Lemon Law

The joys of buying a brand-new or used vehicle are memorable. But what happens when you realize it has defects? Or, that despite frequent repairs, issues continue to persist?The odds are, you may have a lemon or a defective automobile. 

Fortunately, the U.S. has adopted the lemon law — a statute to protect your consumer rights from the sale of faulty automobiles. The scope of the law may be overwhelming, and your first instinct may be to hire a lemon law attorney. However, while that is the preferred and often advised route, it helps to have a basic understanding of the lemon law. 

Here is everything you need to know. 

It is a set of laws that are in place to protect consumers against the sale of defective automobiles by manufacturers or dealers. It empowers consumers to seek compensation for the malfunctioning vehicle through a refund or exchange. 

The lemon law exists in all 50 states, each with unique conditions. However, if the state law does not cover a particular issue, consumers can still appeal under federal law (the Magnuson-Moss Warranty Act). 

The legal terminology within lemon law may be overwhelming. Here's a simplified glossary of some of the most commonly used terms. 

Lemon is slang used to describe a defective automobile. The term “lemon” was initially used in the 1962 Volkswagen Beetle print ad and later popularized in a seminal article by George Akerlorf called The Market for "Lemons."

A substantial defect is any issue that impedes the vehicle's utility, safety, and value. These include engine failures, brake failures, noises or fires in the engine, ignition troubles, and more. 

This pertains to the number of repair opportunities given to the manufacturer to fix the issue. While this may vary between states, the average number of attempts is four. 

Commonly referred to as the federal lemon law, the Magnuson-Moss Warranty Act provides respite for consumers in states where the lemon law might not cover a particular defect. 

The Magnuson-Moss law also encompasses vehicles such as boats or motorhomes, which state lemon law does not always cover.

A warranty is a set of conditions and duration during which a vehicle manufacturer must replace, repair, and compensate the consumer for defective vehicle parts for free. 

Within lemon law, arbitration can either be conducted through a state-run arbitration process or a more private panel or group. The buyer and the seller present their arguments with evidence, and the appointed arbitrator or panel will determine the outcome.

Lemon law safeguards the interests of an aggrieved vehicle owner who owns a lemon. It requires documentation of proof and arbitration to come to a settlement between the owner and manufacturer or dealer. For example, an as-is bill of sale for used items is a legal document that begins the process.

The conditions under which consumers can apply for the lemon law vary from repeated engine failures to suspension issues, leaks, risks of fires, steering issues, and more. 

Generally, cars, trucks, SUVs, vans, boats, and recreational and motor homes are all considered under the lemon law. 

A vehicle is a motor home if it offers mobile living facilities. It is a type of self-propelled recreational vehicle (RV). 

In the context of lemon law, owners of motor homes can still appeal in the case of defective chassis and drivetrains. Leakages may not be covered in certain states, in which case, owners can then appeal under the Magnuson-Moss Warranty Act, which compensates for all types of defects.

The criteria to file an appeal under lemon law may vary across states, but the general overview of the law includes:

Since the requirements of lemon law vary across states, it is advisable to consult an attorney to ensure your claims are valid in your jurisdiction.

The law covers two kinds of defects based on the complexity of the issues and their impact on the motor's reliability, value, and safety. 

During an arbitration hearing, there are four categories within which a buyer can claim a refund or vehicle exchange from the seller.

A buyer can make an "Unrepaired Nonconformity" claim when: 

A buyer can make an “Unrepaired Serious Safety Defect” claim when:

A buyer can make this claim when two or more different “serious safety defects” (whether or not repaired) are covered in the warranty and:

Your vehicle's day out of service is calculated by the number of repair attempts on one or more “nonconformities” or “serious safety defects.” 

Identifying if your vehicle is a lemon can be challenging. Sometimes, your vehicle's flaws aren't that evident and surface months to even a year later.

A common telltale sign that your vehicle is a lemon is if you notice one or more substantial defects in your vehicle that impair its overall utility, safety, and value. Another indicator is when these defects persist after a sizable number of repairs within the warranty period. 

In the context of the lemon law, a warranty is an obligation that a manufacturer or a car dealer has to a consumer to investigate and repair covered parts in a malfunctioning vehicle, free of charge. 

Warranties can be written (express warranties) or implied by law. 

A manufacturer's Written (express) warranty often accompanies the purchase of most new or used vehicles. It is effectively a promise by the manufacturer that the car sold is in good operating condition.

It enlists the types of defects a manufacturer will cover and the duration of time they will be repaired for free.

The eligibility period in lemon law varies between states. However, it is determined by mileage and time limits. 

The case for used car coverage under lemon law also varies by state. While some states mention their exclusion, others do not mention them at all. For states that do not mention used car coverage, an aggrieved consumer will then have to depend on the statutory guidelines of that state to file a dispute claim. 

A substantial defect impairs the vehicle's value and makes it unsafe for its intended use. While a noisy windshield wiper or an AC that blows extra cool air can be an annoyance, they don’t qualify as substantial enough to make a claim. 

However, transmission problems, braking and steering difficulties, acceleration defects, faulty airbags, electric failures, and more qualify as substantial defects. 

Building a lemon law case works as follows: 

You must identify a substantial defect in your vehicle covered by warranty. Defects can include issues in the engine, electrical and transmission systems, brakes, and acceleration.

The vehicle manufacturer should be given reasonable chances to repair the defect. This typically averages around four repairs in the U.S. 

With a lemon on your hands, contacting a lemon law attorney who can guide you through the application process based on the law in your state is essential. 

Reviewing your records, the attorney will collect evidence to substantiate your claim. They will then approach the manufacturer and the panel for the arbitration hearing. The board will ascertain the type of compensation you will receive.

The laws about defective vehicles differ between states. However, federal law protects consumer rights should a particular state not cover a specific claim. 

Federal law safeguards the rights of consumers of any product above $25 with a written warranty. Its guidelines are set in place to prevent manufacturers from drafting unfair warranties. 

The UCC is uniformly adopted nationwide, giving consumers the right to seek a refund or replacement for a lemon. 

State lemon laws also protect consumer rights against selling defective vehicles. However, these laws have statutes of limitations on the mileage and duration of ownership of the lemon. 

At the end of the day, you may still find yourself stuck with your lemon. You may be wondering what you could do to rid yourself of it. There are some options:

We hope this legal guide sheds light on what the Lemon Law is and how it protects your rights as a consumer. Whether you have a lemon or not, knowing your rights as a vehicle user is essential. While the government and states may have variations to the lemon law, the broader criteria for what qualifies as a lemon remains essentially the same. 

Filing a claim and attending arbitration hearings on your own can be challenging. Auto manufacturers and dealers are equipped to deal with claims against defective new vehicles and also have experience with the lemon law for used cars. Hence, working with an experienced lemon law attorney who is familiar with local laws and can arbitrate on your behalf successfully is paramount.