Impact on Dealerships It remains to be seen how this new law will affect California dealerships. If the provisions promoting early settlement are effective, it would be a blessing for dealerships. Dealerships would be named in fewer lawsuits, there would be less depositions of dealership employees, and less interruptions to business in general. On the other hand, while it is not entirely clear, it appears that these new provisions would not apply if the lawsuit includes additional causes of action, such as negligent repair against the dealership. Additionally, the law prescribes standard release language for settlements between the manufacturer and the customer, and dealerships are not included in the release prescribed therein, which could potentially result in dealers being sued separately from the manufacturer on the same transaction. For example, suits involving certified pre-owned vehicles often allege claims against both the manufacturer and dealership. A customer could file a lemon law claim against the manufacturer, reach an early resolution with the manufacturer, and then file a separate proceeding against the dealership alleging misrepresentation of the prior history of the vehicle. Manning, Leaver, Bruder & Berberich LLP is a Los Angeles law firm that practices throughout California and has been in existence for over 100 years. It has a strong automobile dealer practice covering all areas related to the automobile dealer industry, including dealership buy‑sells, real estate transactions, business and consumer litigation, regulatory compliance, dealer association law, new motor vehicle board matters and franchise law. See manningleaver.com for more information and areas of practice. Nothing in this article may be considered as legal advice. Contact legal counsel for legal advice. 1. Civil Code § 1793.2(d)(2). 2. Civil Code § 1795.5(a) — expressly excludes the original manufacturer or distributor in regard to any new vehicle warranties issued when the vehicle was originally sold as new. 3. Civil Code § 1792. 4. A “dealer obligor” service contract. See CNCDA Dealership Operations Guide, Chapter 6: Service Contracts for more information. 5. It does not apply to used vehicles sold with a service contract if no other warranty is issued at the time of sale. 6. Presumably, the warrantor defendant’s answer, but the statute does not specify. CONTACT US TODAY TO PLACE YOUR ANNOUNCEMENT AD. SHOW-OFF. THERE'S NOTHING WRONG WITH BEING A Call (801) 676-9722 or scan the QR code to get started. Place QR Code Here ▷ Show off your employees. ▷ Show off your accomplishments. ▷ Show off a job well done. Employees are motivated when they are recognized and feel valued. This magazine is a great platform to celebrate your team’s accomplishments! 33 California New Car Dealer Quarterly
RkJQdWJsaXNoZXIy MTg3NDExNQ==