How Do Lemon Laws Work? (Different Types & FAQs)
Vehicle shopping is stressful enough when you wonder if a car will be the perfect fit for you and your family over the next few years. The last thing you need to worry about is whether it will run in the first place. Spending thousands of dollars on a car isn’t easy to swallow when it’s subject to endless visits to the mechanic. That’s why federal and state governments enforce lemon laws; they are vital protections that have helped consumers hold manufacturers accountable for defects. Lemon laws offer recourse for consumers if they buy a faulty product.
Understanding how lemon laws work in your state can be a critical factor in getting relief from the headache of faulty products. Let’s explore how lemon laws work and what they can do to help you.
How Do Lemon Laws Work?
They generally focus on new vehicles but can sometimes broadly apply to other items that don’t meet performance or safety standards. Most lemon laws hold that manufacturers must replace or buy back a defective vehicle after a reasonable number of repair attempts or if it is out of commission for a certain period.
Federal and state governments oversee lemon laws. The defining federal law is the Magnuson-Moss Warranty Act of 1975. Quality issues were an ongoing problem in the automobile industry to that point. While warranties were a helpful selling point, car makers had trouble reconciling decent coverage with higher production. By selling shoddy vehicles with short, loose warranties, car companies created a flood of complaints.
Uniform Commercial Code
Before the Magnuson-Moss Warranty Act passed, the Uniform Commercial Code became a legal guideline to make the terms of sales consistent between states. Every state and Washington D.C. have created regulations following the UCC, as it offers critical definitions for interpreting laws and eases sales disputes across multiple states. Article 2 of the UCC focuses on three warranty types:
- Express warranty: A written or verbal promise about a product that influences the sale
- Implied warranty of merchantability: An unspoken promise that a product will do what a product like it should do
- Implied warranty of fitness for a particular purpose: An unwritten promise that a product will perform a specific function that the seller knows the consumer expects from it
Magnuson-Moss allows consumers to sue over express warranties, implied warranties, or both. The UCC explains how buyers can expect manufacturers to repair problems and reject vehicles that don’t meet standards.
Revocation after hundreds or thousands of miles is where lemon laws come into play. Cars with substantial “non-conformities” that affect their operation or safety or fail even after numerous repair attempts should warrant replacement or buybacks by the UCC’s standards.
Magnuson-Moss Warranty Act
To protect consumers, Congress passed Magnuson-Moss. Covering consumer product warranties, the Act set essential expectations, such as:
- Manufacturers couldn’t restrict implied warranty coverage
- Written warranties must be available where manufacturers sell their products
- Warranties must be easy to understand
- Manufacturer warranties must be either “full” or “limited”
- Warranties cannot make consumers take unnecessary steps to make a warranty claim
The act set a foundation for consumers to sue for breach of warranty and made it more difficult for manufacturers to draft dodgy guarantees. It doesn’t cover warranties for resold or commercial goods.
There’s no rule that businesses must draft express warranties. Oral warranties and “as-is” sales aren’t protected under the act. But as warranties are an essential selling feature, manufacturers have plenty of motivation to offer the most competitive guarantees possible.
Notably, the act included a condition where the manufacturers pay the consumer’s attorney fees following successful lawsuits. Consumers gained critical help in going head-to-head with major corporations. Many attorneys work pro bono when they feel they can win. On their end, manufacturers had more reason to handle conflicts efficiently through arbitration.
The UCC and Magnuson-Moss Warranty Acts were necessary starting points to address the lemon problem. But vague terms made them challenging to enforce. The rules didn’t clarify what terms like “reasonable amount of repairs” or “non-conformity” meant. To clear matters up, states began drafting more black-and-white definitions for a “lemon.”
Where Are Lemon Laws Used?
With Representative John J. Woodcock leading the charge, Connecticut passed the first state lemon law in 1982. The remaining 49 states and Washington, D.C., followed suit soon after.
Federal and state laws don’t counteract or impede one another. On the contrary, they provide a series of fallbacks for consumers. State laws are well-defined, easy to argue, and efficient. But they’re also limited to vehicles. If states don’t satisfy the criteria to make a lemon claim, the broader Magnuson-Moss Act may give consumers more ways to seek help.
How State Lemon Laws Vary
In general, state laws only apply to personal use vehicles. Some are more inclusive than others. For instance, most states only cover new and leased vehicles, but places like Massachusetts and New Jersey include used cars under their lemon laws. California has lemon laws for most consumer goods, including appliances and electronics.
Beyond the sale type, state lemon laws also differ in how they qualify lemons. Some of the primary areas where they vary include:
- Covered vehicles: Some laws cover only cars and trucks, and others include RVs, boats, ATVs, and motorcycles
- Protection duration: The specific amount of time or miles that the lemon law applies to a car
- Repair limits: Some states have a limit of three repairs before deeming a car a lemon, and some require four repairs for the same problem; severe safety defects may only need one repair attempt
As an example, let’s look at Oregon’s lemon law. In Oregon, you can get protection if you have a substantial issue that reduces your car’s value, operation, or safety. When you report it to the manufacturer, they have three chances to fix it before you can seek a new car or a refund. You can also look at lemon laws if your vehicle stays in the shop for at least 30 non-consecutive days. The state offers protections for the first two years or 24,000 miles after buying a new car.
Advantages of Lemon Laws
Although dealerships and manufacturers want to maintain positive relationships and reputations, they’re also sensitive to costs. Repairs cost less than a replacement in most instances. Before lemon laws, dealers and manufacturers would help with faulty vehicles only by offering a string of shop visits.
Lemon laws are safeguards against loss that streamline resolutions. Statutes for reasonable replacement can save lives when the defect involves brakes or steering. Thanks to lemon laws, manufacturers have a new responsibility to ensure customers get value from every sale.
Disadvantages of Lemon Laws
Lemon laws are imperfect and still leave room for frustrating consumer experiences. And with the variation between states, some regulations are just plain weak.
Short reporting timeframes of only one year aren’t always long enough to identify and report lemons. At the same time, coverage, in most cases, only extends to new and leased vehicles. Only seven states have used car lemon laws, leaving many buyers with little support.
What Are the Different Types of Lemon Laws?
Lemon laws primarily exist for motor vehicles, especially at the state level. In the broader national framework, you can reference Magnuson-Moss for nearly any consumer good costing over $10. Implied warranties allow customers to file complaints and seek relief for TVs, computers, phones, and other expensive essentials.
But the transaction of material goods isn’t the only area with lemon laws. Today, many states are enacting a new kind of lemon law to protect both the consumer and the product—pet lemon laws. With these laws, also called puppy lemon laws, pet sellers must disclose all prior and genetic health defects. If an owner discovers an undisclosed condition, they can return the pet.
Frequently Asked Questions (FAQs)
What Do You Do If You Think You Have a Lemon?
If you suspect you have a lemon vehicle, research your state’s lemon laws and contact the manufacturer or dealer. Remember that while the dealer may facilitate the resolution, the manufacturer is the one you’ll hold accountable. They will typically have the chance to provide one more repair or offer a settlement.
Gather as much information as you can to build your case. Find warranty information, brochures, and advertisements that make explicit promises. More importantly, ensure you have your service and communication records, such as email or text messages, with the manufacturer. You must show when and why you had repairs and any attempts to contact the company.
If the manufacturer doesn’t satisfy you, you can enter arbitration or go to court. Contacting an experienced lemon law attorney is an excellent first step. Many can provide free initial legal counsel to explain your next moves to help your case. You can also contact state attorneys general offices or a resolution dispute agency, such as the Better Business Bureau.
Which Manufacturer Produces the Most Lemons?
Lemon laws are a comforting fallback when you have a defective vehicle. But most of us would like to avoid the hassle of making a claim at all. Constant repairs and lemon claims processes steal time and opportunity even if they’re successful, making reliability essential.
No manufacturer is perfect, but a look at lemon law claims shows that some are more dependable than others. Unsurprisingly, Toyota takes the top spot. In California, only one in every 2,029 Toyotas was involved in a lemon lawsuit between 2018 and 2021. Among the least reliable are GM vehicles, with one in 78 entering a lemon law case in the state during that time.
Cars are expensive but necessary, and they put consumers in tough spots when they aren’t reliable. Lemon laws are a crucial consumer aid. Understanding how lemon laws work in your state can save you thousands of dollars and tons of time. Though the laws are still a work in progress, several government and consumer advocate groups can help when the manufacturer will not.
Featured Image Credit: F8 studio, Shutterstock