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§3.13 Vehicle Leasing—Prohibited Terms and Acts

Lesson 3:
Vehicle Repairs, Sales, & Leases

The lessor may not include any of the following terms in a motor vehicle lease contract:

  • A power of attorney to confess judgment or an unlawful assignment of wages. [CC §2986.3(a).]
  • A waiver of any right of action against the lessor for any illegal acts done in collection or repossession. [CC §2986.3(b).]
  • Relief of the lessor from liability for any legal remedies the lessee may have against the lessor. [CC §2986.3(c).]
  • A grant to the lessor of a right to bring an action on a lease contract in an improper venue. [CC §2986.3(d).]
  • The inclusion of title to or a lien on any personal or real property, other than the vehicle that is the subject matter of the lease contract, as security for the payment of the contract obligations. [CC §2986.6.]

The lessor may not do any of the following acts:

  • Obtain the lessee’s signature to a contract with blank spaces to be filled in later. [CC §2985.8(d).]
  • Lease a used vehicle that does not meet all equipment requirements of Division 12 of the Vehicle Code. [CC §2986.5(a); see Veh C §§24000 et seq.]
  • Fail to return excess amounts paid by the lessee for licensing or transfer of title. [CC §2986.5(b).]
  • Induce or attempt to induce a contract by offering a rebate, discount, commission, or other consideration on the condition that the lessee give information or assistance to the lessor to make a lease or sale to another. [CC §2986.12.]
  • Fail to refund an advance payment if the lease contract is not executed. [CC §2986.13(a).]
  • Fail to register the leased vehicle pursuant to the lease contract. [CC §2989.4(a)(1).]
  • Refuse to lease a vehicle to any creditworthy person at the advertised total price, exclusive of sales tax, registration fees, and finance charges. [CC §2989.4(a)(3).]
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