Disclosing Non-Customer Pay on an RO?

[Matt Parsons]

I recently have had a dealer tell me he thinks he is required by law to not only disclose non-customer pay repairs (warranty, internal) on an RO to the vehicle owner, but also he must disclose the cost of those repairs?

Has anyone heard this and if so, where can I find additional information it?

[robc]

If they are a GM dealer then they might be referring to bulletin 02-00-89-005. I wrote the below story blurb in May of 2002 when the bulletin was released. Concerning the cost aspect - I am assuming that he meant the "sale" and not the cost of the sale. Since many laws are based on a dollar threshold (i.e., $500) or a percentage of the value of the vehicle (like 2% of MSRP) then there has to be a dollar amount attached to the repair. Also key here is the word "repairs" and although I am not a legal expert always led me to believe that accessories, preps and the like aren't included in the disclosure requirements.

Repair disclosure
While most dealerships realize that they must often disclose transportation damage and subsequent repairs to customers, GM recently reminded us that the same is true of regular mechanical repairs. In bulletin 02-00-89-005, GM states that the dealer must disclose when repairs are done to a vehicle while in dealer inventory.

Your state or local laws would obviously trump GMs requirements. So if your local authority doesnt require disclosure, GM cant really compel you to. However, they can readily deny indemnifying the dealership if they are subsequently sued for failure to provide such a disclosure. It leaves your dealership open to potential legal problems that are best avoided and that GM says they would not be in a position to defend. So whether it is a recall, a minor adjustment, or whatever - I strongly encourage that your sales transaction include a brief history of the vehicle while it was in your possession. I would think the easiest way would be for the F&I office to print out your systems history record for the vehicle, briefly explain what repairs were done and have the customer sign-off that they were told of the repairs. Or, as always, check with your local laws to see what else might be required.



------------------
** Rob, Editor WD&S **
Help is only a message post away!
robc@dealersedge.com

[Matt Parsons]

This actually has to do with Mag Moss. I am being told that in it there is a section that states that if a customer 'participates' in a warranty or internal repair, that the cost of the entire repair must be disclosed. This could possibly mean that if there is a deductible on a warranty repair that the customer would need to see not only the price of the deductible but also the total 'bil' for the repair, even the part that the OEM would be paying for.

NADA Legal is looking into this but I wondered if any stores have run into this.

[fburrows]

Matt:

If the customer is paying a deductible or 50% of a warranty or internal repair, it makes sense that he is entitled to a copy of the repair order showing the full repair. If he pays part of lets say an engine repair, he should have an invoice that details the parts and labor involved in the replacement of the engine. If the engine fails 2 months later and he is traveling, he needs a receipt to prove that the engine is covered under a parts warranty. Most systems can produce a warranty or internal repair order that shows a customer pay deductible. This would satisfy the disclosure requirement, accounting and service history.



------------------
Frank Burrows
Automotive Business Solutions LLC
fburrows@absdata.com

[MGREEN]

ACORDING TO THE BAR LAWS IN CA YOU MUST GET THE CUSTOMERS APROVAL FOR ALL WORK INCLUDING WORK THAT THEY DONT HAVE TO PAY FOR.FOR INSTANCE THE CUSTOMER COMES IN WITH A CK ENG LIGHT AND YOU WRITE A RO TO DIAG THE CAR AND FIND THE PCM NEEDS REPLACMENT AND IT IS COVERED UNDER WARRANTY YOU MUST STILL GET APROVAL FROM THE CUSTOMER TO REPLACE IT.