Understanding Georgia Lemon Law
Roughly 150,000 cars sold in America every year are classified as lemons: cars with repeated, unfixable problems. Lemons can come from any manufacturer: Toyota, Chrysler, Ford and almost every other manufacturer has built lemon vehicles over the years.
“Lemon laws” enacted across the United States help protect consumers who purchase defective vehicles and compensate them for their losses. Additionally, a powerful federal law known as the Magnuson-Moss Warranty Act provides protection for consumers who purchase cars that are having problems under the manufacturer’s warranty. Some lemons may eventually be recalled by the manufacturer, if the problems are systemic.
Georgia’s Lemon Law was updated in 2009 with new standards different from the previous law, the Motor Vehicle Warranty Rights Act.
The new law’s standards apply specifically to all vehicles purchased, leased or registered in Georgia on or after Jan. 1, 2009. The Georgia lemon law protects new vehicle buyers by enforcing the manufacturer’s express warranty. The law does not apply to used cars.
The Georgia Lemon Law explicitly covers new motor vehicles leased or purchased in Georgia, or those registered in Georgia by the original consumer. It also covers motor home vehicles. The law doesn’t cover motorcycles, golf carts, or trucks weighing more than 12,000 pounds.
The Georgia Lemon Law covers consumers who purchase or lease new motor vehicles for personal, family or household purposes. It also covers businesses that purchase or lease no more than ten new vehicles a year for business purposes other than providing limousine rental services.
The lemon law covers “nonconformities:” a serious safety defect or condition that substantially impairs the use, value or safety of a new motor vehicle to the consumer. A manufacturer must repair a nonconformity, unless it was caused by abuse, neglect or unauthorized modification or alteration. The law defines “serious safety defect” as a life-threatening defect or malfunction that impedes the consumer’s ability to control or operate the motor vehicle for ordinary use. Any condition that creates a risk of fire or explosion also counts as a “serious safety defect” under the law.
The lemon law mandates that the manufacturer bring any nonconforming vehicle into conformity with its warranty. The law defines “warranty” as the express warranty or any affirmation of fact or promise made by the manufacturer in connection with the sale of a new motor vehicle to a consumer.
Any nonconformity must be reported during the “lemon law rights period.” The period spans two years after the date of the original delivery of the new vehicle to the consumer or the first 24,000 miles of operation after delivery, whichever comes first.
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If the consumer reports the nonconformity during this period, the manufacturer must be allowed a “reasonable number of attempts” to fix it. The Georgia Lemon Law defines that as one attempt for a serious safety defect that is unsuccessful or three attempts for a non-serious defect that is unsuccessful. It’s also considered an unreasonable repair effort if the vehicle is out of service by reason of repair for nonconformities for a total of 30 days or more.
If the manufacturer cannot fix the problem after the aforementioned reasonable number of attempts, the consumer must notify the manufacturer for a final opportunity to repair the issue. The manufacturer must notify the consumer of a reasonably accessible repair facility within seven days of receiving the consumer’s notice. The manufacturer then has 28 days after receiving the consumer’s notice to fix the problem.
If the final attempt fails or if the car was out of service for 30 days or more, the consumer can request the manufacturer to either replace or repurchase the vehicle. The consumer must send their request by certified mail or statutory overnight delivery. The manufacturer must comply within 20 days of receiving this final request.
A manufacturer repurchasing a vehicle must pay the purchase price of the vehicle, collateral charges such as tax and title charges, and incidental costs. Incidental costs include payments to dealers for attempted repairs of nonconformities, towing charges and costs of obtaining alternative transportation. Manufacturers can subtract a reasonable “offset for use” calculated from the number of miles driven before the consumer first delivered the vehicle to the shop for repair.
Manufacturers replacing a vehicle under the Georgia lemon law must give the consumer a new vehicle that is identical or at least equivalent to the vehicle being replaced. The manufacturer must also pay incidental costs just as they would for repurchasing a vehicle.
If the manufacturer in question participates in an “informal dispute resolution mechanism,” i.e. arbitration, the consumer must go through this process first before submitting it to the Georgia new motor vehicle arbitration panel. The consumer must exhaust the manufacturer’s chosen arbitration mechanism and the Georgia new motor vehicle arbitration panel before taking legal action in the courts.
If the manufacturer’s arbitrator fails to render a decision within 40 days of filing, the consumer becomes eligible to apply for arbitration by the Georgia new motor vehicle arbitration panel.
Consumers must file a claim with their manufacturer’s arbitration mechanism within one year after the expiration of the lemon law rights period. If they reject the decision of that arbitrator, they may request a hearing with the state-operated panel by requesting, completing and submitting forms to the Georgia Governor’s Office of Consumer Affairs. Consumers must submit the forms within 60 days from the date the mechanism concludes its proceedings or within one year after expiration of the lemon law rights period, whichever is later.
In an arbitration, a neutral third party (an arbitrator) decides whether a reasonable number of repair attempts have been made and what award, if any, should be granted to the consumer. If the consumer accepts the arbitrator’s decision, the manufacturer agrees to comply with it. A manufacturer’s arbitration process must comply with the Code of Federal Regulations.
There are downsides to the arbitration process. Firstly, attorneys are not required for either side in arbitration. However, the manufacturer will certainly either send an attorney or someone advised by an attorney. Consumers can bring legal representation, though legal fees may not be awarded by the arbitrator unless the manufacturer has chosen to include them as an award in their arbitration application. Any consumer looking to pursue the arbitration process in Georgia is advised to speak with a law firm beforehand.
Arbitration programs allegedly assist both consumer and manufacturer in collecting evidence to be presented from each side, so that it may be shared with both sides prior to the hearing. Unfortunately, in arbitration both sides have fewer rights to discovery: the legal process by which litigants can obtain evidence. In a lemon law case this puts consumers at a disadvantage, as they need discovery to gather evidence to prove their cases, and much of the evidence is held by the manufacturer and dealership.
Before the arbitration begins, the owner should collect all documents relating to the vehicle and the repair process, including the letters exchanged with the manufacturer. They should also arrange for witnesses to appear at the hearing, including friends who have witnessed the vehicle’s problems. The vehicle in question should also be ready for inspection and test drive at the hearing.
Georgia consumers with warrantied vehicle problems would be well served to contact a law firm for a consultation on what their next step should be, whether it be going through with arbitration or proceeding to trial. In court, consumers are guaranteed the ability to gather evidence under the state’s civil discovery rules, and to be represented by a qualified lawyer who can guide them through the often complex legal process.
By pursuing a claim under the Magnuson-Moss Warranty Act, Georgia consumers can hire lawyers who will represent them without the vehicle owner having to pay any attorneys’ fees directly out of their pocket. This is because the federal Act provides that the vehicle manufacturer may have to pay the claimants’ reasonable attorneys’ fees if the claimant prevails against the manufacturer.
Lemonlawusa.org encourages vehicle owners with a lemon to obtain legal counsel. You can bet the car manufacturers have legal counsel at the ready to help defend against lemon law claims both in arbitration and in court.