GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1995

H	1 

HOUSE BILL 837

Short Title:  MV Manufacturer Warranty Audits.	(Public)

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Sponsors: Representatives Hiatt; Aldridge, Bowie, J. Brown, Capps, Decker, Dickson, Ives, Justus, McComas, Robinson, Sharpe, Sherrill, and G. Wilson.

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Referred to:  Business and Labor.

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April 11, 1995

A BILL TO BE ENTITLED
AN ACT TO MODIFY THE TIME LIMIT WITHIN WHICH MOTOR VEHICLE MANUFACTURERS AND DISTRIBUTORS MAY AUDIT AND CHARGEBACK DEALERS FOR WARRANTY REPAIRS.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 20-305.1(b) reads as rewritten:
"(b)	Notwithstanding the terms of any franchise agreement, it is unlawful for any motor vehicle manufacturer, factory branch, distributor, or distributor branch to fail to perform any of its warranty obligations with respect to a motor vehicle, to fail to compensate its motor vehicle dealers licensed in this State for warranty parts other than parts used to repair the living facilities of recreational vehicles, at the prevailing retail rate according to the factors in subsection (a) of this section, or, in service in accordance with the schedule of compensation provided the dealer pursuant to subsection (a) above, and to fail to indemnify and hold harmless its franchised dealers licensed in this State against any judgment for damages or settlements agreed to by the manufacturer, including, but not limited to, court costs and reasonable attorneys' fees of the motor vehicle dealer, arising out of complaints, claims or lawsuits including, but not limited to, strict liability, negligence, misrepresentation, express or implied warranty, or recision or revocation of acceptance of the sale of a motor vehicle as defined in G.S. 25-2-608, to the extent that the judgment or settlement relates to the alleged defective negligent manufacture, assembly or design of new motor vehicles, parts or accessories or other functions by the manufacturer, factory branch, distributor or distributor branch, beyond the control of the dealer.  Any audit for warranty parts or service compensation shall only be for the 12-month period immediately following the date of the claim.  Any audit for sales incentives, service incentives, rebates, or other forms of incentive compensation shall only be for the 24-month period immediately following the date of the claim.  Provided, however, these limitations shall not be effective in the case of fraudulent claims."
Sec. 2.  This act becomes effective October 1, 1995.