Senate Bill No. 380
(By Senator Miller)
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[Introduced February 13, 1996; referred to the Committee
on Transportation; and then to the Committee on Finance.]
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A BILL to amend and reenact section eighteen, article six,
chapter seventeen-a of the code of West Virginia, one
thousand nine hundred thirty-one, as amended; and to further
amend article six of said chapter by adding thereto two new
sections, designated sections eighteen-a and twenty-five-a,
all relating to motor vehicle dealers; license services and
automobile auctions; creating a motor vehicle dealers
advisory board; establishing powers and duties of the board,
adding new offenses to the grounds for suspending or
revoking a license certificate; and adding provisions for
civil penalties for violations.
Be it enacted by the Legislature of West Virginia:
That section eighteen, article six, chapter seventeen-a of
the code of West Virginia, one thousand nine hundred thirty-one,
as amended, be amended and reenacted; and that article six,
chapter seventeen-a be further amended by adding thereto two new
sections, designated sections eighteen-a and twenty-five-a, all
to read as follows:
ARTICLE 6. LICENSING OF DEALERS AND WRECKERS; ETC.
§17A-6-18. Investigation; matters confidential; grounds for
suspending or revoking license; suspension and revocation generally.
(a) The commissioner may conduct an investigation to
determine whether any provisions of this chapter have been or are
about to be violated by a licensee. Any investigation shall be
kept in strictest confidence by the commissioner, the department,
the licensee, any complainant and all other persons, unless and
until the commissioner suspends or revokes the license
certificate of the licensee involved
or fines the licensee:
Provided, That the commissioner may advise the motor vehicle
dealers advisory board of pending actions and may disclose to the
motor vehicle dealers advisory board such information as may
enable it to perform its advisory function in imposing penalties.
The commissioner may suspend or revoke a license certificate or suspend a special dealer plate or plates if the commissioner
finds that the licensee:
(1) Has failed or refused to comply with the laws of this
state relating to the registration and titling of vehicles and
the giving of notices of transfers, the provisions and
requirements of this article, or any reasonable rules
and
regulations authorized in section nine, article two of this
chapter and promulgated to implement the provisions of this
article by the commissioner in accordance with the provisions of
article three, chapter twenty-nine-a of this code;
(2) Has given any check in the payment of any fee required
under the provisions of this chapter which is dishonored;
(3) In the case of a dealer, has knowingly made or permitted
any unlawful use of any dealer special plate or plates issued to
him
or her; or
(4) In the case of a dealer, has a dealer special plate or
plates to which he
or she is not lawfully entitled.
The commissioner shall suspend or revoke a license
certificate if the commissioner finds that the licensee:
(1) (5) Has knowingly made false statement of a material
fact in his
or her application for the license certificate then issued and outstanding;
(2) (6) Has habitually defaulted on financial obligations;
(3) (7) Does not have and
/or maintain at each place of
business (subject to the qualification contained in subdivision
(17), subsection (a), section one of this article with respect to
a new motor vehicle dealer) an established place of business as
defined for the business in question in said section one;
(4) (8) Has been guilty of any fraudulent act in connection
with the business of new motor vehicle dealer, used motor vehicle
dealer, house trailer dealer, trailer dealer, motorcycle dealer,
used parts dealer, or wrecker or dismantler;
(5) (9) Has defrauded or is attempting to defraud any buyer
or any other person, to the damage of the buyer or such other
person, in the conduct of the licensee's business;
(6) (10) Has defrauded or is attempting to defraud the state
or any political subdivision of the state of any taxes or fees in
connection with the sale or transfer of any vehicle;
(7) (11) Has committed fraud in the registration of a
vehicle;
(8) (12) Has knowingly purchased, sold or otherwise dealt in
a stolen vehicle or vehicles;
(9) (13) Has advertised by any means, with intent to
defraud, any material representation or statement of fact which
is untrue, misleading or deceptive in any particular relating to
the conduct of the licensed business;
(10) (14) Has willfully failed or refused to perform any
legally binding written agreement with any buyer;
(11) (15) Has made a fraudulent sale or purchase;
(12) (16) Has failed or refused to assign, reassign or
transfer a proper certificate of title;
or
(13) (17) Has a license certificate to which he
or she is
not lawfully entitled;
or
(18) Misrepresented a customer's credit or financial status
to obtain financing.
The commissioner shall also suspend or revoke the license
certificate of a licensee if he
or she finds the existence of
any ground upon which the license certificate could have been
refused, or any ground which would be cause for refusing a
license certificate to
such the licensee were he
or she then
applying for the same.
(b) Whenever a licensee fails or refuses to keep the bond or
liability insurance required by section four of this article in full force and effect, the license certificate of such licensee
shall automatically be suspended unless and until a bond or
certificate of insurance as required by said section four is
furnished to the commissioner, in which event the suspension
shall be vacated.
(c) Suspensions hereunder shall continue until the cause
therefor has been eliminated or corrected. Revocation of a
license certificate
shall may not preclude application for a new
license certificate, which application shall be processed in the
same manner and the license certificate issued or refused on the
same grounds as any other application for a license certificate
is processed, considered and passed upon, except that any
previous suspension and the revocation may be given such weight
in deciding whether to issue or refuse such license certificate
as is meet and proper under all of the circumstances.
§17A-6-18a. Motor vehicle dealers advisory board.
(a) There is created a motor vehicle dealers advisory board
to assist and to advise the commissioner on the administration of
laws regulating the motor vehicle industry; to work with the
commissioner in developing new laws, rules or policies regarding
the motor vehicle industry; and to give the commissioner such further advice and assistance as he or she may from time to time
require.
The board shall consist of nine members and the commissioner
of motor vehicles, or his or her representative, who shall be an
ex officio member. Three members shall represent new car
dealers, two members shall represent used car dealers, one member
shall represent wrecker dismantler rebuilders, one member shall
represent automobile auctions, one member shall represent
recreational dealers and one member shall be a representative of
the West Virginia attorney general's office. All the
representatives except the attorney general representative who
shall be designated by the attorney general shall be appointed by
the governor with no more than five being from the same political
party.
The terms of the board members shall be for three years
commencing the first day of July, one thousand nine hundred
ninety-six. Two members shall be appointed to serve one year,
two members shall be appointed to serve two years, and five
members shall be appointed to serve three years. Successive
appointments shall be for the full three years. The attorney
general representative shall serve continuously.
The board shall meet at least four times annually and at the
call of the commissioner.
Notwithstanding the provisions of article ten, chapter four
of this code, the motor vehicle dealers advisory board shall
continue until the first day of July, two thousand one.
(b) The commissioner shall consult with the board before he
or she takes any disciplinary action against a dealer or an
automobile auction or a license service to revoke, suspend, place
on probation or levy a civil penalty.
(c) The commissioner may consult with the board by mail, by
facsimile, by telephone or at a meeting of the board, but the
commissioner is not bound by the recommendations of the board.
The commissioner shall give members seven days from the date of
a mailing or other notification to respond to proposed actions,
except in those instances when the commissioner determines that
the delay in acting creates a serious danger to the public's
health or safety or would unduly compromise the effectiveness of
the action.
(d) No action taken by the commissioner
shall may be subject
to challenge or rendered invalid on account of his or her failure
to consult with the board.
§17A-6-25a. Civil penalties.
(a) In addition to any other remedy or penalty provided by
law the commissioner may levy and collect a civil penalty, in an
amount not to exceed one thousand dollars for each violation,
against any person who violates the provisions of this article or
article six-b of this chapter or article six-c of this chapter or
any of the rules or policies implemented to enforce those
articles or any lawful order of the commissioner pursuant to
authority set forth in those articles. Every transaction which
violates this article, article six-b or article six-c of this
chapter shall be considered a separate violation. For a second
violation the commissioner may levy and collect a civil penalty
in an amount not to exceed twenty-five thousand dollars and for
a third and subsequent violation the commissioner may levy and
collect civil penalties in amounts not to exceed five thousand
dollars.
(b) A civil penalty assessed hereunder
shall may not take
effect until the commissioner sends to the person against whom
the penalty is assessed by certified mail, return receipt
requested, a notice of violation finding that the person has
committed an offense. The notice shall contain:
(1) A statement of the offense the person committed;
(2) A summary of the facts on which the finding of a
violation was made;
(3) The amount of the civil penalty which is being levied;
and
(4) An order that the person:
(A) Cease and desist from all future violations and pay the
civil penalty; or
(B) Protest in writing the findings of the commissioner or
the amount of the assessed penalty and request a hearing.
Any request for a hearing must be received by the
commissioner within thirty days after the mailing date of the
notice of violation. The notice of violation may be sent to any
address which the person has used on any title or license
application, or other filing or record which the commissioner
believes is current. Failure of any person to receive a notice
of violation
will does not preclude the civil penalty from taking
effect. However, the commissioner shall accept as timely a
request for hearing from any person who, within one year of the
date the notice of violation was sent, provides satisfactory
proof that he or she did not receive the notice of violation and that good cause exists to excuse his failure to receive the
notice of violation and that he or she wishes in good faith to
assert a protest to the notice of violation. The pendency of the
one-year period
shall may not keep any penalty from taking
effect, but the commissioner shall stay enforcement of the civil
penalty upon his or her acceptance of any notice filed after the
thirty- day period pending the outcome of the appeal.
(c) Upon receipt of a timely request the commissioner shall
afford the person a hearing in accordance with the rules of the
division of motor vehicles. The commissioner, in addition to
considering the evidence relied upon to prove or defend against
a finding of a violation, shall also evaluate the appropriateness
of the amount of the civil penalty. In making such evaluation,
the commissioner shall consider:
(1) The severity of the violation and its impact on the
public;
(2) The number of similar or related violations;
(3) Whether the violations were willful or intentional; and
(4) Any other facts considered appropriate.
(d) In addition to any other findings of fact or conclusions
of law, the commissioner may reduce the civil penalty to a stated amount. The appellant may, at any time during the pendency of
the appeal, enter into a settlement agreement with the
commissioner. The settlement agreement may provide for a
reduction in the penalty and it may provide for assurances that
future violations will not occur without an admission of guilt by
the appellant. The payment of any civil penalty pursuant to a
settlement agreement which clearly states that no finding of
violation is made shall not amount to an admission of guilt for
purposes of any criminal prosecution. But the settlement
agreement shall operate as a violation for any additional penalty
for a second or subsequent violations.
(e) Upon the expiration of all periods for protest or appeal
of a notice of violation the notice of violation shall have the
same force and effect and be enforceable as a judgment entered by
any court of law of this state.
(f) Any officer of a corporation that is found to have
committed a violation against which a penalty may be assessed
hereunder and who is shown to have been substantially involved
with the violation may be individually found to be a coviolator
and assessed a civil penalty as provided by this rule.
NOTE: The purpose of this bill is to create a motor vehicle
dealers advisory board and establish the duties of the board.
The bill further adds new offenses to the grounds for suspending
or revoking a license certificate.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.
§§17A-6-18a and 25a are new; therefore, strike-throughs and
underscoring have been omitted.
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