You are here

Official Opinion 2001-7

Official Opinion 2001-7

September 17, 2001
To: 

Division Director
Professional Licensing Division Office of the Secretary of State

Re: 

The Used Motor Vehicle Dealers' and Used Motor Vehicle Parts Dealers' Registration Act allows the Used Motor Vehicle Dealers and Used Motor Vehicle Parts Dealers Board to regulate a franchise dealership, who is selling used cars at a temporary location in a county other than the county where the franchise dealership is located.

You have asked my opinion whether O.C.G.A. § 43-47-2(15.1)1 and (17)(B) allow the Used Motor Vehicle Dealers and Used Motor Vehicle Parts Dealers Board to have jurisdiction over a franchise dealership which is selling used cars at a temporary location in a county other than the county where the franchise dealership is located. If the answer to this question is no, you then ask whether a franchise dealership ever falls under the jurisdiction of the Used Motor Vehicle Dealers and Used Motor Vehicle Parts Dealers Board. For the reasons outlined below, it is my opinion that the Board has jurisdiction over a franchise dealership which is selling only used cars at a temporary location in a county other than the county where the franchise dealership is located if the dealer is not operating as a direct dealer of the manufacturer. Because the answer to the first question is yes, this opinion does not address the second question.

The authority for the Used Motor Vehicle Dealers and Used Motor Vehicle Parts Dealers Board to regulate the sales of used motor vehicles is contained in Chapter 47 of Title 43 of the Official Code of Georgia, the Used Motor Vehicle Dealers' and Used Motor Vehicle Parts Dealers' Registration Act (“Act”). Under O.C.G.A. § 43-47-7, it is unlawful to operate as a used motor vehicle dealer in this state without first obtaining a license from the used car division of the Board. A used motor vehicle dealer is “any person who, for commission or with intent to make a profit or gain of money or other thing of value, sells, exchanges, rents with option to purchase, offers, or attempts to negotiate a sale or exchange of an interest in used motor vehicles or who is engaged wholly or in part in the business of selling used motor vehicles, whether or not such motor vehicles are owned by such person.” O.C.G.A. § 43-47-2(17)(A). Used motor vehicles are defined as those vehicles that previously have been the subject of a retail sale. See O.C.G.A. § 43-47-2(16).

The Act provides for numerous exceptions for persons who might otherwise fall under the definition of a used motor vehicle dealer. Relevant to this discussion is O.C.G.A. § 43-47-2(17)(B)(i), which provides that a used motor vehicle dealer does not include “[f]ranchised motor vehicle dealers and their wholly owned and controlled subsidiaries operating in the county in which their franchise is located or operating as a direct dealer of a manufacturer.” See generally Chancellor v. Gateway Lincoln-Mercury, Inc., 233 Ga. App. 38 (1998) (relying on O.C.G.A. § 43-47-2(17)(B)(i) to conclude that the appellee, a franchised motor vehicle dealer, was not subject to the Act).

Your query requests that I consider a scenario where a franchised motor vehicle dealer is engaged in the sales of used motor vehicles at a temporary location in a county outside the county in which the franchise is located. Obviously, if the franchised motor vehicle dealer is not operating in the franchise county, then it cannot satisfy the first condition for the O.C.G.A. § 43-47-2(17)(B)(i) exemption. The question is then whether the dealer can be considered to be operating as a direct dealer of a manufacturer. There is no provision in the Official Code of Georgia that defines the term “direct dealer.” However, the Georgia Motor Vehicle Franchise Practices Act, located in Article 22, Chapter 1, Title 10 of the Official Code of Georgia, gives some insight. For purposes of the Georgia Motor Vehicle Franchise Practices Act, a manufacturer is “any person who performs the major portion of the assembly of a new motor vehicle.” O.C.G.A. § 10-1-622(9). From the plain language of O.C.G.A. § 43-47-2(17)(B)(i), a direct dealer of a manufacturer must be one involved in the direct sale or distribution of new motor vehicles. Consequently, a franchised motor vehicle dealer who is not engaged in the sale of new motor vehicles but rather solely engaged in the sale or distribution of used motor vehicles cannot be considered to be operating as a direct dealer of a manufacturer. Therefore, a franchised motor vehicle dealer engaged exclusively in the sale of used motor vehicles outside the county in which its franchise is located is not exempt under the provisions of O.C.G.A. § 43-47-2(17)(B)(i).

In summary, it is my official opinion that a franchised motor vehicle dealer solely engaged in the sale of used cars at a temporary location in a county outside the county in which the franchise is located is a used motor vehicle dealer and is subject to the licensure requirements of the Used Motor Vehicle Dealers' and Used Motor Vehicle Parts Dealers' Registration Act.

Prepared by:

MAXIMILLIAN J. CHANGUS
Assistant Attorney General


1 This subsection and the corresponding section O.C.G.A. § 43-47-8.2, referring to the operations of used motor vehicle dealers at temporary sites, are not relied on in reaching the conclusion in this opinion, as they are not essential to answering the posed questions.