CHAPTER 2.5. DISCLOSURES REQUIRED IN MOTOR VEHICLE LEASES

IC 9-23-2.5
    Chapter 2.5. Disclosures Required in Motor Vehicle Leases

IC 9-23-2.5-1
"Adjusted or net capitalized cost" defined
    Sec. 1. As used in this chapter, "adjusted or net capitalized cost"means the capitalized cost, less any capitalized cost reductionpayments made by a retail lessee at the inception of a leaseagreement. The adjusted or net capitalized cost is the basis forcalculating the amount of a retail lessee's periodic payment under alease agreement.
As added by P.L.86-1996, SEC.8.

IC 9-23-2.5-2
"Capitalized cost" defined
    Sec. 2. (a) As used in this chapter, "capitalized cost" means theamount that, after deducting any capitalized cost reduction, serves asthe basis for determining the base lease payment, which is the part ofthe periodic lease payment that is the sum of:
        (1) the average periodic lease charge; and
        (2) the average periodic depreciation.
    (b) For a single payment lease, the base lease payment is the sumof:
        (1) the average periodic lease charge multiplied by the numberof months in the term of the lease; and
        (2) the average periodic depreciation multiplied by the numberof months in the term of the lease.
    (c) The capitalized cost may include any of the following:
        (1) Taxes.
        (2) Registration fees.
        (3) License fees.
        (4) Insurance charges.
        (5) Charges for guaranteed auto protection or GAP coverage.
        (6) Charges for service contracts and extended warranties.
        (7) Fees and charges for accessories and for installingaccessories.
        (8) Charges for delivery, service, and repair.
        (9) Administrative fees, acquisition fees, and all fees or chargesfor providing services incidental to the lease agreement.
        (10) The unpaid balance of an amount financed under anoutstanding motor vehicle loan agreement or motor vehicleretail installment contract with respect to a motor vehicle usedas a trade-in vehicle.
        (11) The unpaid part of the early termination obligation underan outstanding lease agreement.
        (12) The first periodic payment due at the inception of the leaseagreement, if not otherwise paid by the retail lessee.
As added by P.L.86-1996, SEC.8.

IC 9-23-2.5-3 "Capitalized cost reduction" defined
    Sec. 3. As used in this chapter, "capitalized cost reduction" meansa payment made by cash, check, credit card debit, net vehicletrade-in, rebate, or other similar means in the nature of a downpayment or credit, made by a retail lessee at the inception of a leaseagreement, for the purpose of reducing the capitalized cost and doesnot include any periodic payments received by the retail lessor at theinception of the lease agreement.
As added by P.L.86-1996, SEC.8.

IC 9-23-2.5-4
"Lease agreement" defined
    Sec. 4. As used in this chapter, "lease agreement" means a writtenagreement entered into in Indiana for the transfer from a retail lessorto a retail lessee of the right to possess and use a motor vehicle inexchange for consideration for a scheduled term exceeding four (4)months, whether or not the retail lessee has the option to purchase orotherwise become the owner of the motor vehicle upon expiration ofthe agreement. The term does not include an agreement that coversan absolute sale, a sale pending approval, or a retail installment sale.
As added by P.L.86-1996, SEC.8.

IC 9-23-2.5-5
"Lease transaction" defined
    Sec. 5. As used in this chapter, "lease transaction" means apresentation made to a retail lessee concerning a motor vehicle,including a sales presentation or a document presented to the retaillessee, resulting in the execution of a lease agreement.
As added by P.L.86-1996, SEC.8.

IC 9-23-2.5-6
"Retail lessee" defined
    Sec. 6. As used in this chapter, "retail lessee" means an individualwho executes a lease agreement for a motor vehicle from a retaillessor primarily for personal, family, or household purposes.
As added by P.L.86-1996, SEC.8.

IC 9-23-2.5-7
"Retail lessor" defined
    Sec. 7. As used in this chapter, "retail lessor" means a person whoregularly engages in the business of selling or leasing motor vehiclesand who offers or arranges a lease agreement for a motor vehicle.The term includes an agent or affiliate who acts on behalf of theretail lessor and excludes any assignee of the lease agreement.
As added by P.L.86-1996, SEC.8.

IC 9-23-2.5-8
Duties of retail lessor
    Sec. 8. A retail lessor shall do the following:
        (1) Comply with the requirements of Regulation M (12 CFR

213) for disclosure of gross capitalized cost, capitalized costreduction, and adjusted capitalized cost adopted under thefederal Truth in Lending Act (15 U.S.C. 1601 et seq.).
        (2) Disclose to a retail lessee in a separate blocked section in alease agreement, in capital letters of at least 10 point bold typethe following:

THIS IS A LEASE AGREEMENT.

THIS IS NOT A PURCHASE AGREEMENT.

        PLEASE REVIEW THESE MATTERS CAREFULLY ANDSEEK INDEPENDENT PROFESSIONAL ADVICE IF YOUHAVE ANY QUESTIONS CONCERNING THISTRANSACTION. YOU ARE ENTITLED TO AN EXACTCOPY OF THE AGREEMENT YOU SIGN.
        (3) Provide the retail lessee with a copy of each documentsigned by the retail lessee during the course of a leasetransaction.
As added by P.L.86-1996, SEC.8. Amended by P.L.74-1998, SEC.1.

IC 9-23-2.5-9
Trade-in vehicle
    Sec. 9. A trade-in vehicle used, in whole or in part, to payamounts due at lease signing or delivery of the vehicle must beidentified as a trade-in vehicle in the lease agreement and identifiedby year, make, and model. The lease agreement must state the netcredit of the trade-in vehicle used to pay amounts due at lease signingor delivery of the vehicle.
As added by P.L.86-1996, SEC.8. Amended by P.L.74-1998, SEC.2.

IC 9-23-2.5-10
Remedies
    Sec. 10. (a) A retail lessor who fails to comply with therequirements of this chapter is liable to the retail lessee for:
        (1) actual damages sustained;
        (2) a civil penalty of not more than one thousand dollars($1,000) per lease transaction; and
        (3) reasonable attorney's fees and costs.
    (b) In addition to any other remedies provided by law, a retaillessee may bring an action in circuit court to recover the damages,penalties, and fees described in subsection (a).
    (c) The total recovery of damages, penalties, and fees in a classaction civil suit brought under this section may not exceed onehundred thousand dollars ($100,000).
As added by P.L.86-1996, SEC.8.

IC 9-23-2.5-11
Civil suit by attorney general
    Sec. 11. The civil suit described under section 10 of this chaptermay be brought on behalf of a consumer by the attorney general.
As added by P.L.86-1996, SEC.8.
IC 9-23-2.5-12
Statute of limitations
    Sec. 12. An action authorized by sections 10 and 11 of thischapter must be brought not later than three (3) years after the datethe lease agreement is signed.
As added by P.L.86-1996, SEC.8.

IC 9-23-2.5-13
Bona fide printing error not considered violation
    Sec. 13. A bona fide printing error identified on the face of thelease agreement does not constitute a violation of this chapter.
As added by P.L.86-1996, SEC.8.