously been registered as a new car dealer or used car dealer in this state

    but who is otherwise qualified for registration provided, however, the

    requirements of this subdivision shall be applicable to that person in all years

    subsequent to the initial year of registration.

    (F)(E) As used in this subdivision, "person" shall include any individual or, in the case of partnerships, corporations or other entities, the

    directors, shareholders, officers or partners in these entities. The term

AS PASSED BY SENATE S.17

    1999 Page 5

“business use of the dealer” shall only mean the motor vehicle business of the

    motor vehicle dealer to which number plates have been issued pursuant to

    section 453 of this title.

    (F) For new and used car dealers, “engaged in the business” means

    selling 12 or more pleasure cars or motor trucks owned but not registered by

    the seller except for vehicles that are to be scrapped, dismantled or destroyed.

    “Engaged in the business” shall also mean selling, during the immediately

    preceding registration year, 12 or more pleasure cars or motor trucks which

    have been in lease or rental services, and persons so engaged shall meet all

    obligations required of dealers.

    Sec. 2. 23 V.S.A. ? 4(42) is amended to read:

    (42) "Transporter" shall mean every a person engaged in the

    business of delivering vehicles of a type required to be registered hereunder

    from a manufacturing, assembling, or distributing plant to dealers or sales

    agents of a manufacturer, and includes persons regularly engaged in the

    business of towing trailer coaches, owned by them or temporarily in their

    custody, on their own wheels over public highways, persons towing office

    trailers owned by them or temporarily in their custody, on their own wheels

    over public highways, persons regularly engaged and properly licensed for the

    short-term rental of "storage trailers" owned by them and who move these

    storage trailers on their own wheels over public highways, and persons

AS PASSED BY SENATE S.17

    1999 Page 6

regularly engaged in the business of moving modular homes over public

    highways and shall also include dealers and automobile repair shop owners

    when engaged in the transportation of motor vehicles to and from their place of business for repair purposes. "Transporter" shall include other persons, firms or corporations, provided the transportation and delivery of motor vehicles is a common and usual incident to the repossession of motor vehicles in connection with their business. For purposes of this subdivision, "short-term rental" shall mean a period of less than one year. Before a person may become licensed as

    a transporter, he or she shall present proof of compliance with section 800 of this title. He or she shall also either own or lease a permanent place of

    business located in this state where business shall be conducted during

    regularly established business hours and the required records stored and

    maintained. Sec. 3. 23 V.S.A. ? 451 is amended to read:

    ? 451. DEALER’S CERTIFICATE

    (a) Instead of registering each motor vehicle owned by him or her, a new car or used car dealer or a finance dealer may make application under oath to

    the commissioner, upon forms prescribed and furnished by the commissioner

    for that purpose, and accompanied by such additional information and

    certifications as the commissioner may reasonably require, for a general

    distinguishing number for such motor vehicles. If the commissioner is

AS PASSED BY SENATE S.17

    1999 Page 7

satisfied that the applicant meets all the requirements of section 4(8) and

    chapter 7 of this title and is qualified to engage in such business, the

    commissioner may issue to the applicant a certificate of registration containing the name, place of residence and address of such applicant, the general distinguishing number assigned, and such further additional information as the

    commissioner may determine. If a dealer has a place of business or agency in more than one city or town, he or she shall file an application and secure a certificate of registration for each place of business or agency. The place of business or agency shall mean a place in any town where motor vehicles owned by a dealer are regularly kept or exposed for sale in the custody or control of the dealer or a salesman, employee or agent of such dealer. In his or her discretion, the commissioner may assign the same distinguishing number with more than one certificate to any dealer who has separate places of business within the same or an adjacent city or town within Vermont. The commissioner may allow a dealer having one distinguishing number with more than one certificate to maintain only one central area for the maintenance of records required by law to be kept, including, but not limited to those required by section 466 of this title and for the transfer of motor vehicles. This location must be in Vermont and must be disclosed on the application prior to approval and may be changed only with the approval of the commissioner or

AS PASSED BY SENATE S.17

    1999 Page 8

his or her agent. Dealer registration plates shall contain letters indicating the

    type of dealer certificate issued before the distinguishing number.

    (b) With the prior approval of the commissioner, a Vermont new or used

    car dealer may display vehicles on a temporary basis, but in no instance for

    more than 10 days, at fairs, shows, exhibitions and other similar off-site

    locations within the manufacturer's stated area of responsibility in the franchise

    agreement, or in the event there is no manufacturer's stated area of

    responsibility, within 25 air miles of the exact location of the dealership as

    authorized by the commissioner. No sales may be transacted at these off site

    locations. A dealer desiring to display vehicles temporarily at an off-site

    location shall apply for approval in writing to notify the commissioner on forms in a manner prescribed and furnished by the commissioner no less than 30 two days prior to the first day for which approval is requested.

    (c) A new or used car dealer may temporarily transfer possession of a

    vehicle owned by the dealer on consignment to a registered auction dealer or

    Vermont licensed auctioneer to be sold at public or private wholesale auction

    by the auction dealer or Vermont licensed auctioneer. Sec. 4. 23 V.S.A. ? 452 is amended to read:

    ? 452. EXPIRATION

    Dealers' Unless otherwise specifically provided or unless canceled, revoked

    or suspended, dealers’ registrations and certificates shall expire on the last day

AS PASSED BY SENATE S.17

    1999 Page 9

of February next following the date become void one year from the first day of

    the month of issue. The commissioner may renew dealer registrations for two

    years and may stagger expiration dates.

    Sec. 5. 23 V.S.A. ? 459 is amended to read:

    ? 459. NOTICE TO COMMISSIONER

    (a) Upon issuing a set of number plate with temporary validation stickers,

    temporary number plates plate or decal to a purchaser for attachment to a

    motor vehicle, a dealer shall immediately , within three business days, forward to the commissioner the application and fee, deposited with him or her by the

    purchaser, together with notice of such issue and such other information as the

    commissioner may require.

    (b) If a number plate with temporary validation stickers, temporary registration plate or decal is not issued by a dealer in connection with the sale

    or exchange of a motor vehicle, the dealer may accept, from the purchaser, a

    properly executed registration, tax and title application and the required fees

    for transmission to the commissioner. The dealer shall immediately , within three business days, forward to the commissioner the application and fee

    together with such other information as the commissioner may require.

    Sec. 6. 23 V.S.A. ? 462 is amended to read:

    ? 462. CANCELLATION OF DEALER’S REGISTRATION

AS PASSED BY SENATE S.17

    1999 Page 10

(a) The commissioner may cancel, revoke or suspend a registration

    certificate issued to a dealer under the provisions of this chapter, whenever,

    after the dealer has been afforded the opportunity of a hearing before the

    commissioner or upon conviction in any court in this state in any jurisdiction, it appears that the dealer has wilfully willfully violated any motor vehicle law

    of this state or any lawful regulation of the commissioner, applying to dealers

    or when it appears that the dealer has engaged in fraudulent or unlawful

    practices in related to the purchase, sale or exchange of motor vehicles. A

    dealer whose certificate has been canceled shall forthwith return to the

    commissioner the registration certificate and the any and all number plates, or numbers or decals furnished him or her by the commissioner; and the right privilege to operate, purchase, sell or exchange motor vehicles under his or her

    dealer's number shall cease. An application for a new dealer’s license for that

    dealer will not be considered until the suspension period has been served. (b) A fee of $30.00 shall be paid to the commissioner prior to the

    reinstatement of any dealer's license or registration certificate cancelled canceled, revoked or suspended for cause.

    Sec. 7. 23 V.S.A. ? 465 is amended to read:

    ? 465. LOANING OF PLATES OR VEHICLES PROHIBITED

    A dealer shall not loan or lease registration certificates, validation stickers,

    numbers, or decals or number plates which have been assigned to him or her

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