§ 46.2-1927. Bonding requirements for applicants for license
Every applicant for an original, second year renewal, and third year renewal dealer's license shall obtain and file with the Commissioner a bond in the amount of $25,000. However, no dealer shall be required to obtain more than one $25,000 bond for all licenses held under this subtitle. Any dealer who is licensed under Chapter 15 of this title and who obtains a T&M vehicle dealer license under this chapter, shall be exempt from the bond requirements set out in this section. In addition, any person who purchases a T&M vehicle from a dealer who is licensed under Chapter 15 of this title, shall have access to the Motor Vehicle Transaction Recovery Fund as prescribed in Article 3.1 (§ 46.2-1527.1 et seq.) of Chapter 15 of this title. The bond shall come from a corporate surety licensed to do business in the Commonwealth and approved by the Attorney General. The bond shall be conditioned on a statement by the applicant that the applicant will not practice fraud, make any fraudulent representation, or violate any provision of this chapter in the conduct of the applicant's business. The Commissioner may, without holding a hearing, suspend the dealer's license during the period that the dealer does not have a sufficient bond on file.
If a person suffers any of the following: (i) loss or damage in connection with the purchase of a T&M vehicle by reason of fraud practiced on him or fraudulent representation made to him by a licensed T&M vehicle dealer or one of the dealer's salespersons acting within his scope of employment; (ii) loss or damage by reason of the violation by a dealer or salesperson of any provision of this chapter in connection with the purchase of a T&M vehicle; or (iii) loss or damage resulting from a breach of an extended service contract entered into on or after July 1, 1995, as defined by § 59.1-435, that person shall have a claim against the dealer and the dealer's bond, and may recover such damages as may be awarded to such person by final judgment of a court of competent jurisdiction against the dealer as a proximate result of such loss or damage up to, but not exceeding, the amount of the bond, from such surety, who shall be subrogated to the rights of such person against the dealer or salesperson. The liability of such surety shall be limited to actual damages, and shall not include any punitive damages or attorneys' fees assessed against the dealer or salesperson.
The dealer's surety shall notify the Department when a claim is made against a dealer's bond, when a claim is paid and when the bond is cancelled. Such notification shall include the amount of a claim and the circumstances surrounding the claim. Notification of cancellation shall include the effective date and reason for cancellation. The bond may be cancelled as to future liability by the dealer's surety upon thirty days' notice to the Department.
(1995, cc. 767, 816; 1996, cc. 1043, 1052.)
Sections: Previous 46.2-1916 46.2-1917 46.2-1918 46.2-1919 46.2-1920 46.2-1921 46.2-1922 46.2-1927 46.2-1928 46.2-1929 46.2-1930 46.2-1931 46.2-1932 46.2-1933 46.2-1934 NextLast modified: April 16, 2009