Lemon Law - Michigan
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.
As used in this act:
(a) "Consumer"
means 1 or more of the following:
(i) A person who purchases
or leases a new motor vehicle for personal, family, or household use
and not for the purpose of selling or leasing the new motor vehicle
to another person.
(ii) A person who purchases
or leases less than 10 new motor vehicles a year.
(iii) A person who purchases
or leases 10 or more new motor vehicles a year only if the vehicles
are purchased or leased for personal, family, or household use.
(iv) Any other person
entitled to enforce the provisions of an express warranty pursuant
to the terms of that warranty.
(b) "Lessee" means
a person who, under a lease, acquires the right to possession and
use of a new motor vehicle.
(c) "Lessor" means
a person who, under a lease, transfers the right to possession and
use of a new motor vehicle.
(d) "Manufacturer"
means any person who manufactures, assembles, or is a distributor of
new motor vehicles and includes an agent of a manufacturer but does
not include a new motor vehicle dealer.
(e) "Manufacturer's
express warranty" means an express warranty as determined under
the uniform commercial code, 1962 PA 174, MCL 440.1101 to 440.11102,
offered by the manufacturer on a new motor vehicle.
(f) "Motor
vehicle" means a motor vehicle as defined in section 33 of the
Michigan vehicle code,1949 PA 300, MCL 257.33, that is designed as a
passenger vehicle, or sport utility vehicle, but does not include a
motor home, bus, truck other than a pickup truck or van, or a
vehicle designed to travel on less than 4 wheels.
(g) "New motor
vehicle" means a motor vehicle that is purchased or leased in
this state or purchased or leased by a resident of this state and is
covered by a manufacturer's express warranty at the time of purchase
or lease.
(h) "New motor vehicle
dealer" means a person or that person's agent who holds a
dealer agreement for the sale of new motor vehicles, who is engaged
in the business of purchasing, leasing, selling, exchanging, or
dealing in new motor vehicles, and who has an established place of
business in this state.
(i) "Person" means
a natural person, a sole proprietorship, partnership, corporation,
association, unit or agency of government, trust, estate, or other
legal entity.
(j) "Resident of this
state" means as follows:
(i) For an individual, an
individual who is a legal resident of this state.
(ii) For a sole
proprietorship or partnership, a sole proprietorship or partnership
created pursuant to the laws of this state and its main office is
located in this state.
(iii) For a corporation, a
corporation that is a domestic corporation and was created under the
laws of this state.
(iv) For an association, an
association created pursuant to the laws of this state and its main
office is located in this state.
(v) For a unit or agency of
government, a unit or agency of government located in this state.
(vi) For a trust, estate, or
other legal entity, a trust, estate, or other legal entity created
pursuant to the laws of this state and that is located in this
state.
(k) "Lease price"
means the actual vehicle sales price paid by the lessor including
any cash payment by the consumer and the sum equal to any allowance
for any trade-in but excludes debt from any other transaction as
well as any manufacturer to consumer discount, rebate, or incentive
appearing in the agreement or contract that the consumer received or
that was applied to reduce the purchase or lease cost. Additionally,
any sales tax, license and registration fees, and similar government
charges not included elsewhere paid by the lessor on behalf of the
lessee are included as a part of lease price.
(l) "Purchase
price" means the actual vehicle sales price listed on the
buyer's order including any cash payment by the consumer and the sum
equal to any allowance for any trade-in but excludes debt from any
other transaction as well as any manufacturer to consumer discount,
rebate, or incentive appearing in the agreement or contract that the
consumer received or that was applied to reduce the purchase cost.
Additionally, any sales tax, license and registration fees, and
similar government charges not included elsewhere paid by the
consumer are included as a part of purchase price.
257.1402 Repair of defect or
condition; report.
If a new motor vehicle has any
defect or condition that impairs the use or value of the new motor
vehicle to the consumer or which prevents the new motor vehicle from
conforming to the manufacturer's express warranty, the manufacturer
or a new motor vehicle dealer of that type of motor vehicle shall
repair the defect or condition as required under section 3 if the
consumer initially reported the defect or condition to the
manufacturer or the new motor vehicle dealer within 1 of the
following time periods, whichever is earlier:
(a) During the term the
manufacturer's express warranty is in effect.
(b) Not later than 1 year
from the date of delivery of the new motor vehicle to the original
consumer.
257.1403 Replacement of motor
vehicle or refund.
Allowance for use; reimbursement
for towing costs and costs for rental vehicle; consent to
replacement of security interest; presumption; performing repairs
after expiration of warranty; extension of time for repair services.
(1) If a defect or condition
that was reported to the manufacturer or new motor vehicle dealer
pursuant to section 2 continues to exist and the new motor vehicle
has been subjected to a reasonable number of repairs as determined
under subsection (5), the manufacturer shall within 30 days, do
either of the following as applicable:
(a) If the new motor vehicle
was purchased, either replace the new motor vehicle with a
comparable replacement motor vehicle currently in production and
acceptable to the consumer or accept return of the vehicle and
refund to the consumer the purchase price. A consumer shall have the
right to demand a refund.
(b) If the new motor vehicle
was leased, the consumer has the right to a refund of the lease
price paid by the consumer. The consumer may agree to accept a
comparable replacement vehicle in lieu of a refund for the lease
price paid. If the consumer agrees to accept a replacement vehicle,
the lease agreement shall not be altered except with respect to the
identification of the vehicle.
(2) The purchase price or
lease price includes the cost of any options or other modifications
installed or made by or for the manufacturer, and the amount of all
other charges made by or for the manufacturer, less a reasonable
allowance for the consumer's use of the vehicle, and less an amount
equal to any appraised damage that is not attributable to normal use
or to the defect or condition. A reasonable allowance for use is the
purchase or lease price of the new motor vehicle multiplied by a
fraction having as the denominator 100,000 miles and having as the
numerator the miles directly attributable to use by the consumer and
any previous consumer prior to his or her first report of a defect
or condition that impairs the use or value of the new motor vehicle
plus all mileage directly attributable to use by a consumer beyond
25,000 miles. If a vehicle is replaced or refunded under the
provisions of this section, if towing services and rental vehicles
were not made available without cost to the consumer, the
manufacturer shall also reimburse the consumer for those towing
costs and reasonable costs for a comparable rental vehicle that were
incurred as a direct result of the defect or condition.
(3) If a court or an
alternative dispute settlement procedure described in section 5
determines that a consumer has provided sufficient evidence that the
vehicle did not provide reliable transportation for ordinary
personal or household use for any period beyond the first 25,000
mileage usage period of the vehicle, the court or the alternative
dispute settlement procedure may reduce the vehicle usage deduction
for mileage beyond the first 25,000 mileage usage period only for
the period beyond the 25,000 mileage usage period that the court or
alternative dispute settlement procedure determines that the vehicle
did not provide useful transportation for ordinary personal or
household use. To determine if the vehicle did or did not provide
useful transportation for ordinary personal and household use, the
court or the alternative dispute settlement procedure shall consider
all of the following:
(a) The number of repairs.
(b) The cost of the repairs.
(c) The number of days the
vehicle was out of service.
(d) Whether the vehicle's
need for repair significantly affected the consumer's ability to use
the vehicle for personal or household functions.
(4) The provisions of this
act do not affect the obligations of a consumer under a loan, sales,
or lease contract or the secured interest of a secured party. The
secured party shall consent to the replacement of the security
interest with a corresponding security interest on a replacement
motor vehicle that is accepted by the consumer in exchange for the
motor vehicle having a defect or condition pursuant to subsection
(1), if the replacement motor vehicle is comparable in value to the
original motor vehicle. If for any reason the security interest in
the new motor vehicle having a defect or condition pursuant to
subsection (1) is not able to be replaced with a corresponding
security interest on a new motor vehicle accepted by the consumer,
the consumer shall accept a refund. A refund required under this
subsection or subsection (1) shall be made to the consumer and the
secured party, if any, as their interests exist at the time the
refund is to be made. The lessor, if any, shall be notified if a
refund is made to a lessee under this act. A lessor shall not assess
a fee for early termination of a lease under this act.
(5) It shall be presumed
that a reasonable number of attempts have been undertaken to repair
a defect or condition if 1 of the following occurs:
(a) The same defect or
condition that substantially impairs the use or value of the new
motor vehicle to the consumer has been subject to repair a total of
4 or more times by the manufacturer or new motor vehicle dealer
within 2 years of the date of the first attempt to repair the defect
or condition, and the defect or condition continues to exist. Any
repair performed on the same defect made pursuant to subsection (6)
shall be included in calculating the number of repairs under this
section. The consumer or his or her representative, before availing
himself or herself of a remedy provided under subsection (1), and
any time after the third attempt to repair the same defect or
condition, shall give written notification, by return receipt
service, to the manufacturer of the need for repair of the defect or
condition in order to allow the manufacturer an opportunity to cure
the defect or condition. The manufacturer shall notify the consumer
as soon as reasonably possible of a reasonably accessible repair
facility. After delivery of the vehicle to the designated repair
facility, the manufacturer has 5 business days to repair the defect
or condition.
(b) The new motor vehicle is
out of service because of repairs for a total of 30 or more days or
parts of days during the term of the manufacturer's express
warranty, or within 1 year from the date of delivery to the original
consumer, whichever is earlier. The consumer, or his or her
representative, before availing himself or herself of a remedy
provided under subsection (1), and after the vehicle has been out of
service for at least 25 days in a repair facility, shall give
written notification by return receipt service to the manufacturer
of the need for repair of the defect or condition in order to allow
the manufacturer an opportunity to cure the defect or condition. The
manufacturer shall notify the consumer as soon as reasonably
possible of a reasonably accessible repair facility. After delivery
of the vehicle to the designated repair facility, the manufacturer
has 5 business days to repair the defect or condition.
(6) Any repairs required to
be made under this act shall be made even if the repairs need to be
performed after the expiration of the manufacturer's express
warranty. The defect needing repair must be a continuation of the
original attempt to repair the defect.
(7) The term of an express
warranty, and the 1-year, 30-day, and 5-day periods of time provided
for in this section shall be extended because repair services were
not available to the consumer because of war, invasion, strike,
fire, flood, or other natural disaster.
257.1404 Other legal remedies
not limited or prohibited.
Nothing in this act shall be
construed to limit or prohibit any other legal remedy of a consumer
regarding a breach of a manufacturer's express warranty or an
implied warranty for a new motor vehicle.
257.1405 Informal dispute
settlement procedure.
If a manufacturer has established
or participates in an informal dispute settlement procedure, the
provisions of this act shall not apply to any consumer who has not
first resorted to such procedure, if such procedure does all of the
following:
(a) Complies with the
Magnuson-Moss warranty--federal trade commission improvement act,
Public Law 93-637, 88 Stat. 2183, and 16 C.F.R. 703 (1975). An
informal dispute settlement procedure which the federal trade
commission rules does not comply with 16 C.F.R. 703 (1975) shall be
considered as not meeting the requirements of this subdivision.
(b) Requires that the
manufacturer is bound by any decision reached if the consumer agrees
to it.
(c) Provides that the
consumer is not obligated to accept the decision and may pursue the
remedies provided for under this act.
(d) Requires the
manufacturer to initiate the process necessary to implement any
final settlement not more than 30 days after the settlement has been
reached.
257.1406 Defects or conditions
to which act inapplicable.
This act does not apply to a defect
or condition that is the result of either of the following:
(a) A modification not
installed or made by or for the manufacturer.
(b) Abuse or neglect of the
new motor vehicle or damage due to an accident that occurred after
the new motor vehicle was purchased or leased by the consumer.
257.1407 Waiver of rights and
remedies prohibited; recovery of costs, expenses, and attorneys'
fees.
(1) Any rights and remedies
provided a consumer under this act may not be waived.
(2) A consumer who prevails
in any action brought under this act may be allowed by the court to
recover as part of the judgment a sum equal to the aggregate amount
of cost and expenses, including attorneys' fees based on actual time
expended by the attorney, determined by the court to have been
reasonably incurred by the consumer for or in connection with the
commencement and prosecution of such action, unless the court in its
discretion shall determine that such an award of attorneys' fees
would be inappropriate.
257.1408 Written statement to be
included with title; type size; form.
(1) Until December 31, 1999
and after as provided in subsection (2), the secretary of state
shall include with any title for a new motor vehicle a written
statement, in 10-point boldfaced type, in substantially the
following form:
"IMPORTANT: IF THIS VEHICLE IS
DEFECTIVE YOU MAY BE ENTITLED UNDER STATE LAW TO REPLACEMENT OF IT
OR A REFUND OF ITS PURCHASE PRICE. TO OBTAIN REPLACEMENT OR A
REFUND, YOU MUST FIRST REPORT THE DEFECT IN WRITING TO THE
MANUFACTURER AND YOU MAY BE REQUIRED TO FIRST ARBITRATE THE DISPUTE.
IN ORDER TO PROTECT YOUR RIGHTS UNDER THIS LAW, YOU SHOULD:
1. KEEP COPIES OF ALL
CORRESPONDENCE TO AND FROM THE MANUFACTURER AND THE DEALER.
2. KEEP COPIES OF ALL WORK ORDERS
FOR REPAIRS ON THE VEHICLE INCLUDING THE DATE(S) THE WORK WAS
PERFORMED AND THE MILEAGE ON THE VEHICLE AT THE TIME OF REPAIR.
3. FOLLOW ALL REQUIREMENTS OF THE
WARRANTY, INCLUDING ANY REQUIREMENT THAT THE REPAIRS MUST BE DONE BY
AN AUTHORIZED DEALER SPECIFIED BY THE MANUFACTURER. IF YOU HAVE ANY
QUESTIONS REGARDING YOUR RIGHTS UNDER THIS LAW, CONSULT AN ATTORNEY
OR OTHER QUALIFIED INDIVIDUAL."
(2) Beginning January 1,
2000, the secretary of state shall include with documentation for a
purchased or leased new motor vehicle a written statement, in
10-point boldfaced type, in substantially the following form:
"IMPORTANT: IF THIS VEHICLE IS
DEFECTIVE YOU MAY BE ENTITLED UNDER STATE LAW TO REPLACEMENT OF IT
OR A REFUND OF ITS PURCHASE PRICE OR LEASE PRICE, AS APPLICABLE. TO
OBTAIN REPLACEMENT OR A REFUND, YOU MUST FIRST REPORT THE DEFECT IN
WRITING TO THE MANUFACTURER AND YOU MAY BE REQUIRED TO FIRST
ARBITRATE THE DISPUTE. IN ORDER TO PROTECT YOUR RIGHTS UNDER THIS
LAW, YOU SHOULD:
1. KEEP COPIES OF ALL
CORRESPONDENCE TO AND FROM THE MANUFACTURER AND THE DEALER.
2. KEEP COPIES OF ALL WORK ORDERS
FOR REPAIRS ON THE VEHICLE INCLUDING THE DATE(S) THE WORK WAS
PERFORMED AND THE MILEAGE ON THE VEHICLE AT THE TIME OF REPAIR.
3. FOLLOW ALL REQUIREMENTS OF THE
WARRANTY, INCLUDING ANY REQUIREMENT THAT THE REPAIRS MUST BE DONE BY
AN AUTHORIZED DEALER SPECIFIED BY THE MANUFACTURER. IF YOU HAVE ANY
QUESTIONS REGARDING YOUR RIGHTS UNDER THIS LAW, CONSULT AN ATTORNEY
OR OTHER QUALIFIED INDIVIDUAL."
(3) Beginning January 1,
2000, the secretary of state shall include a summary of the
provisions of this act on a database that is accessible to the
public through the internet. As used in this section,
"internet" means a worldwide interconnection of individual
computers and computer networks and the facilities and equipment
used to access those interconnected networks.
