Motor Vehicle Warranty and Lemon Law

1.   Coverage For New Motor Vehicles.

A.  OVERVIEW OF SONG-BEVERLY WARRANTY RIGHTS

The Song-Beverly Consumer Warranty Act (beginning with Civil Code section 1790) provides protection for consumers who lease or buy new motor vehicles. The law requires that if the manufacturer or its representative in this state, such as an authorized dealer, is unable to service or repair a new motor vehicle to meet the terms of an express written warranty after a reasonable number of repair attempts, the manufacturer is required promptly to replace the vehicle or return the purchase price to the lessee or buyer. The purchase price that must be returned includes the price paid for manufacturer-installed items and transportation but does not include the price paid for nonmanufacturer items installed by the dealer. The lessee or buyer is completely free to choose whether to accept a replacement or a refund. Whatever the choice, the manufacturer is also responsible to pay for sales or use tax; license, registration, and other official fees; and incidental damages that the lessee or buyer may have incurred such as finance charges, repair, towing, and rental car costs.

The lessee or buyer may be charged for the use of the vehicle regardless of whether the vehicle is replaced or the purchase price is refunded. The amount that may be charged for use is determined by multiplying the actual price of the new vehicle by a fraction having as its denominator 120,000 and as its numerator the number of miles traveled by the vehicle before it was first brought in for correction of the problem. For example, if the car had traveled 6,000 miles before it was first brought in for correction of the problem, the lessee or buyer could be charged 5% (6,000/120,000 = 5%) of the purchase price for usage.

The law applies for the entire period of your warranty. For example, if your vehicle is covered by a three-year warranty and you discover a defect after two years, the manufacturer will have to replace the vehicle or reimburse you as outlined above if the manufacturer or its representative is unable to conform the vehicle to the express warranty after a reasonable number of attempts to do so.

Song-Beverly does not apply if the problem was caused by abuse after the vehicle was delivered. Be sure you follow the terms of the warranty for maintenance and proper use of the vehicle.

Although there is a four-year statute of limitations to bring a law suit for breach of warranty or for violations of Song-Beverly, you should act promptly to try to resolve the problem fairly and quickly without legal action if possible.

B.  THE "LEMON LAW" AND WHAT IS A REASONABLE NUMBER OF REPAIR ATTEMPTS

What is considered a reasonable number of repair attempts will depend on the circumstances including the seriousness of the defect. For example, one or two repair attempts may be considered reasonable for serious safety defects such as brake failure, depending on the exact situation.

A special provision, often called the "Lemon Law," helps determine what is a reasonable number of repair attempts for problems that substantially impair the use, value, or safety of the vehicle. The "Lemon Law" applies to these problems if they arise during the first 18 months after the consumer received delivery of the vehicle or within the first 18,000 miles on the odometer, whichever occurs first. During the first 18 months or 18,000 miles, the "Lemon Law" presumes that a manufacturer has had a reasonable number of attempts to repair the vehicle if either (1) The same problem results in a condition that is likely to cause death or serious bodily injury if the vehicle is driven and the problem has been subject to repair two or more times by the manufacturer or its agents, and the buyer or lessee has at least once directly notified the manufacturer of the need for the repair of the problem as provided in the warranty or owner's manual or (2) The same problem has been subject to repair four or more times by the manufacturer or its agents and the buyer has at least once directly notified the manufacturer of the need for the repair of the problem as provided in the warranty or owner's manual or (3) The vehicle is out of service because of the repair of any number of problems by the manufacturer or its agents for a cumulative total of more than 30 days since delivery of the vehicle.

The "Lemon Law" presumption is a guide, not an absolute rule. A judge or arbitrator can assume that the manufacturer has had a reasonable number of chances to repair the vehicle if all of the conditions are met. The manufacturer, however, has the right to try to prove that it should have the chance to attempt additional repairs, and the consumer has the right to show that fewer repair attempts are reasonable under the circumstances.

Be sure to check your warranty and owner's manual for instructions. You may be required to directly notify the manufacturer of the problem(s). It is a good idea to send your written notice to the manufacturer at the address shown in the warranty or owner's manual by certified mail, return receipt requested so that you have proof that your letter was received. Keep a copy of all correspondence.

If the manufacturer maintains a state-certified arbitration program, the consumer must submit the warranty dispute to the arbitration program before the consumer can take advantage of the presumption in court. Arbitration is an alternative to court proceedings. The consumer may assert the presumption during arbitration. Information about any arbitration should be described in the warranty or owner's manual.

Not every manufacturer maintains a state certified program. You should check with the Department of Consumer Affairs' Arbitration Certification Program at (800) 952-5210 or on the Internet atwww.dca.ca.gov/acp/. You can also ask for the department's free pamphlet that explains more about arbitration, "Lemon Aid for Consumers."

C.  WHO IS COVERED

The law applies to a new motor vehicle that is bought or used primarily for personal, family or household purposes. The law also applies to a new motor vehicle with a gross vehicle weight under 10,000 pounds that is bought or used primarily for business purposes by a person, including a partnership, limited liability company, corporation, association, or any other legal entity, to which not more than five motor vehicles are registered in this state.

D.  WHAT IS A NEW MOTOR VEHICLE

The law discussed above applies to "new motor vehicles." (Certain limited protection may apply to used vehicles as described in Section 2.) The term "new motor vehicle" includes not only new motor vehicles but also demonstrators; the chassis, chassis cab, and propulsion system of a new motor home; and any other motor vehicle sold with a manufacturer's new car warranty. For example, a two-year old used car sold with the remaining one year portion of a manufacturer's three-year new car warranty would be treated as a new motor vehicle. The term "new motor vehicle," however, does not include motorcycles or exclusively off-road vehicles.

2.  Coverage For Vehicles That Are Not "New"

Although the special provisions discussed above apply to new motor vehicles, Song-Beverly has many general rules that apply to any consumer product sold with an express written warranty. As a result, there is important coverage for motorcycles, the living quarters of a mobile home, used vehicles sold with a dealer's express written warranty, "lemon" vehicles repurchased by the manufacturer and sold to consumers with an express written warranty covering the defect, and vehicles sold with a service contract.

A full description of warranty rights is beyond the scope of this message, but you should be aware that coverage is not identical to the coverage for new motor vehicles. For example, a warrantor who is unable to conform a consumer product to its express warranty within a reasonable number of attempts is required to replace the goods or refund the purchase price less an amount attributable to the consumer's use. Unlike the special rules on new motor vehicles, however, there is no set formula for determining the charge for the consumer's use before the discovery of the defect, and the Lemon Law presumption does not apply.

For complete advice concerning your legal rights, you should consult your own attorney.