Section 871.27 - [Effective 1/1/2025] Offsets and calculations for damages and penalties in restitution cases(a) This section only applies to a civil action seeking restitution or replacement of a motor vehicle pursuant to Section 871.20.(b) The defendant is entitled to an offset in the calculation of the actual price paid or payable for optional equipment, service contracts, or GAP financing purchased by the plaintiff during the motor vehicle purchase or lease transaction from third parties, except for optional purchases for dealer-supplied equipment or services. (1) Optional equipment and accessories, theft-deterrent devices, surface-protection products, service contracts, extended warranties, debt-cancellation agreements, and guaranteed asset protection ("GAP") financing supplied by a third party that is not the selling or leasing dealership or an authorized retail facility for the original equipment manufacturer are not recoverable as damages pursuant to this section.(2) Optional equipment and accessories, theft-deterrent devices, surface-protection products, service contracts, extended warranties, debt-cancellation agreements, and GAP financing, if any of the foregoing constitute dealer additions supplied by the selling or leasing dealership or an authorized retail facility for the manufacturer, are recoverable as damages and do not qualify for the offset prescribed by this section.(c) The defendant is entitled to an offset for negative equity incorporated in the transaction from prior vehicles.(d) Noncash credits provided by the manufacturer as a form of down-payment assistance, typically referred to as a manufacturer's rebate, shall not be included in the calculation of the actual price paid or payable and shall not be used to reduce the amount of any negative equity offset.(e) For leases, damages and civil penalties shall be calculated as follows: (1) Amounts paid or payable by the consumer under an existing agreement to extend a lease term shall be allowable as damages.(2) Amounts paid by the consumer for the residual value shall be allowable as damages. If the consumer has obtained financing to pay the residual value, the defendant shall pay the remaining residual value on the motor vehicle directly to the lienholder in the amount necessary to obtain title.(3) Amounts paid or payable by the consumer to extend a lease term shall be included in civil penalty calculations if paid for or the lease extension is activated by the consumer no later than 30 days after delivering pre-suit notice or filing a lawsuit, whichever is earlier.(4) Amounts paid by the consumer for the residual value shall only be included in civil penalty calculations if paid for or financed by the consumer no later than 30 days after delivering pre-suit notice or filing a lawsuit, whichever is earlier.(5) The residual value shall not be included in civil penalty calculations if not paid or financed by the consumer.(f) The defendant shall not be responsible for payment of unpaid interest or unpaid financing costs associated with the retail installment sales contract that will not be owed or paid by the consumer when the lien is paid off.(g) The restitution payment and vehicle return procedures shall comply with all of the following conditions:(1) A remedy in compliance with this section shall not be contingent on the execution of any release other than the Standardized SBA Release provided in Section 871.25.(2) The defendant shall promptly process any agreed-upon motor vehicle restitution or replacement pursuant to this section and complete the restitution or replacement within 30 days from the date of receipt of a signed release from the buyer or lessee's counsel. The defendant's failure to do so shall result in a mandatory penalty of fifty dollars ($50) per day until the settlement is completed, unless the parties stipulate otherwise. The consumer shall comply in good faith with requests from the manufacturer for reasonable documentation required to complete the requested restitution or replacement of the motor vehicle. In the event the consumer fails to comply in good faith and delays the restitution or replacement, the manufacturer shall not be subject to the daily fifty-dollar ($50) penalty.(3) The defendant shall provide the consumer with the funds containing their restitution proceeds at the time of the vehicle return. The defendant shall also expedite the funds for the payoff of the vehicle within one business day of the vehicle return. The defendant shall expedite the funds for attorney's fees, and if applicable, civil penalties to counsel for the consumer within one business day of the vehicle return.Ca. Civ. Proc. Code § 871.27
Added by Stats 2024 ch 938 (AB 1755),s 1, eff. 1/1/2025.