Every new automobile sold by a dealership in the United States comes with a manufacturer's warranty. The warranty may be of little comfort when the car dealer or manufacturer does not satisfy the guarantees made in the warranty or when the new car must be returned for repairs again and again. If this happens, the Motor Vehicle Administration (MVA) is the first place to turn for help.

The MVA licenses car dealers and may be helpful in resolving a warranty complaint. If the MVA is unable to resolve the dispute, several private legal remedies are available. Maryland's Lemon Law is intended to aid in enforcing a new car warranty.

Applicability of the Lemon Law

The Lemon Law applies to the sale of all new cars, small trucks, and multipurpose vehicles in Maryland. It does not apply to motor homes.

The benefits of the Lemon Law are available not only if the vehicle that was purchased from a dealer was new, but also if it was transferred to another person during the vehicle's warranty period. That warranty period is 15 months after the car was originally delivered by the dealer or 15,000 miles, whichever comes first.

Under the law, a car is considered a lemon if, during the 15-month/15,000 mile warranty period, a defect or condition that substantially impairs the use and market value of the car cannot be repaired after a reasonable number of attempts. A "reasonable number of attempts" means once, in the case of the braking or steering system, and four times in the case of other defects.

Alternatively, the "reasonable number of attempts" requirement is satisfied if the car is out of service for repair of defects for a total of 30 or more days during the warranty period.

A car is not considered a lemon, however, if the defect is the result of abuse, neglect, or unauthorized modifications of the car.

How the Process Works

The Lemon Law imposes certain requirements on the consumer, the car dealer, and the manufacturer. If the dealer and manufacturer do not comply with these requirements, they may be subject to several different penalties under the law. If the consumer does not fulfill the consumer's obligations, the right to take advantage of the Lemon Law may be lost.

If there is a problem with a new car during the warranty period, the dealer or the manufacturer must be given an opportunity to repair the defect. Also, the consumer must send a written notice of the defect to the manufacturer by certified mail, return receipt requested, during the warranty period. The manufacturer or dealer must correct the defect, at no charge to the consumer, within 30 days after receiving notice of the defect. If the car is returned to the dealer four times to repair the same defect or if it is out of service for more than a total of 20 days because of defects, the dealer must notify the manufacturer of the defect and send a copy of the notice to the Motor Vehicle Administration. However, failure of the dealer to give the required notice does not affect the consumer's rights under the Lemon Law. If the consumer is not satisfied with the way the dealer or manufacturer is handling the new car's defect or if the consumer is unable to reach an agreement as to an appropriate remedy, the consumer may submit the dispute to the manufacturer's informal arbitration procedure, if one exists. The consumer is not required to submit to arbitration, however, and even if arbitration is chosen, it is not binding on the consumer. Legal action in the courts before, during, or after an arbitration proceeding is always an option. The only limitation is that a legal action under the Lemon Law must be filed in court within three years after the date of original delivery of the vehicle to the consumer.

Remedies

If the dealer or manufacturer is unable to repair the consumer's car after a reasonable number of attempts (as described above), the manufacturer is required to do one of two things. At the consumer's option, the manufacturer must either: (1) Replace the car with another that is acceptable to the consumer; or (2) Accept return of the car and refund the full purchase price, less a reasonable allowance for the use of the vehicle.

There are other remedies available to a consumer under the Lemon Law. If the consumer cannot settle a dispute with the manufacturer out of court, the court may require the manufacturer to pay part or all of the consumer's attorney's fees if the consumer prevails in court. If the court finds that the manufacturer has acted in bad faith in failing to fulfill its obligations under the Lemon Law, the manufacturer may be ordered to pay the consumer up to $10,000, in addition to any other remedies ordered by the court. Furthermore, a violation of the Lemon Law by a car dealer or manufacturer is considered an "unfair and deceptive trade practice" and may subject the dealer or manufacturer to certain penalties under the Maryland Consumer Protection Act.

In addition to the Lemon Law, other areas of the law may help the consumer in a dispute concerning a new car. For example, under the Maryland Uniform Commercial Code, the consumer may be entitled to the benefit of certain implied warranties which are not contained in a written warranty.

More Information

In any dispute concerning a new car, the consumer may wish to consult with an attorney. Further information on the Lemon Law may be obtained from:

Consumer Protection Division
Office of the Attorney General
200 St. Paul Place
Baltimore, Maryland 21202-2021
Telephone: (410) 576-6550

For more information on auto safety in general, contact:

Center for Auto Safety
2001 S Street, N.W. Suite 410
Washington, D.C. 20009
Telephone: (202) 328-7700

The address of the Motor Vehicle Administration is:

Motor Vehicle Administration
Consumer Services, Room 101
6601 Governor Ritchie Highway, N.E.
Glen Burnie, Maryland 21062
Telephone: (410) 768-7535

The Maryland Lemon Law may be found in:

Sections 14-1501 through 14-1504 of the Commercial Law Article of the Annotated Code of Maryland.