Massachusetts 2023-2024 Regular Session

Massachusetts Senate Bill S639 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	1 of 1
2	2	SENATE DOCKET, NO. 1136 FILED ON: 1/18/2023
3	3	SENATE . . . . . . . . . . . . . . No. 639
4	4	The Commonwealth of Massachusetts
5	5	_________________
6	6	PRESENTED BY:
7	7	Paul R. Feeney
8	8	_________________
9	9	To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
10	10	Court assembled:
11	11	The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
12	12	An Act relative to motor vehicle service contracts.
13	13	_______________
14	14	PETITION OF:
15	15	NAME:DISTRICT/ADDRESS :Paul R. FeeneyBristol and Norfolk 1 of 5
16	16	SENATE DOCKET, NO. 1136 FILED ON: 1/18/2023
17	17	SENATE . . . . . . . . . . . . . . No. 639
18	18	By Mr. Feeney, a petition (accompanied by bill, Senate, No. 639) of Paul R. Feeney for
19	19	legislation relative to motor vehicle service contracts. Financial Services.
20	20	[SIMILAR MATTER FILED IN PREVIOUS SESSION
21	21	SEE SENATE, NO. 657 OF 2021-2022.]
22	22	The Commonwealth of Massachusetts
23	23	_______________
24	24	In the One Hundred and Ninety-Third General Court
25	25	(2023-2024)
26	26	_______________
27	27	An Act relative to motor vehicle service contracts.
28	28	Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
29	29	of the same, as follows:
30	30	1 SECTION 1. Section 149M of chapter 175 of the General Laws, as appearing in the 2012
31	31	2Official Edition, is hereby amended by inserting after the definition of “consumer” the following
32	32	35 definitions:-
33	33	4 “Consumer product”, any tangible personal property that is distributed in commerce and
34	34	5is normally used for personal, family or household purposes, including tangible personal
35	35	6property intended to be attached to or installed in any real property without regard to whether it
36	36	7is so attached or installed.
37	37	8 “Maintenance agreement”, a contract for regular maintenance.
38	38	9 “Motor vehicle distributor”, any person who is not a motor vehicle manufacturer or a
39	39	10motor vehicle dealer and who sells or distributes new and unused motor vehicles to motor 2 of 5
40	40	11vehicle dealers within the commonwealth or to a wholesaler who in turn sells or distributes such
41	41	12vehicles to motor vehicle dealers within the commonwealth; provided, however, that “motor
42	42	13vehicle distributor” shall include any branch office or division maintained by any corporation,
43	43	14association, partnership or other legal entity for directing and supervising their franchisor
44	44	15representatives.
45	45	16 “Motor vehicle franchisor representative”, a person employed by a motor vehicle
46	46	17manufacturer or distributor to promote the sale of new motor vehicles or for supervising,
47	47	18servicing, instructing or contracting motor vehicle dealers or prospective motor vehicle dealers
48	48	19and any officer, agent or other authorized representative of a manufacturer or distributor.
49	49	20 “Motor vehicle manufacturer”, a person who: (i) manufactures or produces motor
50	50	21vehicles under the person’s own name or label; (ii) is a subsidiary of the person who
51	51	22manufactures or produces motor vehicles; (iii) is a corporation which owns 100 per cent of the
52	52	23corporation, association, partnership or other legal entity who manufactures or produces motor
53	53	24vehicles; or (iv) does not manufacture or produce motor vehicles but, pursuant to a written
54	54	25contract, licenses the use of its trade name or label to another person who manufactures or
55	55	26produces motor vehicles.
56	56	27 SECTION 2. Said section 149M of said chapter 175, as so appearing, is hereby further
57	57	28amended by striking out the definition of “service contract” and inserting in place thereof the
58	58	29following definition:-
59	59	30 “Service contract”, a contract for a separately stated consideration and for a specific
60	60	31duration to perform the service, repair, replacement or maintenance of a consumer product,
61	61	32including a motor vehicle, or indemnification for service, repair, replacement or maintenance for 3 of 5
62	62	33the operational or structural failure due to a defect in materials or workmanship or normal wear
63	63	34and tear, with or without additional provision for incidental payment or indemnity under limited
64	64	35circumstances, for related expenses, including, but not limited to, rental and food spoilage;
65	65	36provided, however, that a service contract shall also include a contract or agreement sold for a
66	66	37separately stated consideration for a specific duration that provides for any of the following: (i)
67	67	38the repair or replacement of tires or wheels on a motor vehicle damaged as a result of coming
68	68	39into contact with road hazards including, but not limited to, potholes, rocks, wood debris, metal
69	69	40parts, glass, plastic, curbs or composite scraps; (ii) the removal of dents, dings or creases on a
70	70	41motor vehicle that can be repaired using the process of paintless dent removal without affecting
71	71	42the existing paint finish and without replacing vehicle body panels, sanding, bonding or painting;
72	72	43(iii) the repair of small motor vehicle windshield chips or cracks which may include the
73	73	44replacement of the windshield for chips or cracks that cannot be repaired; or (iv) the repair of
74	74	45damage to the interior components of a motor vehicle caused by wear and tear but which shall
75	75	46expressly exclude the replacement of any part or component of a motor vehicle’s interior.
76	76	47 SECTION 3. Section 149N of said chapter 175, as so appearing, is hereby amended by
77	77	48striking out, in line 100, the words “tangible personal property” and inserting in place thereof the
78	78	49following words:- consumer products.
79	79	50 SECTION 4. Section 149U of said chapter 175, as so appearing, is hereby amended by
80	80	51adding the following subsection:-
81	81	52 (c) It shall be an unfair or deceptive act or practice for a motor vehicle manufacturer,
82	82	53distributor or franchisor representative to require, attempt to require, coerce or attempt to coerce
83	83	54a motor vehicle dealer to sell, offer to sell or sell exclusively an extended service contract, 4 of 5
84	84	55extended maintenance plan or similar products, including, but not limited to, guaranteed
85	85	56automobile protection or guaranteed asset protection products, offered, endorsed or sponsored by
86	86	57the motor vehicle manufacturer, distributor or franchisor representative by any of the following
87	87	58means: (i) a statement made by the motor vehicle manufacturer, distributor or franchisor
88	88	59representative that failure to sell, offer to sell or sell exclusively an extended service contract,
89	89	60extended maintenance plan or similar products will substantially and adversely impact the dealer;
90	90	61(ii) a provision in a franchise agreement that the dealer sell or sell exclusively an extended
91	91	62service contract, extended maintenance plan or similar product offered, endorsed or sponsored by
92	92	63the motor vehicle manufacturer, distributor or franchisor representative; (iii) measuring the
93	93	64dealer’s performance under the franchise based on the sale of extended service contracts,
94	94	65extended maintenance plans or similar products offered, endorsed or sponsored by the motor
95	95	66vehicle manufacturer, distributor or franchisor representative; or (iv) requiring the dealer to
96	96	67exclusively promote the sale of extended service contracts, extended maintenance plans or
97	97	68similar products offered, endorsed or sponsored by the motor vehicle manufacturer, distributor or
98	98	69franchisor representative.
99	99	70 Nothing in this subsection shall prohibit a motor vehicle manufacturer, distributor or
100	100	71franchisor representative from providing incentives to a dealer that encourages a voluntary
101	101	72decision to sell or sell exclusively an extended service contract, extended maintenance plan or
102	102	73similar product, including, but not limited to, guaranteed automobile protection or guaranteed
103	103	74asset protection products offered, endorsed or sponsored by the manufacturer, distributor or
104	104	75franchisor.
105	105	76 SECTION 5. Said chapter 175 is hereby amended by striking out section 149V, as so
106	106	77appearing, and inserting in place thereof the following section:- 5 of 5
107	107	78 Section 149V. (a) The following shall be exempt from sections 149M to 149W, inclusive:
108	108	79(i) warranties, service contracts or maintenance agreements provided by public utilities that are
109	109	80regulated by the department of telecommunications and cable or the Federal Communications
110	110	81Commission, or by an affiliate of such entity, covering customer wiring, transmission devices
111	111	82serviced by such public utility or warranting services provided by such public utility or its
112	112	83affiliate; (ii) mechanical breakdown insurance policies offered by insurers otherwise licensed and
113	113	84regulated pursuant to the laws and regulations of the commonwealth; (iii) warranties, service
114	114	85contracts or other agreements regarding automobiles under which a licensed motor vehicle dealer
115	115	86is obligated to perform; (iv) warranties offered by builders as part of a conveyance of real estate;
116	116	87(v) warranties on a product made by the manufacturer, importer or seller of the product; and (vi)
117	117	88maintenance agreements.
118	118	89 (b) Motor vehicle manufacturer’s service contracts on the motor vehicle manufacturer’s
119	119	90products shall comply with sections 149M to 149W, inclusive, as applicable to be determined by
120	120	91the commissioner of insurance; provided, however, that motor vehicle manufacturer’s service
121	121	92contracts on the motor vehicle manufacturer’s products shall be exempt from licensure
122	122	93requirements under subsection (d) of section 149N.