Texas Occupations Code § 2301.001 – Motor Vehicle Safety Responsibility Act (Defects & Recalls)

Table of Contents

• Code Details
• Exact Statute Text
• Texas Occupations Code § 2301.001 Summary
• Purpose of Texas Occupations Code § 2301.001
• Real-World Example of Texas Occupations Code § 2301.001
• Related Statutes
• Case Law Interpreting Texas Occupations Code § 2301.001
• Why Texas Occupations Code § 2301.001 Matters in Personal Injury Litigation

Code Details

OCCUPATIONS CODE

TITLE 14. REGULATION OF MOTOR VEHICLES AND TRANSPORTATION

SUBTITLE A. REGULATIONS RELATED TO MOTOR VEHICLES

CHAPTER 2301. SALE OR LEASE OF MOTOR VEHICLES

SUBCHAPTER A. GENERAL PROVISIONS

Exact Statute Text

Click to view the complete statute text

CONSTRUCTION; PURPOSE. The distribution and sale of motor vehicles in this state vitally affects the general economy of the state and the public interest and welfare of its citizens. This chapter shall be liberally construed to accomplish its purposes, including the exercise of the state’s police power to ensure a sound system of distributing and selling motor vehicles through:

(1) licensing and regulating manufacturers, distributors, converters, and dealers of motor vehicles; and

(2) enforcing this chapter as to other persons to provide for compliance with manufacturer’s warranties and to prevent fraud, unfair practices, discrimination, impositions, or other abuse of the people of this state.

Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.

Texas Occupations Code § 2301.001 Summary

This foundational statute, Texas Occupations Code § 2301.001, serves as the overarching declaration for Chapter 2301, which governs the sale and lease of motor vehicles in Texas. It clearly states that the motor vehicle industry significantly impacts the state’s economy and the well-being of its residents. The statute mandates a broad interpretation of Chapter 2301 to fulfill its objectives. These objectives primarily involve the state exercising its police power to establish a robust system for motor vehicle distribution and sales. This is achieved by licensing and regulating various entities within the industry, including manufacturers, distributors, converters, and dealers. Furthermore, it aims to ensure compliance with manufacturer warranties and to actively prevent deceptive or unjust practices, fraud, discrimination, and other forms of abuse against the people of Texas. In essence, it sets the stage for consumer protection and fair business practices within the automotive sector.

Purpose of Texas Occupations Code § 2301.001

The legislative purpose behind Texas Occupations Code § 2301.001 is explicit: to protect the economic interests and general welfare of Texans. Recognizing the motor vehicle industry’s significant role in the state’s economy, the legislature enacted this statute to address potential problems arising from unregulated or unethical practices. Without clear regulations, consumers could fall victim to fraud, unfair sales tactics, or unfulfilled warranty obligations, leading to substantial financial losses and safety risks.

This section establishes the state’s “police power” as the basis for intervening in the motor vehicle market. The problem it seeks to solve is the potential for an unsound system of vehicle distribution and sale that could harm consumers and create an uneven playing field for legitimate businesses. By licensing and regulating key players like manufacturers and dealers, and by enforcing warranty compliance and preventing abuses, the statute aims to foster consumer confidence, ensure fair transactions, and ultimately, maintain a healthy and stable motor vehicle market in Texas. It is a cornerstone for consumer protection laws in the Texas auto industry, directly influencing measures related to vehicle defects, recalls, and warranty enforcement.

Real-World Example of Texas Occupations Code § 2301.001

Imagine Sarah purchases a new truck from a dealership in Houston. Within a few months, she discovers a persistent engine issue that the manufacturer’s warranty should cover. Despite repeated attempts, the dealership and the manufacturer are unresponsive, refusing to schedule repairs or provide a loaner vehicle, and dismiss her claims as invalid without proper investigation. Sarah feels she is being subjected to unfair practices and that her warranty is not being honored.

In this scenario, Texas Occupations Code § 2301.001 provides the foundational legal authority for the state to address Sarah’s situation. Although her specific remedy might lie in other sections of Chapter 2301, such as the Texas Lemon Law or provisions related to dealer conduct, this statute underscores the state’s legislative intent and justification for those protections. It highlights that the distribution and sale of motor vehicles affect the public interest, and the state has a vested interest in enforcing manufacturer’s warranties and preventing fraud or abuse. Sarah could leverage the regulatory framework established by Chapter 2301 (which this section introduces) by filing a complaint with the Texas Department of Motor Vehicles (TxDMV), prompting an investigation into the dealership’s or manufacturer’s practices under the authority granted by this foundational law.

Related Statutes

Texas Occupations Code § 2301.001 serves as the introductory statement for an entire chapter dedicated to motor vehicle sales and leases. Consequently, many other statutes are directly related, as they implement the principles laid out in this foundational section.

• Texas Occupations Code Chapter 2301, Subchapter M (Manufacturer’s Warranty): This subchapter outlines requirements for manufacturer’s warranties, including their terms and conditions, and obligations to repair or replace vehicles. This directly relates to the purpose of “compliance with manufacturer’s warranties” stated in § 2301.001.
• Texas Occupations Code Chapter 2301, Subchapter O (Repurchase, Replacement, or Repair of Certain Motor Vehicles): Commonly known as the “Texas Lemon Law,” this subchapter provides remedies for consumers who purchase or lease new motor vehicles with significant defects that are not repaired after a reasonable number of attempts. This directly supports the prevention of “abuse of the people of this state” and ensuring “compliance with manufacturer’s warranties.”
• Texas Occupations Code Chapter 2301, Subchapter B (Licensing): This subchapter details the requirements for licensing various motor vehicle industry participants, including manufacturers, distributors, converters, and dealers. This directly corresponds to the stated purpose of “licensing and regulating manufacturers, distributors, converters, and dealers of motor vehicles.”
• Texas Business and Commerce Code Chapter 17 (Deceptive Trade Practices Act – DTPA): While a broader consumer protection law, the DTPA can often be invoked in conjunction with Chapter 2301 to address “fraud, unfair practices, discrimination, impositions, or other abuse” in motor vehicle sales and warranty issues.

Case Law Interpreting Texas Occupations Code § 2301.001

As a foundational “construction; purpose” statute, Texas Occupations Code § 2301.001 is frequently cited by courts to establish legislative intent and the broad scope of Chapter 2301. It is less common for the interpretation of this specific section’s language to be the central dispute in a case, but rather it forms the basis for interpreting other, more specific provisions of the chapter.

One example of a Texas court citing this statute to underscore the legislative intent of the chapter is:

• Toyota of Boerne, Inc. v. Tex. Dep’t of Motor Vehicles, 356 S.W.3d 616, 622 (Tex. App.—Austin 2011, pet. granted, judgm’t vacated w.r.m.). In this case, which dealt with a franchise dispute between a motor vehicle manufacturer and a dealer, the court referenced Texas Occupations Code § 2301.001 to emphasize the statutory mandate for Chapter 2301 to be “liberally construed” to accomplish its purposes, particularly in regulating manufacturers, distributors, and dealers to ensure a sound system of motor vehicle distribution and sale. This citation reinforces the broad regulatory authority of the Texas Department of Motor Vehicles (TxDMV) and the legislative commitment to an ordered and fair motor vehicle market.

Why Texas Occupations Code § 2301.001 Matters in Personal Injury Litigation

Although Texas Occupations Code § 2301.001 is not a direct personal injury liability statute, its foundational principles have significant, albeit indirect, relevance in personal injury litigation, especially in cases involving vehicle defects, manufacturer negligence, or dealer misconduct.

For plaintiffs, this statute establishes the state’s strong public policy interest in ensuring vehicle safety and fair practices within the automotive industry. If an individual is injured due to a vehicle defect or a manufacturer’s failure to honor a warranty or recall, this foundational statute provides the context for holding responsible parties accountable. It underlines that the state exercises its “police power” to prevent “abuse of the people of this state,” which can include injuries resulting from unsafe vehicles or non-compliance with safety regulations. It provides a backdrop for arguments that manufacturers and dealers owe a heightened duty of care due to the vital public interest the state has in regulating their activities.

For personal injury attorneys, understanding this statute means recognizing the broader regulatory framework that supports consumer claims. It can be used to frame arguments about the legislature’s intent to protect consumers from unsafe vehicles and deceptive practices. While claims will typically be brought under more specific statutes (like the Texas Lemon Law, Deceptive Trade Practices Act, or common law product liability), § 2301.001 reinforces the legislative commitment to consumer protection and safety in the automotive sector. This can strengthen arguments related to negligence, breach of warranty, or other forms of liability, particularly when dealing with manufacturers or dealerships that may have violated their statutory or regulatory obligations leading to an injury. It underscores that vehicle safety and warranty compliance are not mere contractual matters but are subject to significant state oversight for the public good.