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2015 GNYADA Membership Directory

51

DAMAGE DISCLOSURE REQUIREMENTS

When is Damage Disclosure Required?

New York requires dealers to disclose damages to a new vehicle that occurred prior to sale and delivery to

a consumer or another dealer when those damages exceed a threshold amount. In NY, if the retail cost of

parts and labor to repair physical damage exceeds 5% of MSRP, dealers must give a written notice to the

consumer.

Manufacturers are Covered, too

NY law also requires disclosure by manufacturers, distributors, and dealers who are transferring or selling

a damaged vehicle to another dealer. A written notice of the repairs must be provided before the buyer

pays for the vehicle.

Exception

No notice requirement applies to identical replacement of stolen or damaged accessories or their

components used to make the repairs.

Penalties

A consumer who does not receive the

written notice is entitled to a full refund of

the purchase price of the vehicle plus any

trade-in allowance plus fees and charges

(within four months of the purchase). The

law includes a deduction for mileage using

a complicated formula.

A retail dealer who suffers a loss because

they were not notified of prior damages

by a manufacturer, distributor, or another

retail dealer is entitled to reimbursement

from the seller who failed to provide such

notice.

In addition, any dealer or his/her employee

who violates this law is subject to a fine of

up to $50 for the first offense and $250 for

each subsequent offense.

GNYADA recommends that you keep a

signed copy of a Damage Disclosure Form

in the deal jacket. See sample form at right.