Each state has its own Lemon Law. Here in California, ours is officially known as the Song-Beverly Consumer Warranty Act.
All Lemon Laws serve the same purpose – they give consumers practical means for enforcing the terms of a new car warranty. If the manufacturer cannot fix a defect covered by the warranty in a timely manner, the consumer can demand a refund, replacement, or other remedy.
Despite the similarities among state laws, California’s version of the Lemon Law has unique provisions that consumers in our state should know about. These particularities can make a big difference when it comes to important questions like who can bring a claim, what the consumer must prove, and which remedies are available.
If you believe your car may be a lemon and you are wondering what to do, the following information will get you up to speed on how the law works in our state.
The ability to continually drive a reliable, newer-model car is one of the biggest reasons people choose to lease instead of buy. After all, what better way to avoid breakdowns than to upgrade to a new vehicle every few years? Unfortunately, the likelihood of a given vehicle coming off the factory floor with a defect is the same whether the car ends up being leased or sold by the dealer. The good news is that people who choose to lease have all the same rights as new-car owners under California’s Lemon Law.
California’s Lemon Law applies only to vehicles covered by the original manufacturer warranty. However, coverage remaining on the warranty at the time of a subsequent sale may transfer to the new owner, making it possible to buy a used (but relatively new) car and still have Lemon Law rights. The law also applies to manufacturer warranties issued for certified pre-owned vehicles. It does not, however, apply to extended warranties and other service contracts purchased from the dealer or a third party.
People in California do not always buy vehicles for the sole purpose of traveling on our streets and highways. Off-road recreational vehicles make up a significant percentage of all purchases. Furthermore, watercraft account for many of the purchases in Los Angeles County, Orange County, and other coastal communities. As long as they are sold by a dealer and are covered by a factory warranty, covered vehicles can include:
The law treats these vehicles as consumer goods and provides some, but not all, of the protections that apply to regular passenger vehicles.
Just because California’s Lemon Law is designed to protect consumers does not mean it applies only to individuals. Businesses that purchase defective vehicles are also covered. It does not matter how the business is organized (sole proprietorship, partnership, LLC, corporation, etc.) or if the vehicle is a “dual use” vehicle driven for both personal and business purposes.
The Lemon Law statute sets forth two restrictions for business vehicles. To qualify for the same protections that apply to personal vehicles:
With respect to the second requirement, the five-vehicle limit reflects the legislature’s intent to extend Lemon Law protections only to small businesses in our state. Large businesses that operate entire fleets of commercial vehicles typically do not need the Lemon Law because they have other means of resolving disputes with auto manufacturers.
California’s Lemon Law generally applies only to sales and leases that occur inside our state borders. For example, residents of Riverside County who take I-10 over to Phoenix to buy a car cannot rely on our Lemon Law. If something goes wrong with the car, they must look to Arizona’s Lemon Law, regardless of how inconvenient that may be. The same is true for out-of-state residents who buy a car before moving here. There is one exception, though. Members of the armed forces stationed in California can use our Lemon Law even if they acquired their vehicle in another state.
A new-car warranty is a written contract. Like any other lawsuit for breach of a written contract in California, a Lemon Law claim must be filed within four years of the date the contract is broken. Notifying the manufacturer is not sufficient – the statute of limitations can be satisfied only by filing a lawsuit.
Notice that the time limit for filing a claim may extend beyond the warranty period. This is because the statute of limitations does not begin to run on the date of purchase/lease. That date is when the warranty contract begins. The statute of limitations runs from the date the warranty contract is broken. In other words, the deadline begins to run when a defect covered by the warranty is discovered and the dealership fails to promptly repair it. This may occur well into the warranty period, or even shortly before it expires.
The Song-Beverly Consumer Warranty Act contains a number of rules that apply only to passenger vehicles. This portion of the Lemon Law even bears a separate name, the Tanner Consumer Protection Act. It is here that one of the most important, California-specific aspects of the law is found – the 18 months/18,000 miles presumption.
Consumers are not expected to give the dealer an unlimited number of chances to repair a defect. That is why California’s Lemon Law was enacted in the first place. The law says the manufacturer gets a “reasonable” number of chances to get it right, and then the consumer can demand compensation. The 18 months/18,000 miles presumption is simply a tool for determining how many repair attempts are considered reasonable.
All qualifying defects must substantially impair the use, value, or safety of the vehicle. After this threshold is met, the presumption says that manufacturers get as few as two attempts to fix a defect that could cause serious injury or death. For all other defects, the law requires consumers to give the dealership as few as four attempts. In order for the presumption to apply, these attempts must occur in the first 18 months or 18,000 miles, whichever comes first.
The key to understanding the effect of the presumption (and how it works to the benefit of consumers) involves a legal concept known as “burden of proof.” Here is how it works:
The fact that the manufacturer gets an opportunity to disprove the consumer’s case makes the rule a “rebuttable” presumption. Consumers should expect manufacturers to try to make this rebuttal. For example, they may argue that the consumer caused the defect by altering the vehicle in some way. Matt Neale and Aaron Fhima are experienced litigators who know how to respond to these sorts of tactics.
Consumers with a valid claim are entitled to a refund of the payments made to purchase, finance, or lease the vehicle, subject to an offset for use of the vehicle prior to the first repair attempt. Amounts still owing on the loan or lease will be paid off by the manufacturer. The vehicle must be surrendered to the dealership in this scenario.
Sometimes clients want to keep their vehicle, despite the defect. We may be able to accomplish this by negotiating a “cash and keep” settlement. Alternatively, California’s Lemon Law allows the manufacturer to replace the defective car with a new one. As might be expected, consumers may not want to continue driving the same make and model after experiencing so many problems, and they can never be forced to accept this remedy.
At Neale & Fhima, we do much more than establish the validity of Lemon Law claims. We negotiate with the other side to fashion a settlement that meet the desires of our clients.
There is no reason to hire a second-rate Lemon Law attorney. After putting up with a faulty new car and a series of excuses from the dealership, you deserve an attorney who can handle your claim properly. Fortunately, California’s Lemon Law provides for reimbursement of attorney fees for successful claimants, by stating that the manufacture pays your fees for legal representation. It all starts with a thorough and honest initial evaluation of your potential claim, which we will provide free of charge.
Continue reading to learn how to exercise your rights under California’s Lemon Law:
If you would like to speak with an attorney about enforcing your rights under California’s Lemon Law, we encourage you to contact us. To schedule an office or telephone consultation, call (888) 407-2955 or submit our online request form today.