Conn. Agencies Regs. § 42-110b-3 - Adjustments
Example: "A" sells a tire with list price of $48 to "B" for $24, with a 12 months guarantee. After 6 months use the tire proves defective. If "A" adjusts on the basis of the price "B" paid, $24, "B" will only have to pay one-half of $24, or $12, for a new tire. If "A" instead adjusts on the basis of list price, "B" will owe one-half of $48, or $24, for a new tire. The guarantor would be required to disclose here, the following: That this was a 12 months guarantee, that a list price of $48 would be used in the adjustment, that there would be an adjustment on the basis of the time that the tire was used, and that he would not pay the adjusted amount in cash, but would make an adjustment on a new tire.
Note: Guarantees which provide for an adjustment based on a fictitious list price should not be used even where adequate disclosure of the price used is made.
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