North Carolina Lemon Law
North Carolina Lemon Laws and the federal Lemon Law (the Magnuson-Moss Warranty Act) provide for compensation
to North Carolina consumers of defective automobiles and trucks and other vehicles and products including
motorcycles, RV’s, boats, computers and other consumer appliances and products. To qualify under the
North Carolina Lemon Law or the federal Lemon Law, you must generally have a product that suffered multiple
repair attempts under the manufacturer’s factory warranty. Lemon Law compensation can include a refund,
replacement or cash compensation. If you think you qualify for a Lemon Law,
click here for a free North Carolina Lemon Law case review or for an immediate evaluation,
simply fax your repair records to 866-773-6152. An experienced Lemon Law attorney will personally review
your inquiry and records and quickly contact you for a free consultation.
For other useful North Carolina Lemon Law information, click here to visit the North Carolina section of our
State Lemon Laws summaries page. Or just keep reading below for the entire North Carolina Lemon Law, or
click here to read the federal lemon law.
North Carolina State Statutes
Article 15A, Chapter 20, Section 351
New Motor Vehicles Warranties Act
This Article shall provide State and private remedies against motor vehicle
manufacturers for persons injured by new motor vehicles failing to conform to express
As used in this Article:
(1) "Consumer" means the purchaser, other than for purposes of
resale, or lessee from a commercial lender, lessor, or from a manufacturer or dealer, of
a motor vehicle, and any other person entitled by the terms of an express warranty to
enforce the obligations of that warranty.
(2) "Manufacturer" means any person or corporation, resident or
nonresident, who manufactures or assembles or imports or distributes new motor vehicles
which are sold in the State of North Carolina.
(3) "Motor vehicle" includes a motor vehicle as defined in G.S.
20-4.01 which is sold or leased in this State, but does not include "house
trailer" as defined in G.S. 20-4.01 or any motor vehicle with a gross vehicle
weight of 10,000 pounds or more.
(4) "New motor vehicle" means a motor vehicle for which a
certificate of origin, as required by G.S. 20-52.1 or a similar requirement in another
state, has never been supplied to a consumer, or which a manufacturer, its agent, or its
authorized dealer states in writing is being sold as a new motor vehicle.
20-351.2 Require repairs.
When mileage warranty begins to accrue.
(a) Express warranties for a new motor vehicle shall remain in effect at least
one year or 12,000 miles. If a new motor vehicle does not conform to all applicable
express warranties for a period of one year, or the term of the express warranties,
whichever is greater, following the date of original delivery of the motor vehicle to
the consumer, and the consumer reports the nonconformity to the manufacturer, its agent,
or its authorized dealer during such period, the manufacturer shall make, or arrange to
have made, repairs necessary to conform the vehicle to the express warranties, whether
or not these repairs are made after the expiration of the applicable warranty period.
(b) Any express warranty for a new motor vehicle expressed in terms of a
certain number of miles shall begin to accrue from the mileage on the odometer at the
date of original delivery to the consumer.
20-351.3 Replacement or refund; disclosure requirement.
(a) When the consumer is the purchaser or a person entitled by the terms of
the express warranty to enforce the obligations of the warranty, if the manufacturer is
unable, after a reasonable number of attempts, to conform the motor vehicle to any
express warranty by repairing or correcting, or arranging for the repair or correction
of, any defect or condition or series of defects or conditions which substantially
impair the value of the motor vehicle to the consumer, and which occurred no later than
24 months or 24,000 miles following original delivery of the vehicle, the manufacturer
shall, at the option of the consumer, replace the vehicle with a comparable new motor
vehicle or accept return of the vehicle from the consumer and refund to the consumer the
(1) The full contract price including, but not limited to, charges for
undercoating, dealer preparation and transportation, and installed options, plus the
non-refundable portions of extended warranties and service contracts;
(2) All collateral charges, including but not limited to, sales tax, license
and registration fees, and similar government charges;
(3) All finance charges incurred by the consumer after he first reports the
nonconformity to the manufacturer, its agent, or its authorized dealer; and
(4) Any incidental damages and monetary consequential damages.
(b) When consumer is a lessee, if the manufacturer is unable, after a
reasonable number of attempts, to conform the motor vehicle to any express warranty by
repairing or correcting, or arranging for the repair or correction of, any defect or
condition or series of defects or conditions which substantially impair the value of the
motor vehicle to the consumer, and which occurred no later than 24 months or 24,000
miles following original delivery of the vehicle, the manufacturer shall, at the option
of the consumer, replace the vehicle with a comparable new motor vehicle or accept
return of the vehicle from the consumer and refund the following:
(1) To the consumer:
a. All sums previously paid by the consumer under the terms of the lease;
b. All sums previously paid by the consumer in connection with entering
into the lease agreement, including, but not limited to, any capitalized cost
reduction, sales tax, license and registration fees, and similar government charges;
c. Any incidental and monetary consequential damages.
(2) To the lessor, a full refund of the lease price, plus an additional
amount equal to five percent (5%) of the lease price, less eighty-five percent (85%)
of the amount actually paid by the consumer to the lessor pursuant to the lease. The
lease price means the actual purchase cost of the vehicle to the lessor.
In the case of a refund, the leased vehicle shall be returned to the manufacturer and
the consumer's written lease shall be terminated by the lessor without any penalty to
the consumer. The lessor shall transfer title of the motor vehicle to the manufacturer
as necessary to effectuate the consumer's rights pursuant to this Article, whether the
consumer chooses vehicle replacement or refund.
(c) Refunds shall be made to the consumer, lessor and any lien holders as
their interests may appear. The refund to the consumer shall be reduced by a reasonable
allowance for the consumer's use of the vehicle. A reasonable allowance for use is that
amount directly attributable to use by the consumer prior to his first report of the
nonconformity to the manufacturer, its agent, or its authorized dealer, and during any
subsequent period when the vehicle is not out of service because of repair.
"Reasonable allowance" is presumed to be the cash price or the lease price, as
the case may be, of the vehicle multiplied by a fraction having as its denominator
100,000 miles and its numerator the number of miles attributed to the consumer.
(d) If a manufacturer, its agent, or its authorized dealer resells a motor
vehicle that was returned pursuant to this Article or any other State's applicable law,
regardless of whether there was any judicial determination that the motor vehicle had
any defect or that it failed to conform to all express warranties, the manufacturer, its
agent, or its authorized dealer shall disclose to the subsequent purchaser prior to the
(1) That the motor vehicle was returned pursuant to this Article or pursuant
to the applicable law of any other State; and
(2) The defect or condition or series of defects or conditions which
substantially impaired the value of the motor vehicle to the consumer.
Any subsequent purchaser who purchases the motor vehicle for resale with notice of
the return, shall make the required disclosures to any person to whom he resells the
20-351.4 Affirmative defenses.
It is an affirmative defense to any claim under this Article that an alleged
nonconformity or series of nonconformities are the result of abuse, neglect, odometer
tampering by the consumer or unauthorized modifications or alterations of a motor vehicle.
(a) It is presumed that a reasonable number of attempts have been undertaken
to conform a motor vehicle to the applicable express warranties if:
(1) The same nonconformity has been presented for repair to the
manufacturer, its agent, or its authorized dealer four or more times but the same
nonconformity continues to exist; or
(2) The vehicle was out of service to the consumer during or while awaiting
repair of the nonconformity or a series of nonconformities for a cumulative total of
20 or more business days during any 12-month period of the warranty, provided that the
consumer has notified the manufacturer directly in writing of the existence of the
nonconformity or series of nonconformities and allowed the manufacturer a reasonable
period, not to exceed 15 calendar days, in which to correct the nonconformity or
series of nonconformities. The manufacturer must clearly and conspicuously disclose to
the consumer in the warranty or owners manual that written notification of a
nonconformity is required before a consumer may be eligible for a refund or
replacement of the vehicle and the manufacturer shall include in the warranty or
owners manual the name and address where the written notification may be sent.
Provided, further, that notice to the manufacturer shall not be required if the
manufacturer fails to make the disclosures provided herein.
(b) The consumer may prove that a defect or condition substantially impairs
the value of the motor vehicle to the consumer in a manner other than that set forth in
subsection (a) of this section.
(c) The term of an express warranty, the one-year period, and the 20-day
period shall be extended by any period of time during which repair services are not
available to the consumer because of war, strike, or natural disaster.
20-351.6 Civil action by the Attorney General.
Whenever, in his opinion, the interests of the public require it, it shall be the duty
of the Attorney General upon his ascertaining that any of the provisions of this Article
have been violated by the manufacturer to bring a civil action in the name of the State,
or any officer or department thereof as provided by law, or in the name of the State on
relation of the Attorney General.
20-351.7 Civil action by the consumer.
A consumer injured by reason of any violation of the provisions of this Article may
bring a civil action against the manufacturer; provided, however, the consumer has given
the manufacturer written notice of his intent to bring an action against the manufacturer
at least 10 days prior to filing such suit. Nothing in this section shall prevent a
manufacturer from requiring a consumer to utilize an informal settlement procedure prior
to litigation if that procedure substantially complies in design and operation with the
Magnuson-Moss Warranty Act, 15 USC 2301 et seq., and regulations promulgated there under,
and that requirement is written clearly and conspicuously, in the written warranty and any
warranty instructions provided to the consumer.
In any action brought under this Article, the court may grant as relief:
(1) A permanent or temporary injunction or other equitable relief as the court
(2) Monetary damages to the injured consumer in the amount fixed by the
verdict. Such damages shall be trebled upon a finding that the manufacturer unreasonably
refused to comply with G.S. 20-351.2 or G.S. 20-351.3. The jury may consider as damages
all items listed for refund under G.S. 20-351.3;
(3) A reasonable attorney's fee for the attorney of the prevailing party,
payable by the losing party, upon a finding by the court that:
a. The manufacturer unreasonably failed or refused to fully resolve the
matter which constitutes the basis of such action; or
b. The party instituting the action knew, or should have known, the action
was frivolous and malicious.
20-351.9 Dealership liability.
No authorized dealer shall be held liable by the manufacturer for any refunds or
vehicle replacements in the absence of evidence indicating that dealership repairs have
been carried out in a manner substantially inconsistent with the manufacturers'
instructions. This Article does not create any cause of action by a consumer against an
20-351.10 Preservation of other remedies.
This Article does not limit the rights or remedies which are otherwise available to a
consumer under any other law.
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