VEHICLES COVERED BY MINNESOTA LEMON LAW

The lemon law covers —motor vehicles“, which it defines as any one of the following that is sold or leased to a consumer in Minnesota:

1. A passenger automobile, designed and used for carrying not more than 15 persons including the driver;

2. A pickup truck or van; and

3. The self-propelled chassis or van portion of recreational equipment. The lemon law covers used vehicles.

CONSUMERS COVERED BY MINNESOTA LEMON LAW

The lemon law covers —consumers“ who fall into either of the following categories:

1. The purchaser or lessee, other than for purposes of resale or sublease, of a new motor vehicle used for personal, family, or household purposes at least 40 per cent of the time; or

2. A person to whom the new motor vehicle is transferred for the same purposes during the duration of the manufacturer‘s written warranty.

PROBLEMS COVERED BY THE MINNESOTA LEMON LAW

The lemon law applies to any defect or condition that does not conform to the manufacturer‘s written warranty and that substantially impairs the use or market value of the motor vehicle to the consumer. These are referred to as nonconformities.

The lemon law provides the manufacturer with an affirmative defense if it can be shown that the nonconformity (1) does not substantially impair the use or market value of the vehicle, or (2) is the result of abuse, neglect, or unauthorized modifications or alterations of the motor vehicle by anyone other than the manufacturer, its agent or authorized dealer.

MANUFACTURER‘S DUTY TO REPAIR

If a new motor vehicle does not conform to the manufacturer‘s written warranty, and the consumer reports the nonconformity to the manufacturer, its agent or dealer during the term of the written warranty or during the period of two years following the date of the vehicle‘s original delivery to a consumer œ whichever is the earlier date, the manufacturer must make the repairs necessary to conform the vehicle to the warranty. Repairs must be made even after the expiration of the warranty term or the two-year period.

MANUFACTURER‘S DUTY TO REPURCHASE OR REPLACE VEHICLE

If the manufacturer, its agents or authorized dealers are unable to conform a purchased motor vehicle to any applicable express warranty by repairing or correcting any nonconformity after a reasonable number of repair attempts within three years following the date of original delivery of the vehicle to a consumer, then the manufacturer must either repurchase or replace the motor vehicle. The consumer has the option of requiring the manufacturer to provide a refund rather than a replacement motor vehicle.

If the manufacturer, its agents or authorized dealers are unable to conform a leased motor vehicle to any applicable express warranty by repairing or correcting any nonconformity after a reasonable number of repair attempts within three years following the date of original delivery of the vehicle to a consumer, then the manufacturer must repurchase the motor vehicle. The lemon law does not provide for the replacement of a leased vehicle.

REASONABLE NUMBER OF REPAIR ATTEMPTS

The lemon law creates a presumption that there have been a reasonable number of repair attempts if, within the manufacturer‘s written warranty term or during the period of two years following the date of original delivery of the vehicle to a consumer, whichever is the earlier date, any of the following occurs:

1. The same nonconformity has been subject to repair four or more times by the manufacturer, its agents or its authorized dealers, and the nonconformity continues to exist;

2. The vehicle is out of service by reason of repair for a cumulative total of 30 or more business days; or

3. A nonconformity that results in complete failure of the braking or steering system of the vehicle, and is likely to cause death or serious bodily injury if the vehicle is driven, has been subject to repair at least once by the manufacturer, its agents, or its authorized dealers, and the nonconformity continues to exist.

The term of the manufacturer‘s written warranty, the two-year period, and the 30-day period are 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.

Even if the presumption is not met, the consumer may still be entitled to recover under the lemon law if (1) the consumer first reported a nonconformity causing a substantial impairment to the manufacturer, its agent or authorized dealer during the term of the manufacturer‘s written warranty, and (2) a reasonable number of attempts to correct the nonconformity occurs within three years following the date of original delivery of the vehicle to a consumer.

NOTICE AND FINAL REPAIR ATTEMPT

The presumption set out above applies against a manufacturer only if the manufacturer, its agent or its authorized dealer has received prior written notification from or on behalf of the consumer at least once, and has had an opportunity to cure the alleged defect. If the notification is received by the manufacturer‘s agent or authorized dealer, the agent or dealer must forward it to the manufacturer by certified mail.

DISPUTE RESOLUTION

The lemon law requires all manufacturers selling vehicles in Minnesota to participate in an informal dispute settlement mechanism located in Minnesota. Consumers must first use this mechanism before suing in court under the lemon law.

TIME PERIOD FOR FILING CLAIMS

An action must be commenced within three years of the date of the vehicle‘s original delivery to a consumer. If a consumer is dissatisfied with the decision of an informal dispute settlement procedure, the consumer must commence an action within six months after the date of the mechanism‘s final decision.

This information is not intended as legal advice. Please direct specific questions to your legal counsel

REPURCHASE OF OWNED VEHICLES

A manufacturer repurchasing an owned vehicle under the Minnesota lemon law must pay the following amounts:

1. The full vehicle purchase price, including the cost of any options or other modifications arranged, installed or made by the manufacturer, its agent or its authorized dealer within 30 days after the date of original delivery. This includes the amount stated by the dealer as the trade-in value of a consumer‘s used vehicle, plus an additional amount paid by the consumer for the vehicle;

2. Sales or excise tax;

3. License fees and registration fees; and

4. Reimbursement for towing and rental vehicle expenses incurred by the consumer as a result of the vehicle being out of service for warranty repair;

5. Less a reasonable allowance for the consumer‘s use of the vehicle.

Refunds must be made to the consumer and lienholder, if any, as their interests appear on the records of the registrar of motor vehicles.

The amount of sales tax to be refunded to the consumer is calculated as follows:

Tax paid by consumer œ ⎡Tax paid by consumer x Reasonable allowance for use at time of purchase ⎣at time of purchase Vehicle‘s purchase price 

The reasonable allowance for use will be deducted for use of the vehicle by the consumer and any previous consumer during any period in which the use and market value of the vehicle are not substantially impaired. This amount may not exceed ten cents per mile driven or ten percent of the purchase price, whichever is less.

REPURCHASE OF LEASED VEHICLES

A manufacturer repurchasing a leased vehicle under the Minnesota lemon law must pay the following amounts:

To the lessor:

1. A full refund of the vehicle‘s original purchase price; and

2. Any early termination costs, not to exceed 15 percent of the vehicle‘s original purchase price;

3. Less any amounts actually paid by the consumer on the written lease.

To the lessee:

1. The amount actually paid by the consumer on the written lease;

2. Sales or excise tax;

3. License fees and registration fees; and

4. Reimbursement for towing and rental vehicle expenses incurred by the consumer as a result of the vehicle being out of service for warranty repair;

5. Less a reasonable allowance for the consumer‘s use of the vehicle.

The reasonable allowance for use will be deducted for use of the vehicle by the consumer and any previous consumer during any period in which the use and market value of the vehicle are not substantially impaired. This amount may not exceed ten cents per mile driven or ten percent of the purchase price, whichever is less.

The consumer‘s leased vehicle must be returned to the manufacturer and the consumer‘s written lease with the lessor must be terminated.

REPLACEMENT OF OWNED VEHICLES

When replacing an owned vehicle under the Minnesota lemon law, the manufacturer must provide a comparable motor vehicle. The reasonable allowance for use does not apply to a replacement.

This information is not intended as legal advice. Please direct specific questions to your legal counsel.