SB589-SSA1,28,82
426.110
(3) Notwithstanding this chapter, no class action may be maintained
3for conduct proscribed in sub. (2) or for a violation of s. 423.301, 424.501, 425.107,
4426.108 or 427.104 (1) (h) unless the conduct has been found to constitute a violation
5of chs. 421 to 427
and 429 at least 30 days prior to the occurrence of the conduct
6involved in the class action by an appellate court of this state or by a rule
7promulgated by the administrator as provided in ss. 426.104 (1) (e) and 426.108
8specifying with particularity the act or practice in question.
SB589-SSA1,28,1610
426.110
(14) A merchant shall not be liable in a class action for specific
11penalties
(ss. under s. 425.302 (1) (a), 425.303 (1), 425.304 (1), 425.305 (1)
) or 429.301
12(1) for which it would be liable in individual actions by reason of violations of chs. 421
13to 427
and 429 or of conduct prescribed in sub. (2) unless it is shown by a
14preponderance of the evidence that the violation was a wilful and knowing violation
15of chs. 421 to 427
and 429. No recovery in an action under this subsection may exceed
16$100,000.
SB589-SSA1,28,20
18426.111 Debtors' remedies not affected. The grant of powers to the
19administrator in this chapter does not affect remedies available to customers under
20chs. 421 to 427
and 429 or under other principles of law or equity.
SB589-SSA1,28,2423
426.201
(2) (g) Such other similar information as the administrator may
24require to effectuate the purposes and policies of chs. 421 to 427
and 429.
SB589-SSA1,29,103
426.202
(1m) (c)
Amount of registration fee. The amount of the registration fee
4shall be determined in accordance with rates set by the administrator, subject to the
5maximum and minimum fees under pars. (d) and (e). In setting these rates, the
6administrator shall consider the costs of administering chs. 421 to 427
and 429,
7including the costs of enforcement, education and seeking voluntary compliance with
8chs. 421 to 427
and 429. Subject to pars. (d) and (e), the registration fee for a person
9shall be based on the person's average monthly outstanding balance during the
10reporting period.
SB589-SSA1,29,15
12426.301 Violations and enforcement.
(1) The administrator may recover
13in a civil action from a person who violates chs. 421 to 427
and 429 or any rule made
14pursuant to any authority granted in chs. 421 to 427
and 429, a civil penalty of not
15less than $100 and not more than $1,000 for each violation.
SB589-SSA1,29,20
16(2) In addition to the amount to which the administrator shall be entitled under
17sub. (1), the administrator may recover in a civil action from a person who knowingly
18or wilfully violates chs. 421 to 427
and 429 or any rule made pursuant to any
19authority granted in chs. 421 to 427
and 429, a civil penalty of not less than $1,000
20and not more than $10,000 for each violation.
SB589-SSA1,29,2422
Chapter 429
23
motor vehicle
24
consumer leases
SB589-SSA1,30,2
1Subchapter i
2
general provisions
SB589-SSA1,30,4
3429.101 Title. This chapter may be cited as the Wisconsin motor vehicle
4consumer lease act.
SB589-SSA1,30,6
5429.102 Applicable law. (1) To the extent that s. 218.01 and chs. 411 and 421
6to 427 are inconsistent with this chapter, the provisions of this chapter shall apply.
SB589-SSA1,30,10
7(2) Unless superseded by the particular provisions of this chapter, parties to
8a motor vehicle consumer lease have all of the obligations, duties, rights and
9remedies provided in s. 218.01 and chs. 411 and 421 to 427 that apply to the
10transaction.
SB589-SSA1,30,14
11429.103 Construction against implied repeal. This chapter being a
12general act intended as a unified coverage of its subject matter, no part of this chapter
13shall be construed to be impliedly repealed by subsequent legislation if such
14construction can reasonably be avoided.
SB589-SSA1,30,15
15429.104 Definitions. In this chapter:
SB589-SSA1,30,18
16(1) "Adjusted capitalized cost" means the amount computed by subtracting
17from capitalized cost any capitalized cost reduction, for the purpose of determining
18the base lease payment.
SB589-SSA1,30,22
19(2) "Average periodic depreciation" means the adjusted capitalized cost, after
20first subtracting the residual value, divided by the number of payment periods under
21the consumer lease or, for a single-payment lease, the number of months in the term
22of the lease.
SB589-SSA1,31,2
23(3) "Average periodic lease charge" means the lease charge for the scheduled
24term of the consumer lease divided by the number of payment periods under the
1consumer lease or, for a single-payment lease, the number of months in the term of
2the lease.
SB589-SSA1,31,3
3(4) "Base lease payment" means an amount determined as follows:
SB589-SSA1,31,64
(a) With respect to a single-payment lease, the product of the number of
5months in the scheduled term of the lease multiplied by the sum of the average
6periodic lease charge and the average periodic depreciation.
SB589-SSA1,31,87
(b) With respect to a lease other than a single-payment lease, the sum of the
8average periodic lease charge and the average periodic depreciation.
SB589-SSA1,31,23
9(5) "Capitalized cost" means the sum of all amounts capitalized in the
10consumer lease that, after subtracting the capitalized cost reduction, amortizes to
11the residual value by the depreciation portion of the periodic lease payments over the
12scheduled term of the lease or, for a single-payment lease, the single payment. These
13amounts may include taxes; fees for registration, license, acquisition,
14administration and assignment; other fees; charges for insurance, service contracts
15and extended warranties; and charges for a waiver of the contractual obligation to
16pay the gap amount, for accessories and their installation, for other services and
17benefits incidental to the consumer lease, and for delivering, servicing, repairing or
18improving the vehicle. With respect to a vehicle or other property traded in
19connection with a consumer lease, the term may include the outstanding unpaid
20balance of the amount financed under a consumer loan, as defined in s. 421.301 (12),
21or a retail instalment contract, as defined in s. 218.01 (1) (t), or the unpaid balance
22of any early termination costs under a lease or other obligation of the lessee. The
23term does not include any lease charge.
SB589-SSA1,32,3
24(6) "Capitalized cost reduction" means the sum, at the time of inception of the
25consumer lease, of any payments made by cash, check, rebates or the like that
1constitute a downpayment made by the lessee and the net amount credited by the
2lessor for any trade-in. The term does not include any base lease payments due at
3the inception of the consumer lease.
SB589-SSA1,32,6
4(7) "Conspicuous" means that the term or clause is so written as to be
5distinguished from other terms or clauses by type size or in some other manner. The
6term includes any writing in at least 10-point boldface type.
SB589-SSA1,32,10
7(8) "Constant yield method" means any of the following methods of
8determining the unpaid balance of the lease charge using a constant yield that
9assumes that any scheduled payment under the consumer lease is made on its exact
10due date and that the consumer lease is and remains a valid lease for its duration:
SB589-SSA1,32,1811
(a) In the case of a lease other than a single-payment lease, the method of
12determining the lease charge portion of each base lease payment pursuant to which
13the lease charge for each payment period is earned in advance of that period by
14multiplying the constant rate used to compute the lease charge times the balance
15subject to a lease charge at the scheduled time of a lease payment. For purposes of
16this paragraph, the balance subject to a lease charge is calculated by subtracting
17from the adjusted capitalized cost the sum of the first base lease payment and all
18depreciation amounts accrued during any preceding payment period.
SB589-SSA1,33,219
(b) In the case of a single-payment lease, the method of determining the
20periodic earning of the lease charge pursuant to which the lease charge for any
21computational period is earned in advance of that period by multiplying the constant
22rate used to compute the lease charge times the balance subject to a lease charge at
23the applicable time during the term of the lease. For purposes of this paragraph, the
24balance subject to a lease charge is calculated by subtracting the total lease charge
1from the sum of the residual value and all lease charges accrued during any
2preceding computational periods.
SB589-SSA1,33,9
3(9) "Consumer lease" or "lease" means a lease entered into in this state that
4transfers the right of possession and use by a natural person of a motor vehicle
5primarily for a personal, family, household or agricultural purpose, for a period of
6time exceeding 4 months, if the total lease obligation, excluding any option to
7purchase or otherwise become owner of the motor vehicle at the expiration of the
8consumer lease, does not exceed $25,000. The term does not include a credit sale, as
9defined under
12 CFR 226.2 (a) (16).
SB589-SSA1,33,11
10(10) "Early termination" means termination of a consumer lease before the
11termination date set forth in the consumer lease.
SB589-SSA1,33,13
12(11) "Federal consumer leasing act" means the federal consumer leasing act,
13as amended,
15 USC 1667-1667e, and regulations issued under that act.
SB589-SSA1,33,24
14(12) "Gap amount" means the difference between the amount specified in the
15consumer lease to be paid by the lessee under the consumer lease in the event of total
16loss or destruction of the leased vehicle prior to expiration of the lease term by theft,
17physical damage, or other occurrence specified in the lease, and the actual cash value
18or portion thereof received by the lessor from insurance proceeds or from any other
19person on account of the total loss or destruction of the motor vehicle. The term does
20not include any deductible amount applicable to any insurance policy maintained by
21the lessee, any past-due payments owed by the lessee at the time of receipt by the
22lessor of the actual cash value or portion thereof from insurance proceeds or from any
23other person, or any other amount due under the lease resulting from default by the
24lessee.
SB589-SSA1,33,25
25(13) "Gap protection" means any of the following:
SB589-SSA1,34,2
1(a) A provision in a consumer lease under which the lessor agrees, for a charge,
2to waive the gap amount.
SB589-SSA1,34,43
(b) Insurance coverage that provides that another person is liable for the gap
4amount.
SB589-SSA1,34,7
5(14) "Group credit insurance" means group credit life insurance, group credit
6accident insurance, group credit accident and health insurance, group disability
7insurance or group credit unemployment insurance.
SB589-SSA1,34,11
8(15) "Holder" means, with respect to a consumer lease, the lessor and, upon
9assignment of the lease, the assignee for the period of assignment. The term does
10not include a pledgee of a consumer lease or the owner or beneficiary of an interest
11in a trust that owns consumer leases.
SB589-SSA1,34,14
12(16) "Lease charge" means the sum of all charges payable by the lessee for the
13privilege of making the scheduled lease payments under a consumer lease. The term
14does not include capitalized cost.
SB589-SSA1,34,16
15(17) "Lessee" means a natural person who leases a motor vehicle from a lessor
16under a consumer lease.
SB589-SSA1,34,18
17(18) "Lessor" means a person regularly engaged in the business of leasing or
18selling vehicles who leases a motor vehicle to a lessee under a consumer lease.
SB589-SSA1,34,19
19(19) "Motor vehicle" has the meaning given in s. 218.01 (1) (m).
SB589-SSA1,34,21
20(20) "Periodic" means weekly, monthly, quarterly or any other period of time
21specified in a consumer lease.
SB589-SSA1,34,24
22(21) "Prospective lessee" means a natural person who enters into a prelease
23agreement under s. 218.01 (6x) with a prospective lessor, or who otherwise intends
24to become a lessee.
SB589-SSA1,35,3
1(21m) "Prospective lessor" means a person regularly engaged in the business
2of leasing or selling vehicles who enters into a prelease agreement under s. 218.01
3(6x) with a prospective lessee, or who otherwise intends to become a lessor.
SB589-SSA1,35,6
4(22) "Realized value" means, with respect to any motor vehicle leased under
5a consumer lease that is terminated before the expiration date, the value determined
6under s. 429.206.
SB589-SSA1,35,13
7(23) "Renegotiation" means the satisfaction and replacement of an existing
8consumer lease by a new consumer lease between the same parties, including an
9assignee of the lessor. The term does not include a deferral or extension of any
10periodic lease payments or portions thereof not exceeding 6 months in the aggregate,
11a satisfaction and replacement of a consumer lease involving a court proceeding or
12the settlement of a dispute, or any other action that does not constitute a
13renegotiation under the federal consumer leasing act.
SB589-SSA1,35,16
14(24) "Residual value" means the estimated value of the leased vehicle at the
15expiration of the lease term that is used in the consumer lease to determine the base
16lease payment.
SB589-SSA1,35,18
17(25) "Single-payment lease" means a consumer lease that requires only one
18payment, to be paid at the time of consummation of the lease.
SB589-SSA1,35,19
19(26) "Total lease obligation" means the sum of all of the following:
SB589-SSA1,35,2020
(a) All scheduled periodic payments under the lease.
SB589-SSA1,35,2121
(b) Capitalized cost reduction.
SB589-SSA1,35,2422
Subchapter II
23
Disclosures; limitations on
24
agreements and practices
SB589-SSA1,36,4
1429.201 Prelease availability of consumer lease form. A lessor shall,
2upon request of a prospective lessee, make readily available a blank sample of its
3current consumer lease form for examination by the prospective lessee before
4execution of the consumer lease.
SB589-SSA1,36,14
5429.202 Advance payment or trade-in; refund or return. (1) If a
6prospective lessee has made an advance payment or surrendered possession of a
7vehicle to a prospective lessor as a trade-in pending the execution of a consumer
8lease, the prospective lessee shall have the right, if the application for the consumer
9lease is not approved, to receive a prompt refund of the advance payment and, if
10applicable, to have the trade-in vehicle promptly returned. If a prospective lessor
11takes possession of a trade-in vehicle under this subsection, the prospective lessor
12may not sell, offer for sale, lease, transfer or otherwise dispose of the vehicle in any
13manner until execution of the consumer lease or, except for return of the vehicle to
14the prospective lessee, disapproval of the consumer lease application.
SB589-SSA1,36,19
15(2) This section does not apply to the sale of a vehicle by a prospective lessee
16to a prospective lessor under a separate contract of sale if the contract of sale is
17executed prior to execution of the consumer lease between the parties, gives the date
18of sale and is signed by both parties. Any contract of sale under this subsection shall
19provide for all of the following:
SB589-SSA1,36,2320
(a) That the contract price establishes the value of the vehicle to be credited
21against the amount due from the lessee at the consummation of the lease or, if the
22parties fail to execute a consumer lease, the amount due the prospective lessee for
23the vehicle.
SB589-SSA1,37,224
(b) That the prospective lessee agrees to leave the contract price on deposit with
25the prospective lessor pending the execution of a consumer lease between the parties
1with respect to a motor vehicle to be ordered from a manufacturer, including a motor
2vehicle not yet in production as of the date of sale.
SB589-SSA1,37,63
(c) That the prospective lessee shall be entitled to payment of the contract price
4from the prospective lessor no later than 75 days after the date of sale, unless the
5parties have executed a consumer lease or the prospective lessee has already
6received such payment.
SB589-SSA1,37,8
7429.203 Requirements of a consumer lease. (1) A consumer lease shall
8be in writing and signed by the lessor and the lessee.
SB589-SSA1,37,12
9(2) Except as otherwise provided in this subsection, the printed portion of a
10consumer lease, other than instructions for its completion, shall be in at least 8-point
11type. The consumer lease shall contain all of the following printed in a conspicuous
12manner:
SB589-SSA1,37,1413
(a) At the top of the consumer lease, the words "MOTOR VEHICLE LEASE
14AGREEMENT" in at least 10-point type.
SB589-SSA1,37,1915
(b) 1. Except as provided in subd. 2., if no liability insurance for bodily injury
16or property damage is provided for under the consumer lease, a notice in
17substantially the following language in bold-faced capital letters of not less than
1810-point type: "NO LIABILITY INSURANCE FOR BODILY INJURY OR
19PROPERTY DAMAGE IS INCLUDED IN THIS LEASE."
SB589-SSA1,37,2220
2. The notice required under subd. 1. may be provided on a separate document
21delivered to the prospective lessee not later than the time of execution of the
22consumer lease.
SB589-SSA1,38,2
23(2m) Every writing evidencing the customer's obligation to pay under a motor
24vehicle consumer lease shall contain immediately above or adjacent to the place for
1the signature of the customer, a conspicuous, printed or typewritten notice in
2substantially the following language:
SB589-SSA1,38,33
NOTICE TO LESSEE
SB589-SSA1,38,74
(a) THIS IS A MOTOR VEHICLE LEASE AGREEMENT. YOU HAVE NO
5OWNERSHIP RIGHTS IN THE MOTOR VEHICLE UNLESS THIS LEASE
6CONTAINS A PURCHASE OPTION AND YOU EXERCISE YOUR OPTION TO
7PURCHASE THE MOTOR VEHICLE.
SB589-SSA1,38,98
(b) DO NOT SIGN THIS LEASE BEFORE YOU READ IT, INCLUDING ANY
9WRITING ON THE REVERSE SIDE.
SB589-SSA1,38,1010
(c) DO NOT SIGN THIS IF IT CONTAINS ANY BLANK SPACES.
SB589-SSA1,38,1211
(d) EARLY TERMINATION OF THIS LEASE MAY REQUIRE YOU TO PAY
12A SUBSTANTIAL AMOUNT.
SB589-SSA1,38,1413
(e) YOU ARE ENTITLED TO A COMPLETED COPY OF THIS LEASE WHEN
14YOU SIGN IT.
SB589-SSA1,38,17
15(3) The consumer lease shall contain all disclosures required by the federal
16consumer leasing act and any of the following disclosures that are not disclosed in
17the same or substantially similar disclosures under the federal consumer leasing act:
SB589-SSA1,38,2218
(a) The capitalized cost, using the term "capitalized cost", and an explanation
19of the term in substantially the following language: "The capitalized cost is the
20agreed-upon amount determined at the inception of the consumer lease for all items
21and services included in the lease other than the charges you pay for the privilege
22of making the scheduled lease payments."
SB589-SSA1,39,223
(b) Any capitalized cost reduction, using the term "capitalized cost reduction",
24and an explanation of the term in substantially the following language: "The
1capitalized cost reduction is any cash, check, rebate or the like and, if applicable, net
2trade-in allowance that reduces the capitalized cost."
SB589-SSA1,39,83
(c) The adjusted capitalized cost, using the term "adjusted capitalized cost",
4and an explanation of the term, as applicable, in substantially the following
5language: "The adjusted capitalized cost is the agreed-upon amount that serves as
6the basis for determining the base lease payment. If you are not in default on the
7consumer lease, this amount (plus any applicable early termination charges)
8determines your maximum early termination obligation."
SB589-SSA1,39,129
(d) The residual value of the leased vehicle, using the term "residual value", and
10an explanation of the term in substantially the following language: "The residual
11value is the estimated value of the leased vehicle at the end of the lease term that
12is used in determining the base lease payment."
SB589-SSA1,39,1513
(e) The standards to be applied by the holder in determining the excess wear
14and damage to the leased vehicle for which the lessee shall be held liable. These
15standards shall comply with the federal consumer leasing act.
SB589-SSA1,39,1616
(f) Any disclosure required under sub. (2m).
SB589-SSA1,39,20
17(4) The consumer lease shall contain the names of the lessor and the lessee; the
18place of business of the lessor; the place of business or residence of the lessee, as
19specified by the lessee; and the year, make, model and, if known, serial or
20identification number of the motor vehicle.
SB589-SSA1,39,24
21(5) The lessor shall deliver to the lessee a completed copy of the consumer lease
22signed by both parties. Any acknowledgement of delivery of a copy of the consumer
23lease by the lessee shall be conspicuous and appear directly above the space reserved
24for the signature of the lessee.
SB589-SSA1,40,4
1(6) (a) Any policy of bodily injury and property damage liability insurance with
2respect to operation of the leased vehicle for which a charge is included in the
3consumer lease shall be issued by an insurer authorized to transact business in this
4state.
SB589-SSA1,40,125
(b) The lessee shall have the right of purchasing a policy of bodily injury and
6property damage liability insurance with respect to operation of the leased vehicle
7from an insurance agent or broker selected by the lessee, if the insurer selected to
8issue the policy is acceptable to the lessor. If a lessee purchases an insurance policy
9under this paragraph, the lessor may agree to pay an applicable insurance premium
10and include a charge equal to the insurance premium in the consumer lease. A lessor
11has no obligation under this paragraph to send or cause to be sent to the lessee a copy
12of the applicable insurance policy.
SB589-SSA1,40,2213
(c) If any liability insurance policy or other insurance on the leased vehicle is
14canceled, a refund of any insurance premium paid for the insurance that is received
15by the holder from the insurer shall be refunded to the lessee or credited, together
16with that portion of the lease charge applicable to such refund, to the lessee's
17outstanding obligations under the consumer lease, including to any remaining lease
18payments or, at the option of the holder, to the existing obligations of the lessee upon
19expiration, termination or cancellation of the consumer lease. A refund or credit
20under this paragraph is not required if the amount of the refund or credit is applied
21toward the purchase of similar liability insurance protecting the interests of the
22lessee or holder or would be less than $1.
SB589-SSA1,41,6
23(7) A holder may purchase or sell, or otherwise acquire or transfer, an interest
24in a consumer lease or a motor vehicle subject to a consumer lease, on such terms and
25conditions as may be mutually agreed upon by the parties to the sale, transfer or
1acquisition. No filing of the sale, transfer or acquisition, or any requirement that the
2holder be deprived of any payments due with respect to the consumer lease or, if
3subject to replevin or otherwise returned to the holder, the motor vehicle, shall be
4necessary to the validity of any written bill of sale or other instrument of transfer of
5the interest in a consumer lease as against creditors, subsequent purchasers,
6pledges, encumbrancers, mortgagees, successors or assigns.
SB589-SSA1,41,10
7(8) (a) Upon written request from a lessee, the holder shall give or forward to
8the lessee a written statement that specifies, without regard to realized value, the
9projected obligation that the lessee will incur in the event of early termination of the
10consumer lease.