Lemon laws are state laws that permit the buyer of a "lemon" to recover a refund or a replacement car.

Definition of a Lemon

A lemon is a car that contains a "substantial defect" that cannot be repaired after a reasonable number of attempts.

A substantial defect is a defect that impairs the use, value, or safety of the car. A defect that makes it impossible or unsafe to operate the car is a substantial defect. A minor defect, such as a small crack in a window, is not a substantial defect.

In order to qualify as a lemon, the car's substantial defect must occur within a certain period of time or a certain number of miles. For example, a state lemon law may provide that a car is not a lemon unless the defect arises within one year of purchase or 12,000 miles. In some states, the lemon law presumes that a car is a lemon if it is out of service due to repair for a certain number of days (e.g., 30 days in the first year).

Opportunity to Repair

All lemon laws require the buyer to give the manufacturer of the car a reasonable opportunity to repair the defect. The manufacturer must repair the defect after a reasonable number of attempts. Some lemon laws require the manufacturer to repair the defect within a certain number of attempts (e.g., three or four). According to other laws, the number of times the manufacturer may attempt to repair the car depends on the nature of the defect.

Notice Requirement

The buyer is required to notify the manufacturer of the defect in order to recover under a state lemon law. In some states, the buyer is also required to notify the dealer.

Applicability of Lemon Laws

Lemon laws apply when a buyer purchases a new car. In some states, the lemon law applies to purchases of used cars. In other states, used cars are not covered by the lemon law.

Remedies

If the car qualifies as a lemon under the applicable state lemon law, the buyer is entitled to recover a refund or a replacement car from the manufacturer. A refund may include the purchase price of the car and reimbursement for taxes, registration fees, repair costs, and other expenses arising from the defect.

Many state lemon laws require the buyer to arbitrate the dispute with the manufacturer. If the buyer is unsatisfied with the arbitrator's decision, the buyer may file a lawsuit against the manufacturer.

Copyright 2009 LexisNexis, a division of Reed Elsevier Inc.