SRC-AAA H.B. 381 75(R)   BILL ANALYSIS


Senate Research Center   H.B. 381
By: Swinford (Madla)
Economic Development
5-7-97
Engrossed


DIGEST 

Currently, farm, industrial and outdoor power equipment is sold by a
dealer but the manufacturer warranties the product for a period of time.
After using the product for a period of time under the warranty, if the
buyer has a problem the manufacturer is contacted, who, in turn, sends the
buyer to an authorized service center.  These service centers often send
the product right back to a dealer who offers the repairs.  These repair
centers have published hourly rates for repair usually posted within the
store which are included in the final cost to the customer for the repair
as "labor plus parts."  The repair center fixes the equipment under
warranty and bills the manufacturer for the repair.  The manufacturer,
usually located in another state, oftentimes will not pay the published
labor rate yet requires the store to repair the product.   H.B. 381 amends
Chapter 19B, Business & Commerce Code, by requiring a manufacturer to pay
the entire cost associated with fixing a warranty claim.
PURPOSE

As proposed, H.B. 381 amends Chapter 19B, Business & Commerce Code, by
requiring a manufacturer to pay the entire cost associated with fixing a
warranty claim.                                                    
RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter 19B, Business & Commerce Code, by adding Section
19.28, as follows: 

Sec. 19.28. WARRANTY CLAIM. Provides that this section applies to a
warranty claim submitted by a dealer while the dealer agreement is in
effect, or after termination of the agreement.  Sets forth requirements
and procedures for accepting or rejecting a warranty claim.  Sets forth
requirements for charging back, setting off, or attempting to recover a
warranty claim.  Sets forth requirements for giving a written warranty
agreement to a purchaser.   

SECTION 2. Repealer: Section 19.46, Business & Commerce Code (Warranty
claim). 

SECTION 3. Makes application of this Act prospective.

SECTION 4. Effective date: September 1, 1997.

SECTION 5. Emergency clause.