Lemon Law - Kentucky
Lemon Law
Lemon Law - "Lemon
law" is that body of state law which defines an automobile
owners rights when the manufacturer is not able to repair the
automobile within the limits specified. In
such cases, the automobile is referred to as a "lemon",
and is subject to the conditions of the state lemon law.
Your Lemon Law:
Disclaimer:
These pages are created to inform and educate the public about lemon
law and under the lemon law in your state. They are not and
should not be considered legal opinions or advice as to whether you
have rights under lemon law or whether you should pursue "a
lemon law case". If after reading this information,
you believe you qualify, you should seek the advice and counsel of
an attorney specializing in lemon law in your state. Remember
that each state's lemon laws vary.
(1) "Buyer" means any
resident person who buys, contracts to buy, or leases a new motor
vehicle in the Commonwealth of Kentucky. In the case of the lease of
a new motor vehicle, "buyer" shall mean the lessor,
lessee, or both.
(2) "Manufacturer" means
any person or corporation, resident or nonresident, who manufactures
or assembles new motor vehicles, including new conversion van
manufacturers, which are sold in the Commonwealth of Kentucky.
(3) "Motor vehicle" means
every vehicle which is self-propelled, and which is intended
primarily for use and operation on the public highways and required
to be registered or licensed in the Commonwealth prior to such use
or operation; however, "motor vehicle" shall not include:
(a) Any vehicle substantially
altered after its initial sale from a dealer to an individual;
(b) Motor homes;
(c) Motorcycles;
(d) Mopeds;
(e) Farm tractors and other
machines used in the production, harvesting, and care of farm
products; or
(f) Vehicles which have more than
two (2) axles.
(4) "New motor vehicle"
means a motor vehicle which has been finally and completely
assembled and is in the possession of a manufacturer, factory
branch, distributor, wholesaler, or an authorized motor vehicle
dealer operating under a valid sales and service agreement,
franchise, or contract for the sale of such vehicle granted by the
manufacturer, factory branch, distributor, or wholesaler which is,
in fact, new and on which the original title has never been issued.
(5) "Express warranty" or
"warranty" means the written warranty, so labeled, of the
manufacturer of a new automobile, including any terms or conditions
precedent to the enforcement of obligations under the warranty.
(6) "Nonconformity" means
a failure to conform with an express warranty in a manner which
substantially impairs the use, value, or safety of the motor
vehicle.
(7) "Reasonable allowance for
use" means the amount directly attributable to a consumer's use
of the vehicle other than those time periods when the vehicle is out
of service due to the nonconformity.
367.842 Options of buyer if
manufacturer unable to repair nonconformity in new motor vehicle --
Rights of lienholder -- Resolution of disputes -- Dealer not liable.
(1) If, after a reasonable number
of attempts, the manufacturer or its agents are unable to repair the
nonconformity in the motor vehicle to the express warranty during
the first twelve thousand (12,000) miles of operation or during the
first twelve (12) months following the date of delivery to the
buyer, whichever is the earlier date, that buyer shall report the
nonconformity, in writing, to the manufacturer.
(2) If, within the period specified
in subsection (1) of this section, the manufacturer or its agents,
are unable to repair or correct any nonconformity or defect that
substantially impairs the use, value, or safety of the motor
vehicle, after a reasonable number of attempts, the manufacturer, at
the option of the buyer, shall replace the motor vehicle with a
comparable motor vehicle, or accept return of the vehicle from the
buyer and refund to the buyer the full purchase price. The full
purchase price shall include the amount paid for the motor vehicle,
finance charge, all sales tax, license fee, registration fee, and
any similar governmental charges plus all collateral charges, less a
reasonable allowance for the buyer's use of the vehicle. Refunds
shall be made to the buyer and lienholder, if any, as their
interests may appear on the records of ownership kept by the
Department of Vehicle Regulation. The provisions of this section
shall not affect the interests of a lienholder, unless the
lienholder consents to the replacement of the lien with a
corresponding lien on the automobile accepted by the consumer in
exchange for the automobile having a nonconformity, the lienholder
shall be paid in full the amount due on the lien, including finance
charges and other charges, before an exchange of automobiles or a
refund to the consumer is made. It shall be an affirmative defense
to any claim under this section that:
(a) The nonconformity, defect, or
condition does not substantially impair the use, value, or safety
of the motor vehicle; or
(b) The nonconformity, defect, or
condition is the result of abuse, neglect, or unauthorized
modification or alteration of the motor vehicle by the buyer.
(3) It shall be presumed that a
reasonable number of attempts have been undertaken to conform a
motor vehicle to the applicable express warranty if, within the
first twelve thousand (12,000) miles of operation or during the
period of, twelve (12) months following the date of original
delivery of the motor vehicle to the buyer, whichever is the earlier
date:
(a) The same nonconformity, defect,
or condition has been subject to repair four (4) or more times by
the manufacturer, but such nonconformity, defect, or condition
continues to exist; or
(b) The vehicle is out of
service/use by reason of repair of the same nonconformity, defect,
or condition for a cumulative total of at least thirty (30)
calendar days.
(4) Disputes arising under
subsection (2) of this section concerning refund or replacement
shall be resolved through the dispute resolution system established
under either KRS 367.860 to 367.870, or 16 C.F.R. part 703. Such
remedy shall be pursued prior to seeking any judicial relief under
KRS 367.843.
(5) Nothing in this chapter may be
construed as imposing any liability on a dealer or creating a cause
of action by a consumer against a dealer.
(6) Nothing in this section shall
in any way limit the rights or remedies which are otherwise
available to a buyer under any other law.
(7) Any agreement entered into by a
buyer for the purchase of a new motor vehicle which waives, limits,
or disclaims the rights set forth in this section shall be void as
contrary to public policy.
(8) Any action brought pursuant to
this section shall be commenced within two (2) years after the date
of original delivery of the new motor vehicle to the buyer.
(9) A court may award reasonable
attorney's fees to a prevailing plaintiff.
367.843 Action for relief by
purchaser.
Any person who purchases a motor
vehicle and thereby suffers any ascertainable loss of money or
property, real or personal, as a result of a violation of KRS
367.842, may bring an action under the provisions of KRS 367.220 for
relief.
367.844 Manufacturer prohibited
from exposing franchised dealer to liability.
No manufacturer shall, directly or
indirectly, by any means or methods, expose or attempt to expose any
franchised dealer to liability as forbidden in KRS 367.842(4) and
(5). Any violation of this section shall be subject to all
applicable provisions of the law, including but not limited to the
provisions of KRS 190.062(2).
367.845 Enforcement of
provisions of KRS 367.842 to 367.844 by Attorney General.
Noncompliance with the provisions
of KRS 367.842 to 367.844 by a manufacturer shall be unlawful. The
Attorney General shall have authority to enforce KRS 367.842 to
367.844 in accordance with powers provided by KRS 367.190 and
367.230, pertaining to acts declared unlawful by KRS 367.170. Any
expenses accruing to the Attorney General from the provisions of KRS
367.842 to 367.844 shall be assessed by his office upon the motor
vehicle manufacturer involved in any action cited in the provisions
herein.
367.846 Application of KRS
367.840 to 367.845.
KRS 367.840 to 367.845 shall apply
to new motor vehicles purchased after July 15, 1986, and to motor
vehicles leased after July 15, 1998.
Informal Dispute Resolution
System
367.860 DEFINITIONS FOR KRS
367.865
As used in KRS 367.865 unless the
context requires otherwise:
(1) "Buyer" means any
resident person who buys or contracts to buy a new motor vehicle in
the Commonwealth of Kentucky.
(2) "Manufacturer" means
any person, resident or nonresident, who manufactures or assembles
new motor vehicles which are sold in the Commonwealth of Kentucky.
(3) "Motor vehicle" means
any two (2) axle, motor-driven vehicle with at least four (4) wheels
which is required to be registered or licensed in the Commonwealth
of Kentucky before being operated upon the highways and is used or
bought for use primarily for personal, family, or household
purposes.
(4) "New motor vehicle"
means a motor vehicle which, after its final assembly, is either in
the possession of the manufacturer, factory branch or distributor,
or an authorized dealer operating under a franchise with the
manufacturer, factory branch or distributor, and the legal or
equitable title to which has never been the subject of a sale or
transfer other than to another dealer operating under a similar
franchise with the same manufacturer, factory branch or distributor.
(5) "System" means an
informal dispute resolution procedure adopted by each manufacturer
to resolve questions of law and fact relating to disputes between
the buyer and the manufacturer arising within the first two (2)
years or twenty-five thousand (25,000) miles of the buyer's
ownership, whichever occurs first, including but not limited to
unsatisfactory warranty repairs of the buyer's motor vehicle,
mechanical malfunctions of the buyer's motor vehicle, or other
problems relating to the performance of the buyer's motor vehicle.
367.865 INFORMAL DISPUTE
RESOLUTION SYSTEM
(1) Effective January 1, 1983, each
motor vehicle manufacturer shall offer to the buyer a comprehensive
informal dispute resolution system. By transacting business in the
Commonwealth of Kentucky, each manufacturer is deemed to have
voluntarily consented to participate in the system. Each system
shall operate pursuant to written rules and procedures which:
(a) Ensure that the system is
impartial, accessible to the buyer, and expeditious, and shall
operate at no cost to the buyer;
(b) Provide that if the buyer
elects to submit the dispute to the system, the manufacturer shall
not refuse to submit the dispute to the system as long as the
subject of the dispute occurred during the first two (2) years or
twenty-five thousand (25,000) miles, whichever occurs first, of
the buyer's ownership of the motor vehicle involved in the
dispute;
(c) Provide that the system shall
provide for an oral hearing, unless the buyer agrees in writing
that the system shall render a decision based solely on documents
submitted to it;
(d) Shall include, but is not
limited to, procedures for informing the buyer of the existence of
the system, preparing the agreement between the buyer and the
manufacturer whereby the dispute may be submitted to the system,
selecting the members of the decision-making panel, notifying the
parties of the complaint, investigating the complaint, providing
for hearings, rendering a fair and expeditious decision, and
informing parties of the decision.
(2) The decision of the system shall
be legally binding on the manufacturer. The decision of the system
shall not be legally binding on the buyer, unless the manufacturer
elects to have its system binding on all buyers who summit their
disputes to the system. If the system is to be binding to both
parties, the written agreement between the buyer and the
manufacturer whereby the dispute is submitted to the system shall
include in conspicuous, bold-faced type the following statement:
"YOU SHOULD REMEMBER THAT BY ENTERING INTO THIS AGREEMENT YOU
ARE DECIDING TO USE THIS DISPUTE RESOLUTION SYSTEM TO SETTLE YOUR
DISPUTE INSTEAD OF GOING TO COURT. AFTER A DECISION BY AN
ARBITRATOR, NORMALLY A COURT WILL REFUSE TO HEAR THE FACTS IN A CASE
IN ALL BUT THE MOST UNUSUAL SITUATIONS. YOUR SIGNATURE IS REQUIRED
IMMEDIATELY BELOW TO INDICATE THAT YOU HAVE READ THIS DISCLOSURE.
______________________________"
SIGNATURE OF BUYER
(3) Before a dispute may be
submitted to a system which is legally binding on both parties, the
buyer shall sign the disclosure statement required by subsection (2)
of this section.
(4) Each manufacturer shall take
steps reasonably calculated to make the buyer aware of the existence
of the system at the time the dispute arises.
(5) Each manufacturer shall take
all steps necessary to ensure that the system is sufficiently
insulated from the manufacturer so that the decisions of the system
are not influenced by the manufacturer. The system's decision-making
panel shall be composed of members at least fifty-one percent (51%)
of whom have no involvement in the manufacture, distribution or sale
of motor vehicles. No member deciding a dispute shall be a party to
the dispute; nor shall any member deciding a dispute be an employee
or agent of a party to the dispute, unless solely for the purpose of
impartially deciding disputes.
(6) Nothing herein shall prohibit
the manufacturer from participating in a system sponsored or
administered by an impartial third party having no direct
involvement in the manufacture, distribution, sale, or service of
motor vehicles.
