41-3-401.5 - Disclosure of financing arrangements relating to the lease of a motor vehicle. - Utah Statutes

41-3-401.5. Disclosure of financing arrangements relating to the lease of a motorvehicle.
(1) (a) A dealer may not issue a temporary permit or release possession of a motorvehicle wherein the dealer has contracted to enter into a lease agreement to someone other thananother dealer unless the contract to enter into a lease agreement contains the disclosure listed inSubsection (2).
(b) The disclosure shall be set forth clearly and conspicuously on the first or front page ofthe contract to enter into a lease agreement, executed by the prospective lessee and the dealer.
(2) The form to be used when the dealer contracts to enter into a lease agreement for thepotential lease of a motor vehicle shall read as follows:
"(1) THE PROSPECTIVE LESSEE OF THE MOTOR VEHICLE DESCRIBED INTHIS CONTRACT TO ENTER INTO A LEASE AGREEMENT HAS EXECUTED THECONTRACT IN RELIANCE UPON THE DEALER'S REPRESENTATION THAT THEDEALER CAN SECURE FROM A FINANCIAL INSTITUTION FINANCINGARRANGEMENTS FOR THE LEASE OF THE MOTOR VEHICLE. THE PRIMARYTERMS OF THE FINANCING ARRANGEMENT ARE TO BE AS FOLLOWS:
TERM BETWEEN _____ MONTHS AND ______ MONTHS. MONTHLYPAYMENTS BETWEEN $______ PER MONTH AND $ _____ PER MONTH BASED ON ADOWN PAYMENT AND/OR NET TRADE-IN ALLOWANCE OF $ _________.
(2) (a) IF THE DEALER IS NOT ABLE TO SECURE FINANCINGARRANGEMENTS WITHIN THE TERMS DISCLOSED, THEN THE DEALER MUSTWITHIN SEVEN CALENDAR DAYS OF THE DATE OF THE CONTRACT TO ENTERINTO A LEASE AGREEMENT MAIL NOTICE TO THE PROSPECTIVE LESSEE THATTHE DEALER HAS NOT BEEN ABLE TO SECURE FINANCING ARRANGEMENTS INACCORDANCE WITH THE DISCLOSED TERMS AND THE CONTRACT TO ENTERINTO A LEASE AGREEMENT IS THEREFORE RESCINDED.
(b) IF THE DEALER IS NOT ABLE TO SECURE FINANCING ARRANGEMENTSWITHIN THE TERMS DISCLOSED, SUCH FAILURE DOES NOT UNDER ANYCIRCUMSTANCES REQUIRE THE DEALER TO PROVIDE THE FINANCINGNECESSARY FOR THE PROSPECTIVE LESSEE TO LEASE THE VEHICLE.
(c) IF THE CONTRACT TO ENTER INTO A LEASE AGREEMENT IS RESCINDED,THE PROSPECTIVE LESSEE HAS 48 HOURS FROM RECEIPT OF THE NOTICE TO:
(i) RETURN TO THE DEALER THE MOTOR VEHICLE THE PROSPECTIVELESSEE AGREED TO LEASE;
(ii) PAY THE DEALER AN AMOUNT EQUAL TO THE CURRENT STANDARDMILEAGE RATE FOR THE COST OF OPERATING A MOTOR VEHICLE ESTABLISHEDBY THE FEDERAL INTERNAL REVENUE SERVICE FOR EACH MILE THE MOTORVEHICLE HAS BEEN DRIVEN WHILE IN THE PROSPECTIVE LESSEE'S POSSESSION;AND
(iii) COMPENSATE THE DEALER FOR ANY PHYSICAL DAMAGE TO THEMOTOR VEHICLE WHILE THE VEHICLE WAS IN THE PROSPECTIVE LESSEE'SPOSSESSION.
(3) IN RETURN, UPON RECEIPT OF THE ITEMS SET FORTH IN (2)(c)(i), (ii), and(iii) THE DEALER SHALL RETURN TO THE PROSPECTIVE LESSEE ALL PAYMENTSOR OTHER CONSIDERATION PAID BY THE PROSPECTIVE LESSEE, INCLUDING ANY

DOWN PAYMENT AND ANY MOTOR VEHICLE TRADED IN.
(4) IF THE TRADE-IN HAS BEEN SOLD OR OTHERWISE DISPOSED OF BEFORETHE CONTRACT TO ENTER INTO A LEASE AGREEMENT IS RESCINDED, THEN THEDEALER SHALL RETURN TO THE PROSPECTIVE LESSEE A SUM EQUIVALENT TOTHE ALLOWANCE TOWARD THE LEASE PRICE GIVEN BY THE DEALER FOR THETRADE-IN, AS NOTED IN THE CONTRACT TO ENTER INTO A LEASE AGREEMENT.
______________________________
(Signature of the Prospective Lessee)
______________________________
(Signature of the Dealer)"
(3) (a) (i) In addition to the penalties in this chapter, if the disclosure in Subsection (2) isnot properly executed or if the dealer is unable to secure financing arrangements for the lessee asprovided in Subsection (2) within seven calendar days immediately following the date disclosedon the contract to enter into a lease agreement, then in either case the prospective lessee mayreturn the motor vehicle to the dealer and receive a complete refund of all money and otherconsideration given to the dealer for the contract to enter into a lease agreement, including anymotor vehicle or property used as a trade-in.
(ii) If the motor vehicle or property used as a trade-in has been sold or otherwisedisposed of, the dealer shall return to the prospective lessee the amount of money equivalent tothe allowance towards the lease price given by the dealer for the motor vehicle or property tradedin, as noted in the contract to enter into a lease agreement.
(b) If the dealer provides the notice as set forth in Subsection (2)(a) of the disclosurestatement, the contract to enter into a lease agreement is rescinded.
(c) If a contract to enter into a lease agreement is rescinded under Subsection (3)(b):
(i) the prospective lessee shall return the leased vehicle within 48 hours of receiving anotice that the dealer is unable to secure financing arrangements for the lease; and
(ii) the prospective lessee is liable to the dealer:
(A) for all physical damage to the motor vehicle while in the possession of theprospective lessee; and
(B) in an amount equal to the current standard mileage rate for the cost of operating amotor vehicle established by the federal Internal Revenue Service for each mile the motor vehiclewas driven between the date the prospective lessee first acquired possession and the date whenthe prospective lessee returned the motor vehicle to the dealer.
(4) (a) A dealer who has complied with Subsection (2), but who has not been able tosecure financing arrangements as set forth in the disclosure, shall within seven days of the date ofthe contract to enter into a lease agreement mail written notice to the prospective lessee:
(i) disclosing that the dealer has not been able to secure financing arrangements as setforth in the disclosure; and
(ii) instructing the prospective lessee of the prospective lessee's responsibility to returnthe vehicle within 48 hours of receiving the notice, as provided for in Subsection (2).
(b) (i) The dealer shall mail notification to the prospective lessee within seven calendardays following the date that the contract to enter into a lease agreement was executed.
(ii) A notice complies with Subsection (4)(b)(i) if it is postmarked before the end of theseventh day following the date that the contract to enter into a lease agreement was executed andaddressed to the prospective lessee at the address contained in the contract to enter into a lease

agreement.
(iii) If the prospective lessee's address is not contained on the contract to enter into alease agreement, then proof of compliance with the notification provision of this Subsection(4)(b) shall be borne by the dealer.
(iv) If a dealer gives notice in the manner prescribed, the prospective lessee has 48 hoursfrom receipt of the notice to return the vehicle to the dealer.
(c) If a dealer executes the disclosure required by Subsection (2), but is not able to securefinancing arrangements as set forth in the disclosure, and the dealer fails to give written notice tothe prospective lessee within seven days, as provided for in Subsections (4)(a) and (b), then theprospective lessee shall return the vehicle within 48 hours of the date the prospective lessee firstlearns that the dealer has not been able to secure financing arrangements as set forth in thedisclosure.
(5) (a) Either the prospective lessee or a dealer may bring an action to enforce contractualor statutory rights under this section.
(b) The prevailing party in an action under Subsection (5)(a) is entitled to reasonableattorney fees as part of the costs of the action.
(6) A motor vehicle returned by the prospective lessee to the dealer in accordance withthe rescission provisions of this section is not considered leased for purposes of sales and use taxunder Title 59, Chapter 12, Sales and Use Tax Act.

Amended by Chapter 100, 2008 General Session