Wsiada mag 201805 web

The official publication of the Washington State Independent Auto Dealers Association

May | June 2018

Celebrating 65 Years of service to independent auto dealers

Don’t Let the Deal Ruin the Sale Senate Reigns in CFPB

PLUS...

WSIADA updates on all things digital

People Matter Most.

Dave Blake

GM, DAA Seattle

For us, it’s about more than the bottom line.

Choose an auction with the right priorities.

McConkeyAuctions.com

The official magazine of the

WASHINGTON STATE INDEPENDENT AUTO DEALERS ASSOCIATION

MAY|JUNE 2018

707 Auburn Way South Auburn, WA 98002 T: 253-735-0267 | F: 253-804-0844 staff@wsiada.com WSIADA.COM Mo Aliabadi, Board President South Tacoma Auto Sales, Inc. Mo@southtacomaauto.com

Randy Fletcher, President Emeritus In N Out Auto Sales | inandoutwa@gmail.com

Emil Scarsella, Board Treasurer Town & Country Auto Sales | E.Scarsella@hotmail.com

J.T. Curry, Board President Emeritus Motors Northwest | JT_Curry@motorsnorthwest.com

Ken Williamson, Board President Emeritus John’s Auto Mart, LLC | JohnsAutoMart@msn.com

AJ Hamedian, Chapter President – North Cascade Excellent Choice Auto Sales, LLC aHamedian@yahoo.com

Andrew Drager, Chapter President – North Sound Drager’s International, Inc. | Andrew_Drager@mac.com

Brian Corigliano, Chapter President – Spokane Globe Motors | GlobeMotorsUSA.com Andrew Harding, Chapter President – Tri Cities Harding Motor Co. | HardingMotorCompany@gmail.com

Vacant, Board Secretary Vacancy - Board Vice President Vacancy - Chapter President – South Sound Vacancy - Chapter President – Vancouver Vacancy - Chapter President – Yakima WSIADA STAFF Todd C. Elliott, Executive Director Colette Eilers, Receivables/Payables Michael McGaughy, Spokane Auctions Rick Olson, Project Manager Ashlie Seipert, Education | Member Services Mia Froman, Member Services

PUBLISHER Sygnifi Networks wsiada@sygnifi.com ©Copyright 2018 WASIADA MEMBER

contents 2 | President’s Message 4 | Events Calendar 5 | Executive Director’s Message 7 | Compliance 9 | Legislative Update 10 | Membership Updates 13 | Judicial Updates 14 | Digital Corner: Association Updates 15 | Auction Listings 16 | Service Providers Directory 17 | Dealer Alert Digest 19 | Registration Form: Education Fairs 21 | Read and Respond Continuing Ed Quiz 23 | Enrollment Form: WSIADA Membership 24 | Legal Corner: Davies Pearson, P.C. 24 | Just for Fun the Front Row | wsiada.com | May/June 2018 |

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ADVERTISER INDEX

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Lobel Financial . . . . . . . . . . . . . . . . 3 Manheim . . . . . . . . . . . . Inside Back Rekdal Hopkins Howard . . . . . . . . 13 Shepard & Shepard Insurance . . 12 Skywerks . . . . . . . . . . . . . . . . . . . . . 20 Service Provider Directory . . . . . 16 Smart Office Rewards . . . . . . . . . . . 8 SmartSocial . . . . . . . . . . . . . . . . . . 11

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Events Calendar NOTE: Please check our online calendar to confirm dates and locations and to see dates further out.

Education Fairs Education Fair East TUE JUL 17 Holiday Inn Spokane Airport 1616 S. Windsor Dr., Spokane

Education Fair West THU AUG 16 LeMay - America’s Car Museum 2702 East D Street, Tacoma

Pre-Licensing Workshops (9am to 5pm)

THU JUN 14............. Auburn HQ TUE JUN 26.............. Spokane THU JUL 12.............. Auburn HQ THU AUG 09............ Auburn HQ TUE AUG 21............ Spokane THU SEP 13.............. Auburn HQ THU OCT 11............ Auburn HQ WED OCT 17........... Spokane THU NOV 08............ Auburn HQ TUE DEC 04............. Spokane THU DEC 13............ Auburn HQ

Title Workshops

Tri-Cities MON SEP 24 | 7 - 9pm Clover Island Inn 435 N Clover Island Drive Kennewick 99336

(9am to 1pm)

THU MAY 17............ Auburn HQ

THU JUN 28............. Auburn HQ

THU JUL 26.............. Auburn HQ

WED AUG 22.......... Spokane

THU AUG 30............ Auburn HQ

THU SEP 20.............. Auburn HQ

TUE SEP 25............... Kennewick

WED SEP 26............ Yakima

THU OCT 18............ Spokane

THU OCT 25............ Auburn HQ

THU NOV 08............ Auburn HQ

WED OCT 17 | 7 - 9pm Hilton Garden Inn Spokane Airport 9015 US-2, Spokane 99224

THU DEC 20............ Auburn HQ

North Cascade (NEW)

Chapter Meetings

Yakima TUE SEP 25 | 7:30 - 9:30am Hilton Garden Inn 401 Yakima Avenue, Yakima 98901

South Sound MON OCT 01 | 8:00 - 10am Hilton Garden Inn 2101 Henderson Park Ln SE, Olympia 98501

Spokane

MON OCT 29 | 7 - 9pm Hampton Suites, Burlington 98233

Vancouver

North Sound

SAT SEP 11 | 12:30 - 2:30pm Manheim Portland 3000 N Hayden Island Drive Portland, OR 97217

MON NOV 05 | 7 - 9pm Dragers International Classics 18805 Aurora Ave. N., Seattle 98133

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4 | the Front Row | wsiada.com | May/June 2018

EXECUTIVE DIRECTOR’S MESSAGE

Sixty-five Years of Service

S

pring came one day last week, then, in the blink of an eye, it was gone. Hopefully summer will be getting ready to descend upon the Pacific Northwest by the time we go to press for the July/August edition. Don’t tell me “that’s why it is so GREEN here”!

In the same way spring is teasing us, we had a similar problem when it came to choosing a theme to this month’s magazine. Last year we called it the “car care issue.”

Griot’s garage helped with an article and an ad. We thought about that this year but ran into two problems. Editorial content was the second one. Consequently we (I) decided on Rules and such.

Boring, but necessary.

difficulty making it to an Auction in person. We plan to offer the Program to all dealers in the State with special incentives for Member Dealers.

The Program will also be offered to Oregon dealers a month or so later.

By the time we go to press, a small group of dealers will be helping us to fine tune our Auction Savings Program. The Program eliminates the Auction Discount Card and replaces it with a mobile app that gives Auctions, dealers and WSIADA more efficient way to share savings offers and communicate essential inventory information for members and non-members alike.

The Program will be available for purchases at Auction and via online programs. The Online program will be available shortly after launch, which should be particularly helpful to those remote dealers who have

program that could help your store achieve safety compliance AND generate potential L&I savings by investing in the program. Mark your calendars and make sure you RSVP via the app or WSIADA.com We would certainly love to sell out.

WANTED: Your dealer plate on the WSIADA Wall of Frame!

This issue also contains several important calendar reminders, including our two Education Fairs.

The Eastern Fair in Spokane will once again be the Tuesday before the DAA Rock and Roll Sale. For In this issue, we prepare you for Credence fans, John Fogarty is this regulatory inquests, clarify a Supreme year’s performer. The Western Fair Court Ruling, remind you of the includes our Olympia partners (DOR, Senate’s steps to reign in CFPB and DOL and AG) and I am pleased summarizing the Dealer Alerts we to announce that Steve Jordan, have been posting on WSIADA. CEO of NIADA will be joining us with com. Before I stray from the subject Shaun Peterson, EVP of Legal Affairs. of Dealer Alerts, please make sure Each member of the WSIADA is also you download the WSIADA mobile a member of NIADA. This is great app to your smartphone. In the opportunity to learn about the new short-term it gives you instant access and exciting things NIADA has in to dealer alerts and all the other store. features of WSIADA.com. The mobile WSIADA recently joined the app is also the gateway to simplified Washington Retail Association.

Auction Savings.

They will join us to review an exciting

As always, let me know what new and exciting ways WSIADA can serve our Dealer and Associate Members.

Get your plate frames and inserts from WSIADA!

YOUR logo, YOUR style Competitive Pricing Support WSIADA

Get started today in the online store at www.wsiada.com or call (253) 735-0267.

Todd C. Elliott, WSIADA the Front Row | wsiada.com | May/June 2018 |

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IT ADDS UP. ADESA.com/Rewards 6 | the Front Row | wsiada.com | May/June 2018

for the specific purpose for which it was designed, it may cause a problem for the dealership when used in conjunction with the other documents in a car deal.

COMPLIANCE

Don’t Let the Deal Ruin the Sale For steps dealers and F&I professionals can take to fill in the gaps in your documentation process and prepare your dealership for regulatory inquests.

By Keith Whann

W

e live in a rapidly changing and­—despite all the technological advances— increasingly complex world. It used to be that when a motor vehicle dealer made a mistake, they had an opportunity to fix it. Today, that first mistake can come at a high cost.

compliance with these laws on an ongoing basis (e.g., the Department of Defense’s recently issued interpretive rule under the Military Lending Act).

Putting all this together, achieving compliance for a motor vehicle dealership and keeping current with legal, regulatory, and legislative developments that impact your Surprisingly to many, compliance next car deal can be extremely of the “car deal” itself is one of the biggest challenges and the area that challenging. Let’s discuss four steps you can take now to tighten up your presents some of the greatest legal process. exposure for your dealership. There are a whole host of state and federal Step 1: Complete the Jacket laws that impact a motor vehicle transaction, including state unfair One of the most important things and deceptive acts and practices to remember is that the individual (UDAP) statutes and administrative documents in a car deal must not rules, state laws governing title and be designed to stand alone in a retail installment sales contracts vacuum. Rather, they must work (RISC), the Uniform Commercial together as part of the overall car Code (UCC), the Truth in Lending deal. and Leasing Acts, the MagnusonJust as important is to recognize that Moss Warranty Act, the Federal the different variables impacting a Trade Commission’s Used Car Rule, transaction — such as whether a the Fair Credit Reporting Act (FCRA) vehicle is new or used, being sold or and federal privacy and antiterrorism laws and their implementing leased, its history, whom it’s being sold to, and what activity occurred regulations, to name a few. online — will impact the content What’s more, not only do these of the documents and the types of state and federal laws go through disclosures contained therein. periodic revision, they are subject As a result, while an individual to case decisions and regulatory document may be appropriate interpretations addressing

For example, the UCC, MagnusonMoss Act, and the Used Car Rule each impose specific requirements on dealerships when offering or disclaiming warranties. Many state UDAP statutes also require that every retail sale of a motor vehicle be preceded by a written contract that contains all the agreements of the parties, including all material statements made prior to obtaining the customer’s signature on the purchase contract.

If you wish to be in compliance with all of these laws, you must ensure that the retail buyer’s order, FTC buyer’s guide, and limited warranty document contain the required disclosures — and those disclosures must be consistent and properly integrated.

Step 2: Prepare for the Lot Lawyers The difficulties you face in making sure your documents comply with the maze of overlapping state and federal laws have not been overlooked by consumer attorneys.

They have adopted a strategy for handling motor vehicle cases in hopes of recovering large damage awards and attorney fees.

Instead of focusing on what the consumer alleges the problem is with a motor vehicle transaction, the consumer’s lawyer goes for what has become known as the “quick kill.” They carefully scrutinize the car deal looking for incorrect or inappropriately completed documents that might provide the basis to successfully rescind the transaction, recover damages, and collect attorney fees.

Step 3: Rethink Your Compliance Warranties No car deal is complete without financing. In virtually all of the hundreds of dealership lender agreements I have reviewed over CONTINUED NEXT PAGE

the Front Row | wsiada.com | May/June 2018 |

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the years, the dealer must warrant that the documents used in the transaction are in compliance with applicable state and federal laws, rules, and regulations. Breach of that warranty requires a dealership to repurchase the car deal from the finance source.

Such a warranty takes on even more significance in today’s market, given the declining creditworthiness of consumers and the likelihood of consumer defaults increasing.

Dealerships should be cautious about making such compliance warranties to a lender without first taking a good look at their car deal.

Step 4: Get Serious About Auditing Not that long ago, auditing a car deal meant looking at a series of printed documents and a few photocopies stored in a paper deal jacket. Look at the makeup of a car deal today. While you will still see some printed documents and photocopies, it now contains

“Not that long ago, auditing a car deal meant looking at a series of printed documents and a few photocopies stored in a paper deal jacket. Look at the makeup of a car deal today. While you will still see some printed documents and photocopies, it now contains documents produced from the internet, various formats of menus, items that are presented electronically, and screenshots from various sources.”

All of these “documents” come from a number of dealership product and service providers and are produced by various methods and sources. It seems hard to imagine, but that is what comprises today’s car deal.

What are the odds these documents on their own all work together to produce a complete car deal where everything works together and that...

• No required documents are missing.

• All documents are drafted correctly such that they don’t conflict with other documents.

• All required disclosures are made correctly.

• The obligations, rights, and remedies of all parties are correctly stated.

• All material statements are properly integrated.

• Each document is used properly by dealership employees.

documents produced from the internet, various formats of menus, items that are presented electronically, and screenshots from various sources.

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• Documents and information contained therein don’t conflict with your electronic processes.

Who within the dealership has the responsibility and the expertise to make sure the documents in your car deal do this? And when was the last time a comprehensive review of all things impacting your car deal was done?

The answers: slim, they don’t, nobody, and a long time ago, if ever. If you have not updated your dealership’s car deal documents and related procedures within the last year, they probably are not in compliance with applicable state and federal laws. And remember, if you don’t review your car deal, someone else will!

Keith Whann is the founder of The Whann Group LLC and has more than 33 years of legal and compliance experience on issues affecting the automotive industry. Nothing in this article is legal advice and should not be taken as such. Please address all legal questions to your counsel.

For more information email keith.whann@bobit.com

wsiada.com/SmartOfficeRewards Copyright © 2018 F&I and Showroom. Used with permission.

8

| the Front Row | wsiada.com | May/June 2018

LEGISLATIVE UPDATE

Senate votes to repeal CFPB’s Auto Finance Guidance

5

years since the Consumer Financial Protection Bureau (CFPB)

put auto finance sources on notice for policies that allow dealers to mark up interest rates in exchange for service rendered, the U.S. Senate voted 51-47 to approve legislation aimed at repealing the guidance containing the regulator’s warning.

The vote also comes five months after the Government Accountability Office said Congress has the power under the Congressional Review Act (CRA) to repeal the CFPB’s March 2013 guidance on dealer participation, and about a week after Sen. Pat Toomey (R-Pa.), the lawmaker who asked the GAO to review the bureau’s guidance one year ago, pledged that the U.S. Senate Banking Committee would scrap the rule.

“The CFPB, under [former CFPB Director] Richard Cordray, frequently overstepped its authority while snubbing Congress and the public in the process. This auto lending guidance is an example,” Sen. Toomey said on Tuesday just prior to the U.S. Senate’s 50-47 vote in favor of debating whether to undo the bureau’s guidance. “I appreciate the GAO’s decision in this matter and encourage my colleagues to support this CRA resolution.”

Sen. Jerry Moran, who introduced the joint resolution of disapproval, S.J. Res. 57, added: “An ill-advised

Obama-era auto-lending rule issued by the CFPB missed the mark on both process and substance. This resolution of disapproval provides Congress the opportunity to reverse this overreaching rule to return a sense of stability to the auto marketplace, ultimately providing a path to lower costs for all car purchasers.”

The process used to repeal the bureau’s guidance is the same Congressional Republicans used this past October to kill the CFPB’s rule banning pre-dispute arbitration.

Today’s vote marked the first time it was used on a rule that has been in effect for several years.

Under the CRA, both houses must approve resolutions of disapproval by a simple majority and receive the president’s signature to kill a regulation. Today’s vote on the Senate version of the joint resolution of disapproval leaves it up to the House of Representatives to approve its version of the legislation, H.J.Res.132.

It currently sits in the House Committee on Financial Services and is expected to be approved when it goes before the full House.

“S.J. Res. 57 continues the bipartisan effort that began years ago to preserve the ability of local dealerships to offer discounted auto loans to their customers, and we thank Senator Toomey and Senator Moran for their leadership on this issue,” said Peter Welch, President and CEO of the National Automobile Dealers Association (NADA).

“America’s franchised auto dealers strongly believe that every customer deserves to be treated fairly, and that there is no room for discrimination of any kind in auto retailing — period.

This is a narrowly tailored resolution that in no way modifies or affects the enforcement of any fair credit laws or regulations. But it does take the important step of ensuring that consumer discounts in auto lending are safeguarded for every consumer.

“We hope this CRA resolution sees swift action in the House of Representatives, which has already demonstrated strong bipartisan support for repealing the CFPB’s flawed guidance and preserving important auto loan discounts for consumers.”

The CFPB alleged in its five-page fair lending guidance that bank policies which allow auto dealers to mark up interest rates on retail installment sale transactions as compensation for services rendered create a significant risk of unintentional, disparate impact discrimination. It also warned lenders active in the indirect auto finance channel that they would be held liable for unlawful, discriminatory markups.

The bulletin goes on to state that lenders operating in the indirect auto finance channel “should take steps to ensure that they are operating in compliance with the [Equal Credit Opportunity Act] and Regulation B as applied to dealer markup and compensation policies.”

It then listed a variety of steps and CONTINUED ON PAGE 11

the Front Row | wsiada.com | May/June 2018 |

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WSIADA Membership Updates We want to say “Thank You!” to the following dealerships for renewing their membership since November 2017!

And we extend a “Warm Welcome!” to our newest members, who are highlighted below in bold red text.

Access Mobility Systems Adams Auto Sales Affordable Auto Sales & Service LLC Aguila Used Car & Truck Sales AK Motors, LLC All Recovery Services of Washington LLC Allyn's Specialty Cars Anacortes Auto Sales LLC Apex ASAE Auto Sales International Auburn Speed, LLC Auto Max USA Auto Place, Inc Auto Sales Consultants, LLC Auto Trans Tech Sales & Services Autos Only Burien Auto Sales Autowerx B & B Auto Repair & Sales B & B Enterprises, Inc Ball Auto Sales & Service, Inc. Basin Auto Sales, Inc Bayside Auto Sales BBL Auto Sales Bear Motors, Inc Bill Harris Used Cars, Inc Biniam Tesfai Booker Auction Company Brooks Biddle Chevrolet-Suzuki, Inc Buy Here Pay Here, Inc C & V Auto Sales C and R Car Sales Car Chasers LLC Car Club, Inc Car Craft Auto Sales, Inc Car Link Used Auto Sales Car Mart Car Trends II, LLC Car Zone, LLC Car-Dawgs Carmax Carpapapa Auto Group LLC Chandler Auto Sales Christopher Clark Clarkston Auto Sales, Inc Classic Car Addiction Classy Chassies Fine Used Cars Clearwater Auto Sales CMS Autogroup Coastal RV & Auto Sales Columbia Auto Center Common Sense Motors Community First Auto Centers Commuters, LLC Consignment Sales & Lease Copart Auto Auction Country Bear Auto Dave's Auto David Rochlin Del Toro Auto Sales Dick Hannah Drive A Car E-Z Credit Auto Sales Eastside Advanced Auto, LLC Eastside Harley-Davidson EF Auto Sales LLC Ehli Auctions Ehli Auctions Eldon Robbins Auto Sales, Inc Elite Auto Source, LLC

Elite Motors Emerald City Harley Davidson European Auto Brokers Inc Evergreen Sales And Lease, Inc Fair Deal Auto Sales LLC Federal Way Auto Sales Fife Auto Repair & Sales Fife RV Inc FJ Automotive Group LLC Four-Ten Auto Sales Garza's Auto Repair German Auto Services, L.L.C. Global Elite Motors H and H Classic Cars Inc Harper's Auto Sales LLC High Road Auto Sales Highland Auto Hill's Auto & RV, LLC Hot Rod Alley Inc House of Hybrids I-5 Motors Impact Auto Sales, LLC Independence Auto Center INW Motorsport J. Stout Auction James Michael Harvey JDM Car & Motorcycle Jennifer's Greenacres Auto Sales Job Depot USA John Clark Motors, Inc Johnson RV JTM Group LLC Julie Wessell-Cremeans Justin Eide Kent Grand Auto Sales Kersey Mobility Systems, Inc Kim Eccleston's Motors Inc Kirkland RV Sales Kitsap Auto Outlet Kitsap Used Cars Kleyn's Auto Sales, Inc Kost Auto Sales Lake City Auto Sales, LLC Laurie Jarman Leslie Vannieuwenhuizen Lifestyle Motor Co Lost and Found Classic Car Co Luque's Auto Sales Maxx Autos Plus MC Euro, LLC McCord's Vancouver Auto Center McMillan Brothers Auction, Inc Medrano's Auto Repairs and Sales, LLC Millennium Auto Sales Mills Motors LLC MNM Auto Modern Collision Rebuild & Service Moneyman Pawn & Jewelry Motherland LLC Mt Si Motors Napo V Jemmings Jr Nelson Truck Equipment Co., Inc. Northtown Auto Liquidators Northwest Auto Liquidators Northwest Rides, Inc. Northwest Sales & Service OB-1 Car company Inc Olympic Auto Works, LLC

10 | the Front Row | wsiada.com | May/June 2018

Olympic Motors Omak Auto Plaza LLC Owen Equipment Company Paramount Motors NW Payless Auto Sales Penske Truck Leasing Co, LP Premier Motorsports Inc Priceless Auto Sales LLC Rain City Auto Sales Rare Garage Auto Recon Ready Auto Sales Rick's Auto Sales Rick's Kar Korner Robert Clark Roosales S & S Best Auto Sales LLC Seven Auto Sales Sid's Affordable Autos LLC SNS Auto Sales Solid Rock Auto Sales Source Motor Sales, LLC Sun Auto, RV & Marine Sales, Inc Sunset Auto Wholesale Ted Motors Co Terry's Auto & Truck Sales TG Motors LLC The Auto Mart The Car Connection Three Rivers Marine Tri-City Car Sales Triple C Auto Brokers Trudeau Automotive Union Gospel Mission Motors USA Auto Sales, Inc Vail International, Inc Valley Equipment and Truck Inc Wakefield Inc Walker Motor Works Washington Cedar & Supply Co Western AG Sales Western Auto Sales LLC X Car Inc Zipstar Auto Sales

Four of our members have been nominated for Best of Clark County, including one of the dealers, Top Auto Brokers, after only a couple years in business.

Dick Hannah was selected for Top Dealer recognition. Please join WSIADA in congratulating...

Art Kuzma Motors Dick Hannah McCord Vancouver Top Auto Brokers

CFPB, CONTINUED ON PAGE 9

tools they could employ to address the bureau’s stated fair lending risks,” including “eliminating dealer discretion to markup buy rates and fairly compensate dealers using another mechanism, such as a flat fee per transaction, that does not result in discrimination.”

Auto industry trade groups have argued that the bureau used its guidance to indirectly regulate the activities of dealers, which are mostly exempt from the bureau’s oversight under the Dodd-Frank Act. They also claimed the bureau was aware its methodology for determining disparate impact and potential harm to protected classes was flawed and prone to overestimation, yet pushed forward with claims of discrimination that resulted in enforcement actions that imposed millions of dollars in fines on auto finance sources, including Ally Financial, American Honda Finance Corp., and Fifth Third Bank.

The guidance also caused several finance sources, including BB&T and BMO Harris, to switch to a flatfee compensation model. BB&T switched back to a dealer spread compensation plan last month, while BMO switch to a three-tiered flat-rate system last summer.

The guidance was also behind consent orders the CFPB entered into with Fifth Third Bank, Toyota Motor Credit Corp., and American Honda Finance Corp regarding their dealer markup policies. As a result of those orders, the bank and two captives agreed to lower their markup caps to 1.25% and 1%. Fifth Third’s consent order, however, is set to expire this September, while Toyota Motor Credit’s and Honda Finance’s consent orders are set to expire in February 2019 and July 2020, respectively. The three finance sources yet to say whether they’ll return to a dealer participation model when they do.

“The CFPB, established to regulate Wall Street, never should have involved itself in dealership operations,” said AIADA President and CEO Cody Lusk. “Today’s vote is confirmation to dealers everywhere that the agency overreached when issuing its 2013 indirect auto financing guidance.

The agency concluded, without accurate supporting data, that dealerships were using race as a determining factor when issuing loans. Today the Senate has righted a wrong.”

When it initially issued its guidance, the bureau argued that because it had no legal effect on regulated entities, the CRA does not apply.

The GAO, however, stated in its response to Toomey’s request that the bulletin “fits squarely within the Supreme Court’s definition of a statement of policy,” because it provides information on the manner in which the bureau planned to exercise its discretionary enforcement power.

Congress has attempted to kill the bureau’s guidance through the leg-

“

The CFPB frequently

overstepped its authority

And according to the GAO, the CRA “establishes special expedited procedures under which Congress may pass a joint resolution of disapproval that, if enacted into law, overturns the rule.” In a statement posted on its website just after the GAO delivered its answer, Sen. Toomey he intended “to do everything in my power to repeal this ill-conceived rule using the Congressional Review Act.”

while snubbing Congress and the public in the process.

”

Sen. Pat Toomey (R-Pa.)

islative route. In November 2015, the House of Representatives approved the Reforming CFPB Indirect Auto Finance Guidance Act by a 332-96 vote. The bill, however, was not acted upon by the Senate before the end of the 114th Congress.

Last March, Sen. Toomey asked the GAO whether the CFPB’s guidance on dealer participation falls under the CRA. The agency delivered its answer this past December, writing in a letter to Toomey that it did.

“The vehicle finance market in the United States is a highly competitive market which benefits consumers as dealers and lenders discount pricing and loan rates to sell and finance new and used vehicles,” said Chris Stinebert, president and CEO of the American Financial Services Association, a trade association representing vehicle finance sources. “The vote today is in the best interests of the carbuying public.”

WSIADA PRESENTS...

Update all your social media sites simultaneously from a single place, schedule custom posts, attach photos, target your audience and much more!

wsiada.com/smartsocial the Front Row | wsiada.com | May/June 2018 |

11

LET US SET YOUR DEALERSHIP FOR FREE!

Washington State Independent Auto Dealers Association

Membership Benefits • Auction discounts worth over $5000!

• Dealer advocacy • Dealer hotline • 10% off most WSIADA services and products • Legislative updates • Legal support program • Convenient billing • Regional and online continuing education opportunities • Subscription to the Front Row magazine

Protect your own interests and support the auto industry in Washington State.

Join WSIADA or renew your membership today!

See enrollment form on page 23.

12 | the Front Row | wsiada.com | May/June 2018

Supreme Court Rules Service Advisors Exempt from Overtime That overturned a 2011 ruling by the Obama Administration’s Department of Labor that dealerships were required to pay overtime to service advisors. The DOL policy was challenged in 2012 but was upheld by the Ninth Circuit Court of Appeals in 2015 and again in 2017 after the Supreme Court vacated the first decision and sent it back to the lower court.

By Any Friedlander, NIADA

I

n April the U.S. Supreme Court ruled automotive service advisors are not covered by the Fair Labor Standards Act’s overtime pay requirement, the final word in a long court battle that actually made it to the high court twice.

In a 5-4 decision, the court held that service advisors fall under the FLSA provision that exempts a “salesman, partsman or mechanic primarily engaged in selling or servicing automobiles” from federal overtime pay.

“The Court’s decision ratifies what has been an industry practice in dealerships for decades – a practice that had been satisfactory to both federal regulators and courts,” NIADA senior vice president of legal and government affairs Shaun Petersen said. “NIADA is pleased the Court’s ruling allows dealers much needed flexibility in structuring service advisors’ pay plans.”

In his majority opinion, Justice Clarence Thomas said a service advisor is a salesman because service advisors sell services to customers, and service advisors

JUDICIAL UPDATE

are also engaged in servicing automobiles because they are integral to the servicing process.

The court noted service advisors’ active and essential participation in the auto service process – meeting customers, listening to their concerns, suggesting and discussing repairs, selling parts and accessories, recording repair orders and following up with customers – qualifies them as “primarily engaged in servicing automobiles,” even though they do not actually perform the mechanical service work on vehicles.

Please note this ruling only affects federal law regarding overtime. State laws still apply. Several states, such as California, have laws governing overtime pay requirements for dealership employees, including service advisors.

Consult your legal counsel about your state’s overtime rules.

For more information, contact Andy Friedlander at andy@niada.com or 800.682.3837

the Front Row | wsiada.com | May/June 2018 |

13

WSIADA DIGITAL CORNER

By Rick Olson, Project Manager

O

ver the past year, your Association has been diligently upgrading our systems to accommodate the needs of dealerships and their staffs throughout the state of Washington. Our Executive Director has pub-

lished information on the upgrades periodically in his column. This article provides a more comprehensive breakdown on what WSIADA has been preparing to help in your success. comes as a benefit to your membership. The memberships will be tied to our CRM which will update regularly should renewals not be completed.

be able to register for events that we are having such as Education Fair, Title PCI Compliance will be Workshops, enforced with the new etc. without system. In the past, our having to ordering platforms was able sit at the to save a credit card on file computer. for when a dealership staff Access the member called in to place new store, an order but we won’t be process your able to do that any longer New Digital Store membership with this system. If you’re an active (new or renewals), check on auction I’ve been working with our developer member of the association, you’ll be events and report a curbstoner in on getting a new web store created able to utilize the invoice option when your area all from the mobile app. that will allow dealers to have you place an order or give a credit more features and product options card with each purchase you make.

Auction Savings Program available for ordering. The new Speaking of credit cards, we know system will allow us to work off one Over the next couple months, we that a lot of dealers have asked us platform instead of multiples like the will be rolling out our Auction Savings in the past on many occasions when past whether you call in an order, Program. Initially, we are getting credit card readers place an order online or at the the Program for our auction and headquarters auction locations. You will even be will replace able to access the new store through locations to speed up the buying the Auction process. We are resolving some last the new WSIADA mobile App. Discount Cards bugs in our system and will soon have currently offered This new platform gives us the ability them available at all of our locations to Member to provide sales, clearance items, to do just that to go with the print Dealers. The and other specials in the future but receipt that we have had at those Auction Savings also will allow dealers to review their locations for the past few months.

Program will be prior orders and to reorder without I should point out that on the available to all too much time spent on the site. old digital store, you were able independent The new store will allow you to ship to to register and purchase your dealers in the your dealership with real time pricing education renewal. In the future, State. Member through FedEx Ground. Given our you will need to go through our Dealers will enjoy volume, we ship only FedEx Ground, regular website, WSIADA.com, to some special delivery is generally 1-to-2 business get your registrations (Chapter benefits. Watch future editions of days. If you have multiple locations, Meeting RSVP, Continuing Education, the Front Row and WSIADA.com for you will be able to order for a specific Title Workshop, Pre-Licensing, details. location. We may offer Overnight in etc) processed. These will not be If there are any questions or the future but for now, the confusion available on the new platform, but comments on our new digital between Ground and Overnight was we will provide clear guidance on changes, please contact me to get causing a pricing issue. how to use the platforms. these sorted out. If I don’t know there If you’re an active member of are issues or glitches, we can’t get Mobile App the Association, your discount will them fixed. automatically be displayed once In early April, we launched the you sign in and have access to WSIADA mobile App for Apple rick@wsiada.com the standard invoicing option that and Google smartphones. You will ©Copyright 2018 SmartDealer™

14 | the Front Row | wsiada.com | May/June 2018

(253) 735-0267 x103

AUCTION LISTINGS For a current calendar view, visit WSIADA.com and select “Calendar” from the top navigation menu.

Adesa | adesa.com/seattle

Tuesday: Consignment 9:30AM Alternate Tuesday: Specialty 8:30AM Thursday Night: InOp Sale 4:45PM

Adesa | Portland adesa.com/portland Thursday: Consult website

Bowen-Scarff Ford Lincoln bowenscarff.com

Call 253.243.5251 for days and times

Copart | copart.com

Times vary: Consult website

CTM Unlimited

See website for auction dates and times: www.ctmunlimitedauction.com

DAA | Seattle | daanw.com

Friday: Dealer and Fleet/Lease 9:00AM Alternate Friday: Heavy Metal*

9:00AM (Lane 8) Monthly GSA Public Auctions:

1:00pm as scheduled” *Mechanically-challenged/cosmetically damaged/nonrunning inventory

DAA | Northwest | daanw.com

Weekly auctions: Thursdays at 9:00am; Monthly promotional event auctions:

Wednesday at 2pm &

Thursday at 9:00am Monthly MotorSports auctions:

Thursdays at 11:00am (Lane 8) Monthly RV auctions:

11:00am (Lane 8);

Heavy Metal auctions:

8:30am as scheduled (Lane 8); NOTE: MotorSports, RV and Heavy Metal auction dates can be found at daanwmotorsports.com

Ehli Auto Auctions | ehliauctions.com Last weekend of every month.

IAA - Insurance Auto Auctions iaai.com See website for dates and times

Kaman | kamanauctions.com Thursday: Noon

Manheim | Seattle manheim.com/locations/SSAA/events Monday: OVE Event Sales Tuesday: Alternate weeks Ford Factory

(Closed sale) - 10:00am;

Crossborder Mobile Sale - 1:00pm Wednesday: General Sale Weekly 9:00am All sale dates and times are subject to change.

Please verify with the Auction or manheim.com.

Manheim | Portland manheim.com/locations/PAA/events Tuesday: Open Sale: 9:00AM

the Front Row | wsiada.com | May/June 2018 |

15

Service Provider Directory WSIADA service providers are best in class. We invite you to explore their services and please mention that you saw their listing in the Front Row magazine.

Accounting Services

Auto Museum

Rekdal Hopkins Howard

LeMay Car Museum

(425) 658-1400 rh2cpas.com

Please see our ad on page 13

Auctions Adesa Seattle

(253) 735-1600 adesa.com/Seattle

Please see our ad on page 6

Adesa Portland

(503) 492-9200 adesa.com/Portland

Bowen Scarff Ford Lincoln (253) 243-5251 bowenscarff.com

Copart Auto Auction (253) 847-8300 copart.com

CTM Unlimited

(360) 273-5808 ctmunlimitedauction.com

DAA Northwest (509) 244-4500 daanw.com

Please see our ad on the inside front cover

DAA Seattle

(253) 737-2200 daaseattle.com

Ehli Auctions

(253) 572-0990 ehliauctions.com

Insurance Auto Auction (IAA) (206) 658-6900 iaai.com

Kaman Auctions

(253) 779-8490 AmericasCarMuseum.org

Please see our ad on page 18

Benefits / Health Insurance Benefit Consultants NW (800) 945-4193 bcnw.com.org

Bonds and Commercial Insurance Hecht & Hecht Insurance (800) 609-0979 hechtins.com

Shepard & Shepard Business Solutions (855) 396-0488 shepquote.com

Please see our ad on page 12

Car Care Griot’s Garage

(253) 922-2200 griotsgarage.com

Custom Signs Sign Dog

(253) 445-6424 signdog.com

Dealer Management Systems (DMS) Carousel Software

Drive Dealer Solutions

(425) 478-7242 drivedealersolutions.com

The F&I Group, LLC (360) 710-9545 thefandigroup.com

Northwest Dealer Financial Services

(206) 718-7234 (Western WA) (509) 705-7597 (Eastern WA) nwdfs.com

Southwest Dealer Services (206) 571-3068 ian.fee@swds.net

Western Fidelity Insured Services, Inc. (425) 283-4158 wfisinc.com

Floor Plan Companies AFC

(253) 333-0300 afcdealer.com

Floor Plan Xpress (509) 703-6558 fpxus.com

Identity Theft Protection LegalShield

253 905-9111 legalshield.com

Legal Services Davies Pearson, P.C.

Dennis Demattia demattia@mailforce.net (509) 926-8848 carouselsw.com

(253) 620-1500 dpearson.com

Frazer Computing, Inc.

(253) 279-3260 creditacceptance.com

Lending Credit Acceptance

(425) 640-5111 kamanauctions.com

(888) 963-5369 frazer.com info@frazer.com

Manheim Portland

Skywerks

Innovative Finance (877) 635-2021

Please see our ad on page 20

Lobel Financial Corp.

(503) 286-3000 manheim.com

Manheim Seattle

(206) 999-6699 skywerks.com

(206) 762-1600 manheim.com

Finance and Insurance

on the inside back cover.

(800) 826-3207 aulcorp.com

Please see our ad

Yarbro Auctioneers (509) 765-6869 yarbro.com

AUL Corp

Please see our ad on page 4

Benchmark Dealer Services (206) 696-2264 dpccorp.net

Please see our ad on page 15

16 | the Front Row | wsiada.com | May/June 2018

Please see our ad on page 15

innovativeauto.com

(253) 839-2600 lobelfinancial.com

Marketing Sygnifi Networks (734) 418-7073 info@sygnifi.com sygnifi.com

Parts & Service Advance Auto Parts

(877) ADVANCE advanceautoparts.com

AutoZone

(866) 727-5317 sc53@autozone.com

Please see our ad on the back cover

Staffing Job Depot USA

(877) 868-7635 info@jobdepotusa.com

State Agencies WA State Attorney General Office

atg.wa.gov/used-car-considerations

Department of Licensing Dealer Services

(360) 664-6466 dol.wa.gov/business/vehiclevesseldealer/dlrrenew.html

Department of Revenue Business Licensing (BLS) (800) 451-7985 bls.dor.wa.gov/

WSP Vehicle Inspection

wsp.wa.gov/driver/schedule-avin/

WSDOT Commerical Vehicle Services

wsdot.wa.gov/commercialvehicle/default.htm

Surveillance/Security Pro-Vigil Surveillance (210) 858-1105 pro-vigil.com

Please see our ad on page 3

Vehicle and Fleet Management

United Finance

Spireon

(503) 238-6475 unitedfinance.org

(800) 557-1449 spireon.com

Dealer Alert Digest

FEB 02 | New System for Filing Taxes

identity and data with Multi-Factor Authentication (MFA). MFA makes it about four times more difficult for an attacker to impersonate you or one of your customers online.

I

n case you’ve missed any of this year’s WSIADA Dealer Alerts, we’re publishing this digest.

In the electronic magazine version, simply click on the link to go directly to the full article on WSIADA.com.

If you have the WSIADA App, you will receive these alerts as real-time notifications. You can download the free app on one of the online app stores. In the electronic magazine version, simply click on the icon below to visit that app store directly:

CURRENT ALERTS APR 17 | Wholesale License Update As of July 1, 2018, if you’ve had your WA Wholesale Auto license for at least six continuous years you can retain your Wholesale license without converting to a Retail license.

Read the full article: https://www.wsiada.com/item/wa-wholesalelicense

APR 13 | Drivers License Numbering Changes After Sept. 4, 2018, every person receiving a license for the first time in Washington will receive the new DLN format. People who already have a license will get the new DLN when they renew or replace their license.

Read the full article: https://www.wsiada.com/item/drivers-licensenumbering-changes?category_id=34

APR 10 | Department of Licensing MFA Upgrades The Washington State Department of Licensing is upgrading security measures to protect customer

DEALER ALERTS

https://www.wsiada.com/item/washington-statedept-of-revenue-new-system-for-filing-taxescoming-march-19-2018

Read the full article:

JAN 30 - Military Lending Act:

https://www.wsiada.com/item/department-oflicensing-mfa-upgrades

https://www.wsiada.com/item/military-lendingact?category_id=34

APR 05 | License Express System JAN 29 | 8300 Rule Updates

If cash less than $10,000 is combined with cashier’s checks or travelers checks less then $10,000 and the total comes to greater than $10,000, you must file an 8300.

License Express continually updates their system to add improvements and visual enhancements. This article outlines the newest improvements and visual enhancements available as of April 9, 2018:

https://www.wsiada.com/item/8300-rule

JAN 29 | NIADA Buyers Guide Announcement

Read the full article: https://www.wsiada.com/item/license-expresssystem-updates-coming-monday-april-92018?category_id=34

https://www.wsiada.com/item/niada-buyersguide-announcement?category_id=34

APR 02 | Title Applications Alterations made to dealer title applications are increasing the number of title applications rejected by the Department of Licensing (DOL) in Olympia. This article clarifies what is acceptable and what is required in the event of an alteration.

Read the full article:

WSIADA!

https://www.wsiada.com/item/reminder-titleapplication-annoucement?category_id=34

the Front Row magazine is the most effective way to reach over 1,600 automobile dealers in Washington State.

PREVIOUS ALERTS MAR 13 | Report of Sale and Transfer of Ownership Information https://www.wsiada.com/item/report-of-sale-andtransfer-of-ownership-information

MAR 05 | DOL ATLAS Rollout 2 https://www.wsiada.com/item/department-ofrevenue-atlas-rollout-2-launches-march-19

Advertise with

Contact WSIADA for more information about targeting your ad dollars today!

253.735.0267

FEB 21 | Title Applications https://www.wsiada.com/item/dealer-alteredapplications-notice?category_id=34

the Front Row | wsiada.com | May/June 2018 |

17

EXPERIENCE YOUR AUTOBIOGRAPHY

COMPLIMENTARY DEALER CROSS-PROMOTIONAL OPPORTUNITIES • Display vehicles on Anderson Plaza at ACM — Great visibility from I-5, I-705 & Tacoma Dome • Offer Ride & Drives around Dome District & Haub Family Field • Purchase ACM Group Admission Tickets for event promotion • ACM develops event promotional email for dealership

RESERVE TODAY Contact the Sales Manager at rsvp@americascarmuseum.org 2702 East D Street, Tacoma, WA 98421 | 253.779.8490 | americascarmuseum.org

Washington State Independent Auto Dealers Association

2018 Education Fairs Attending one of WSIADA’s 2018 Education Fairs will satisfy dealers’ annual continuing education requirement for license renewal. The discounted pricing listed below is available for applications received or postmarked by August 1st, 2018.

STEP 1: SELECT EAST | Tuesday, July 17, 2018 | Airport Holiday Inn, 1616 Windsor Drive, Spokane WA WEST | Thursday, August 16, 2018 | Lemay, America ‘s Car Museum, 2702 East D Street, Tacoma WA

STEP 2: REGISTER DEALERSHIP NAME

DEALER#

AUTHORIZED SIGNATURE (IF DIFFERENT THAN CARDHOLDER)

NAME PRINTED

BUSINESS PHONE

FAX

DATE

ATTENDEES (USE ADDITIONAL FORM IF NEEDED)

EMAIL ADDRESS

STEP 3: PAY Non-Member Price: $150 $125 per attendee VISA

MC

AMEXcheck

Member Price: $50 $25 per attendee

CHECK No.___________

CARD NUMBER

NAME ON CARD

EXPIRATION DATE

CARDHOLDER SIGNATURE

CCV

BILLING ZIP CODE

STEP 4: SEND WSIADA FAX EMAIL(as a scanned attachment)

707 Auburn Way South 253-804-0844 staff@wsiada.com

Auburn, WA 98002 the Front Row | wsiada.com | May/June 2018 |

19

20 | the Front Row | wsiada.com | May/June 2018

READ AND RESPOND | the Front Row MAY/JUNE 2018

T

he purpose of this Read and Respond quiz is to verify one has read the content of this issue of the Front Row. All of the answers for the questions provided are included in the content of the issue. WSIADA’s Read and Respond quizzes earn 1 hour of continuing education credit. A passing grade will be granted for scores of 80% or higher.

Payment is required prior to the Washington State Department of Licensing being notified of completed continuing education. The Front Row Read & Respond policy has been updated; please contact WSIADA for payment information.

Please be advised that the information contained in WSIADA’s the Front Row is, to the best of our knowledge, current and correct. However, we caution readers not to use the information provided to them as final authority. Its purpose is to be a guide. Any legal advice should be regarded as general information. It is strongly recommended that one contact an attorney for counsel regarding specific circumstances. Some articles may express opinions and/or suggestions for best practices. Likewise, the appearance of advertisers or their identification as members of WSIADA, does not constitute an endorsement of the products or services featured.

DEALERSHIP NAME CHECK:

DEALER#

BUSINESS PHONE

FAX

I HAVE READ AND UNDERSTAND THE DISCLAIMER ABOVE.

QUIZ TAKER’S NAME

POSITION

SIGNATURE

CIRCLE THE CORRECT ANSWER. 1: The US Senate voted 51 – 47 to approve legislation aimed at repealing the guidance containing the CFPB’s warning. a. True b. False 2: On April 13th, the WSIADA Dealer Alert was about what subject? a. Wholesale License b. Title Applications c. Driver’s License number change d. NIADA Buyer Guide Announcement 3: The Supreme Court decision concerning Service Advisors Exemption from Overtime only affects Federal law, not state laws?

EMAIL

DATE

Send your completed quiz to WSIADA...

MAIL: 707 Auburn Way South; Auburn, WA 98002 FAX: 253-804-0844 EMAIL: staff@wsiada.com

4: DAA Northwest (Spokane) will be having their Rock & Roll Sale on July 16th. Who is going to be the concert attraction?

7: The new WSIADA Auction Savings Program will be available for all dealers, not just members, when its unveiled later this summer?

a. John Fogerty

a. True

b. Weird’ Al Yankovic

b. False

c. Creedence Clearwater Revival d. Justin Beiber 5: Bushing refers to what after four business days of a deal is signed? a. Customer wants to return the vehicle

8: 2018 Best of Clark County had four member dealerships nominated this year: Art Kuzma, Dick Hannah, McCord Vancouver and Top Auto Brokers.

Who was the ultimate winner of the competition? a. Dick Hannah

b. A dealer attempts to change the terms of a sale agreement

b. McCord Vancouver

c. Customer attempts to change the terms of the sale agreement

d. Art Kuzma Motors

6: The Washington Consumer Protection Act enables the Attorney General’s Office to demand information from a dealership in the course of an investigation

a. True

a. True

b. False

b. False

c. Top Auto Brokers

9: The Auto industry trade groups have argued that the CFPB used its guidance to indirectly regulate the activities of dealers which is mostly exempt under the Dodd-Frank Act? a. True b. False the Front Row | wsiada.com | May/June 2018 |

21

READ AND RESPOND | continued 10: There are five steps dealers and F&I professionals can take to fill in gaps in documention?

13: WSIADA’s annual Education Fairs are coming. What dates are scheduled? a. July 16 (East) / August 17 (West)

a. True

a. WSIADA

b. August 16 (East) / July 17 (West)

b. False

b. NIADA

c. July 17 (East) / August 16 (West)

11: “The vote today is in the best interests of the car-buying public” was quoted by whom?

c. WSADA

d. July 17 (West) / August 16 (East)

d. OSHA

14: Individual documents in a car deal must not be designed to stand alone in a

a. Senator Pat Toomey

vaccum

b. Chris Stinebert

16: Shaun Peterson is vice president of legal and government affairs for which association?

17: Sponsors listed in the Service Provider Directory are available to all dealerships not just Members of WSIADA?

c. Donald Trump

a. True

a. True

d. Tony Stark

b. False

b. False

12: With the new digital store for the WSIADA, will you be able to purchase your continuing education and events still?

15: How often should your dealership ensure all car deal documents are updated to be in compliance?

a. Yes, nothing has changed with this option

a. Each year b. 2 years

18: How old is the WSIADA this year? a. 100 years b. 65 years c. 50 years d. 55 years

c. 4 years

b. No, it has to be done through WSIADA.com now

d. 5 years

Reserve Your Place!

5

Ed ing h c tinu Con dits Ea Cre

JULY

17

In conjunction with DAA Northwestʼs Annual Rock & Roll Sale

AUGUST

16

2018 WSIADA EDUCATION FAIRS 22 | the Front Row | wsiada.com | May/June 2018

Washington State Independent Auto Dealers Association

Membership Enrollment

YES!

I know that it is important to be recognized as a professional in the automotive industry!

Enclosed are my annual dues to ensure that my business has all the advantages WSIADA/NIADA provides to put me at the forefront of my profession. By completing this form, I am consenting to and giving WSIADA/NIADA, their affiliates and/or subsidiaries, my permission to contact me at the methods I have provided on this form until/unless I revoke that permission in writing. I hereby certify that (I am/we are) eligible for membership in WSIADA.

SIGN Member Name Business Name

Dealer #

Address City

State

Business Phone

Zip

Mobile

County Fax

E-Mail

Website: Enrolled by _____________

Membership Category: Dealer Membership is [a] limited to any sole proprietorship, partnership or corporation which is engaged in buying and selling motor vehicles as a principal part of its business; and [b] member must hold a vehicle dealer’s license issued by the Washington State Department of Licensing.

Business Name

Dealer #

Business Name

Dealer #

Business Name

Dealer #

Other Employees I would like to include within my membership: Full Name

Position

Mobile

Email

Full Name

Position

Mobile

Email

Full Name

Position

Mobile

Email

SEAL

PAYMENT METHOD:

$450 Annual Charge

$42 Monthly Charge (debit/credit card only)

CHECK No._______________

VISA

CARD NUMBER

NAME ON CARD

MC

EXPIRATION DATE

CARDHOLDER SIGNATURE

Discover

AMEX

CCV

BILLING ZIP CODE

DISCLAIMER: 12 monthly installments will be charged on the 1st of every month. Receipts will be emailed unless otherwise requested. This agreement will continue until/unless the card holder revokes consent in writing or cancels membership. At that point member will be billed for the remaining balance. If provided card is declined, WSIADA may continue to attempt to process payment(s) or request updated payment information. If payment is declined and no card update issued, dealer will be invoiced for remaining balance and access to WSIADA services will be suspended until balance is paid in full.

DELIVER

WSIADA 707 Auburn Way South Auburn, WA 98002

FAX 253-804-0844

EMAIL(as a scanned attachment) staff@wsiada.com the Front Row | wsiada.com | May/June 2018 |

23

LEGAL CORNER From the offices of Davies Pearson, P.C.

Navigating Spot Delivery

B

ushing occurs when a dealer attempts to change the terms of a sale agreement more than four business days after the deal was signed. In that case, a dealer must void the prior deal documents and refund any payments before entering into a new deal. This is true even if the new terms are more favorable to the buyer.

Many dealers find it helpful to implement a Conditional Delivery Agreement, otherwise known as a Spot Delivery Agreement, which provides many benefits.

• First, it contains the statutory requirements. For example, finalizing the deal by the close of business on the fourth calendar day after the date of sale (exclusive of Saturdays, Sundays and legal holidays).

• Second, it contains significant protections for the dealer by shifting risk to the customer, including the risk of lawsuits and damages resulting from injuries to third parties or their property.

• Finally, it outlines the rights and obligations of both dealer and customer, including the customer’s obligation to return the vehicle upon demand and pay for any damage to the vehicle or excessive mileage.

Responding to a Demand from the Office of the Attorney General

T

he Washington State Office of the Attorney General has the authority to enforce the Washington Consumer Protection Act. The law enables the AG’s Office to demand information from dealerships in the course of investigating complaints regarding potential violations of the law. The demands may seek the production of records as well as responses to written questions. A demand does not necessarily lead to—but may be the precursor for—a lawsuit.

These requests must be responded to with great care and caution, and with the assistance of your attorney, as your responses can be publicly disclosed and reviewed by individuals outside the AG’s Office (e.g., a

JUST FOR FUN

Local Urban Myth “A gentleman came into WSIADA HQ recently. He used to race cars in the Bothell Washington area back in the 50’s and 60’s. He told us about how police officers would stop cars in Bothell and use a pack of cigarettes to gauge if a car was going to get a citation for being too low. If the officer used the cigarette pack upright and there was space, they were okay. If the officer turned the pack on the side and there was no space for the pack to fit under, the driver got a ticket for being too low.

‘We spoke with an Officer Martin in the Traffic Division at Bothell Police Department, he consulted several retired officers to learn this was an urban legend, of sorts, because the law states no metal can hang below the rim of a vehicle to maintain control in case of rapid deflation of a tire.” ~ WSIADA Staff

24 | the Front Row | wsiada.com | May/June 2018

dissatified consumer and his or her attorney. In addition, the response to a demand can be used against a dealership in the event of a lawsuit.

There are a number of considerations that must be looked at when responding to a demand. Because each demand is unique, these considerations may not be advisable in each case: 1. Don’t volunteer extraneous information that is beyond the scope of the specific requests; 2. Don’t respond with legal conclusions; 3. Don’t respond in a tone that is adversarial towards either the Attorney General’s Office or the complainant(s); 4. Do convey a desire and commitment to work out a reasonable resolution of the issue(s); and 5. Do stick to the facts.

These are just a few of the considerations that must be looked at when responding to a demand. Each case is unique and should be treated seriously, so contact your attorney should you receive a demand.

For more information, contact Davies Pearson, P.C. at 253.620.1500 or www.dpearson.com.

64TH ANNIVERSARY SALE

A LUAU

EVENT SALE AT MANHEIM SEATTLE

WEDNESDAY

MAY 9, 2018 STARTS AT 9:00 AM

2100+ UNITS LANES 1-10

HULA ON IN FOR A TIKI TIME HIGHLINE SALE! NOT ONLY GREAT INVENTORY, BUT FOOD, FUN, AND PRIZES. JET SKI, BIG GREEN EGG SMOKER, AND MUCH MORE FOR END OF SALE PRIZES!

WASHINGTON STATE INDEPENDENT AUTO DEALERS ASSOCIATION 707 Auburn Way South Auburn, WA 98002 WSIADA.COM

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