California Lemon Law Glossary
While California’s Lemon Law provides important protections to consumers who purchase and lease defective vehicles, understanding your rights under the law is not easy.
Use this glossary to familiarize yourself with some of the key terms in the California Lemon Law, then contact us for a free, no-obligation consultation about your legal rights.
Glossary of Key Terms Under California’s Lemon Law
If you are entitled to remedies under California’s Lemon Law, and you request a refund (also referred to as “restitution”), the amount of your refund will be based on your actual damages. Under Section 1793.2 of the Song-Beverly Consumer Warranty Act, this includes, “the actual price paid or payable by the buyer, including any charges for transportation and manufacturer-installed options . . . and including any collateral charges such as sales or use tax, license fees, registration fees, and other official fees, plus any incidental damages [such as] reasonable repair, towing, and rental car costs….”
Arbitration is a form of “alternative dispute resolution” available to consumers in California Lemon Law cases. When you take your claim to arbitration, the outcome will be determined by an “arbitrator.” The arbitrator is a neutral third party who serves in a role similar to a judge—although arbitration is much more simplified and streamlined than going to court. In California Lemon Law arbitration, the claimant’s attorney presents their arguments. First, the dealership or manufacturer presents its defense, and then the arbitrator issues a final decision (subject to appeal).
As a consumer, you have the option to pursue arbitration for your California Lemon Law claim—you are not required to do so. In many cases, arbitration will not be necessary. You also have the option to take your case to court, and in some cases, it may be more effective or more efficient to pursue litigation instead of arbitration. Your attorney can help you determine the best path forward.
Automotive Consumer Notification Act
The Automotive Consumer Notification Act (California Civil Code Section 1793.23) is a California law that requires manufacturers to inform consumers when they are selling “Lemon Law buybacks.” As discussed below, a Lemon Law buyback is a vehicle that a manufacturer repurchases from a claimant through the Lemon Law claims process. Under the Automotive Consumer Notification Act, manufacturers must ask the California Department of Motor Vehicles to place a “Lemon Law buyback” notation on a repurchased vehicle’s title before reselling the vehicle or transferring it to another state.
When you have a claim under California’s Lemon Law, one of the options you have available is to seek a cash settlement. When you obtain a cash settlement through a California Lemon Law claim, you keep your car, truck, or SUV. Still, you give up the right to pursue any additional claims against the dealership or manufacturer related to the vehicle.
A certified pre-owned (CPO) vehicle is a vehicle that has undergone inspection, maintenance, and repairs according to the manufacturer’s specified standards. In most cases, manufacturers sell CPO vehicles with additional warranties. A used vehicle does not have to be a CPO vehicle to qualify under California’s Lemon Law.
A civil penalty is available under California’s Lemon Law when a manufacturer willfully sells a defective vehicle. In other words, the manufacturer must be aware of the defect, and it must sell the vehicle anyway. When the California Lemon Law’s civil penalty provision applies, a purchaser or lessee can obtain additional payment in an amount equal to twice the purchaser’s or lessee’s actual damages.
Consequential damages are the costs a purchaser or lessee incurs as the result of purchasing or leasing a lemon. Common examples include repair costs, replacement parts, and rental cars or transportation costs. Consequential damages are a component of actual damages in a California Lemon Law case.
A contingency fee is a legal fee that an attorney is only entitled to collect if the client’s case is successful. In California Lemon Law cases, contingency fees are paid by the manufacturer. Since attorneys only get paid if they win, they have a strong financial incentive to obtain the best possible results for their clients.
California’s Lemon Law only applies to vehicles that have defects. Specifically, to qualify under the statute, a defect must substantially impair the purchaser’s or lessee’s use of the vehicle, or it must substantially impair the vehicle’s safety or value.
A vehicle is considered defective if it has an issue when it leaves the assembly line. Issues that result from improper maintenance or faulty repairs might be frustrating, but they do not qualify as defects under the CA Lemon Law. A defect can affect any part or component of a vehicle, from brake pads and tires to seatbelts and airbags.
A lease is a contract that allows for using a vehicle (or other property) in exchange for a fee. This fee typically involves an initial down payment and monthly lease payments. Vehicle leases will often include various terms and restrictions (i.e., restrictions on the number of vehicles the lessee can drive without incurring additional fees or costs). Vehicles subject to lease are eligible under California’s Lemon Law as long as the lease period is longer than four months.
A lessee is a person or company that leases a vehicle (or other property). As a lessee, you have the same rights as a purchaser under California’s Lemon Law, and the same basic eligibility criteria apply to your leased vehicle. The one significant difference is that if you choose a refund as your remedy, your refund will be based (in part) on the remaining balance of your lease agreement rather than your car loan.
A lessor is a company that leases a vehicle (or other property) to a lessee. When you lease a vehicle, the lessor is typically affiliated with the vehicle’s manufacturer.
Lemon law is a statute that entitles a purchaser or lessee to a replacement vehicle, refund, or cash settlement when the purchaser’s or lessee’s vehicle turns out to be a lemon. Generally speaking, a vehicle is considered a “lemon” if it has a defect that cannot be repaired within a reasonable number of attempts. California has one of the strongest lemon laws in the country, and every day California residents use the state’s lemon law to secure remedies from auto manufacturers.
While lemon laws are designed to protect consumers, filing a successful claim is not easy, and dealerships and manufacturers routinely dispute consumers’ claims under California’s Lemon Law. As a result, most people will benefit greatly from hiring an experienced attorney to handle their lemon law claim.
Lemon Law Buyback
A Lemon Law buyback is a vehicle that a manufacturer has repurchased in response to a purchaser’s or lessee’s lemon law claim. Sometimes manufacturers will destroy Lemon Law buybacks or keep them for research purposes. But, in some cases, manufacturers will also offer Lemon Law buybacks to the public. As noted above, before offering a Lemon Law buyback for sale, manufacturers must comply with California’s Automotive Consumer Notification Act.
Lemon Law Presumption
The Lemon Law presumption is a key aspect of California’s Lemon Law. If your vehicle meets certain criteria, it is presumed that it is a lemon. Unfortunately, this means that it is now up to the manufacturer to prove that your vehicle isn’t a lemon—which can be challenging to do. While a vehicle does not necessarily have to satisfy the Lemon Law presumption to merit a replacement, refund, or cash settlement, showing that your vehicle meets the presumption can streamline the process of securing your desired remedy.
Magnuson-Moss Warranty Act
The Magnuson-Moss Warranty Act is a federal lemon law. Passed by Congress in 1975, this law requires vehicle manufacturers to provide detailed warranty information to purchasers and lessees, and it requires manufacturers to comply with their written warranties.
Crucially, the Magnuson-Moss Warranty Act does not require vehicle manufacturers to provide written warranties (although other warranty requirements apply). Instead, it states that when a manufacturer provides a warranty, it must uphold the terms of the warranty, and it cannot seek to avoid upholding the terms of the warranty by using hidden, unfair, or misleading disclaimers.
Member of the Armed Forces
For purposes of California’s Lemon Law, a member of the armed forces is anyone who is on full-time active duty with the Army, Navy, Marine Corps, Air Force, National Guard, or Coast Guard. This term also covers individuals who are enrolled at military service academies.
Under California’s Lemon Law, members of the armed forces have additional rights not afforded to civilian residents. Specifically, the law allows members of the armed forces stationed in California to pursue claims even if they purchased or leased their vehicle in another state. In addition, it allows those stationed in other states to file claims related to California vehicles they purchased or leased.
Your refund amount is subject to a mileage offset when you request a refund under the California Lemon Law. The manufacturer is entitled to retain a portion of the money it would otherwise have to pay based on how far you were able to drive the vehicle before returning it. The more miles you have driven the vehicle, the larger your mileage offset will be (and the less of a refund you will be entitled to receive).
You have seen a Monroney sticker if you have ever purchased or leased a vehicle off a dealership lot. More commonly known as a “window sticker,” the Monroney sticker is the black-and-white piece of paper taped inside of a vehicle’s window on the lot.
Dealerships don’t put window stickers on their vehicles voluntarily. Rather, they are required to do so under federal law. Among other information, the Monroney sticker must include the manufacturer’s suggested retail price (MSRP), warranty information, standard and optional equipment, and fuel and crash test ratings.
California’s Lemon Law applies to motor vehicles. While it might seem obvious what is a motor vehicle and what isn’t, this term has a specific definition under Section 1793.22 of the law. A vehicle qualifies as a “motor vehicle” for purposes of California’s Lemon Law if: (i) it is used primarily for personal, household, or family use; or, (ii) if it is primarily used for business, it has a maximum curb weight of 10,000 pounds and the business has no more than five vehicles registered in California.
If you purchased or leased a car, truck, or SUV for yourself or your family, you almost certainly have a “motor vehicle” under the California Lemon Law. In addition, if you own a small business that has no more than five registered vehicles, any vehicles your company has purchased that weigh less than 10,000 pounds should qualify as well.
Reasonable Number of Attempts
Before you can seek a replacement, refund, or cash settlement under California’s Lemon Law, you must make a reasonable number of attempts to get your vehicle repaired at the dealership. You must make at least two attempts to qualify for the Lemon Law presumption for safety-related defects. For non-safety-related defects, you must make at least three attempts. However, fewer attempts will qualify as a “reasonable number” in some cases.
When you have a claim under the California Lemon Law, one of your options is to request a refund. This is a refund of all amounts you paid to the manufacturer or dealership (i.e., your down payment and monthly payments), as well as registration fees, taxes, and other purchase or lease-related expenses. The manufacturer or dealership must also pay off your remaining car loan or lease balance. As mentioned above, your refund amount will be reduced based on the mileage offset.
Another option available under California’s Lemon Law is to obtain a replacement vehicle. If you request a replacement, the manufacturer or dealership must provide the same make and model with substantially the same options as you originally chose. Since this is a replacement vehicle, you will be required to surrender your current vehicle—just as you would if you requested a refund.
A refund is technically referred to as “restitution” under California’s Lemon Law. Therefore, this is the amount you are entitled to receive if you decide to return your vehicle and do not wish to receive a replacement.
Statute of Limitations
Claims under California’s Lemon Law are subject to a statute of limitations. This is the maximum amount of time you have to assert your legal rights. The statute of limitations for California Lemon Law claims is four years from the date you first discover your vehicle’s defect.
While you may have up to four years to file a California Lemon Law claim, it is strongly in your best interests to get started as soon as possible. This will help prevent any unnecessary challenges from arising, and it will help ensure that you receive your replacement vehicle, refund, or cash settlement as quickly as possible.
Song-Beverly Consumer Warranty Act
The Song-Beverly Consumer Warranty Act is the formal name for California’s Lemon Law. It was enacted in 1970, and it appears in Article 1 of the California Civil Code. If you believe that you may have purchased or leased a lemon, you should promptly speak with a lawyer about your rights under the Song-Beverly Consumer Warranty Act.
Tanner Consumer Protection Act
The Tanner Consumer Protection Act is part of California’s Lemon Law. It works alongside the Song-Beverly Consumer Warranty Act to provide essential rights and remedies to vehicle purchasers and lessees. Specifically, the Tanner Consumer Protection Act addresses the presumption aspect of the law. As discussed above, when the Lemon Law presumption applies, the burden shifts to the manufacturer to prove that a consumer is not entitled to a replacement vehicle, refund, or cash settlement.
A used vehicle is any vehicle that a consumer or business purchases second-hand, whether from a dealership or from a private seller. For a used vehicle to qualify as a lemon under California’s Lemon Law, it must be purchased from a dealership, and it must still be covered under a manufacturer warranty. However, a vehicle does not need to be classified as certified pre-owned to qualify under the law.
A warranty is a legally enforceable promise or guarantee about how a vehicle can be used or how the vehicle will perform. Vehicles sold in California are subject to both express (written) and implied warranties. This warranty protection is an essential element of the protections afforded to consumers under the California Lemon Law.
Contact Us About Your California Lemon Law Claim
Do you need to know more about the protections afforded to consumers under California’s Lemon Law? If so, we encourage you to get in touch. For a free, no-obligation consultation, call 888-757-5366 or tell us how we can reach you online now.