Agreed for the purpose of this document and circumstance:
- “Back-up Shop” is another shop an insurance company or appraiser identifies as an insurance selected collision shop to support the price and process the insurer has proposed for repair.
- “Bate and Switch” is the practice of advertising or offering a consumer an item or service of specific value and then substituting a product or service of a lessor or greater value or price.
- “Best Practice” in the absence of written manufacturer advice. Completing a repair task in a proven repeatable manner with dependable expected results.
- “Breach of Warranty” occurs when failing or refusing to honor the written promise to re-repair a covered defective product or service as agreed.
- “Breach of Contract” is a legal concept in which a binding agreement , bargained-for exchange, is not honored by one or more of the parties to the contract by non-performance or unilaterail deviation of the term set forth in the agreement.
- “Coersion” is the activity of compelling a person or manipulating them to behave in an involuntary way through action or use of threats, intimidation, deceipt, trickery, or some other form of pressure or force.
- “Collision Repairer” shall mean any person or business engaged in disassembling, diagnosing, reconstructing, or repairing vehicles that have sustained physical or cosmetic damage.
- “Collision Repair Facility” shall mean any business that receives
compensation for the activities of collision repair and complies with all local,
state and federal laws.
- “Consumer” is defined as any private individual that has purchased or leased a
vehicle primarily for personal or household use.
- “Consumer Fraud” an intentional deception made for personal gain or intended to deceive a consumer of goods or services.
- “ Contract of Repair”is a written document outlining specific duties and responsibilities of the consumer and the repair facility. A contract is not the estimate or work order.
- “Cost Shifting” is the practice of converting the dollar value of parts into labor. The practice will be considered diceptive if conducted without the consumers written approval and documentation by way of itemized invoice.
- “Customer” is defined as the registered owner of the vehicle, or the Designated Representative of either.
- “Deceptive Business Practice” encompasses fraud by misrepresentation and oppressive or unconscionable acts or practices by business, often against consumers or other businesses as prohibited by consumer law, in NY Section § GB 349.
- “Designated Representative” (DR) is defined as any person with knowledge
that has been given the legal right to act on behalf of the vehicle owner/consumer as provided by NYS Regulation 64. Requires a single executed document that complies with the Regulation 64, duly executed by the true vehicle owner(s) or consumer(s). The DR creates a fiduciary relationship between the owner and DR whereby the DR acts as an authority on behalf of the consumer.
- “Damage Analysis” is defined as the written document of a thorough review of
the damage sustained by a vehicle and the proposed plan to repair the vehicle.
- “Damage Analyst” is defined as any person employed by a collision repair
facility technically qualified in the practice of preparing damage analyses.
- “Estimate” is defined as a preliminary verbal or written identification of damage or vehicle harm and expected repair costs.
- “Final Invoice” is an itemized document produced at the end of the repair that summarizes all of the repairs complete, indicating the status of each part as NEW, USED, REMANUFACTURED, NON-OEM. as required by state law. May not match exactly the estimate(s) or repair order however estimate deviation requires written consumer approval.
- “Faulty Repair” completing a repair that one with experience would know is bound to fail untimely or not cure the initial failure.
- “Illegal Steering” is the practice of directing, by word or written means a collision repair customer to a specified insurance directed or controlled repair shop, or any shop without the consumer’s consent or approval or by discouraging the consumer to use their own choice of shop by coercion or threat.
- “Insurance Fraud” is any act committed with the intent to fraudulently obtain payment from an insurer.
- “Manufacturer Recommended” The original builder of a vehicle published written advice or procedures to test, correct or repair failure.
- “ Non-Quality Repair” A repair viewed as not equal to its original counterpart or exhibits visual or functional defects.
- “Paintless Dent Repair” is defined as a process that lessens indentations
in sheet metal components of a vehicle that is achieved without disturbing the external coating to the vehicle.
- “Peer Review Board” is defined as a board consisting of members of the
collision repair industry who have met the qualifications to serve as an oversight
authority for members of local collision repair industry.
- “Peer Review Panel” is defined as a panel consisting of qualified members of
the collision repair industry authorized by the Peer Review Board to hear complaints and render disciplinary recommendations to the Peer Review Board for violations of the Collision Repair Code of Ethics.
- “Pre-Loss Condition” is the physical, visual or mechanical status of a vehicle immediately before an incident that alters the vehicle’s appearance, safety, function or value.
- “Product Supplier” expressly includes any person, representative,
distributor, or business that markets or sells products for incorporation into, or use in the repair of, a consumer/customer’s motor vehicle i.e. parts, paint, materials, hardware. That sells, licenses, or provides database repair pricing and suggested repair times, theory of activities, procedures, or other information, sells or licenses software, markets, sells, or licenses equipment for use in the collision
- “Quality Repair” The word “Quality” has become a cliché. The action of quality repair is a phrase where the subject example can only be measured by visual comparison to a new undamaged example of similar year, make and model approved by the PRP.
- “Safety Related” any subject of repair, replacement or process to check operation related to the safety features of a vehicle.
- “Suspension” is that part(s) related to the steering i.e. wheels, tires, drivetrain axles, differential, and geometric control devices, parts or mechanisims controlling directional operation forward, backward or latteral control.
- “Third Party” is defined as any person, representative, or organization which
is not a party to the repair contract.
- “Tortious Business Interference” can occur when a person or entity attempts to disrupt the existing contract between two parties. One party disrupts the ability of others to perform obligations under the contract, thereby preventing performance.
- “Warranty” is a written obligation or guarantee that a part or service sold will be repaired or replaced at no cost to the buyer for a specific time period or miles drivien, implied by the seller, certain terms typically apply.
Licensure, Registration, Permitting and Business Insurance
- Licensure, Registration
- No collision repair facility or individual repairer required by state law to
be licensed or registered shall operate or engage in any activities constituting
collision repair without being licensed by the city or township or registered pursuant to the mandates of the NY State’s law. No collision repair facility or individual repairer shall fail to maintain compliance with the licensure or registration requirements mandated by state law.
- No collision repair facility or individual repairer, if not employed by a
repair facility, may undertake the repair of any customer’s motor vehicle for
compensation without first acquiring and maintaining in effect a garagekeepers
and/or garage liability insurance policy.
- No Collision repairer shall prepare an estimate without proper licensing maintaining and posting as required.
*As of 2009 no licensing of repair shops is required in NY at the present time however registration is required. Licensing is required for all businesses by city and county.
- A collision repair facility must obtain and maintain proper permits for hazardous waste handling from State and Federal agencies. Some debris disposal if required, welding-cutting and associated fluids, fuel and gases storage, pollution to air ,waste water and drainage systems. Copies of permits must be posted as required.
- Business Insurance
- A collision repair facility or individual collision repairer shall maintain a
minimum of $100,000 of garagekeepers liability insurance. Covering completed operations and for vehicles held in their care custody and control. These limits may be reset by the Peer Review Board and reviewed annually.
- No collision repair facility or individual repairer may enter into any
agreement that requires the repair facility or individual repairer to indemnify
a 3rd party relating to a vehicle repair unless a written insurance provision(s) are provided that specifically cover the indemnification agreement, the repairs and warranty the vehicle repair.
- Nothing in this section, however, shall be construed as prohibiting a repair facility or individual repairer from entering into a contract for vehicle repair with a governmental entity that requires indemnification.
Organization, Facility and Equipment
Certified Collision Shops will have sufficient organization, operational procedures, sufficient facilities and equipment to engage in the safe and legitimate repair of crashed vehicles with the goal of replicating “pre-loss condition” on a regular basis. To maintain appropriate equipment serviced at regular intervals sufficient to complete repairs on vehicles typical of the market area.
- Organizational Requirements
- Adhere to an organizational management system so that consumer issues are handled in a timely manner with a goal of resolving complaints fairly to each party.
- Maintain workers compensation insurance appropriate to the operation of the laws and local ordinances.
- Maintain proper licensing, permits and postings as required by local city, county and state or Federal Government.
- Maintain systems for proper waste disposal of all products used in the operation of the business in accordance with local, state and federal laws.
- Equipment Requirements
- Access to Frame Rack, Bench or Structural correction tools.
- Access to four wheel alignment with written printout.
- Access to Computerized Estimating for parts cost and labor.
- Access to reliable manufacturer generated repair information.
- Access to three-dimensional measuring device with printout.
- Metal inert gas (MIG) welding and/or brazing.
- Manufacturer approved spot welding equipment.
- Code Approved Paint booth with filtered exhaust.
- Separate tools and space for aluminum work if applicable.
- Tools to identify handle/cut/weld/repair/replace HSS, HSLA, ultra-hard, boron, or other types of steel.
- Ability to lift a vehicle for underbody inspection.
- Sufficient light to inspect vehicles for crash damage.
- Digital camera equipment.
- Facility Requirements
- Maintain facilities appropriate for the legitimate operation of a collision
- Maintain a safe-clean consumer waiting area sufficient to accommodate the
volume of business conducted.
- Maintain fenced or secured outside storage, security cameras or other alarm to protect the belongings and property of customers.
- Exterior signage identifying facility and directing consumer to business office. Including state required signage inside and outside.
- Maintain restroom facilities according to health and labor laws
Repair Contract, Obligations, Judgment
- It is agreed the Vehicle Owner is the Customer
- The collision repairer shall always recognize that only the consumer,
the vehicle’s registered owner, or individual selected as a designated
representative is the customer.
- Irrespective of any authority conferred by the customer on a
designated representative, a collision repairer shall not engage in any repair
activities that interfere with or compromise the repairer’s exercise of professional
judgment, as set forth in DR 14.
- The collision repairer owes a duty of professional care to the customer
and shall act in the best interests of the customer in all repair decisions and
recommendations. Nothing in this section, however, shall be interpreted as an obligation to perform repairs for free. Nothing shall prohibit a repairer from charging for goods and services, collecting for goods and services rendered, including initiating or defending any action permitted by law or equity, or acquiring or enforcing a possessory lien upon a customer’s vehicle for abandonment or breach of the repair contract.
- The Collision repairer shall use a repair contract written in plain language to explain the obligations of each party. The contract shall be reviewed with the consumer and a signed copy shall be maintained in the repair file. A copy will be given to the consumer at the time of signing.
- The Collision repairer shall at the request of the consumer prepare a preliminary estimate of the damage. Wording, “Open for additional damage” noted on the appraisal. An Estimate is NOT a contract for repair unless the cost of repair is less than $500.
- Damage Analysis
- The Collision repairer or collision repair facility’s damage analyst must
prepare and provide the customer with a completed written analysis of the damage and plan of repair, as soon as practical itemizing the expected cost to repair the vehicle upon request or according to contractual agreement.
- The collision repairer does not fulfill the requirement to provide the
customer with a written damage analysis by copying a damage analysis written by another entity, i.e. insurance or other collision repair facility without verification.
- In the absence of an executed contract. The Collision repairer has an affirmative obligation to contact the customer, provide the customer with an opportunity to discuss the proposed plan of repair, and obtain the customer’s express written consent for the repairs.
- A collision repairer may not utilize any estimate or damage
analysis prepared by any person not employed by or directly affiliated with the
repairer or repair facility for the purpose of engaging in repairs to a vehicle. An
estimate or damage analysis prepared by any person not directly affiliated with the
repairer or repair facility may be used solely for administrative purposes.
- At the time of preparing the damage analysis, a repairer shall include
in the written analysis, the year, make, model, mileage, license number or vehicle hull identification number. The analyst shall record all damage visible and all damage reasonably expected to complete repair that is not visible.
- The actual cost to repair a vehicle should not exceed the after tear down estimate by more than 10% with regular consistency or as agreed by the PRB in any given case if applicable.
- A pattern of preparing a damage analysis that does not include damage
reasonably expected shall be presumed to be deliberate.
- The Collision repairer can rebut the presumption of a pattern of deliberately
undervaluing by presenting evidence of specific circumstances or complexity of repair that contributed to undervaluation in any given case.
- Allegations of a pattern of writing undervalued estimates may be
submitted alone or determined in discovery by the PRB during adjudication.
- Professional Judgment
- The collision repairer or collision repair facility shall exercise professional
judgment and utilize the repairer’s expertise in all aspects of collision repair.
- On issues of safety, a repairer shall not relinquish or surrender professional judgment of the necessary repairs, necessary in favor of any external interest including the customer, tortfessor or an insurance company.
- On non-safety issues, the repairer may consider the express wishes
of the customer in addition to the repairer’s professional judgment in the repair of
the vehicle. In exercise of due care, the repairer has the final determination of
the appropriate method of repair or parts to be used in the repair with proper consumer acknowledgement by way of written documentation. However the collision repairer still has the duty to act in the best interests of the consumer customer.
- Only the Collision repairer shall make the final determination of whether an
issue is safety-related.
- The repairer shall consider the vehicle manufacturer’s product
standards, use repair position statements, and/or recommendations for the
repair. If the repairer does not follow the manufacturer’s standards, position
statements, and/or recommendations in the repair, the repairer must maintain documentation in the file as to the reason why the repairer chose to deviate the manufacturer’s recommendation at the time of repair.
- Affiliations and Compensation
- A repair contract shall clearly state that the customer sign an acknowledgement that the customer is responsible for payment of the full cost of repairs.
- A repairer may accept payment from a third party on behalf of the
customer with written approval. However, a collision repairer shall not accept payment from any third party if the payment suggests it compromises any claim, or portion of a claim, on behalf of the customer.
- A repairer shall not agree with any third party to perform repairs for
the arbitrary amount the third party desires to pay, negating the consumers rights.
- Only the customer has the right to make the determination of and agree to the type and cost of repair to be performed unless such agreement is contractually acceptable.
- No repair facility repairing vehicles for customers shall be owned by,
controlled by, or unduly influenced by any person or entity whose financial
interests are likely to interfere with a repairer’s exercise of professional judgment
on behalf of, and in the best repair interest of, a consumer/customer.
- No collision repair facility shall be owned by, controlled by, or unduly influenced by a collision repair product supplier. Nothing in this section shall be interpreted as prohibiting a repairer facility from following the repair mandates, advice, or recommendations of the vehicle’s original manufacturer. Nothing in this section shall be interpreted as prohibiting a repairer or repair facility to be “certified” by an original manufacturer of a motor vehicle, or exist as a department within a new car dealership. This section is not intended to prohibit repairers or a repair facility
from engaging in normal business relations with product suppliers. It is intended to
prohibit actions on the part of the repairer or repair facility from allowing the
interests of the product supplier to interfere with the best interests of the consumer customer.*
(*4e) A repair facility owned by an insurer is an “inherent conflict of interest” as determined by Allstate Ins. Co. v.Abbott, 2006 U.S. Dist. LEXIS 9342 (N.D. Tex., Mar. 9, 2006), affd, 495 F.3d 151 (5th Cir. 2007), cert. denied, 2008 U.S. LEXIS 1297, 76 U.S.L.W. 3439 (U.S. Feb. 19, 2008), and is unduly influential.
- Product supplier expressly does not include the original
manufacturer of a vehicle, or affiliated dealership collision facilities.