New Car Lemon Law FAQs Answers to Your Most Frequently Asked Questions About Your New Lemon

Lemon laws, which exist in all fifty states and DC, define when a manufacturer of specified vehicles has breached its express (written) warranty. These laws specify the compensation that consumers are entitled to receive for breach of warranty. Lemon laws also authorize a consumer to receive reimbursement for legal fees and court costs after successfully prevailing in a lemon law case. Broadly, a vehicle is a lemon under these laws if a nonconformity or defect (or combination of defects) substantially impair the safety, value, or use of the vehicle. The manufacturer is entitled to a reasonable number of chances or reasonable time to fix the defects or nonconformity. When the problems are not remedied, the consumer often can obtain a full refund of the amount paid or a comparable replacement vehicle.

Many states cover leased vehicles under their lemon law, but you should seek legal advice regarding the lemon law in your state. Even if your leased vehicle is not covered under your state’s lemon law, the federal lemon law (Federal Warranty Act) might provide damages, including a right to attorney fees and court costs.

While lemon laws vary depending on the jurisdiction, many states (including Michigan) allow the manufacturer four or more attempts for the same issue as long as the first attempt occurred within a year of delivery of the vehicle. The vehicle will also be considered defective after the vehicle is out of service for at least thirty days for repairs during the first year of ownership for the same or different issues.

Consumers need to establish that the dealer has worked on the vehicle the requisite number of times or that the vehicle was out of service for the minimum number of days. Consumers need to ensure that service reports are accurate and that they save these records. The service report should include certain critical information, such as dates the vehicle was in and out of service, repair attempts, mileage of the vehicle, and the customer’s complaint. Even if the service technician looks at the car quickly during the visit and indicates that he cannot duplicate the complaint, you should never leave without written documentation of the visit and complaint. Always confirm that all of your complaints are accurately reflected on the service report. Complaints should also be relatively general. If you detect noise in the transmission, front tire, or engine, you should describe the problem as “noise in the front end.”

While the procedures differ some depending on the state, the Michigan Lemon Law is fairly typical. The owner of the vehicle must provide written notice by return receipt after the third repair attempt or 25 days after the vehicle is out of service. The manufacturer also must be given one final opportunity to fix the problem after receiving the notice. The manufacturer must contact the consumer and arrange to repair the vehicle within five days of receipt of the notice. The consumer might also need to participate in the manufacturer’s dispute resolution program before pursuing a lemon law claim.

While many state lemon laws are limited to new cars, light trucks (e.g. pickup trucks), and SUVs, the federal lemon laws will extend to other vehicles like boats, motorhomes, and ATVs, as well as used vehicles. Leased vehicles also are covered under many lemon laws, but the vehicle must be for personal, family or household use. There are other restrictions that apply to leased vehicles aimed at restricting certain commercial entities from utilizing the lemon law.