Put Compliance In Plain Sight

By law, car dealerships must display a great deal of information for employees and customers. Some postings are required of all businesses, others unique to dealerships. They all have one thing in common: Failure to display them will be noticed by someone looking for them.

That includes federal investigators or lawyers who are working on a claim or defense for a customer or employee.

Here's advice about various postings:

Employment posters

From time to time, it is a good idea to make sure employee-information posters required by federal and state law are properly displayed in one or more common locations where employees are likely to see them.

You may have separate posters, or you may purchase “all-in-one” posters from a supplier. Regardless of how you choose to comply, make sure that you regularly check to be sure that up-to-date posters are displayed.

Fuel economy guides

Federal law requires that new-car dealers display Environmental Protection Agency/Department of Energy fuel-economy guide booklets at locations where new vehicles are offered for sale. The booklets must be available to the public at no charge. The booklets and related information are at http://www.fueleconomy.gov.

Insurance-cost Information booklets

New car dealers must display the National Highway and Transportation Safety Admin.'s most recent “Relative Collision Insurance Cost Information Booklet.” This compares differences in insurance costs for vehicles within a similar class on the basis of damage susceptibility. It is updated each year. One booklet is generally mailed to each new-car dealer annually.

Or the booklet is available from http://www.nhtsa.dot.gov/. Reproduce them and maintain a sufficient number of copies that are available to prospective new-car buyers.

Monroney stickers

The 1958 Automobile Information Disclosure Act requires a sticker to be placed on a new vehicle prior to sale indicating the manufacturer's suggested retail price and other information such as engine specifications and standard equipment listings.

The Monroney label cannot be removed or altered prior to the first retail sale. A dealer may have inventory vehicles with Monroney labels removed by employees for the purpose of demonstrating a vehicle (removal should be prohibited unless absolutely necessary for safety) or by customers when vehicles are spot delivered but the sale falls through.

In those cases, the dealer should request a substitute Monroney label from the manufacturer to be placed in the window.

Used-car buyers guides

Will a federal trade commission investigator who may walk onto your lot find buyers guides (commonly known as FTC stickers) on every used car and demonstrator available for retail sale? The FTC Used-Car Rule requires display of buyers guides on used cars available for retail sale. The terms and format of the guide are strictly specified.

An FTC investigator who visits a dealership will look at all used cars on the lot and all demonstrators to see if stickers are appropriately affixed.

Warranties

The Magnuson-Moss Warranty Act requires the seller of a consumer product with a written warranty (“a promise made in connection with the sale of a consumer product”) to make a text of the warranty readily available for examination by a prospective buyer.

The requirement is satisfied if the dealer either displays the warranty in close proximity to the warranted car or places signs, reasonably calculated to elicit the attention of prospective buyers, in prominent locations in the dealership advising prospective buyers of the availability of warranties upon request.

If the dealer opts for the latter option, the dealer must furnish the warranty upon request.

Remember: The description of a warranty for a used car on the FTC window sticker is not the warranty itself.

Michael Charapp, an attorney with Charapp & Weiss, LLP who specializes in representing motor vehicle dealers, can be reached at (703) 564-0220 or [email protected].

Questions or comments about this column?
Send us an e-mail at [email protected].