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Maryland Lemon Law Statutes
Maryland Lemon law Sections 14-1501 - 12-1504 of the Commercial Law Articles
Maryland Lemon law § 14-1501.
- In this subtitle the following words have the meanings indicated.
- The purchaser, other than for purposes of resale, of a new motor vehicle;
- Any person to whom a new motor vehicle is transferred during the duration of the warranty applicable to such motor vehicle; or
- Any other person who is entitled to enforce the obligations of the warranty.
"Motor vehicle" means a vehicle that is registered in this State as a:
- Class A (passenger) vehicle;
- Class D (motorcycle) vehicle;
- Class E (truck) vehicle with a 3/4 ton or less manufacturer's rated capacity; or
- Class M (multipurpose) vehicle.
- "Motor vehicle" does not include a motor home. For the purpose of administering this subtitle, the Motor Vehicle Administration shall promulgate a regulation defining a motor home.
- "Motor vehicle" means a vehicle that is registered in this State as a:
- "Dealer" has the meaning provided in § 15-101(b) of the Transportation Article.
- "Manufacturer, factory branch, or distributor" means a person, partnership, association, corporation, or entity engaged in the business of manufacturing or assembling motor vehicles or of distributing motor vehicles to motor vehicle dealers as defined in § 15-201(b), (c), and (e) of the Transportation Article.
- "Warranty" means warranties as defined in §§ 2-312, 2-313, 2-314, and 2-315 of this article.
"Manufacturer's warranty period" means the earlier of:
- The period of the motor vehicle's first 15,000 miles of operation; or
- 15 months following the date of original delivery of the motor vehicle to the consumer.
- This subsection does not extend any manufacturer's express warranty.
- "Manufacturer's warranty period" means the earlier of:
§ Maryland Lemon law 14-1502.
- If the manufacturer's warranty period is to include those miles of operation when the new motor vehicle is in the possession of any person other than the consumer, the manufacturer shall state that fact in 12 point bold face type in the manufacturer's written warranty.
- If a new motor vehicle does not conform to all applicable warranties during the warranty period, the consumer shall, during such period, report the nonconformity, defect, or condition by giving written notice to the manufacturer or factory branch by certified mail, return receipt requested. Notice of this procedure shall be conspicuously disclosed to the consumer in writing at the time of sale or delivery of the motor vehicle.
- The consumer shall provide an opportunity for the manufacturer or factory branch, or its agent to cure the nonconformity, defect, or condition.
- The manufacturer or factory branch, its agent, or its authorized dealer shall correct the nonconformity, defect, or condition at no charge to the consumer, even if repairs are made after the expiration of the warranty period. The corrections shall be completed within 30 days of the manufacturer's receipt of the consumer's notification of the nonconformity, defect, or condition.
If, during the warranty period, the manufacturer or factory branch, its agent, or its authorized dealer is unable to repair or correct any defect or condition that substantially impairs the use and market value of the motor vehicle to the consumer after a reasonable number of attempts, the manufacturer or factory branch, at the option of the consumer, shall:
- Replace the motor vehicle with a comparable motor vehicle acceptable to the consumer; or
Accept return of the motor vehicle from the consumer and refund to the consumer the full purchase price including all license fees, registration fees, and any similar governmental charges, less:
- A reasonable allowance for the consumer's use of the vehicle not to exceed 15 percent of the purchase price; and
- A reasonable allowance for damage not attributable to normal wear but not to include damage resulting from a nonconformity, defect, or condition.
- The manufacturer or factory branch shall make refunds under this section to the consumer and lienholder, if any, as their interests appear on the records of ownership maintained by the Motor Vehicle Administration.
It is an affirmative defense to any claim under this section that the nonconformity, defect, or condition:
- Does not substantially impair the use and market value of the motor vehicle; or
- Is the result of abuse, neglect, or unauthorized modifications or alterations of the motor vehicle.
- If, during the warranty period, the manufacturer or factory branch, its agent, or its authorized dealer is unable to repair or correct any defect or condition that substantially impairs the use and market value of the motor vehicle to the consumer after a reasonable number of attempts, the manufacturer or factory branch, at the option of the consumer, shall:
It shall be presumed that a reasonable number of attempts have been undertaken to conform a motor vehicle to the applicable warranties if:
- The same nonconformity, defect, or condition has been subject to repair 4 or more times by the manufacturer or factory branch, or its agents or authorized dealers, within the warranty period but such nonconformity, defect, or condition continues to exist;
- The vehicle is out of service by reason of repair of 1 or more nonconformities, defects, or conditions for a cumulative total of 30 or more days during the warranty period; or
- A nonconformity, defect, or condition resulting in failure of the braking or steering system has been subject to the same repair at least once within the warranty period, and the manufacturer has been notified and given the opportunity to cure the defect, and the repair does not bring the vehicle into compliance with the motor vehicle safety inspection laws of the State.
- The term of any warranty, the warranty period, and the 30 day out of service period shall be extended by any time during which repair services are not available to the consumer by reason of war, invasion, strike, or fire, flood, or other natural disaster.
- It shall be the duty of a dealer to notify the manufacturer of the existence of a nonconformity, defect, or condition within 7 days when the motor vehicle is delivered to the same dealer for a fourth time for repair of the same nonconformity or when the vehicle is out of service by reason of repair of one or more nonconformities, defects, or conditions for a cumulative total of 20 days.
- The notification shall be sent by certified mail and a copy of the notification shall be sent to the Motor Vehicle Administration; however, failure of the dealer to give the required notice required under this subsection shall not affect the consumer's right under this subtitle.
- If a motor vehicle is returned to a manufacturer or factory branch either under this subtitle, or by judgment, decree, arbitration award, or by voluntary agreement, the manufacturer or factory branch shall notify the Motor Vehicle Administration in writing within 15 days of the fact that the vehicle was returned.
- If a motor vehicle that is returned to the manufacturer under either this subtitle or by judgment, decree, arbitration award, settlement agreement, or by voluntary agreement in this or any other state and is then transferred to a dealer in Maryland, the manufacturer shall disclose this information to the dealer.
The manufacturer's disclosure under this paragraph shall be in writing on a separate piece of paper in 10 point all capital type and shall state in a clear and conspicuous manner:
- That the motor vehicle was returned to the manufacturer or factory branch;
- The nature of the defect, if any, that resulted in the return; and
- The condition of the motor vehicle at the time that it is transferred to the dealer.
- If the returned vehicle is then made available for resale, the seller shall provide a copy of the manufacturer's disclosure form to the consumer prior to sale.
- If the returned vehicle is sold, the seller shall send a copy of the manufacturer's disclosure form, signed by the consumer, to the Administration.
- This section does not limit the rights or remedies that are otherwise available to a consumer under any other law, including any implied warranties.
- If a manufacturer or factory branch has established an informal dispute settlement procedure which complies in all respects with the provisions of Title 16, Code of Federal Regulations, Part 703, as amended, a consumer may resort to that procedure before subsection (c) of this section applies.
- A consumer who has resorted to an informal dispute settlement procedure may not be precluded from seeking the rights or remedies available by law.
- Any agreement entered into by a consumer for the purchase of a new motor vehicle that waives, limits, or disclaims the rights set forth in this section shall be void.
- The rights available to a consumer under this section shall inure to a subsequent transferee of a new motor vehicle for the duration of the applicable warranties.
- Any action brought under this section shall be commenced within 3 years of the date of original delivery of the motor vehicle to the consumer.
- A court may award reasonable attorney's fees to a prevailing plaintiff under this section.
- If it appears to the satisfaction of the court that an action is brought in bad faith or is of a frivolous nature, the court may order the offending party to pay to the other party reasonable attorney's fees.
- This subtitle does not apply to a fleet purchase of five or more motor vehicles.
§ Maryland Lemon law 14-1502.1.
The Motor Vehicle Administration shall:
- Develop a notice that describes the rights provided to consumers under this subtitle;
- Make the notice available to all dealers that sell new motor vehicles in the State; and
- Adopt regulations as necessary to implement the provisions of this section.
The notice shall:
- Be written in simple and readable plain language; and
- Contain sufficient detail to fully inform consumers about the rights and remedies available under this subtitle and the procedures to follow to enforce those rights and remedies.
- Each dealer that sells a new motor vehicle in the State shall provide to the purchaser, at the time of the sale or delivery of the motor vehicle, a copy of the notice developed by the Motor Vehicle Administration under this section.
§ Maryland Lemon law 14-1503.
- If a dealer, manufacturer, factory branch, or distributor is required under a judgment, decree, arbitration award, or settlement agreement to accept, or by voluntary agreement accepts, return of a motor vehicle from a consumer, the consumer shall be entitled to recover from the Motor Vehicle Administration the excise taxes originally paid by the consumer, subject to subsection (b) of this section.
- If a dealer, manufacturer, factory branch, or distributor replaces a motor vehicle with a comparable motor vehicle under § 14-1502(c)(1)(i) of this subtitle, the Motor Vehicle Administration shall allow a credit against the excise tax imposed for the replacement vehicle in the amount of the excise taxes originally paid by the consumer for the returned vehicle, subject to subsection (b) of this section.
- If the excise tax on the replacement vehicle exceeds the credit allowed under subparagraph (i) of this paragraph, the dealer shall collect only that portion of excise tax due; or
- If the excise tax on the vehicle being replaced exceeds the excise tax on the replacement vehicle, the consumer shall be entitled to recover from the Motor Vehicle Administration the excess of the excise tax paid.
- The excise taxes that a consumer is entitled to recover under this section shall be calculated based on the amount of the purchase price or any portion of the purchase price of the motor vehicle that the dealer, manufacturer, factory branch, or distributor refunds to the consumer.
- A dealer, manufacturer, factory branch, or distributor who is required under a judgment, decree, arbitration award, or settlement agreement to accept, or who accepts, by voluntary agreement, return of a motor vehicle shall notify the consumer in writing that the consumer is entitled to recover the excise taxes from the Motor Vehicle Administration.
§ Maryland Lemon law 14-1504.
- A violation of this subtitle shall be an unfair and deceptive trade practice under Title 13 of the Commercial Law Article.
- In addition to any other remedies that may be available under this subtitle, if a manufacturer, factory branch, or distributor is found to have acted in bad faith, the court may award the consumer damages of up to $10,000.
The Magnuson-Moss Warranty Act
The Magnuson-Moss Warranty Act is a Federal Law that protects the buyer of any product which costs more than $25 and comes with an express written warranty. This law applies to any product that you buy that does not perform as it should.
Your car is a major investment, rationalized by the peace of mind that flows from its expected dependability and safety. Accordingly, you are entitled to expect an automobile properly constructed and regulated to provide reasonably safe, trouble-free, and dependable transportation – regardless of the exact make and model you bought. Unfortunately, sometimes these principles do not hold true and defects arise in automobiles. Although one defect is not actionable, repeated defects are as there exists a generally accepted rule that unsuccessful repair efforts render the warrantor liable. Simply put, there comes a time when “enough is enough” – when after having to take your car into the shop for repairs an inordinate number of times and experiencing all of the attendant inconvenience, you are entitled to say, ‘That’s all,’ and revoke, notwithstanding the seller’s repeated good faith efforts to fix the car. The rationale behind these basic principles is clear: once your faith in the vehicle is shaken, the vehicle loses its real value to you and becomes an instrument whose integrity is impaired and whose operation is fraught with apprehension. The question thus becomes when is “enough”?
As you know, enough is never enough from your warrantor’s point of view and you should simply continue to have your defective vehicle repaired – time and time again. However, you are not required to allow a warrantor to tinker with your vehicle indefinitely in the hope that it may eventually be fixed. Rather, you are entitled to expect your vehicle to be repaired within a reasonable opportunity. To this end, both the federal Moss Warranty Act, and the various state “lemon laws,” require repairs to your vehicle be performed within a reasonable opportunity.
Under the Magnuson-Moss Warranty Act, a warrantor should perform adequate repairs in at least two, and possibly three, attempts to correct a particular defect. Further, the Magnuson-Moss Warranty Act’s reasonableness requirement applies to your vehicle as a whole rather than to each individual defect that arises. Although most of the Lemon Laws vary from state to state, each individual law usually require a warrantor to cure a specific defect within four to five attempts or the automobile as a whole within thirty days. If the warrantor fails to meet this obligation, most of the lemon laws provide for a full refund or new replacement vehicle. Further, this reasonable number of attempts/reasonable opportunity standard, whether it be that of the Magnuson-Moss Warranty Act or that of the Lemon Laws, is akin to strict liability – once this threshold has been met, the continued existence of a defect is irrelevant and you are still entitled to relief.
One of the most important parts of the Magnuson-Moss Warranty Act is its fee shifting provision. This provision provides that you may recover the attorney fees incurred in the prosecution of your case if you are successful – independent of how much you actually win. That rational behind this fee shifting provision is to twofold: (1) to ensure you will be able to vindicate your rights without having to expend large sums on attorney's fees and (2) because automobile manufacturers are able to write off all expenses of defense as a legitimate business expense, whereas you, the average consumer, obviously does not have that kind of economic staying power. Most of the Lemon Laws contain similar fee shifting provisions.
You may also derive additional warranty rights from the Uniform Commercial Code; however, the Code does not allow you in most states to recover your attorney fees and is also not as consumer friendly as the Magnuson-Moss Warranty Act or the various state lemon laws.
The narrative information on Magnuson-Moss, UCC and Maryland lemon laws on these pages is provided by Marshall Meyers, attorney.
Uniform Commercial Code Summary
The Uniform Commercial Code or UCC has been enacted in all 50 states and some of the territories of the United States. It is the primary source of law in all contracts dealing with the sale of products. The TARR refers to Tender, Acceptance, Rejection, Revocation and applies to different aspects of the consumer's "relationship" with the purchased goods.
TENDER - The tender provisions of the Uniform Commercial Code contained in Section2-601 provide that the buyer is entitled to reject any goods that fail in any respect to conform to the contract. Unfortunately, new cars are often technically complex and their innermost workings are beyond the understanding of the average new car buyer. The buyer, therefore, does not know whether the goods are then conforming.
ACCEPTANCE - The new car buyer accepts the goods believing and expecting that the manufacturer will repair any problem he has with the goods under the warranty.
REJECTION - The new car buyer may discover a problem with the vehicle within the first few miles of his purchase. This would allow the new car buyer to reject the goods. If the new car buyer discovers a defect in the car within a reasonable time to inspect the vehicle, he may reject the vehicle. This period is not defined. On the one hand, the buyer must be given a reasonable time to inspect and that reasonable time to inspect will be held as an acceptance of the vehicle. The Courts will decide this reasonable time to inspect based on the knowledge and experience of the buyer, the difficulty in discovering the defect, and the opportunity to discover the defect. The following is an example of a case of rejection: Mr. Zabriskie purchase a new 1966 Chevrolet Biscayne. After picking up the car on Friday evening, while en route to his home 2.5 miles away, and within 7/10ths of a mile from the dealership, the car stalled and stalled again within 15 feet. Thereafter, the car would only drive in low gear. The buyer rejected the vehicle and stopped payment on his check. The dealer contended that the buyer could not reject the car because he had driven it around the block and that was his reasonable opportunity to inspect. The New Jersey Court said;
To the layman, the complicated mechanisms of today's automobile are a complete mystery. To have the automobile inspected by someone with sufficient expertise to disassemble the vehicle in order the discover latent defects before the contract is signed, is assuredly impossible and highly impractical. Consequently, the first few miles of driving become even more significant to the excited new car buyer. This is the buyer's first reasonable opportunity to enjoy his new vehicle to see if it conforms to what it was represented to be and whether he is getting what he bargained for. How long the buyer may drive the new car under the guise of inspection of new goods is not an issue in the present case because 7/10th of a mile is clearly within the ambit of a reasonable opportunity to inspect. Zabriskie Chevrolet, Inc. v. Smith, 240 A. 2d 195(1968)
It is suggested that Courts will tend to excuse use by consumers if possible.
REVOCATION - What happens when the consumer has used the new car for a lengthy period of time? This is the typical lemon car case. The UCC provides that a buyer may revoke his acceptance of goods whose non-conformity substantially impairs the value of the goods to him when he has accepted the goods without discovery of a non-conformity because it was difficult to discover or if he was assured that non-conformities would be repaired. Of course, the average new car buyer does not learn of the nonconformity until hundreds of thousands of miles later. And because quality is job one, and manufacturers are competing on the basis of their warranties, the consumer always is assured that any noncomformities he does discover will be remedied. What is a noncomformity substantially impairing the value of the vehicle?
- A noncomformity may include a number of relatively minor defects whose cumulative total adds up to a substantial impairment. This is the "Shake Faith" Doctrine first stated in the Zabrisikie case. "For a majority of people the purchase of a new car is a major investment, rationalized by the peace of mind that flows from its dependability and safety. Once their faith is shaken, the vehicle loses not only its real value in their eyes, but becomes an instrument whose integrity is substantially impaired and whose operation is fraught with apprehension".
- A substantial noncomformity may include a failure or refusal to repair the goods under the warranty. In Durfee V. Rod Baxter Imports, the Minnesota Court held that the Saab owner that was plagued by a series of of annoying minor defects and stalling, which were never repaired after a number of attempts, could revoke, "if repairs are not successfully undertaken within a reasonable time", the consumer may elect to revoke.
- Substantial Non Conformity and Lemon Laws often define what may be considered a substantial impairment. These definitions have been successfully used to flesh out the substantial impairment in the UCC.
Additional narrative information on Magnusson-Moss, UCC and Maryland lemon laws on these pages is provided by T. Michael Flinn, attorney.