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Requirements

Payments from the fund may be made to retail customers and car dealers who obtain a court judgment and who incur loss as a result of:

1) Fraud practiced by a licensed motor vehicle dealer or salesperson in connection with the purchase or lease of a motor vehicle, 2) a violation of the motor vehicle dealer licensing laws in connection with the purchase of a motor vehicle on or after January 1, 1989, or the lease of a motor vehicle on or after October 1, 1998, or 3) a breach of an extended motor vehicle service contract entered into with a car dealer licensed in the business for three or fewer years beginning on or after April 8, 1994.

It is important that a claimant follow the requirement on serving the Motor Vehicle Dealer Board (Board) with documents related to any legal action against a dealer or salesperson which may lead to a claim being made against the fund. If a claimant does not submit those documents, before filing a claim, the Board may not be able to pay the claim. The next paragraph is taken directly from §46.2-1527.4 of the Code of Virginia and explains this requirement.

Any action instituted by a person against a licensed or register dealer or a salesperson, which may become a claim against the fund, shall be served to the Board in the manner prescribed by law. All subsequent pleadings and documents shall also be served to the Board. Included in such service shall be an affidavit stating all acts constituting fraud or violations of this chapter (Virginia Motor Vehicle Dealer Licensing Laws). Upon service of process, the Board, or duly authorized representative, shall have the right to request leave of the court to intervene. That person shall submit such pleadings or documents to the Board by certified mail or the equivalent.