NAAA National Arbitration Policy

Arbitration Policy for

444 Joe Frank Harris Pkwy

Cartersville GA 30120

770-382-1010

All ABC Atlanta Arbitration rules, as listed below, supersede the NAAA Arbitration Rules. (As noted with”***.”)

GENERAL ARBITRATION POLICIES (3/17/06)

ABC ATLANTA/RED TOP AUTO AUCTION

1.  The Auction makes no representations or guarantees as to the description, equipment, history, warranties, service policy, title status/accuracy or odometer on any vehicle sold or offered for sale.  The Auction does not guarantee or get involved in any factory or dealer warranty coverage issues on vehicles sold or offered for sale at the Auction.

2.  The Auction intendeds to promote fair and ethical treatment to both the Buyer and Seller.  If the Auction determines that the transaction is not fair and ethical to either party, the Seller and Buyer agree that the Auction may cancel the sale, at its sole discretion.

3.  The decision of the Arbitration Department is final and binding on both the Buyer and Seller.  The Auction reserves the right to assess an arbitration fee to the Buyer if an arbitrated claim is deemed to be not valid or too frivolous: At a cost of $1.00 per minute plus transportation to the service shop ($25.00.) with a minimum fee of $40. Any arbitration must be properly documented in writing and signed by the arbitrator.  If the arbitration is valid, the Auction reserves the right to assess an arbitration fee to the Seller if they knowingly omitted an announcement.  This fee is in addition to any charges associated with the arbitration procedure; such as check out fees at a specialty shop
or transportation costs to and from a garage, etc. 

4.  The Auction is not a party to the contract of the sale.  The sales contract is between the Seller and Buyer only.  The Seller is required to give the Federal Odometer Mileage Statement in connection with any Auction sale as required by the Motor Vehicle Information and Cost Savings Act of 1972 as amended, or other applicable laws.  The Auction is not responsible and does not guarantee the accuracy of odometer readings, odometer statements, or damage disclosure statements.

5. Any vehicle sold “AS-IS”, or any vehicle sold for ($3000) or less, is NOT subject to mechanical arbitration.

6.     LOT SALES / OUTSIDE SALES

           a.   Any sale in which the Auctioneer does not state the selling price of the
             vehicle  or “sell under  the hammer” is considered a “LOT SALE”.

         b.  All “LOT SALES” are conditional until the Buyer pays for the vehicle.  Up
             until the time of payment, the sale is not binding on either party.

        c. Once a “LOT SALE” has been paid for, the vehicle becomes “AS-IS” property
   of the Buyer.  Buyer needs to check “LOT SALE” vehicles very carefully before
   purchasing, since they are not arbitratable for any reason, including frame.
   Vehicles sold immediately after crossing the block are still subject to the
   announced conditions noted on the Auction Block Ticket.

d.      All vehicles bought or sold on the premises must be processed through the
 Auction Office.  Failure to do so WILL result in suspension of trading
 privileges at the Auction. 

e.       Sellers may guarantee Lot Sales, but must do so in writing.

7.    All vehicles consigned must have a public Vehicle Identification Number (VIN) plate attached to the vehicle.  Those vehicles having a reassigned VIN plate by the State in place of the original VIN plate must be announced or will be subject to sale cancellation or Buyer return.  The Auction reserves the right to refuse the sale of any vehicle in which the VIN plate appears altered in any way.

 8.  The Auction reserves the right to review any audio/video documentation for
 verifying accuracy of the sale. 

9.    All guaranties as stated by the Seller are those of the Seller only.  The Auction does not make any guaranties, expressed or implied.  The Auction assumes no responsibility for vehicle record books, service records, warranty vehicles, or history.

10.  The Auction does not guarantee information listed in Electronic Data Vehicle Histories (i.e., CarFax, AutoCheck, etc.) and may not arbitrate solely on
EDVH data.

11.  The Auction does not guarantee any warranty books, plates, or the year of kit vehicles, trailers, motorcycles, watercraft, recreational vehicles, antique, homemade or modified vehicles.  All of these vehicles are sold “AS-IS” and have no odometer or frame guarantee.  The Auction does not guarantee titles on watercraft. 

 12.  The Auction reserves the right to reject any vehicle that management judges to be unsafe.

 13.   Engines/Rear End – No arbitration on noises that are inherent or typical to a particular model or manufacturer, unless deemed “excessive” by the arbitrator on non-warranty items.

 14. Standard transmissions cannot be arbitrated for manual clutches unless
 completely inoperative. 

15.  All mechanical arbitration is the day of sale prior to (5:00 p.m.), unless there is a pending Post Sale Inspection (PSI). Tomorrow is too late. It is the Auction’s responsibility to inform the Seller of any pending PSI or arbitration resulting from the sale day. ***Tuesday night auction arbitration ends by noon the following day. 

16. Manufacturer’s Warranty:  The availability of a manufacturer’s warranty shall
       not affect a Buyer’s right to arbitrate a vehicle.

17. The arbitrator will inspect only the defect(s) which are on the arbitration form. Each vehicle is allowed one chance at mechanical arbitration.  If price adjustment is made and accepted, vehicle becomes “AS-IS”, property of Buyer, and is not subject to any further arbitration for mechanical defects or adjustments.  The decision of the arbitrator is final, and binding to both Buyer and Seller.

**  Ifs: Conditional Ifs are binding until 12:00 PM on Wednesdays for Tuesday’s sale, 5:00 PM on Fridays for Friday’s Sale. Buyers do not have option to void deal before that time.

SALE-LIGHT SYSTEM

1.   The NAAA has a standardized light system to describe the condition and/or announcements related to the vehicle being sold.  The light system is defined as:

a.   Green Light – “Ride & Drive”:  The green light signals that this vehicle is guaranteed under the conditions outlined in the Sale Day, Seven Day and As-Is Arbitration section, except for specific announcements made prior to the sale.

      b.   Yellow Light – “Announcements”:  This light is an indication to the Buyer that the Auctioneer or Selling Representative has made announcements that qualify the condition and limit arbitration of this vehicle.

c.   Red Light – “As-Is”: Vehicles selling under the red light will only qualify for arbitration under the rules outlined in the Sale Day, Seven Day and As-Is Arbitration section.

       d.        Blue Light – “Title Attached/Title Unavailable/Title Absent”:  This light is used to announce that the title is not present at the time of sale. For Auction rules regarding titles, please refer to the Title Arbitration Policy section.

2.  The Seller understands that the sale lights are a binding representation of
    vehicle condition, and is therefore responsible for ensuring that their vehicles
    sell under the correct light in the lane.

3.      The Buyer is responsible for listening to announcements related to the vehicle,
 made by the auctioneer or Selling Representative, prior to the start of the sale
 for each vehicle. The Buyer is also responsible to observe and understand the
 sale lights (Green, White, Yellow, Red and Blue), which identify various sale
 conditions for the vehicle.

“AS IS” vehicles sold under red light

***The following conditions represent an “AS IS” sale and are not
     subject to arbitration for any reason, except odometer discrepancies,
     frame/unibody and mandatory announcements.

1.     All vehicles sold under $3000.00.

2.     All vehicles 10 years old and older.

3.     All vehicles over 100,000 miles.

4.     All miscellaneous items, such as boats, campers, taxi’s, motorcycles, ATV’s, trailers, jet skis, antique cars, snowmobiles, are exempt from arbitration for frame/unibody damage, mileage/hours and year model.

5.     All off the block sales are sold “AS-IS”, it is buyers responsibility to inspect vehicles.

6.     All vehicles for $1000.00 or less are exempt from ANY Arbitration including frame/unibody arbitration.

7.     All vehicles sold at In-Op sale; are sold AS-IS, no exceptions.

8.     Auction does not guarantee miles on vehicles that are exempt regardless of seller announcments       .

9.     Vehicles 10 years or older are exempt. All vehicles that are Exempt are TMU. The True mileage is not known on Exempt vehicles.

10.  Any vehicle returned to our auction for TA over 30 days, will be refunded the full amount: as long as the vehicle is in the same condition in which it was purchased, and has less than 200 miles added to the odometer. The buyer will be charged .30 cents
per mile for every mile over 200.

SELLER RESPONSIBILITIES

1.     Seller will be held responsible for the accuracy of any representations (verbal or written) made by Seller or Auctioneer at the time of sale - independent of vehicle “light” designation or guarantee offered.  This includes year, model, mileage, announced conditions, and the corresponding lights under which the vehicle is being sold.

2.   Mileage announcements are not required on vehicles deemed exempt from Federal/State Odometer and Title disclosure laws unless a mileage discrepancy is known or apparent to the Seller.  The Seller may represent miles on exempt vehicles - any statement made by the Seller and all known odometer discrepancies are grounds for arbitration.

3.   The Seller is responsible for reimbursement of all reasonable documented expenses incurred by the Buyer excluding profit, commissions and detail charges) on vehicles arbitrated for unannounced conditions not detectable                 through vehicle inspection (i.e. stolen vehicle, odometer, title discrepancy, frame damage, flood damage, manufacturer buyback, etc). Expense reimbursements will be at the sole discretion of the Auction and will, at times be limited to reasonable and documented expenses and transportation only.

 4. The Seller has the responsibility to announce any known state or local DMV fees, taxes or other fees over $100 due on the vehicle (if required by state).

 5.  Title Discrepancies must be announced including salvage, disclosure
     requirements [if required by state]    (i.e. 25%), previous salvage,
     theft recovery, not actual miles (previously TMU), odometer replacements,
     flood/fire history and Lemon Law buybacks.

 6. All titles submitted must be in the Seller’s name.  It is the Seller’s
    responsibility to ensure that a sold vehicle’s title is
    negotiable in the state in which the Auction resides and that
    the title is clear of all liens and encumbrances.

 7.  Seller is responsible for correct VIN numbers on titles and vehicles.
     All vehicles registered at Auction are subject to inspection by the FBI,
    State Police, National Auto Theft Bureau, and Local Police Authorities.

 8.  Seller shall be solely responsible for repurchase of any vehicle sold through
     the Auction found to be stolen prior to the date of sale (if not announced). 

 9. Seller has the responsibility to produce a negotiable/marketable title
     to Auction within a maximum of 30 days of the date of sale [sale day
     is day one (1)], or as specified by state law, on vehicles sold T/A
    (no title present at time of sale).  See Auction rules in Title Attached Policy.

 10. All 2-wheel drive, multipurpose and utility-type vehicles that have the
      appearance of being 4-wheel drive* must be announced.
     (*as determined by the Auction)

11.  See mandatory Seller Disclosure Requirements on the chart below:

BUYER RESPONSIBILITIES

As to any vehicle purchased at the Auction, the Buyer is responsible for the following: 

1.  Buyer will inspect the vehicle prior to and immediately following the sale. The Buyer must verify the Seller’s representations and notify the Auction immediately of any discrepancies within the time frame as stated in this arbitration policy. Buyer will verify odometer reading and operation before leaving the Auction. Mileage must be the same as it was when it left the Auction if arbitrated for inoperatable odometer.

2.  The Buyer will follow Auctioneer’s cadence on price - any misunderstanding
    concerning price must be addressed at the drop of the Auctioneer’s hammer
    (not following the sale of the vehicle).

3.   The Buyer will inform the Auction immediately of any discrepancies as to
 Seller’s representations warranties, and descriptions. Arbitration will be
 limited to the specific defects described by the Buyer upon placing the
 vehicle in arbitration.

4.  Buyer guarantees sufficient funds are available and will remain on deposit
     at Buyer’s bank to cover all checks and drafts. Until payment and receipt
     of title, the Buyer shall acquire neither title to the vehicle nor any right
      to sell or offer for sale.

5.  Buyer will pay the bid price plus a Buyer’s fee and draft fees (if applicable). Payment by means other than draft must be made on day of sale. Floor plan payments must be established on day of sale.

 6.  Buyer agrees to be liable for any and all work done to a vehicle prior to
     returning the vehicle to the Auction except on vehicles arbitrated for
     unannounced conditions not detectable through vehicle inspection
     (i.e. stolen vehicle, odometer, title discrepancy - does not include title attached).  

7.  Buyers should thoroughly check and test drive every vehicle. If there is any problem, a complaint must be properly filed with the Arbitration Office within
the established arbitration time limit.  The Buyer assumes responsibility for mechanical failure after leaving the Auction once the arbitration period is over.

8.  It is the Buyer’s responsibility to watch lights and listen to announced
conditions before placing bids. Once the vehicle is sold the Buyer should
check the Block Ticket to confirm the vehicle price and announcements
are correct before legibly printing and signing their name to the Block Ticket.
The Auction will not arbitrate defects visible from the block or announced conditions.

9.  Mileage and other information written on the window of sale vehicles or in
    Auction Catalogs is for the convenience of the Buyer and is not to be relied
    upon as accurate or complete. Buyers should satisfy themselves as to year,
    mileage and/or equipment by viewing the actual vehicle prior to bidding.

        The Auction will not arbitrate vehicles based on incorrect information written on a vehicle or in the catalog.        

10.  The buyers is resonsible for any pending sale from arbitration.

TITLE ARBITRATION POLICY

1.     The Seller guarantees the title of vehicles that are sold through the
        Auction (non T/A).  This guarantee of the title warrants that title shall be
        marketable and free and clear of all liens and encumbrances, including
        any brand (such as ‘salvage’) noted upon the current or any prior certificate
        of title unless such encumbrances were announced at the time the vehicle is
        sold through the Auction and for a period of four (4) years from the date
        of the Auction sale.  The Auction’s liability under this title guarantee shall
        never exceed the Auction sale price of the vehicle, and this maximum amount
        shall be reduced by two percent (2%) per month following the Auction
        sale date.  All liability under this title guarantee shall expire and terminate
        48 months after the Auction sale date.  The Auction will not be responsible
        for any expenses incurred on vehicles returned for late title. 

2.     All titles submitted by Seller must be in Seller’s company name on title or
       on reassignment form.   

3.     Clerical Error – If the title problem is due to a clerical or coding error, or
        incomplete documentation, the Auction shall be given reasonable time
        after receiving notice to have the error corrected.

4.     Procedure – Whenever any claim is made by any person against the title
       of a vehicle, whether by suit or otherwise, the Buyer, after becoming
       aware of said claim, shall immediately notify the Auction giving full
       particulars of the claim, and shall cooperate fully in defending any legal
      action and in taking other steps to minimize possible loss.

5.    The Buyer shall not surrender possession of the vehicle, except as required
       by legal process, to any claimant, nor shall Buyer voluntarily pay or
      acknowledge the validity of any claim, without the prior approval of the
      Auction. Time is of the essence.  Any failure on the part of the Buyer to
      notify the Auction of any claim in a timely manner or failure of the Buyer to
      cooperate in defending any such claim shall relieve the Auction of any
      liability under this policy.

6.   Seller and Buyer agree that Auction is neither responsible for odometer
     mileage on the consigned vehicle nor the information contained in the
     odometer mileage statement and the damage disclosure statement which
     Seller as Transferor is required to complete and sign, and Buyer as Transferee
     is required to acknowledge.

7.  In regard to defect in title, and any matter relating to odometer mileage,
    odometer statements, or damage disclosure statements: Seller and Buyer
    agree to indemnify and hold harmless the Auction from any liability, lost cost,
    damage or expense, including attorney fees which may arise either directly
    or indirectly from the sale and purchase of the consigned vehicle including
    but not limited to title services provided.

8.  Any sale without proper documents and not sold under the proper light
     is subject to rejection.

9.  Title must be reassigned directly to Buyer.  No title assigned directly to
    the Auction will be accepted.

10.  Non-titled vehicles – Auction accepts no responsibility for non-titled vehicles
 sold without title. Seller must announce the vehicle being sold with a bill
 of sale only and that there is no title to transfer.

11.  All non-titled vehicles and equipment will be sold “ AS-IS”.

12.  SELLER will NOT be paid for vehicles until a transferable title is received.

13.  SELLER will NOT be paid for vehicles in arbitration unless or until
       arbitration is settled, and vehicles are sold.

14.  Foreign titles, such as Canadian titles, are unacceptable.

15.  Seller’s Title Guarantee: The Seller warrants, represents and guarantees
      that he has and will convey a certificate of title, properly executed, valid
      in the state where the transaction is occurring and clear of all liens and
      encumbrances (except current year DMV fees in California), and that
      he will warrant and defend the title against the claims and demands
      of all persons whatsoever.

16.  Applications for duplicate title will not be accepted (unless announced as
      such or if state allows).

17.  Seller has up to a maximum of (30) calendar days for title to be received
      by Auction [sale day is day one (1)].

18.  After the (31st) calendar day period, it is the Buyer’s option to return
      the vehicle or to wait a reasonable period of time for the title. (Must
      submit 24 hour notice to return a vehicle for TA 30 days, regardless
      of time table, a 24 hour notice must be given.) No vehicle return call
      (24 hour notice,) can be made on Saturday and Sunday.

19.  Anyone not having a properly assigned title or reassignment to transfer
      a title at time of sale must sell “Title Attached/Title Unavailable/Title Absent”.
 

20.  Vehicles lacking lien release must be sold “Title Attached/Title Unavailable/
      Title Absent”. 

21.  Any vehicle that is on an MSO must be announced.

22.  The Buyer is cautioned not to sell or make repairs on the vehicle until title
      is received.  If title has been mailed from Auction to Buyer, Buyer may not
      return vehicle.  Buyer is required to notify Auction one (1) business day
      before returning vehicles.

23.  Just because a vehicle is returned to the Auction does not mean the
      Buyer is out of the deal.  The vehicle must be received and inspected by
      Auction management before the Buyer is out of the deal. Any vehicle
      returned must be in the same or better condition as when sold.

24.  Any and all “Title Brands” which may affect a vehicle’s value must be
     announced.  Some “Title Brands” Include, but are not limited to: Lemon Law,
     Rental/For Hire, Reconstructed, Salvage,  Stolen Vehicle and Insurance transfers.

25.  Seller will be responsible for the buy fee plus reasonable transportation
      expenses from the Buyer’s dealership to the Auction on vehicles returned
      for “no title”.

26.  There may be a charge of $.10 per mile for excessive mileage on a
      returned vehicle (at the discretion of the local Auction).

27.  Titles received after (30) calendar days may be subject to a late title fee.  All expenses to obtain the title will be charged to the Seller.

28.  Auction will not be responsible for titles mailed from Auction and not
      received.  Buyer has the choice of alternative delivery method and will
      pay Auction cost.

***Late titles:

Buyer is cautioned not to spend any money on unit (you will not be reimbursed) and not to put excessive miles on unit, not to damage unit and not to sell unit until title is received. After 30 calendar days, the buyer has the option to return the unit or wait for a reasonable period of time for title. Special arrangements must be made with Auction before unit is returned. The Buyer must have prior approval from Auction management to return any unit to Auction. The Seller is responsible for all Auction fees due on transaction.

GRAY MARKET VEHICLES (Canadian Vehicles)

1. Only vehicles made in North America for Canadian use and properly
    converted to U.S. specifications can be sold and must be announced as such.
    No other Gray Market vehicles are accepted for sale.

2. Sellers must inform the Auction that a vehicle has Canadian history at time of registration and must disclose that to the Buyer in writing as an announced condition on the block ticket unless the car is five (5) years old or older (see item 7 below).