SEARCH SITE
VIRGINIA LAW PORTAL
- Code of Virginia
- Virginia Administrative Code
- Constitution of Virginia
- Charters
- Authorities
- Compacts
- Uncodified Acts
- RIS Users (account required)
SEARCHABLE DATABASES
- Bills & Resolutions
session legislation - Bill Summaries
session summaries - Reports to the General Assembly
House and Senate documents - Legislative Liaisons
State agency contacts
ACROSS SESSIONS
- Subject Index: Since 1995
- Bills & Resolutions: Since 1994
- Summaries: Since 1994
Developed and maintained by the Division of Legislative Automated Systems.
2012 SESSION
Be it enacted by the General Assembly of Virginia:
1. That §§ 46.2-1527.1 and 46.2-1527.2 of the Code of Virginia are amended and reenacted as follows:
§ 46.2-1527.1. Motor Vehicle Transaction Recovery Fund established.
All fees in this article shall be deposited in the Motor
Vehicle Transaction Recovery Fund, hereinafter referred to in this article as
"the Fund." The Fund shall be a special fund in the state treasury to
pay claims against the Fund and for no other purpose, provided that any such
payment does not result in a negative balance of the Fund, except the Board
may expend moneys for the administration of this article up to the maximum
amount authorized for consumer assistance in the general appropriation act,
provided the amount expended does not result in a balance of the Fund of less
than $250,000. The Fund shall be used to satisfy unpaid judgments, as provided
for in § 46.2-1527.3. Any interest income shall accrue to the Fund. The Board
shall maintain an accurate record of all transactions involving the Fund. The minimum
balance of the Fund shall be $250,000. In order to maintain the minimum Fund
balance, the Board may levy a special assessment on all dealers
participating in the Fund to pay claims against the Fund and to maintain a
minimum Fund balance that is in its judgment adequate. The Board may choose to
await a positive balance in the Fund to pay claims ready for payment in
chronological order, provided such claims do not go unpaid for more than 60
days.
Every applicant renewing a motor vehicle dealer's license shall pay, in addition to other license fees, an annual Fund fee of $100, and every applicant for a motor vehicle salesperson's license shall pay, in addition to other license fees, an annual Fund fee of $10, prior to license issue. However, annual Fund renewal fees from salespersons shall not exceed $100 per year from an individual dealer. These fees shall be deposited in the Motor Vehicle Transaction Recovery Fund.
Applicants for an original motor vehicle dealer's license shall pay an annual Fund fee of $250 each year for three consecutive years. During this period, the $250 Fund fee will take the place of the annual $100 Fund fee.
In addition to the $250 annual fee, applicants for an original dealer's license shall have a $50,000 bond pursuant to § 46.2-1527.2 for three consecutive years. Only those renewing licensees who have not been the subject of a claim against their bond or against the Fund for three consecutive years shall pay the annual $100 fee and will no longer be required to pay the $250 annual fee or hold the $50,000 bond.
In addition to other license fees, applicants for an original Certificate of Dealer Registration or its renewal shall pay a Fund fee of $60.
The Board may suspend or reinstate collection of Fund fees.
The provisions of this section shall not apply to manufactured home dealers as defined in § 36-85.16, T&M vehicle dealers as defined in § 46.2-1900, trailer dealers as defined in § 46.2-1992, motorcycle dealers as defined in § 46.2-1993, and nonprofit organizations issued certificates pursuant to subsection B of § 46.2-1508.1.
The provisions of this section shall not apply to applicants
for the renewal of a motor vehicle dealer's license where such applicants have
not been the subject of a claim against a bond issued pursuant to § 46.2-1527.2
or against the Fund for three years and such applicants elect to maintain
continuous bonding pursuant to Article 3.2 (§ 46.2-1527.9 et seq.) of this
chapter. Such applicants shall not participate in the Fund and shall be
exempt from the payment of any Fund fees.
§ 46.2-1527.2. Bonding requirements for applicants for an original license.
Before the Board shall issue to an applicant an original license, the applicant shall obtain and file with the Board a bond in the amount of $50,000. The bond shall come from a corporate surety licensed to do business in the Commonwealth and approved by the Attorney General. The bond shall be conditioned on a statement by the applicant that the applicant will not practice fraud, make any fraudulent representation, or violate any provision of this chapter in the conduct of the applicant's business. The Board may, without holding a hearing, suspend the dealer's license during the period that the dealer does not have a sufficient bond on file.
If a person suffers any of the following: (i) loss or damage
in connection with the purchase or lease of a motor vehicle by reason of fraud
practiced on him or fraudulent representation made to him by a licensed motor
vehicle dealer or one of the dealer's salespersons acting within his scope of
employment, (ii) loss or damage by reason of the violation by a dealer or
salesperson of any provision of this chapter in connection with the purchase or
lease of a motor vehicle, or (iii) loss or damage resulting from a breach of an
extended service contract entered into on or after the effective date of this
act, as defined by § 59.1-435, that person shall have a claim against the
dealer and the dealer's bond, and may recover such damages as may be awarded to
such person by final judgment of a court of competent jurisdiction against the
dealer as a proximate result of such loss or damage up to but not exceeding
$20,000, from such surety, who shall be subrogated to the rights of such person
against the dealer or salesperson. The liability of such surety shall be
limited to actual damages and attorney fees, and shall not include any
punitive damages or attorney fees assessed against the dealer or
salesperson.
In those cases in which a dealer's surety shall be liable pursuant to this section, the surety shall be liable only for the first $50,000 in claims against the dealer. Thereafter, the Fund shall be liable for the next $50,000 in those cases in which the Fund itself may be liable. The aggregate liability of the dealer's surety to any and all persons, regardless of the number of claims made against the bond or the number of years the bond remains in force, shall in no event exceed $50,000.
The dealer's surety shall notify the Board when a claim is made against a dealer's bond, when a claim is paid and when the bond is cancelled. Such notification shall include the amount of a claim and the circumstances surrounding the claim. Notification of cancellation shall include the effective date and reason for cancellation. The bond may be cancelled as to future liability by the dealer's surety upon 30 days' notice to the Board.