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Office of Consumer Protection
Consumer's Guide to the New Jersey Lemon Law
- What is the Lemon Law?
- Who is covered under the Lemon Law?
- Is your vehicle a lemon?
- Getting your vehicle repaired
- Who pays for the repairs?
- How long should the repair take?
- Getting your refund or replacement
- Reasonable allowance for vehicle use
- Enforcing your rights
- The Lemon Law hearing process
- Resolution by the manufacturer
- Court action
- Can the decision of the Division or the court be appealed?
- What if the manufacturer fails to comply with the final decision
- What amounts can be awarded to you if you win?
- Can the manufacturer resell or re-lease "lemon"?
- Solving problems with a new vehicle - a review
- Further help and information
- What is the Lemon Law?
The Lemon Law is a
consumer protection law enacted by the New Jersey Legislature to assist
consumers when they purchase a new motor vehicle that develops repeated
defects or lengthy unusable periods during the first two years or 18,000
miles (whichever comes first) . The intent of the law is to require the
manufacturer of a new motor vehicle to correct defects that are
originally covered under the manufacturer's warranty
and are identified and reported within a specific time period. The law
also provides procedures to quickly resolve disputes between a consumer
and a manufacturer and specific remedies when the uncorrected defect
substantially impairs the use, value or safety of the new
vehicle. Lemon Law procedures are very specific. Please
read this information carefully and keep it in your files. Be sure to
keep accurate written records of all service to your vehicle. When
corresponding with the dealer, the manufacturer or the Division's
Lemon Law Unit concerning problems, send all mail by
certified mail with a return receipt requested. The Division of Consumer
Affairs' Lemon Law Unit offers information and application processing
only. The Division does not hear cases directly; that is the
responsibility of the Office of Administrative Law.
- Who is covered under the Lemon Law?
Any consumer who buys, leases or
registers a new passenger vehicle or motorcycle in the State of New
Jersey is covered by the Lemon Law.* The consumer is protected
for two years after the original delivery date of the vehicle, OR for
the first 18,000 miles, whichever comes first. If the vehicle is
transferred to someone else during this two-year/18,000-mile period,
that owner or the person leasing the vehicle is also covered under the
Lemon Law. Important: The Lemon Law does not cover
commercial vehicles or the living quarters of motor homes.
*Note:
The Lemon Law
became effective on March 14, 1989, for all new vehicles registered in
the State of New Jersey. As of August 4, 1991, the law covers vehicles
purchased or leased in New Jersey,
regardless of the state where the vehicle is
registered. However, this change is not retroactive.
- Is your
vehicle a lemon?
A new motor vehicle is presumed to be a lemon
if it has one or more defects that continue to exist after
three attempts at repairs, OR after the vehicle has been out
of service for a total of 20 cumulative calendar
days. The Lemon Law requires that the consumer write
to the manufacturer giving notification of one last chance to repair the
defect (see page 3 for more information about this process).
To qualify under the Lemon Law, the defect must substantially impair the
use, value or safety of the vehicle. However, the Lemon Law
does not cover defects caused by an accident, vandalism, abuse or
neglect. It also does not cover defects caused by attempts to
repair or to modify the vehicle by a person other than the manufacturer,
its agent or an authorized dealer.
- Getting Your Vehicle Repaired
It is very important that you report any
defect or condition directly to the manufacturer or the dealer
immediately. It is also important to keep all receipts of repair
attempts and a complete record of all contact with the manufacturer and
dealer.You have the right to receive a dated, detailed statement each time the vehicle is
brought in for repair. This statement should include any charges for
parts and labor, a general description of the problem, the odometer
reading at the time you brought the vehicle in for repair and also when
you pick up the car, as well as a list of all work performed. It should
also state the date the vehicle was brought in for repair and the date
you picked up the car. Be sure you are given these statements
(it's the law) and that you keep them on file.
- Who pays for the repairs?
Most manufacturers' warranties on purchased vehicles cover repairs for at
least the first year following the original delivery date or the first
12,000 miles, whichever comes first. If repairs are needed
after your warranty has ended, you must pay for the repairs.
Check your warranty booklet to find out the details of your particular
coverage. Repair costs can be recovered if the vehicle is later proven
to be a "lemon" under the law. For this reason, it is important to remember to keep your
receipts. If you are leasing a vehicle, check your leasing contract to find out
who is responsible for repair bills.
- How long should the repair take?
The Lemon Law allows the manufacturer a " reasonable amount of time" to
repair or correct the defect. A "reasonable amount of time" means three repair attempts for the same
defect or a total of 20 cumulative calendar days out of service because
of a series of defects or repairs.
Final Repair Attempt: Before you can file a claim under the Lemon Law with the Division of Consumer Affairs, you
must give the manufacturer one final chance
repair the defect. You must send a letter to the
manufacturer (not the dealer) by certified mail, return
receipt requested, stating that you may have a claim and that you are
giving the manufacturer one last chance to repair the defect. (A sample
letter is shown on page 5.) This letter should be mailed after
the second unsuccessful repair attempt or after
the 20-cumulative-calendar-day period. Contact the Division of Consumer
Affairs' Lemon Law Unit for the address of the manufacturer's
regional office.
Keep a photocopy of the letter for your records and
send the original to the manufacturer by certified mail, return receipt
requested. This receipt is proof that the letter was received by the
manufacturer. Keep it with your records.
After receiving your letter, the manufacturer has 10 calendar
days to attempt a final repair. If the defect is not repaired within
this time, you have the right to demand a refund.
You must provide a copy of your 10-day demand letter, the return receipt verification and the final
repair attempt invoice before you can file a claim under the Lemon
Law.
- Getting Your
Refund or Replacement
Replacement - The manufacturer may offer to replace
your original vehicle; however, you do not have to accept the offer.
You may refuse the offer of a replacement vehicle and demand a refund.
If the manufacturer refuses to give you a refund, you can pursue the
matter through a hearing or in court. If you do accept a replacement
vehicle, and the original vehicle was financed, the manufacturer must
make sure the financing is transferred from the original vehicle to the
replacement vehicle. It is your responsibility to have the title and
registration transferred to your new vehicle.
Refund for Purchased Vehicles - If you choose to receive a refund, you will receive the full purchase price of
your original motor vehicle, minus a "reasonable
allowance for vehicle use."
The full refund can include, but is notlimited to:
- credits and allowances for any trade-in vehicles;
- costs of any options and other
modifications added by the manufacturer or its authorized dealer within
30 days after the original delivery date;
- cost of sales tax, license and registration fees, and finance charges;
- towing;
- cost of vehicle repairs paid for by you;
- charges for renting a similar vehicle while the original vehicle was out of
service because of the defect;
- attorney's fees;
- expert witness fees; and
- the Lemon Law filing fee.
- Reasonable Allowance for
Vehicle Use
" The reasonable allowance for vehicle use" equals the purchase price multiplied
by the mileage at the time the vehicle was
first brought to the dealer or manufacturer for repair of the
defect divided by 100,000 miles. For example, the reasonable allowance for a
$12,000 vehicle with 10,000 miles on the odometer would be calculated as
follows: 12,000 x
10,000 miles = 120,000,000
120,000,000 divided by 100,000 =1,200
The reasonable
allowance for vehicle use in this case is $1,200.
The purchase price can include
finance charges, license and registration fees, sales tax, towing
charges and other costs. See N.J.S.A. 56:12-32(a)
of the New Jersey Lemon Law for a detailed list of costs included in the
vehicle purchase price.
You may be eligible to receive a refund for a leased vehicle. You can receive
a full refund for any leasing fees you have
already paid and certain other fees (see page 4), less a reasonable
allowance for vehicle use. Under the Lemon Law, your lease agreement
ends when you return the leased vehicle. You cannot be charged any
penalties for ending the lease early.
- Enforcing Your Rights
If the manufacturer does not accept
your Lemon Law claim and will not refund your money or replace your
vehicle, you have three choices. You may:
- ask for a
hearing through the Division of Consumer Affairs's
Automotive Dispute Resolution Program; or
- send your
complaint to the manufacturer's informal dispute
settlement program; or
- file a civil action in
court.
Resolution through
the Division - The Lemon Law gives consumers the chance to
have their cases heard before an administrative law judge in the Office
of Administrative Law. An attorney is not required for this hearing.
However, it may be to your advantage to have one present, because the
manufacturer will have legal representation. If you are successful in
proving your case, you will be awarded any reasonable attorney's
fees. The Lemon Law Unit does not provide legal
representation for the consumer.
IMPORTANT : To qualify for a hearing
before an administrative law judge:
- You must have allowed the
manufacturer three (3) chances to repair substantially the same
defect(s) OR your vehicle must have been out of service
due to repairs for a total of 20 cumulative
calendar days for a single problem or a series of problems.
- You must
have notified the manufacturer in writing of its final chance to repair
the defect before the vehicle goes beyond 18,000 miles or two years old,
whichever comes first.
- You must have given the manufacturer
that final chance to repair the vehicle.
- You must have the certified
mail receipt proving that you sent the final-chance notification to the
manufacturer.
- The
Lemon Law Hearing Process
If the matter is resolved, you should inform the
Lemon Law Unit of the disposition. If the matter is not resolved after
the final repair attempt has been completed, follow the steps
below. - Fill out a Lemon Law application and send it to the Lemon Law Unit along with a legible photocopy of your vehicle registration, certified letter to the manufacturer, certified mail return receipt, all repair invoices, towing or rental car receipts, vehicle purchase order, retail installment contract or lease agreement. Do Not Send Original Documents.
- After receiving your
application package, the Lemon Law Unit will review your case to see if
it meets the requirements for a Lemon Law hearing at the Office of
Administrative Law. If so, the Lemon Law Unit will approve your
application and ask you to send a check or money order for the $50
application fee. This fee cannot be refunded. If you win your case,
the fee will be returned to you as part of the amount awarded.
- Once payment is
received and the application is accepted, the Lemon Law Unit will
contact you and the manufacturer to arrange a hearing date. The hearing
will be set no later than 20 days from that date, unless you agree to a
later date.
- Once the case has been heard, a
decision will be issued within 20 days after the hearing ends.
- The Director of
the Division of Consumer Affairs can accept, modify or reject the
decision within 15 days. If no action is taken by the Director, the
decision of the administrative law judge becomes final.
If the
administrative law judge decides in your favor and the Director of
Consumer Affairs agrees, you will receive a refund plus other costs. You
may only use the Lemon Law hearing process once for a motor
vehicle.
- Resolution
by the Manufacturer
You are not required to use the
manufacturer's dispute resolution program. If you
do use it and you are not satisfied with the outcome, you may still file
for a hearing before an administrative law judge. However, any findings
made during the manufacturer's dispute resolution
program can be used against you later in the Office of Administrative
Law hearing or in court.
- Court Action
You may choose to file a civil action in court to
resolve your claim. However, once a court
decision has been issued, you can no longer use the
Division's program.
It is a good idea to consult with a lawyer if you are considering court
action, to determine whether you have other courses of action in
addition to a Lemon Law claim. If you bring an action, your interests
may best be represented by an attorney (the manufacturer will be
represented by counsel). If you win, the manufacturer must repay you
for costs, reasonable attorney's fees and expert witness
fees.
- Can the decision of the Division or
the court be appealed?
Yes. You or the manufacturer can file an appeal in
the Appellate Division of the Superior Court.
The Lemon Law
protects you against a manufacturer who appeals without good reason. A
manufacturer who files an appeal must post a bond equal to the amount
awarded to you by the final decision, plus an extra $2,500
to cover your attorney's fees. The bond
is payable to you, and the amount will be turned over to you if you win
the appeal.
- What if the manufacturer fails to comply with the final
decision?
If the manufacturer fails to comply with the final decision, you should
notify the Division of Consumer Affairs immediately by calling the Lemon
Law Unit. A manufacturer can be penalized $5,000 per day for each day
it unreasonably fails to comply.
- What amounts can be awarded to you if you
win?
If you
prevail in the Office of Administrative Law hearing (and the decision is
accepted by the Division) or if you win in court, you can receive the
following:
- refund of vehicle purchase price or leasing costs;
- finance charges (if
any);
- reasonable attorney's fees;
- the application fee for
the Division's resolution program;
- cost of vehicle repairs
paid for by you;
- reasonable costs of a rental
vehicle while your vehicle is out of service because of the defect;
and fees for expert witnesses.
- Can the manufacturer resell or
re-lease a "lemon"?
Yes, but under the revised Lemon Law, effective April
1, 1993, the dealer or leasing company must have the consumer sign a
written notice certifying that the consumer knows the vehicle was
returned as a "lemon."
If the dealer or leasing company resells or transfers ownership of a returned
"lemon," the dealer or leasing company must notify the Division of Motor Vehicles
so the vehicle's title can be marked accordingly. So, if you are
purchasing a used vehicle, do not forget to ask before you
sign anything or hand over any cash to the dealer whether the
vehicle had ever been returned to the manufacturer as a
" lemon."
- Solving Problems with a New Vehicle - A
Review
If
your vehicle is defective:
- Give your dealer an opportunity to
repair your vehicle.
- Keep all repair receipts and a
complete record of all contacts with the manufacturer or
dealer.
If
substantial defects continue after two repair attempts or 20 cumulative
calendar days:
- Give the manufacturer written notice of its last chance to
repair the defect. Be sure to send the letter by certified mail, return
receipt requested.
If the substantial defect is not corrected
within 10 calendar days after the manufacturer receives the written
notice:
If the manufacturer does not agree that you are entitled to a refund under the Lemon
Law:
- File for dispute resolution through the Division of Consumer
Affairs; or
- File for dispute resolution through the manufacturer's
system; or
- File a civil action in court.
If you are not satisfied with the outcome of
the manufacturer's system:
- You can still file
for a Lemon Law hearing through the Division or file a civil action in
court.
If you are not satisfied with the decision of the Division or the court:
- You have 45 days to file for an appeal in
the Appellate Division of the Superior Court (609-292-4822).
The following is a sample letter to a manufacturer. It is
VERY IMPORTANT to send this letter by Certified Mail-Return Receipt Requested.
Your name
Your address
Your telephone number
The date
The name of the manufacturer
The manufacturer's address
To Whom it May Concern:
I believe that my (passenger vehicle/motorcycle) is a "lemon" under the New Jersey Lemon Law
(N.J.S.A. 56:12-29 to 56:12-49).I am hereby making a written demand for relief under
the Lemon Law.
I purchased/leased a (make, model year of vehicle and vehicle identification number) on (date)
from (name of dealership) in (city, state). Since I bought the vehicle, I have had to return
it to the dealership a total of (number of times the vehicle was returned to an authorized
dealer for repairs) times. My vehicle has been out of service for repairs for a total of
(total number of calendar days the vehicle has been out of service being repaired) calendar
days.The current mileage on my vehicle is (current odometer reading).
My vehicle has been in (name of authorized dealership) on the following dates for repair of the
following defects:
(date in and date out)
(list the vehicle's problems)
My vehicle is currently experiencing the following defects:(List current defects.)
Since these defects substantially impair the use, value or safety of my vehicle, I am hereby
allowing you one final oppurtunity to repair my vehicle. If these repairs are not completed within
10 calendar days of receipt of this letter, I am entitled to a refund calculated in accordance
with the Lemon Law.
I look foward to hearing from you soon. You can reach me during the day at ____________________
and in the evening at ___________________.
Sincerely,
Your name
- Further Help and
Information
If you have
questions or want more information on your rights under the Lemon Law,
call or write: New Jersey
Division of Consumer Affairs
Lemon
Law Unit
P.O. Box 45026, 124
Halsey Street
Newark, N.J.
07101
973-504-6226For more information about the
New Jersey Division of Consumer Affairs, call the Tel-Consumer automated
information service at 1-800-242-5846 or write to:
ATTN.: CONSUMER EDUCATION\
New Jersey Division of Consumer Affairs
P.O. Box 40527, 124 Halsey Street
Newark, N.J. 07101
973-504-6200
You can also contact the Division by e-mail -
askconsumeraffairs@oag.lps.state.nj.us
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