Lemon Law - Tennessee
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 part, unless the
context otherwise requires:
(1) "Consumer"
means the purchaser (other than for purposes of resale) or the
lessee of a motor vehicle, any person to whom such motor vehicle is
transferred during the duration of an express warranty applicable to
such motor vehicle, and any other person entitled by the terms of
such warranty to enforce the obligations of the warranty.
"Consumer" does not include any governmental entity or any
business or commercial entity which registers three (3) or more
vehicles;
(2) "Lessee" means
any consumer who leases a motor vehicle pursuant to a written lease
agreement by which a manufacturer's warranty was issued as a
condition of sale or which provides that the lessee is responsible
for repairs to such motor vehicle;
(3) "Motor
vehicle" means a motor vehicle as defined in 55-1-103, which is
sold and subject to the registration and certificate of title
provisions in chapters 1-6 of this title in the state of Tennessee,
and classified as a Class C vehicle according to 55-4-111. For the
purposes of this part, "motor vehicle" does not include
motorized bicycles as defined in 55-8-101, motor homes as defined in
55-1-104, lawnmowers or garden tractors, recreational vehicles or
off-road vehicles and vehicles over ten thousand (10,000) pounds
gross vehicle weight;
(4) "Substantially
impair" means to render a motor vehicle unreliable or unsafe
for normal operation or to reduce its resale market value below the
average resale value for comparable motor vehicles; and
(5) "Term of
protection" means the term of applicable express warranties or
the period of one (1) year following the date of original delivery
of the motor vehicle to a consumer, whichever comes first; or, in
the case of a replacement vehicle provided by a manufacturer to a
consumer under this part, one (1) year from the date of delivery to
the consumer of the replacement vehicle.
55-24-202. Nonconforming
vehicles.
Reports - Repairs.
If a new motor vehicle does not
conform to all applicable express warranties and the consumer
reports the nonconformity, defect or condition to the manufacturer,
its agent or its authorized dealer during the term of protection,
the manufacturer, its agent or its authorized dealer shall correct
the nonconformity, defect or condition at no charge to the consumer,
notwithstanding the fact that such repairs are made after the
expiration of such term. Any corrections or attempted corrections
undertaken by an authorized dealer under the provisions of this
section shall be treated as warranty work and billed by the dealer
to the manufacturer in the same manner as other work under warranty
is billed.
55-24-203. Replacement or repair
of vehicles.
Refunds - Refinancing agreements -
Defenses.
(a) The manufacturer must
replace the motor vehicle with a comparable motor vehicle or accept
return of the vehicle from the consumer and refund to the consumer
the full purchase price if:
(1) The nonconformity,
defect or condition substantially impairs the motor vehicle; and
(2) The manufacturer, its
agent or authorized dealer is unable to conform the motor vehicle to
any applicable express warranty after a reasonable number of
attempts.
(b) For purposes of this
section:
(1) "Collateral
charges" means manufacturer-installed or agent-installed items
or service charges, credit life and disability insurance charges,
sales taxes, title charges, license fees, registration fees, any
similar governmental charges and other reasonable expenses incurred
for the purchase of the motor vehicle;
(2) "Comparable motor
vehicle" means a new motor vehicle of comparable worth to the
same make and model with all options and accessories, with
appropriate adjustments being allowed for any model year
differences;
(3) "Full purchase
price" means the actual cost paid by the consumer, including
all collateral charges, less a reasonable allowance for use; and
(4)
(A) "Reasonable
allowance for use" means that amount directly attributable to
use by a consumer prior to such consumer's first report of the
nonconformity to the manufacturer, agent or dealer and during any
subsequent period when the vehicle is not out of service by reason
of repair, plus a reasonable amount for any damage not attributable
to normal wear.
(B) A reasonable allowance
for use shall not exceed one half (1/2) of the amount allowed per
mile by the internal revenue service, as provided by regulation,
revenue procedure or revenue ruling promulgated pursuant to 162 of
the Internal Revenue Code, for use of a personal vehicle for
business purposes, plus an amount to account for any loss to the
fair market value of the vehicle resulting from damage beyond normal
wear and tear, unless the damage resulted from nonconformity to an
express warranty.
(c) Refunds shall be made to
the consumer, and lien holder, if any, as their interests appear.
The provisions of this section shall not affect the interests of a
lien holder; unless the lien holder consents to the replacement of
the lien with a corresponding lien on the vehicle accepted by the
consumer in exchange for the vehicle having a nonconformity, the
lien holder shall be paid in full the amount due on the lien,
including interest and other charges, before an exchange of
automobiles or a refund to the consumer is made.
(d) In instances where a
vehicle which was financed by the manufacturer or its subsidiary or
agent is replaced under the provisions of this section, the
manufacturer, subsidiary or agent shall not require the consumer to
enter into any refinancing agreement which would create any
financial obligations upon such consumer beyond those imposed by the
original financing agreement.
(e) It shall be an
affirmative defense to any claim under this part:
(1) That an alleged
nonconformity does not substantially impair a motor vehicle; or
(2) That a nonconformity is
the result of abuse, neglect or unauthorized modifications or
alterations of a motor vehicle by a consumer.
55-24-204. Leased vehicles -
Refunds.
(a) In the case of a leased
vehicle, refunds will be made to the lessor and lessee as follows:
The lessee will receive the lessee cost and the lessor will receive
the lease price less the aggregate deposit and rental payments
previously paid to the lessor for the leased vehicle.
(b) For purposes of this
section:
(1) "Lease price"
means the aggregate of:
(A) Lessor's actual purchase
cost;
(B) Freight, if applicable;
(C) Accessories, if
applicable;
(D) Any fee paid to another
to obtain the lease; and
(E) An amount equal to five
percent (5%) of subdivision (b)(1);
(2) "Lessee cost"
means the aggregate deposit and rental payments previously paid to
the lessor for the leased vehicle less service fees; and
(3) "Service fees"
means the portion of a lease payment attributable to:
(A) An amount for earned
interest calculated on the rental payments previously paid to the
lessor for the leased vehicle at an annual rate equal to two (2)
points above the prime rate in effect on the date of the execution
of the lease; and
(B) Any insurance or other
costs expended by the lessor for the benefit of the lessee.
55-24-205. Presumptions
Term of protection - Notice to
manufacturer.
(a) It shall be presumed
that a reasonable number of attempts have been undertaken to conform
a motor vehicle to the applicable express warranties, if:
(1) The same nonconformity
has been subject to repair four (4) or more times by the
manufacturer or its agents or authorized dealers, but such
nonconformity continues to exist; or
(2) The vehicle is out of
service by reason of repair for a cumulative total of thirty (30) or
more calendar days during the term of protection.
(b) The term of protection
and such thirty-day period shall be extended by any period of time
during which repair services are not available to the consumer
because of a war, invasion, strike or fire, flood or other natural
disaster.
(c) It shall be the
responsibility of the consumer, or the representative of the
consumer, prior to proceeding under the provisions of 55-24-203, to
give written notification by certified mail directly to the
manufacturer of the need for the correction or repair of the
nonconformity. If the address of the manufacturer is not readily
available to the consumer in the owner's manual or manufacturer's
warranty received by the consumer at the time of purchase of the
motor vehicle, such written notification shall be mailed to an
authorized dealer. The authorized dealer shall upon receipt forward
such notification to the manufacturer. If, at the time such notice
is given, either of the conditions set forth in subsection (a)
already exists, the manufacturer shall be given an additional
opportunity after receipt of the notification, not to exceed ten
(10) days, to correct or repair the nonconformity.
55-24-206. Informal dispute
settlement procedure.
(a) If a manufacturer has
established or participates in an informal dispute settlement
procedure which complies with the provisions of Title 16, Code of
Federal Regulations, Part 703, as those provisions read on November
3, 1983, and of this part, and causes the consumer to be notified of
the procedure, the provisions of 55-24-203 concerning refunds or
replacement shall not apply to any consumer who has not first
resorted to such procedure. The attorney general and reporter shall,
upon application, issue a determination whether an informal dispute
resolution mechanism qualifies under this section.
(b)
(1) The informal dispute
settlement panel shall determine whether the motor vehicle does or
does not conform to all applicable express warranties.
(2) If the motor vehicle
does not conform to all applicable express warranties, the informal
dispute settlement panel shall then determine whether the
nonconformity substantially impairs the motor vehicle.
(3) If the nonconformity
does substantially impair the motor vehicle, the informal dispute
settlement panel shall then determine, in accordance with this part,
whether a reasonable number of attempts have been made to correct
the nonconformity.
(4) If a reasonable number
of attempts have been made to correct the nonconformity, the
informal dispute settlement panel shall determine whether the
manufacturer has been given an opportunity to repair the motor
vehicle as provided in 55-24-202.
(5) If the manufacturer has
been given an opportunity to repair the motor vehicle as provided in
55-24-202, the panel shall find that the consumer is entitled to
refund or replacement as provided in 55-24-203(a).
(6) The informal dispute
settlement panel shall determine the amount of collateral charges,
where appropriate.
55-24-207. Statute of
limitations.
(a) Any action brought under
this part shall be commenced within six (6) months following:
(1) Expiration of the
express warranty term; or
(2) One (1) year following
the date of original delivery of the motor vehicle to a consumer,
whichever is the later date.
(b) The statute of
limitations shall be tolled for the period beginning on the date
when the consumer submits a dispute to an informal dispute
settlement procedure as provided in 55-24-206 and ending on the date
of its decision or the date before which the manufacturer, its agent
or its authorized dealer is required by the decision to fulfill its
terms, whichever comes later.
55-24-208. Recovery of costs and
expenses - Attorneys' fees.
If a consumer finally prevails in
any action brought under this part, such consumer may be allowed by
the court to recover as part of the judgment a sum equal to the
aggregate amount of costs and expenses, including attorneys' fees
based on actual time expended, determined by the court to have been
reasonably incurred by the plaintiff for or in connection with the
commencement and prosecution of such action.
55-24-209. Copy of repair order
to consumer.
A manufacturer, its agent or
authorized dealer shall provide to the consumer, each time the
consumer's vehicle is returned from being serviced or repaired, a
copy of the repair order indicating all work performed on the
vehicle, including, but not limited to, parts and labor provided
without cost or at reduced cost because of shop or manufacturer's
warranty, the date the vehicle was submitted for repair, the date it
was returned to the consumer, and the odometer reading.
55-24-210. Election of remedies.
(a) Nothing in this part
shall in any way limit the rights or remedies which are otherwise
available to a consumer under any other law.
(b) In no event shall a
consumer who has resorted to an informal dispute settlement
procedure be precluded from seeking the rights or remedies available
by law. However, if the consumer elects to pursue any other remedy
in state or federal court, the remedy available under this part
shall not be available insofar as it would result in recovery in
excess of the recovery authorized by 55-24-203 without proof of
fault resulting in damages in excess of such recovery.
(c) Any agreement entered
into by a consumer for, or in connection with, the purchase or lease
of a new motor vehicle which waives, limits or disclaims the rights
set forth in this part shall be void as contrary to public policy.
These rights shall inure to a subsequent transferee of such motor
vehicle.
55-24-211. Commencing actions
against sellers or lessors.
No action shall be commenced or
maintained under the provisions of this part against the seller or
lessor of a motor vehicle unless the seller or lessor is also the
manufacturer, or unless the manufacturer of the motor vehicle is not
subject to service of process in the state of Tennessee, or service
cannot be secured by the long-arm statutes of Tennessee, or unless
the manufacturer has been judicially declared insolvent.
55-24-212. Manufacturer's
warranty - Disclosure to purchaser.
Any business entity which purchases
a fleet of new motor vehicles, titles such motor vehicles in the
business entity's name and sells such vehicles to an individual
purchaser shall disclose in writing any remaining manufacturer's
warranty on such motor vehicles to such purchaser.
