Opinion ID: 2036626
Heading Depth: 1
Heading Rank: 1

Heading: New Car Lemon Law

Text: In 1983, the Legislature enacted the New Car Lemon Law (General Business Law § 198-a) to provide New York consumers greater protection than that afforded by automobile manufacturers' express limited warranties or the Federal Magnuson-Moss Warranty Act ( Motor Veh. Mfrs. Assn. of U.S. v State of New York, 75 NY2d 175, 179 [1990]). The statute obligates manufacturers to repair, without charge, any new motor vehicle which fails to conform to all express warranties during the first 18,000 miles of operation or for two years immediately following delivery of the vehicle, whichever comes first ( see General Business Law § 198-a [b] [1]). If, within this time frame, a manufacturer is unable to correct a defect that substantially impairs the value of the vehicle after a reasonable number of attempts, the manufacturerat the consumer's optionmust either replace the vehicle or accept the return of the vehicle in exchange for a refund of the purchase price (General Business Law § 198-a [c] [1]). Under the statute, a presumption that the consumer has met the reasonable number of attempts requirement arises in two circumstances: if the same defect has been subject to repair four or more times but continues to existcommonly termed the repair presumption (General Business Law § 198-a [d] [1]); or if the vehicle has been out of service for a total of 30 or more daysreferred to as the days-out-of-service presumption (General Business Law § 198-a [d] [2]). The triggering of either presumption does not ensure that a consumer will recover. A manufacturer may attempt to rebut the presumption and is afforded an affirmative defense when it can show either that the defect does not substantially impair the vehicle's value or the condition resulted from abuse, neglect or unauthorized modifications or alterations of the motor vehicle (General Business Law § 198-a [c] [3] [i], [ii]). As originally enacted, the New Car Lemon Law required consumers to commence a legal action to obtain relief from manufacturers ( see General Business Law § 198-a [j]). In 1986, the Legislature amended the statute to give consumers the option of resolving disputes by arbitration and directed the Attorney General to establish and supervise the arbitration hearing process ( see General Business Law § 198-a [k]). In addition to promulgating regulations that govern the relevant procedures ( see 13 NYCRR part 300), the Attorney General created a written consumer's guide to Lemon Law procedures and standard forms for use in arbitration. Beginning in 1987, the consumer's guide and forms stated that a consumer would be eligible for a refund or replacement vehicle only when the purchaser could demonstrate that a defect still existed as of the date of arbitration. But in 2002, in response to Matter of Bay Ridge Toyota v Lyons (272 AD2d 397 [2d Dept 2000]), [1] the Attorney General reconsidered his interpretation of General Business Law § 198-a (d), and concluded that the presence of a defect at the time of arbitration or trial was not a prerequisite for recovery. In accordance with this view, the Attorney General amended the consumer guide and forms, effective in 2003, to explain that a consumer may be entitled to relief if, within the first 18,000 miles or two years, the vehicle was subject to four or more unsuccessful repair attempts or out of service for 30 days, notwithstanding that the condition was subsequently repaired.