2016 Tennessee Code
Title 55 - Motor and Other Vehicles
Chapter 28 - Tennessee Recreation Vehicle Franchise Act of 2016 [Effective July 1, 2017]
§ 55-28-107. Warranty claims; violations by warrantor or dealer. [Effective July 1, 2017.]
(a) Each warrantor shall:
(1) Specify in writing to each of its dealer obligations, if any, for preparation, delivery, and warranty service on its products;
(2) Compensate the dealer for warranty service required of the dealer by the warrantor; and
(3) Provide the dealer the schedule of compensation to be paid and the time allowances for the performance of any work and service. The schedule of compensation must include reasonable compensation for diagnostic work as well as warranty labor.
(b) Time allowances for the diagnosis and performance of warranty labor must be reasonable for the work to be performed. In the determination of what constitutes reasonable compensation under this section, the principal factors to be given consideration shall be the actual wage rates being paid by the dealer, and the actual retail labor rate being charged by the dealers in the community in which the dealer is doing business. The compensation of a dealer for warranty labor shall not be less than the lowest retail labor rates actually charged by the dealer for like nonwarranty labor as long as such rates are reasonable.
(c) The warrantor shall reimburse the dealer for any warranty part, accessory, or complete component at actual wholesale cost plus a minimum thirty percent (30%) handling charge up to a maximum of one hundred fifty dollars ($150) and the cost, if any, of freight to return such part, component, or accessory to the warrantor.
(d) Warranty audits of dealer records may be conducted by the warrantor within twelve (12) months of payment of the claim and adjustments, if any, will include debits and credits. Dealer claims for warranty compensation shall not be denied except for cause, including performance of nonwarranty repairs, material noncompliance with the warrantor's published policies and procedures, lack of material documentation, fraud, or misrepresentation.
(e) The dealer shall submit warranty claims within forty-five (45) days after completing work.
(f) The dealer shall immediately notify the warrantor verbally or in writing if the dealer is unable to perform any warranty repairs within ten (10) days of receipt of verbal or written complaints from a consumer. If the cause for the consumer complaint is a delay in delivery of warranty parts from the manufacturer, then the dealer need only report this fact to the manufacturer.
(g) The warrantor shall disapprove warranty claims in writing within thirty (30) days after the date of submission by the dealer in the manner and form prescribed by the warrantor. Claims not specifically disapproved in writing within thirty (30) days shall be construed to be approved and must be paid within sixty (60) days of submission.
(h) A dealer is not obligated to store defective warranty parts for more than thirty (30) days from the time the warranty work is paid by the warrantor, if the defective parts, components, or accessories are not immediately returned to the warrantor or the consumer.
(i) It is a violation of this chapter for any warrantor to:
(1) Fail to perform any of its warranty obligations with respect to its warranted products;
(2) Fail to include, in written notices of factory campaigns to recreational vehicle owners and dealers, the expected date by which necessary parts and equipment, including tires and chassis or chassis parts, will be available to dealers to perform the campaign work. The warrantor may ship parts to the dealer to effect the campaign work, and, if such parts are in excess of the dealer's requirements, the dealer may return unused, undamaged parts to the warrantor for full credit of the original charge to the dealer for the value of the parts returned after completion of the campaign;
(3) Fail to compensate any of its dealers for authorized repairs effected by the dealer on vehicles damaged in manufacture or transit to the dealer, if the carrier is designated by the warrantor, factory branch, distributor, or distributor branch;
(4) Fail to compensate any of its dealers in accordance with the schedule of compensation provided to the dealer pursuant to this section if performed in a timely and competent manner;
(5) Intentionally misrepresent in any way to purchasers of recreational vehicles that warranties with respect to the manufacture, performance, or design of the vehicle are made by the dealer as warrantor or co-warrantor; or
(6) Require the dealer to make warranties to customers in any manner related to the manufacture of the recreational vehicle.
(j) It is a violation of this chapter for any dealer to:
(1) Fail to perform predelivery inspection functions, as specified by the warrantor, in a competent and timely manner;
(2) Fail to perform warranty service work authorized by the warrantor in a competent and reasonably timely manner on any transient customer's vehicle of a line-make sold or serviced by that dealer;
(3) Fail to notify the warrantor within ten (10) days of a second repair attempt which impairs the use, value or safety of the vehicle; or
(4) Make fraudulent warranty claims or misrepresent the terms of any warranty.
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