Texas Lemon Law Explained
The Lemon Law is a mechanism by which consumers can protect themselves against a defective motor vehicle. In many jurisdictions, including Texas, the Lemon Law is a form of warranty enforcement. This means that if the manufacturer has breached its warranty, either express or implied, the consumer may be entitled to remedy. The Texas Lemon Law applies to new vehicles which have either a defect or nonconformity that is not repaired after four unsuccessful repairs. A nonconformity is a defect, a malfunction, or failure to conform to an express warranty . The defect or nonconformity must be present during the warranty period in order for the consumer to obtain relief under the Lemon Law. This means that the defect or nonconformity must have either occurred or have existed in order for the consumer to recover.
The Texas Lemon Law is important because it allows the consumer to obtain a remedy for a defect or nonconformity in a motor vehicle. Consumers should not be forced to pay for a defective product. The Lemon Law allows those consumers who are having difficulty with a defective vehicle to hold the manufacturer accountable for its warranty obligations.
Qualifying for Lemon Law Claims
To file a claim under the Lemon Law in Texas, certain conditions must first be met. While each case is different, Nissan Lemon Law Group examines whether a vehicle qualifies as a Lemon Vehicle under the following criteria:
- The vehicle was purchased for personal, family, or household use.
- The vehicle does not qualify as a leased vehicle under the Texas Lemon Law.
- The vehicle was purchased in Texas or registered for use in Texas.
- The vehicle was purchased within the thirty months preceding the Lemon Law claim filing.
- The vehicle is or was covered under a manufacturer’s warranty.
- The manufacturer issued one or more nonconformities within the warranty during the first twenty-four months or 24,000 miles of usage.
- The nonconformities were repaired, but the problem still exists or continues to exist after three failed repairs.
- The vehicle was out of service, during the warranty period, for at least thirty days due to nonconformities.
Process for a Lemon Law Claim in Texas
The process of filing a Lemon Law claim in Texas begins when an individual orders or buys a vehicle, which turns out to have defects that are covered by the Lemon Law. Once a consumer has tried to get the dealership or manufacturer to repair a defective vehicle a certain number of times or failed to deliver or non-conforming goods within a certain number of days, the complaint process can be initiated. The first step requires submitting a dispute form, which includes personal information; motor vehicle description, such as the year, make, model, and vehicle identification number; dealership information, including name and address; defects or problems and what attempts were made to fix them; and specifics about consumer goods purchased. A dispute may be filed with the state or county at which the manufacturer or dealer does business.
Filing a dispute isn’t the end of the process, though. Before a consumer can perfect their lemon law claim, they must first wait until a period of time has passed to allow for repair or replacement of nonconforming goods or perform a return or repair within a certain time frame. These time frames must meet or exceed those established by the Federal Magnuson-Moss Warranty Act. These time frames vary based upon the terms of the warranty or service contract, but generally require that a defect be repaired four times or out of service for at least 30 days. If the dealership or manufacturer has had the opportunity and failed to repair the nonconforming goods or delivered goods that fail to conform to the written warranty within the established time frames, a consumer may qualify for Lemon Law relief.
Holding a dealer, manufacturer, or retailer accountable to the Texas Lemon Law may require a day in court. If the dealership refuses to take care of the problem, the consumer’s next step could be filing an arbitration or court application for a hearing before an administrative law judge. Before an application for a hearing is filed, it is crucial to collect all documentation supporting the case. Required documents may include a copy of a written warranty or service contract, a list of explanations of nonconformities and defects, repair order entry, repair order invoices, work orders, explanations of repairs or services performed, statements from the manufacturer, invoices, and other communications between the consumer and manufacturer or dealer. Once an application for hearing is filed, a hearing date will become available.
Possible Outcomes and Remedies
Should consumers prevail with a Lemon Law claim in Texas, there are various remedies available for relief that may be sought. The statute provides that a consumer is entitled to a refund of the part of the purchase price that is attributable to the defect(s), to be "determined on a reasonable pro rata basis." The pro rata measure seeks to grant compensation to a consumer as if the defect(s) had been present all along. As an example, if the manufacturer was unable to repair the vehicle after 300 days in the shop, the refund would be based on the 300 days of the total months of the warranty. That would be 300 days divided by approximately 620 total days in the warranty, multiplied by the $30,000 price of the car – a refund of about $25,000.
Another remedy that might apply is a replacement vehicle , "of the same kind and of equivalent or greater value." A third possible remedy would be "any other reasonable remedy determined by the court." A consumer is also entitled to the recovery of any reasonable attorney’s fees incurred in connection with enforcing these rights. The statute also dictates the calculation of attorney’s fees and reflects a prevailing trend in consumer protection legislation and litigation. Under the Lemon Law, attorney’s fees are turned against the manufacturer to the benefit of consumers. That means that if a consumer has an attorney who files a Lemon Law suit, and the consumer prevails, the Lemon Law statute directs that the manufacturer shall pay the consumer’s attorney’s fees in addition to the money judgment that the court awards.
Legal Help for Lemon Law
Legal assistance becomes even more critical for the lawyer-less claimant in the later stages of a lemon law case. In particular, the entirety of the remedies available to the lawyer-less claimant rests in litigation. Without an attorney, the risk of losing the entire claim is present.
This risk exists due to an insurmountable imbalance between the power of the manufacturer and the claimants:
• Manufacturers have entire legal departments dedicated to fighting lemon law claims,
• Many manufacturers are foreign corporations, represented by lawyers and law firms dedicated to combat lemons in foreign courts, outside of the Texas Lemon Law,
• Manufacturers have all the motivation and resources to refute every arguable claim,
• Manufacturers use technological advances to reduce costs, thus devote those savings towards combatting lemon law claims,
• Lawyers who represent consumers can and do remove barriers to filing a complaint and help consumers overcome crippling procedural hurdles,
• The manufacture’s lawyer can gauge the likelihood of success by comparing the consumer’s lawyer’s experience with the manufacturer’s lawyer’s experience; such a comparison is tilted in the manufacturer’s favor, and
• There is no definitive way to determine if an unrepresented consumer is timely filing a complaint until several years from the date of filing.
For the manufacturer, the risks of unrepresented claimants are up to 50-50 in the manufacturer’s favor. And that is a generous estimate.
The protection afforded to consumers under the lemon law is limited if they are not represented by counsel because:
• Many defenses exist when one is unrepresented, but are overruled as the lemon law claimant becomes represented,
• Many problems with the lemon law case favor manufacturers and are hindered by consumer representations, and
• The overall scheme is premised on the wisdom that lawyers can cure lemon law cases, under the Lemon Law Foundation.
Litigating a lemon law claim requires knowledge, skill and some luck, and consumers without attorneys are at a clear disadvantage.
Myths of the Texas Lemon Law
There are several common misconceptions when it comes to the Texas Lemon Law. It’s important to understand and dispel these so that our clients know their rights. This fact page should be helpful in doing that. One of the biggest issues we see has to do with repairs. Repairs do not have to have "fixed" the problem for it to count as a valid repair. Minor or temporary fixes do count for the purposes of the Lemon law including reprogramming on-board computers and other systems like the Entertainment system. In addition, cleaning or adjusting door rubs, air vent doors, lift gates and headlamp assemblies also count as a repair. An auto manufacturer can’t just do anything they want. There is a process that they must go through. If they fail to comply with the appropriate procedure and all the timelines required than a case can be pursued against them. The process is not as daunting as it appears. In many cases we can get the client money back without the necessity of an arbitration . In addition, the process is not as long as people think. Once you submit the appropriate information to the manufacturer they have 40 days to come up with the paperwork and response. In most cases when there has been some form of arbitration, the entire process has taken less than a year and that includes all the waiting time. It is as simple as it sounds. You fill out the consumer complaint form from the G.R.A.C. and submit it to the manufacturer with a request for arbitration. A few days later you will get a packet from them telling you when your first date schedule is. In most cases this is the only paperwork that you will need. Many of our clients assume that the fact that they have a bad car means that they are stuck with a bad car and that they are just going to have to grit their teeth and stick it out. That is simply not true. They can get a refund or a replacement car. The only requirement is that the car needs to recline to one of the above-mentioned solutions (or a similar one) twice within the express warranty period.