I. The Magnuson-Moss Act
This is a federal law that applies to any product that carries a written warranty. Manufacturers are required to allow consumers to choose either a refund or a replacement if the product malfunctions repeatedly and cannot be successfully repaired after a reasonable number of attempts.
This has become known as the "three strikes and you're out" rule, because lawyers have successfully argued in court that if the product has malfunctioned that many times and the manufacturer can't or won't get it to "stay fixed," then in all fairness to the consumer, he/she should be allowed to choose either a refund or a new item of the same kind.
Under Magnuson-Moss, consumers may sue and recover their attorney's fees if successful. If the car owner has made repeated attempts to get repairs and has documents, correspondence, notes, etc. to support this, the dealer and manufacturer will be motivated to settle rather than defend a "loser" case in court and pay attorney's fees to lawyers on both sides.
II. Uniform Commercial Code
The UCC is the law of the land concerning contracts for the sale of goods, and has been adopted in all 50 states. The basic elements of a UCC transaction are referred to as the "TARR baby." TARR stands for "Tender," "Acceptance," "Rejection," and "Revocation."
Tender - the buyer may reject any goods that in any manner fail to meet the terms of the contract.
Acceptance - lemon cars usually can't be detected on cursory inspection. All too often the defect(s) do not appear until the vehicle has been driven awhile. So the custom is that the buyer "accepts" the vehicle with the understanding that any defects will be repaired by the dealer under the manufacturer's warranty.
Rejection - a buyer is entitled to a "reasonable" time to inspect the vehicle. A non-conforming defect may manifest itself in the 5th, 500th, or 5,000th mile of driving. Therefore, merely driving the vehicle off the dealer's lot does not constitute iron-clad "acceptance" under the UCC. The right to use the vehicle a "reasonable" time is necessary for consumers to be able to make an informed "acceptance." However, continued driving and use of the vehicle beyond what is "reasonable" will be construed by courts as "acceptance." This is the stuff litigation is made of. All the more reason to document everything and keep copies of service records.
