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a. It shall be unlawful for any dealer in second-hand articles to carry on his or her business at any place other than the one designated in such license.
b. It shall be unlawful for any such dealer to purchase any second-hand goods, or things from any person whom he or she knows to be or has reason to believe is a minor.
c. It shall be unlawful for any person whose principal business is dealing in second-hand articles to purchase any second-hand goods or articles from any person between the hours of 12:00 A.M. and 6:00 A.M.
d. It shall be unlawful for any such dealer to sell or dispose of any articles or things except household furniture, curtains, carpets, stoves, kitchen utensils, office furniture, automobiles, motor and other vehicles, machinery, belting, building materials and barrels, or other articles or things received from a dealer or pawnbroker, or which have been received from persons known to be jewelers, dealers, banking institutions, executors or administrators, until the expiration of fifteen days after such purchase or redemption.
e. All second-hand articles or things purchased for the purpose of melting or refining by persons principally engaged in such business, from persons who are not jewelers or dealers, shall not be sold, refined or melted or disposed of until the expiration of fifteen days after such purchase. Such items as described in the preceding paragraph shall be kept on the premises described in the license which is required by section 20-265 of this chapter.
f. It shall be unlawful for any person licensed as a dealer in second-hand articles, to be licensed as a pawnbroker. It shall be unlawful for any such dealer to receive any article by way of pledge or pawn, or employ subterfuge for receiving goods as security for the advancement of money; nor shall any sign, device or subterfuge be displayed, used or employed by any such dealer in or about the premises where such business is conducted, which in any way resembles the emblem or sign commonly used by pawnbrokers, or which is intended to give the appearance that the business conducted on such premises is, or is connected with, the business of a pawnbroker; nor shall there be any sign displayed which is calculated to deceive.
g. 1. All open lots used as places of storage by junk dealers and dealers in second-hand articles, except lots used as places of display by dealers engaged exclusively in the sale of used or second-hand automobiles, shall be enclosed on all sides adjoining any street by a sheet metal or wooden fence which shall be sufficient to obscure such premises from the public view, and at least six feet in height. It shall be unlawful for such dealer to display or exhibit such property or articles on or in front of any such fence. It shall be the duty of such dealer occupying such premises to keep such fence free and clear of all signs, posters, handbills or other forms of advertisement of any sort whatsoever, except that such dealer may display one sign not exceeding twenty-four feet in length by six feet in height on such fence on each street which such premises shall adjoin, such sign to be used for the purpose of advertising the business of such dealer. The same restrictions shall apply to the owner of such premises in the event that such premises are made available for lease by such owner.
2. It shall be unlawful to stack or to permit the stacking of any motor vehicles of any kind, or any parts thereof, upon any private property within the city unless such vehicles or parts thereof are completely enclosed within a building, or within an area surrounded by a six foot high fence constructed of sheet metal or wood. When stacked in an open lot such motor vehicles or parts thereof shall be on the interior portion of the lot and the base of such stack shall be a distance of not less than twenty feet from such fence, and the height of such stack shall not exceed twenty feet. There shall be no less than a five hundred foot distance between the area so used and any place of worship, school or other public building.
3. The commissioner shall cause periodic inspection to be made of the area and must be satisfied that such premises comply with all laws and rules and regulations of the department of buildings, the fire department, the department of transportation, the department of health and mental hygiene, and the department of environmental protection insofar as the same are applicable thereto. For purposes of facilitating the inspection prescribed by this section, the commissioner is authorized to call upon the heads of the above named departments and such departments and their employees shall make such inspections as may be required.
4. The provisions set forth in paragraph (2) hereof relating to the five hundred foot distance from any place of worship, school or public building, shall not apply to any existing licensed premises.
h. 1. A person who is licensed as a dealer in secondhand automobiles who sells a secondhand automobile, automobile part or equipment that is identified as having been recalled by the national highway transportation safety administration ("NHTSA"), pursuant to its authority under chapter 301 of title 49 of the United States code, must provide to the purchaser, prior to the execution of the contract for sale, a copy of the recall information for such secondhand automobile, automobile part or equipment, as printed out directly from the NHTSA website, https://www.nhtsa.gov/recalls, or any successor to such website. Such disclosure shall be made in writing and that writing must be signed or initialed by the purchaser of the secondhand automobile, automobile part or equipment. Such signed or initialed disclosure shall be maintained by the dealer, in either electronic or paper form, for no less than five years and such disclosure shall be subject to inspection by the commissioner.
2. Nothing in this subdivision shall supersede any existing city, state or federal law or regulation pertaining to automobile safety or roadworthiness, or prevent the department or any other city, state or federal agency from enforcing any city, state or federal law or regulation pertaining to automobile safety or roadworthiness.
(Am. L.L. 2017/085, 5/30/2017, eff. 9/27/2017)
Editor's note: For related unconsolidated provisions, see Appendix A at L.L. 1996/059 and L.L. 2006/039.
a. No mandatory financing. A second-hand automobile dealer shall not require a consumer to accept financing or assistance in obtaining financing from a lender as a condition of the purchase of an automobile, and shall not increase the price of such automobile on the basis that the consumer has secured financing from a third-party lender.
b. Conditional sales contract. No retail installment contract for the purchase of a second-hand automobile shall include a term rendering the contract voidable, subject to modification, or otherwise not binding upon a second-hand automobile dealer because of such dealer's inability or unwillingness to sell, assign or otherwise transfer the contract to a third party after execution of the sales contract.
c. Payment price packing. A second-hand automobile dealer shall not:
1. Require a consumer to purchase any add-on product as a condition of purchasing a second-hand automobile or obtaining financing from a lender for the purchase of an automobile; or
2. Charge a consumer a higher amount if such consumer does not purchase an add-on product, and shall not condition a financing offer on any such purchase.
d. False information provided to lender or finance company. In connection with the sale or offer for sale of a second-hand automobile, a second-hand automobile dealer or employees or agents thereof shall not:
1. Prepare, participate, assist or direct any person to prepare, participate or assist in the submission of a false, misleading, or deceptive credit application or contract to a lender or finance company; or
2. Request or allow a consumer to sign a blank or incomplete credit application or contract.
e. Disclosures.
1. Prior to the execution of any bill of sale, a second-hand automobile dealer shall provide to each consumer a document that discloses the availability of a contract cancellation option. The form and content of the required disclosure shall be prescribed by the commissioner by rule.
2. Prior to the execution of any retail installment contract, a second-hand automobile dealer that offers financing to a consumer of a second-hand automobile or assists such consumer in obtaining financing from a lender shall provide to such consumer in writing all disclosures required by the federal truth in lending act and by article nine of the personal property law. In addition to such disclosures, a second-hand automobile dealer shall provide to such consumer, in a form prescribed by the commissioner by rule, a document containing the following disclosures:
(a) The price of each add-on product to be included in such retail installment contract;
(b) The total cost of the automobile and the monthly payments, including any amounts associated with financing, that the consumer will be required to make to purchase the automobile (i) with each such add-on product included, (ii) without any add-on product included, and (iii) with all such add-on products.
(c) The lowest annual percentage rate offered to such consumer by the financing companies from whom the dealer has solicited financing on behalf of the consumer; and
(d) Any other financing-related disclosure prescribed by the commissioner by rule.
3. The disclosures described in this subdivision shall be provided to the consumer in the language in which the sale or finance agreement was negotiated, provided the commissioner has made available to second-hand automobile dealers such disclosures in such language.
4. Receipt of the disclosures described in this subdivision must be acknowledged by the consumer by signing or initialing in writing.
f. Waiver prohibited. No retail installment contract or other contract related to the purchase of a second-hand automobile may require a consumer to waive any of the protections provided by this section.
(L.L. 2017/197, 10/16/2017, eff. 2/13/2018)
a. Prior to executing a bill of sale with a consumer for the purchase of an automobile, a second-hand automobile dealer shall offer such consumer an automobile contract cancellation option that authorizes such consumer to cancel the sales contract, subject to the conditions set forth in this section. Until such option is declined in writing or forfeited by such consumer, such dealer may retain possession of and title to such automobile.
b. An automobile contract cancellation option shall be contained in a document separate from any sales, purchase, or financing agreement or contract and its terms shall be incorporated into the bill of sale governing each sale. The form and content of such automobile contract cancellation option document shall be prescribed by the commissioner by rule. The automobile contract cancellation option document shall contain, at a minimum, the following:
1. The name of the second-hand automobile dealer and the consumer;
2. A description of the second-hand automobile and the vehicle identification number of such automobile;
3. A statement specifying that the consumer may exercise the option to cancel the sales contract no later than the dealer's close of business on the second business day following the day on which the bill of sale was signed by the consumer or the day on which the retail installment contract was signed by the consumer, whichever occurs later;
4. A statement that the consumer has the option to cancel the sales contract and obtain a full refund and that such option will apply only if, within the two business day period specified in the automobile contract cancellation option document, such consumer personally delivers to the second-hand automobile dealer a written statement signed by such consumer, pursuant to paragraph 8 of this subdivision, exercising the option to cancel the sales contract;
5. A statement clearly indicating the date and time by which the option to cancel the sales contract may be exercised;
6. A statement specifying that the second-hand automobile dealer may retain possession of and title to such vehicle until such consumer declines in writing the option to cancel the sales contract or forfeits such option;
7. A statement that, when signed by the consumer, acknowledges receipt of the automobile contract cancellation option document and indicates whether such consumer has accepted or declined the option offered therein;
8. A statement that, if signed by such consumer, will either execute the cancellation of the sales contract, provided all necessary conditions for such cancellation have been met, or decline such cancellation, provided further that the consumer has previously accepted the automobile contract cancellation option;
9. A statement specifying that the consumer will execute documents reasonably necessary to effectuate the cancellation of the sales contract and the refund as reasonably required to comply with applicable law; and
10. If the sales contract includes a trade-in automobile, a statement specifying the consumer's rights in connection with such automobile and the terms and conditions that apply if such consumer elects to use the trade-in automobile during the cancellation period.
c. A consumer who has accepted an automobile contract cancellation option may exercise the option to cancel the sales contract no later than the dealer's close of business on the second business day following the day on which either the bill of sale or the retail installment contract was signed by such consumer, whichever such signing occurred later. A consumer shall forfeit the option to cancel the sales contract by failing to respond in writing to the business within such cancellation period.
d. A consumer's timely in-person delivery to the second-hand automobile dealer of the automobile contract cancellation option with such consumer's signature shall constitute sufficient written notice to such dealer of such consumer's exercise of the option to cancel the sales contract.
e. Upon delivery in person by a consumer of a written, signed statement exercising the option to cancel the sales contract in compliance with an automobile contract cancellation option, the second-hand automobile dealer shall immediately cancel the contract and provide such consumer with a full refund, including any sales tax collected in connection with the purchase.
f. The second-hand automobile dealer shall provide a consumer with a copy of the contract cancellation option document containing such consumer's signature accepting or declining the terms of the option. If the consumer exercises such option, the dealer shall provide such consumer with a copy of the document submitted by such consumer exercising such option.
g. A consumer who accepts an automobile contract cancellation option as part of a sales contract in which a trade-in automobile is included shall pay a refundable deposit of $100, and may:
1. Leave the trade-in automobile with the second-hand automobile dealer, who shall retain such automobile until the consumer exercises the option to cancel the sales contract or the option expires. If the consumer exercises the option to cancel the sales contract, such dealer shall keep the $100 deposit and return the trade-in automobile to the consumer no later than the day on which the consumer exercises such option. If the consumer declines to exercise the option to cancel the sales contract, such dealer shall return the $100 deposit to the consumer. If such dealer inadvertently sells or otherwise transfers title to the trade-in automobile as a result of bona fide error, notwithstanding reasonable procedures designed to avoid that error, such sale or transfer of title shall not be considered a violation of this paragraph, and the full refund described in subdivision e of this section shall include the retail market value of such trade-in automobile, or its value as stated in the sales contract, whichever is greater; or
2. Use the trade-in automobile during the cancellation period for a non-refundable fee of $50 payable to the second-hand automobile dealer. During such cancellation period, the consumer shall be prohibited from driving more than 250 miles in the trade-in automobile and must return such automobile in the same condition as when such automobile was presented to such dealer as a trade-in automobile, excepting any reasonable wear and tear. If the consumer declines to exercise the option to cancel the sales contract, such dealer shall return the $100 deposit to the consumer, provided that if the consumer does not comply with the terms and conditions governing the use of such trade-in automobile during the cancellation period, the dealer may either cancel the sales contract or keep such deposit. The dealer shall not be required to deliver the second-hand automobile to the consumer until the trade-in automobile has been delivered to the dealer.
h. A second-hand automobile dealer shall not increase the price of an automobile or impose a fee on a consumer in connection with the exercise of an automobile contract cancellation option except as provided in subdivision g of this section.
i. A second-hand automobile dealer shall not require that a consumer declines an automobile contract cancellation option or declines cancelling a sales contract as a condition for the purchase of a second-hand automobile.
(L.L. 2017/197, 10/16/2017, eff. 2/13/2018)
In advance of execution of any contract between a second-hand automobile dealer and a customer for the sale of a second-hand automobile, including, but not limited to, a buyer's order, retail installment contract, bill of sale, automobile contract cancellation option document, or service contract, a second-hand automobile dealer shall provide to such consumer a copy of such contract, all documents incorporated or referenced in such contract, and all documents to be signed or initialed by such consumer in connection with such contract, in the language used by such dealer to negotiate the sale of such second-hand automobile.
(L.L. 2017/197, 10/16/2017, eff. 2/13/2018)
a. On or before December 1, 2017, the department shall create a consumer bill of rights that informs consumers of second-hand automobiles of certain rights and protections that are afforded to them by law. The commissioner shall determine the contents of such bill of rights by rule, provided that the bill of rights shall contain, at a minimum, the following information:
1. Every second-hand automobile dealer in New York city is required to offer an automobile contract cancellation option to each consumer of a second-hand automobile;
2. A consumer of a second-hand automobile is not required to accept financing from a second-hand automobile dealer and has the right to pay for such automobile in cash or seek a loan from another lender;
3. A second-hand automobile dealer shall not sell a second-hand automobile at a price higher than the price advertised, quoted or posted on the automobile, and may not increase the price of the automobile on the basis that a consumer has secured financing from a third-party lender;
4. A consumer of a second-hand automobile may file a complaint against a second-hand automobile dealer or retrieve the 311 complaint history of a second-hand automobile dealer by calling 311 and referencing the license number of such dealer;
5. A consumer of a second-hand automobile is entitled to a buyer's guide, as required by section 455.2 of title 16 of the code of federal regulations, as well as warranties and rights described in section 198-b of the general business law;
6. A consumer of a second-hand automobile is entitled to specific disclosures, including a disclosure that states the lowest annual percentage rate offered to such consumer by a financing company solicited on the consumer's behalf by a dealer and any fees being charged by the second-hand automobile dealer in connection with the financing of a second-hand automobile;
7. A consumer of a second-hand automobile is not required to purchase any add-on product as a condition of purchasing or financing a second-hand automobile at an offered price; and
8. A second-hand automobile dealer shall provide to a second-hand automobile consumer, in writing, the itemized cost of each add-on product to be included in the retail installment contract, including the monthly and total cost of financing with and without each such add-on product.
b. 1. Every second-hand automobile dealer shall conspicuously post a consumer bill of rights in their place of business in a form and manner to be prescribed by the commissioner by rule.
2. Prior to the execution of any sales contract for the purchase of a second-hand automobile, and in a form and manner prescribed by the commissioner by rule, a second-hand automobile dealer shall separately provide a consumer with a copy of the consumer bill of rights, the receipt of which the consumer must acknowledge by signing or initialing in writing. Such dealer shall provide such consumer with a copy of the signed or initialed consumer bill of rights.
3. Every second-hand automobile dealer shall provide the consumer bill of rights to a consumer in the language in which the sales contract was negotiated, provided the commissioner has made a sample bill of rights available in such language.
(L.L. 2017/198, 10/16/2017, eff. 2/13/2018)
a. A second-hand automobile dealer shall maintain a physical or electronic copy of each of the following documents relating to the sale of a second-hand automobile for six years after the date of execution by the consumer of such documents:
1. The buyer's order, bill of sale, any retail installment contract, and any document incorporated by reference into the bill of sale or retail installment contract;
2. Every document signed or initialed by the consumer in connection with the sale transaction;
3. Every written disclosure provided to, and signed or initialed by, the consumer pursuant to this subchapter;
4. Each signed automobile contract cancellation option document, whether accepted or declined by the consumer; and
5. Each signed document cancelling a sales contract or declining to cancel a sales contract pursuant to an automobile contract cancellation option.
b. The department may inspect and audit all records required to be maintained pursuant to this section.
c. A second-hand automobile dealer shall maintain a report on consumer use of automobile contract cancellation options in a format to be prescribed by the commissioner by rule. The report shall be made available upon request of the commissioner but in no instance shall such request be made more than once annually. The report shall include:
1. The total number of consumers that accepted an automobile contract cancellation option in connection with their second-hand automobile purchase; and
2. The total number of consumers that canceled their second-hand automobile sales contracts pursuant to an automobile contract cancellation option.
(L.L. 2017/197, 10/16/2017, eff. 2/13/2018)
The commissioner may submit to the council and the mayor a report of legislative recommendations on the regulation of the second-hand automobile dealer industry. Such report, should the commissioner elect to submit it, may address (i) whether it is advisable to create additional enforcement tools to promote compliance with sections 20-268.1, 20-268.2, 20-268.3, 20-268.4 and 20-268.5 by licensees; (ii) the effect such sections have had on the prevalence of predatory practices in the second-hand automobile dealer industry; (iii) whether new predatory practices have emerged in the second-hand automobile dealer industry; (iv) whether additional disclosure or reporting requirements for second-hand automobile dealers would mitigate consumer harm; and (v) the effectiveness of the department's outreach and education efforts in this area.
(L.L. 2017/197, 10/16/2017, eff. 2/13/2018)
a. Before any dealer in second-hand articles as defined by this subchapter, other than a vehicle dismantler, as defined in section 415-a of the vehicle and traffic law, purchases a second-hand catalytic converter, such dealer must obtain from the seller the following information:
1. The year, make, model and vehicle identification number for the vehicle from which the second-hand catalytic converter was removed;
2. A copy of the certificate of title or other documentation indicating that the seller has an ownership interest in the vehicle described in paragraph 1, or where the seller is the owner of a motor vehicle repair shop, as defined in section 398-b of the vehicle and traffic law, and the second-hand catalytic converter was removed by such owner in connection with a repair of the vehicle, the name and address of the owner of such vehicle and copies of all invoices related to such repair; and
3. The unique identifying number of the second-hand catalytic converter, if any.
b. Such dealer must determine that the second-hand catalytic converter is consistent with the manufacturer's specifications for a catalytic converter from the vehicle identified in the information provided pursuant to subdivision a and must document such determination.
c. Such dealer shall maintain an electronic record of the information provided pursuant to subdivision a for a minimum of six years from the date of the purchase of the second-hand catalytic converter. Such electronic record shall be created by the dealer at the time of each transaction. Such electronic record shall be maintained in a manner to be specified in rules of the police commissioner, which may include the real-time sharing or accessing of such records in an electronic format and/or through use of an internet website designated by the police commissioner. Such records shall be open to the inspection of officers and employees of the department and officers of the fire department or the police department during regular and usual business hours.
(L.L. 2022/123, 12/23/2022, eff. 4/22/2023)
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