(a) As used in this section, “dealer” shall have the same meaning as such term is defined by section four hundred fifteen of the vehicle and traffic law.
Terms Used In N.Y. General Business Law 198-C
- Common law: The legal system that originated in England and is now in use in the United States. It is based on judicial decisions rather than legislative action.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Lien: A claim against real or personal property in satisfaction of a debt.
- Misdemeanor: Usually a petty offense, a less serious crime than a felony, punishable by less than a year of confinement.
- Remainder: An interest in property that takes effect in the future at a specified time or after the occurrence of some event, such as the death of a life tenant.
- Rescission: The cancellation of budget authority previously provided by Congress. The Impoundment Control Act of 1974 specifies that the President may propose to Congress that funds be rescinded. If both Houses have not approved a rescission proposal (by passing legislation) within 45 days of continuous session, any funds being withheld must be made available for obligation.
- Statute: A law passed by a legislature.
(b) When a 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 dealer agreed 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 dealer shall tender the agreed upon amount as provided in the written agreement to the lessor, or to the lien holder, or to the designee of that lessor or lien holder of the vehicle purchased or obtained in trade within twenty-one calendar days of purchasing or obtaining the vehicle in trade, provided, however, that the dealer may rely upon the amount due as stated by the lessor or lien holder.
(2) If the dealer did not set forth an agreement regarding payment of a prior credit or lease balance owed on the vehicle purchased or obtained in trade, in a written agreement documenting the transaction, the dealer shall tender to the lessor, or to the lien holder, or to the designee of that lessor or lien holder of the vehicle purchased or obtained in trade, 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 of purchasing or obtaining the vehicle in trade, provided, however, that the dealer may rely upon the amount due as stated by the lessor or lien holder.
(3) The time period specified in paragraph one or two of this subdivision may be shortened if the dealer and consumer agree, in writing, to a shorter time period.
(4) A dealer shall not sell, consign for sale, or transfer any 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 has been tendered to the lessor, or to the lien holder, or to the designee of that lessor or lien holder of the vehicle purchased or obtained in trade.
(c) If the agreement gives either party the right to rescind the entire agreement within a reasonable time period, rescission of the entire agreement shall effectively rescind the obligations pursuant to this section without violating this section.
(d) This section shall not apply to agreements or transactions that involve a state or federal program in which a dealer is issued a voucher to offset the purchase price or lease price for a qualifying lease of a new vehicle upon the surrender of an eligible trade-in vehicle to a dealer participating in the program.
(e) (1) Every violation of this section shall be deemed a deceptive act and practice subject to enforcement under article twenty-two-A of this chapter. In addition, the district attorney, county attorney, and the corporation counsel shall have concurrent authority to seek the relief in paragraph two of this subdivision, and all civil penalties obtained in any such action shall be retained by the municipality or county.
(2) In every case where the court shall determine that a violation of this section has occurred, it may impose a civil penalty of not more than five thousand dollars for each violation. Such penalty shall be in addition to any denial of registration or renewal, suspension of registration or revocation of registration or assessment of a fine authorized by subdivision nine of section four hundred fifteen of the vehicle and traffic law.
(3) Nothing in this section shall be construed to restrict any right which any person may have under any other statute or the common law.
(4) No dealer shall be deemed to have violated the provisions of this section if such dealer shows, by a preponderance of the evidence, that the violation was not intentional and resulted from a bona fide error made notwithstanding the maintenance of procedures reasonably adopted to avoid such error.
(f) Any person who is convicted of knowingly violating paragraph four of subdivision (b) of this section shall be guilty of a class A misdemeanor.
(g) If any part or provision of this section or the application thereof to any person or circumstances be adjudged invalid by any court of competent jurisdiction, such judgment shall be confined in its operations to the part, provision or application directly involved in the controversy in which such judgment shall have been rendered and shall not affect or impair the validity of the remainder of this section or the application thereof to other persons or circumstances.