60-1441. New motor vehicle dealers; recall repairs; compensation; stop-sale or do-not-drive order; compensation; applicability of section; prohibited acts.

(1) A manufacturer, distributor, factory branch, or distributor branch shall compensate its new motor vehicle dealers for all labor and parts required by the manufacturer, distributor, factory branch, or distributor branch to perform recall repairs on used motor vehicles. Compensation for recall repairs shall be reasonable. If parts or a remedy are not reasonably available to perform a recall service or repair on a used motor vehicle held for sale by a new motor vehicle dealer authorized to sell and service new motor vehicles of the same line-make within thirty days after the initial notice of recall, and a stop-sale or do-not-drive order has been issued on the motor vehicle, the manufacturer, distributor, factory branch, or distributor branch shall compensate the new motor vehicle dealer at a prorated rate of at least one percent of the value of the used motor vehicle per month beginning on the date that is thirty days after the date on which the stop-sale or do-not-drive order was provided to the new motor vehicle dealer until the earlier of either of the following:

(a) The date the recall or remedy parts are made available; or

(b) The date the new motor vehicle dealer sells, trades, or otherwise disposes of the affected used motor vehicle.

(2) The value of a used motor vehicle shall be the average trade-in value for used motor vehicles as indicated in an independent third-party guide for the year, make, and model of the recalled used motor vehicle.

(3) This section applies only to used motor vehicles subject to safety or emissions recalls pursuant to and recalled in accordance with federal law and regulations adopted thereunder and if a stop-sale or do-not-drive order has been issued and repair parts or remedy remain unavailable for thirty days or longer.

(4) This section applies only to new motor vehicle dealers holding an affected used motor vehicle for sale:

(a)(i) In inventory at the time a stop-sale or do-not-drive order was issued; or

(ii) Which was taken in the used motor vehicle inventory of the new motor vehicle dealer as a consumer trade-in incident to the purchase of a new motor vehicle from the new motor vehicle dealer after the stop-sale or do-not-drive order was issued; and

(b) That is of a line-make which the new motor vehicle dealer is franchised to sell or on which the new motor vehicle dealer is authorized to perform recall repairs.

(5) Subject to the audit provisions of subsection (5) of section 60-1438, it shall be a violation of this section for a manufacturer, distributor, factory branch, or distributor branch to reduce the amount of compensation otherwise owed to an individual new motor vehicle dealer, whether through a chargeback, removal of the individual new motor vehicle dealer from an incentive program, or reduction in amount owed under an incentive program solely because the new motor vehicle dealer has submitted a claim for reimbursement under this section. This subsection does not apply to an action by a manufacturer, distributor, factory branch, or distributor branch that is applied uniformly among all new motor vehicle dealers of the same line-make in the state.

(6) Any reimbursement claim made by a new motor vehicle dealer pursuant to this section for recall remedies or repairs, or for compensation where no part or repair is reasonably available and the used motor vehicle is subject to a stop-sale or do-not-drive order, shall be subject to the same limitations and requirements as a warranty reimbursement claim made under section 60-1438. In the alternative, a manufacturer, distributor, factory branch, or distributor branch may compensate its franchised new motor vehicle dealers under a national recall compensation program if the compensation under the program is equal to or greater than that provided under subsection (1) of this section; or the new motor vehicle dealer and the manufacturer, distributor, factory branch, or distributor branch otherwise agree.

(7) A manufacturer, distributor, factory branch, or distributor branch may direct the manner and method in which a new motor vehicle dealer demonstrates the inventory status of an affected used motor vehicle in order to determine eligibility for compensation under this section so long as the manner and method are not unduly burdensome and do not require information that is unduly burdensome to provide.

(8) Nothing in this section shall require a manufacturer, distributor, factory branch, or distributor branch to provide total compensation to a new motor vehicle dealer which would exceed the total average trade-in value of the affected used motor vehicle as originally determined under subsection (2) of this section.

(9) Any remedy provided to a new motor vehicle dealer under this section is exclusive and shall not be combined with any other state or federal recall compensation remedy.

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