Helpful Definitions Regarding Lemon Laws And Consumer Fraud Protection
Below are important definitions of the California Lemon Law — and how these concepts may apply to your claim.
The California Lemon Law allows a jury to impose a fine on a warrantor that intentionally refuses to replace a defective product or refund a consumer’s money when it is required to do so. This civil penalty can be up to twice the consumer’s actual damages. This discourages warrantors from forcing consumers to take them to court, and encourages them to resolve disputes promptly, without a trial.
A consumer is usually an individual with a product used primarily for personal, family, or household purposes. So long as there has been more personal use than business or commercial use, the lemon law will usually apply. California’s lemon law is broader, and under some circumstances will cover individuals or small businesses that use a defective vehicle exclusively for business purposes.
Any failure of a product to work the way it should is technically a defect. Lemon laws generally apply only when a defect is substantial.
A distributor is a company responsible for distribution of a manufacturer’s products to the dealers that sell those products. This situation most commonly arises where a foreign manufacturer wants to sell its products here in the United States, and forms a separate domestic company to supply and warrant the products it builds.
Neither the California Lemon Law nor the federal lemon law actually contains a definition of the term “lemon.” It is a popular colloquial term that has come to mean a consumer product — usually a car or other vehicle — that is not fixed after multiple attempts.
Lemon laws are statutes that protect consumers when warrantors cannot or will not stand behind the promises in their own warranties. Lemon laws usually give a warrantor a reasonable number of attempts to fix a defective product under warranty, and then require the warrantor to take back the product and either replace it or refund the consumer’s money. Today lemon laws exist in all 50 states, and there is a federal lemon law as well.
Magnuson-Moss Warranty Act:
The federal lemon law is called the Magnuson-Moss Warranty-Federal Trade Commission Improvement Act. It is generally inferior to California’s lemon law.
New Motor Vehicle:
Under California’s lemon law, any vehicle, new or used, is considered a “new” vehicle if it came with the original warranty still in effect. For example, if a consumer purchases a vehicle that is two years old and has 25,000 miles on it, and it comes with the original manufacturer’s three-year/36,000-mile warranty, California’s lemon law covers it as a “new” vehicle.
In a similar way, the federal lemon law makes no distinction between new and used products: It applies as long as the original warranty is still in effect.
If a warrantor cannot repair a substantially defective product after a reasonable number of attempts, it should either replace the product or refund the consumer’s money. A refund should include the full purchase price, including any interest or finance charges. Where applicable, it should also include additional charges such as sales tax and DMV registration. The consumer should also be reimbursed for all actual expenses resulting from the defect(s) such as repairs, towing, rental cars, and so on.
Song-Beverly Consumer Warranty Act:
California’s lemon law is called the Song-Beverly Consumer Warranty Act. It is one of the strongest lemon laws in the country.
Statute Of Limitations:
Usually, a person who has suffered a legal wrong does not have an unlimited amount of time to file a lawsuit. The amount of time that the person has to file a lawsuit is called the statute of limitations. The length of time will vary depending on the nature of the legal wrong.
In a lemon law case in California, the statute of limitations is four years. However, this does not require the consumer to file suit within four years from the date of purchase or lease. The consumer has four years from the date that he or she is entitled to a replacement or refund — which is when the warrantor has had a reasonable number of attempts to fix the product, but has not been successful.
To qualify under the California Lemon Law, a defect or defects must substantially impair the use, value, or safety of the product in the eyes of a reasonable person in the same circumstances as the owner.
Any company that gives warranties covering products is a warrantor of those products. In the case of cars manufactured in the United States, the warrantor is usually the manufacturer such as General Motors Corporation. For cars manufactured overseas, the warrantor is usually an American company called the distributor such as Toyota Motor Sales, U.S.A., Inc.
Although the warrantor is usually the manufacturer or distributor, anyone giving a warranty is a warrantor. For example, if a dealer gives a warranty when it sells a used car — even a warranty that lasts only 10 days or 500 miles, and covers only one or two components — then the dealer has become a warrantor of that car.
A warranty is usually a written promise or guarantee that a product will have no defects for a certain period, or that, if it does have defects, the warrantor will fix them at no cost. Some warranties are not given in writing, but are imposed by law. These are called implied warranties.