House bill will require disclosing ‘salvage vehicle’ info
The House of Representatives unanimously passed last Feb. 16 a bill that will require that vehicles that are rebuilt from salvage or have undergone much damage but are rebuilt and resold must disclose that information upon transfer of ownership.
The legislation, House Bill 23-71, House Draft 1, defines “vehicle rebuilt from salvage” as a flood-damaged vehicle, a vehicle branded as a salvage vehicle by another state or territory, or a vehicle that has been damaged to the extent that the vehicle is determined to be a total loss.
With all 20 House members voting “yes,” House Bill 23-71, House Draft 1 now goes to the Senate for action.
Before voting, the House adopted the House Judiciary and Governmental Operations Committee report that recommended passage of the bill with amendments.
The bill proposes to amend the Commonwealth Code by adding new provisions requiring disclosure upon transfer of ownership of a salvage vehicle.
Rep. Angelo A. Camacho (Ind-Saipan) introduced the bill last September and was referred to the JGO Committee.
Camacho stated in the legislation that there are businesses within the CNMI that engage in the selling and/or reselling of previously damaged vehicles, commonly known as “salvage vehicles.” Despite being aware of the damage history of such vehicles, these businesses refuse to disclose such information and continue to give false impression to potential buyers that the vehicles are in pristine and flawless conditions, he said.
To address that unethical business practice, Camacho said it is of utmost importance to implement disclosure requirements that detail the damage sustained by such vehicles.
Under the legislation, any person who buys a vehicle rebuilt from salvage who was not provided a copy of a disclosure affidavit and who, after the sale, discovers that the vehicle had been rebuilt from salvage shall be entitled to a full and immediate refund of the purchase price from the prior owner.
Any owner, seller, or transferor of a vehicle rebuilt from salvage who fails to comply with the rule shall be guilty of a misdemeanor, and shall be punished by a fine of $1,999 for each subsequent offense.
According to the JGO Committee report, some individuals in the CNMI have been selling and/or reselling used damage vehicles without disclosing the vehicles’ damage history.
The committee finds that, despite being aware of such history, these individuals continue to sell vehicles without disclosing such vital information.
Without disclosure, the committee says, potential buyers may be misled that such vehicles are in excellent condition.
The committee determines that there are no laws that require full disclosure of a vehicle’s damage history upon sale and/or transfer of ownership.
The committee deems it highly appropriate to establish vehicle damage disclosure requirements upon the sale and/or transfer of ownership of a “salvage vehicle.”
The committee notes that other U.S. jurisdictions such as Virginia, Arizona, and others have established similar laws and/or regulations that require disclosure of a vehicle’s salvage history prior to sale or other transfer of ownership.
Angelo Atalig Camacho
