California advances consumer protection bill on flooded vehicles

| 6/8/2006

The California Assembly has unanimously approved a bill intended to provide car and truck buyers with greater assurances that used vehicles have not been water-damaged.

The measure would prohibit reselling or transferring ownership of a vehicle that has been damaged by a flood unless that fact is disclosed on the vehicle’s title. It also would require the removal of any of the vehicle’s “structural, mechanical, electronic, electrical, fuel, brake, safety systems or its computer-based components” that had water damage.

Sponsored by Assemblywoman Jenny Oropeza, D-Carson, the bill – AB1854 – now heads to the Senate for further consideration.

Oropeza said the effort is needed to combat vehicles, including large trucks, damaged by flooding from sources like Hurricanes Katrina and Rita, as well as recent California floods, from being sold to unsuspecting consumers.

She said the bill would “protect consumers by making it a misdemeanor to resell or transfer ownership of a vehicle that has been flooded, water damaged or the title reregistered so often the salvage label has been dropped, or ‘washed’ to hide its true history.

“Caveat Emptor may mean ‘buyer beware’ but when the title of the vehicle itself is fraudulent, consumers need strong government protection,” Oropeza said.

She said that as many as 600,000 water-damaged vehicles from Hurricane Katrina could have been sent to used lots nationwide.

Anyone found in violation would face fines of $1,000. Repeat offenders would face a $5,000 fine. A third or subsequent offense would result in a $10,000 fine.

A similar protection was signed into law in Louisiana late last year.

The Louisiana version requires most vehicles totaled by flood to receive a “certificate of destruction” and be crushed or dismantled. The new law, however, excludes from the protection vehicles with a gross weight in excess of 20,000 pounds.

Louisiana law previously required flooded vehicles to receive a “salvage certificate” and that the damage be noted on the titles.

Damaged vehicles must have their frames and electrical systems dismantled and crushed while certain parts can be refurbished or resold. Only vehicles that are more than 75 percent ruined by a natural disaster declared by the governor or president would be covered under the measure.

Anyone who fails to abide by the rule could get up to six months in jail and/or up to a $5,000 fine, as well as at least 80 hours of community service.

– Keith Goble, state legislative editor