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Wednesday, 08 May 2019 16:54

Assembly Bill Modifies Storage Rates and Accident Charges

Index

Effective Jan. 1, 2019, Assembly Bill 2392 (Santiago, Chapter 434, Statutes of 2018) modified Vehicle Code (VC) § 22524.5 regarding reasonableness of storage rates and presumptively unreasonable charges when those fees are a result of an accident or recovery of a stolen vehicle.

 VC § 22524.5(c)(2)(A) states that towing and storage charges are deemed reasonable if they do not exceed the amount charged to a public agency such as the California Highway Patrol or local police department.

 

This would apply to an automotive repair dealer (ARD) if, in addition to performing automotive repair, they engage in the storage of vehicles for a public agency.

 

VC § 22524.5(c)(2)(B) states that storage charges are reasonable if they are comparable to those charged by other facilities in the same area.

 

This applies to ARDs and sets the reasonableness of the storage charges based upon other similar facilities in the same geographic/ demographic area. VC § 22524.5(c)(3) states that administrative or filing fees, security fees, dolly fees, load and unload fees, pull-out fees, and gate fees are presumptively unreasonable, which means they are presumed to be unreasonable unless rebutted with evidence.

 

Although storage fees and lien sales do not fall directly under the jurisdiction of the Bureau of Automotive Repair (BAR), the issues are often included in complaint investigations.

 

Before charging storage fees or proceeding with a lien sale, ARDs should review the following reminders:

 

  • • An ARD must have a valid registration with BAR to be able to perform a lien sale or sue on a contract for automotive repairs. Business and Professions Code (B&P) § 9884.16
  • • An ARD must obtain the consumer’s authorization before performing work or accruing charges. B&P § 9884.9
  • • An ARD can charge reasonable towing and storage fees when those services are performed as a result of an accident or recovery of a stolen vehicle after the lien has arisen. VC § 22524.5

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