 |
Lemon Law America® offers owners of defective motor vehicles resources to help them research their state's lemon law statutes, and provides links to lemon lawyers practicing in their state.
Click here for legal help for your Hawaii lemon
|
|
Hawaii
Lemon Law Statutes
Chapter 4811
481I-1.
Legislative intent.
The legislature recognizes that a motor vehicle is a major consumer
purchase and that a defective motor vehicle creates a hardship
for the consumer. The legislature further recognizes that a duly
franchised motor vehicle dealer is an authorized service agent
of the manufacturer. It is the intent of the legislature that
a good faith motor vehicle warranty complaint by a consumer be
resolved by the manufacturer within a specified period of time.
It is further the intent of the legislature to provide statutory
procedures whereby a consumer may receive a replacement motor
vehicle, or a full refund, for a motor vehicle which is not brought
into conformity with the applicable express warranties, as provided
in this chapter. Finally, it is the intent of the legislature
to ensure that consumers are made aware of their rights under
this chapter and are not refused the information, documents,
or service necessary to exercise their rights.
Nothing in this chapter shall in any way limit or expand the
rights or remedies which are otherwise available to a consumer
under any other law.
481I-2. Definitions.
When used in this section unless the context otherwise requires:
- " Business day" means any day during which the service
departments of authorized dealers of the manufacturer of the
motor vehicle are normally open for business.
- " Collateral charges" means those additional charges
to a consumer wholly incurred as a result of the acquisition
of the motor vehicle. For the purposes of this chapter, collateral
charges include, but are not limited to, manufacturer-installed
or agent-installed items, general excise tax, license and registration
fees, title charges, and similar government charges.
- " Consumer" means the purchaser, other than for purposes
of resale, or the lessee of a motor vehicle, any person to whom
the motor vehicle is transferred during the duration of the express
warranty applicable to the motor vehicle, and any other person
entitled to enforce the obligations of the express warranty.
- " Express warranty" means any written warranty issued
by the manufacturer, or any affirmation of fact or promise made
by the manufacturer, excluding statements made by the dealer,
in connection with the sale or lease of a motor vehicle to a
consumer, which relates to the nature of the material or workmanship
and affirms or promises that the motor vehicle shall conform
to the affirmation, promise, or description or that the material
or workmanship is free of defects or will meet a specified level
of performance.
- " Incidental charges" means those reasonable costs
incurred by the consumer, including, but not limited to, towing
charges and the costs of obtaining alternative transportation
which are directly caused by the nonconformity or nonconformities
which are the subject of the claim, but shall not include loss
of use, loss of income, or personal injury claims.
- " Lemon law rights period" means the term of the manufacturer's
express warranty, the period ending two years after the date
of the original delivery of a motor vehicle to a consumer, or
the first 24,000 miles of operation, whichever occurs first.
- " Lessee" means any consumer who leases a motor vehicle
for one year or more pursuant to a written lease agreement which
provides that the lessee is responsible for repairs to such motor
vehicle, or any consumer who leases a motor vehicle pursuant
to a lease-purchase agreement.
- " Motor vehicle" means a self-propelled vehicle primarily
designed for the transportation of persons or property over public
streets and highways which is used primarily for personal, family,
or household purposes. For purposes of this definition, a "motor
vehicle" also includes a "demonstrator", which
means a vehicle assigned by a dealer for the purpose of demonstrating
qualities and characteristics common to vehicles of the same
or similar model or type, but does not include mopeds, motorcycles,
or motor scooters, as those terms are defined in chapter 286,
or vehicles over 10,000 pounds, gross vehicle weight rating.
For purposes of this definition, a "motor vehicle" also
includes (1) an individually registered vehicle used for an individual's
business purposes and for personal, family, or household purposes;
and (2) a vehicle owned or leased by a sole proprietorship, corporation
or partnership which has purchased or leased no more than one
vehicle per year, used for household, individual, or personal
use in addition to business use.
- " Nonconformity" means a defect, malfunction, or condition
that fails to conform to the motor vehicle's applicable express
warranty and that substantially impairs the use, market value,
or safety of a motor vehicle, but does not include a defect,
malfunction, or condition that results from an accident, abuse,
neglect, modification, or alteration of the motor vehicle by
persons other than the manufacturer, its agent, distributor,
or authorized dealer.
- " Purchase price" means the cash price appearing in
the sales agreement or contract and paid for the motor vehicle,
including any net allowance for a trade-in vehicle. Where the
consumer is a second or subsequent purchaser and the arbitration
award is for a refund of the motor vehicle, "purchase price" means
the purchase price of the second or subsequent purchase not to
exceed the purchase price paid by the original purchaser.
- " Reasonable offset" for use means the number of miles
attributable to a consumer up to the date of the third repair
attempt of the same nonconformity which is the subject of the
claim, the date of the first repair attempt of a nonconformity
that is likely to cause death or serious bodily injury, or the
date of the thirtieth (30th) cumulative business day when the
vehicle is out of service by reason of repair of one or more
nonconformities, whichever occurs first. The reasonable offset
for use shall be equal to one percent of the purchase price for
every thousand miles of use.
- " Replacement motor vehicle" means a motor vehicle
which is identical or reasonably equivalent to the motor vehicle
to be replaced, as the motor vehicle to be replaced existed at
the time of original acquisition, including any service contract,
undercoating, rustproofing, and factory or dealer installed options.
A reasonable offset shall be made for the use of the motor vehicle
and an additional offset may be made for loss to the fair market
value of the vehicle resulting from damage beyond normal wear
and tear, unless the damage resulted from the nonconformity.
- " Substantially impairs" means to render the motor
vehicle unfit, unreliable, or unsafe for warranted or normal
use, or to significantly diminish the value of the motor vehicle.
481I-3. Motor vehicle: express warranties, return.
- If a motor vehicle does not conform to all applicable
express warranties, and the consumer reports the nonconformity
in writing to the manufacturer, its agent, distributor, or
its authorized dealer during the term of the lemon law rights
period, then the manufacturer, or, at its option, its agent,
distributor, or its authorized dealer, shall make such repairs
as are necessary to conform the vehicle to such express warranties,
notwithstanding the fact that such repairs are made after
the expiration of such term.
- If the manufacturer, its agents, distributors, or authorized
dealers are unable to conform the motor vehicle to any applicable
express warranty by repairing or correcting any defect or
condition which substantially impairs the use, market value,
or safety of the motor vehicle after a reasonable number
of documented attempts, then the manufacturer shall provide
the consumer with a replacement motor vehicle or accept return
of the vehicle from the consumer and refund to the consumer
the following: the full purchase price including, but not
limited to, charges for undercoating, dealer preparation,
transportation and installed options, and all collateral
and incidental charges, excluding finance and interest charges,
and less a reasonable offset for the consumer's use of the
motor vehicle. If either a replacement motor vehicle or a
refund is awarded, an "offset" may be made for
damage to the vehicle not attributable to normal wear and
tear, if unrelated to the nonconformity. Refunds made pursuant
to this subsection shall be deemed to be refunds of the sales
price and treated as such for purposes of section 237-3.
Refunds shall be made to the consumer and lienholder, if
any, as their interests may appear on the records of ownership.
If applicable, refunds shall be made to the lessor and lessee
pursuant to rules adopted by the department of commerce and
consumer affairs.
- It shall be an affirmative defense to any claim under
this section that a nonconformity is the result of abuse,
neglect, or unauthorized modifications or alterations of
a motor vehicle by a consumer.
- It shall be presumed that a reasonable number of attempts
have been undertaken to conform a motor vehicle to the applicable
express warranties, if, during the lemon law rights period,
any of the following occurs:
- The same nonconformity has been subject to examination
or repair at least three times by the manufacturer, its agents,
distributors, or authorized dealers, but such nonconformity
continues to exists; or
- The nonconformity has been subject to examination or
repair at least once by the manufacturer, its agents, distributors,
or authorized dealers, but continues to be a nonconformity
which is likely to cause death or serious bodily injury if
the vehicle is driven; or
- The motor vehicle is out of service by reason of repair
by the manufacturer, its agents, distributors, or authorized
dealers for one or more nonconformities for a cumulative
total of thirty or more business days during the lemon law
rights period.
The term of the lemon law rights period and such thirty-day
period shall be extended by any period of time during which
repair services are not available to the consumer because
of a war, invasion, strike, fire, flood or other natural
disaster.
The presumptions provided in this subsection shall not apply
unless the manufacturer has received a written report of
the nonconformity from the consumer and has had a reasonable
opportunity to repair the nonconformity alleged.
Upon a second notice of the nonconformity, or, if the motor
vehicle has been out of service by reason of repair in excess
of twenty business days, the dealer shall notify the manufacturer
of the nonconformity.
- During the lemon law rights period, the manufacturer
or its agent, distributor, or authorized dealer shall provide
to the consumer, each time the consumer's vehicle is returned
from being diagnosed or repaired under the warranty, a fully
itemized, legible statement or repair order indicating any
diagnosis made and all work performed on the vehicle, including,
but not limited to, a general description of the problem
reported by the consumer or an identification of the defect
or condition, parts and labor supplied, the date and the
odometer reading when the vehicle was submitted for repair,
and the date when the vehicle was made available to the consumer.
The consumer shall sign and receive a copy of the statement
or repair order.
- Upon request from the consumer, the manufacturer, or
at its option its agent, distributor, or authorized dealer,
shall provide a copy of any report or computer reading regarding
inspection, diagnosis, or test-drive of the consumer's motor
vehicle, and shall provide a copy of any technical service
bulletin related to the nonconformity issued by the manufacturer
regarding the year and model of the consumer's motor vehicle
as it pertains to any material, feature, component, or the
performance thereof.
Upon receipt of a consumer's written report of a nonconformity
to the manufacturer, the manufacturer or, at its option,
its agent, distributor, or authorized dealer, shall inform
the consumer of any technical service bulletin or report
relating to the nonconformity, and shall advise the consumer
of the consumer's right to obtain a copy of such report or
technical service bulletin.
- The manufacturer, its agent, distributor, or authorized
dealer, shall provide the consumer at the time of purchase
of the motor vehicle a written notice setting forth the terms
of a state certified arbitration program and a statement
of the rights of the consumer under this section in plain
language, the form of which has been previously reviewed
and approved by the department of commerce and consumer affairs
for substantial compliance with title 16, Code of Federal
Regulations, part 703, as may be modified by the requirements
of this chapter. The written notice must specify the requirement
that written notification to the manufacturer of the motor
vehicle nonconformity is required before the consumer is
eligible for a refund or replacement of the motor vehicle.
The notice must also include the name and address to which
the consumer must send such written notification. The provision
of this statement is the direct responsibility of the dealer,
as that term is defined in chapter 437.
- The consumer shall be required to notify the manufacturer
of the nonconformity only if the consumer has received a
written notice setting forth the terms of the state certified
arbitration program and a statement of the rights of the
consumer as set out in subsection (g).
- Where the state certified arbitration program is invoked
by the consumer of a motor vehicle under express warranties,
a decision resolving the dispute shall be rendered within
forty-five days after the procedure is invoked. If no decision
is rendered within forty-five days as required by this subsection,
the dispute shall be submitted to the regulated industries
complaints office of the department of commerce and consumer
affairs for investigation and hearing. Any decision rendered
resolving the dispute shall provide appropriate remedies
including, but not limited to, the following:
- Provision of a replacement motor vehicle; or
- Acceptance of the motor vehicle from the consumer,
refund of the full purchase price, and all collateral and
incidental charges.
The decision shall specify a date for performance and completion
of all awarded remedies.
- Any action brought under this section must be initiated
within one year following expiration of the lemon law rights
period.
- No vehicle transferred to a dealer or manufacturer
by a buyer or a lessee under subsection (b) may be sold or
leased
by any person unless:
- The nature of the defect experienced by the original
buyer or lessee is clearly and conspicuously disclosed on
a separate document that must be signed by the manufacturer
and the purchaser and must be in ten point, capitalized type,
in substantially the following form: "IMPORTANT: THIS
VEHICLE WAS RETURNED TO THE MANUFACTURER BECAUSE A DEFECT(S)
COVERED BY THE MANUFACTURER'S EXPRESS WARRANTY WAS NOT REPAIRED
WITHIN A REASONABLE TIME AS PROVIDED BY Hawaii LAW.";
- The defect is corrected; and
- The manufacturer warrants to the new buyer or lessee,
in writing, that if the defect reappears within one year
or 12,000 miles after the date of resale, whichever occurs
first, it will be corrected at no expense to the consumer.
- A violation of subsection (k) shall constitute prima
facie evidence of an unfair or deceptive act or practice
under chapter 480.
481I-4. Arbitration mechanism.
- The department of commerce and consumer affairs shall establish
and monitor a state certified arbitration program which is in
substantial compliance with title 16, Code of Federal Regulations,
part 703, as may be modified by this section, and shall adopt
appropriate rules governing its operation.
- The director of commerce and consumer affairs may contract
with an independent arbitration organization for annual term
appointments to screen, hear, and resolve consumer complaints
which have been initiated pursuant to section 481I-3. The following
criteria shall be considered in evaluating the suitability of
independent arbitration mechanisms: capability, objectivity,
experience, nonaffiliation with manufacturers of or dealers in
new motor vehicles, reliability, financial stability, and fee
structure.
- If a consumer agrees to participate in and be bound by the
operation and decision of the state certified arbitration program,
then all parties shall also participate in, and be bound by,
the operation and decision of the state certified arbitration
program. The prevailing party of an arbitration decision made
pursuant to this section may be allowed reasonable attorney's
fees.
- The submission of any dispute to arbitration in which the
consumer elects nonbinding arbitration shall not limit the right
of any party to a subsequent trial de novo upon written demand
made upon the opposing party to the arbitration within thirty
calendar days after service of the arbitration award, and the
award shall not be admissible as evidence at that trial. If the
party demanding a trial de novo does not improve its position
as a result of the trial by at least twenty-five per cent, then
the court shall order that all of the reasonable costs of trial,
consultation, and attorney's fees be paid for by the party making
the demand. If neither party to a nonbinding arbitration demands
a trial de novo within thirty days after service of the arbitration
award, the arbitrator's decision shall become binding on both
parties upon the expiration of the thirty-day period.
- Funding of the state certified arbitration program shall
be provided through an initial filing fee of $200 to be paid
by the manufacturer and $50 to be paid by the consumer upon initiating
a case for arbitration under this section. Every final decision
in favor of the consumer issued by the independent arbitration
mechanism shall include within its relief the return of the $50
filing fee to the consumer. The director of commerce and consumer
affairs may establish a trust fund for the purpose of administering
fees and costs associated with the state certified arbitration
program.
- The failure of a manufacturer to timely comply with a binding
decision of a state certified arbitration program shall be prima
facie evidence of an unfair or deceptive act or practice under
chapter 480 unless the manufacturer can prove that it attempted
in "good faith" to comply, or that the failure was
beyond the manufacturer's control, the result of a written agreement
with the consumer, or based on an appeal filed under chapter
658.
|
|
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 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 lemon laws on these pages is provided by T. Michael Flinn, attorney.
|
|
|
|
 |
