What is a 'Lemon'? How lemons affect both dealers and consumers.
New cars and other new motor vehicles are covered by manufacturers' warranties. These warranties must follow the rules set by the federal Magnuson-Moss Warranty Act and the Uniform Commercial Code (UCC) (refer to the section on Warranties for more information). The manufacturer's warranty is provided at no extra cost to the buyer. Sometimes, despite the best efforts of a dealer's service department, a defect cannot be satisfactorily fixed. These unfixable vehicles are popularly referred to as "lemons." New Hampshire's "Lemon Law" provides a method for the "lemon" owner to satisfactorily resolve the problem.
New Hampshire's "Lemon Law" (RSA 357-D) applies only to new vehicles purchased from New Hampshire dealerships. New Hampshire consumers who find themselves with a defective new vehicle that the dealer has been unable to repair may turn to the Motor Vehicle Arbitration Board (MVAB). The MVAB will decide whether the motor vehicle is so impaired by its defect that the manufacturer should take the vehicle back. The MVAB, a five-person panel of consumers, auto dealers and certified mechanics, has been in existence since January 1, 1992. The MVAB reviews consumer complaints about defective vehicles and holds evidentiary hearings which typically include inspecting and/or test driving the vehicle. If a majority of the panel members find that the vehicle is substantially impaired due to defects covered by the manufacturer's warranty, the board will order the manufacturer to either buy the "lemon" back from the consumer or, at the consumer's option, trade the "lemon" for another vehicle of equal value. The MVAB can also award "damages" which can include license and registration fees as well as the finance charges (interest) for the loan to purchase the defective vehicle. Either the consumer or manufacturer can appeal a MVAB decision to the Superior Court.
A vehicle is considered to be a "lemon" if: The new vehicle is substantially impaired in use, value, or safety due to a defect covered by the manufacturer's warranty that the manufacturer or its authorized representative has not fixed.
In order to qualify for arbitration, a consumer must ordinarily show either:
- The manufacturer or its representative has made at least three unsuccessful attempts to fix the motor vehicle; or
- The motor vehicle has been out of service for 30 or more business days (cumulative) due to defects or nonconformities covered by the warranty.
Note: In some cases involving extensive or dangerous defects, the MVAB may decide to hear a case with fewer repair attempts or days out of service.
New Hampshire's "Lemon Law" requires that manufacturers of new motor vehicles provide purchasers with a notice of their rights to arbitration under New Hampshire law, including a "demand for arbitration" form. Furthermore, New Hampshire dealerships are required to post a notice of consumer rights under this statute in all new car showrooms.
Note: New Hampshire's "Lemon Law" applies only to "new" motor vehicles, described in the statute as vehicles still under manufacturer's original warranty. Low mileage used cars may, under some circumstances, qualify for arbitration and relief under the "Lemon Law" for defects in systems covered by a warranty. Older used cars, which are out of warranty when purchased, do not generally fall within the protection of the New Hampshire "Lemon Law." (For information on legal protection for used car buyers, refer to the section entitled Autos: Used.)
Example: In 2006, Joe Smiley buys a used 2005 Tomoto Tomotovan with only 25,000 miles on the odometer. The vehicle is still covered by the manufacturer's 50,000 mile drive train warranty. If Joe experiences recurrent transmission problems with the vehicle during the remaining warranty period, he would probably qualify for a hearing before the MVAB under the NH "Lemon Law." If, on the other hand, Joe had bought his van with 60,000 miles on the odometer and all original manufacturer's warranties had expired, he probably would not qualify for assistance under the NH "Lemon Law."
New Hampshire's "Lemon Law" also requires that any motor vehicle sold in New Hampshire conform to the applicable manufacturer's warranty and that manufacturers promptly correct defects covered by the warranty. This requirement is complemented by RSA 382-A:2-329 which requires automobile manufacturers to maintain in-state service agents and to provide parts needed for repairs within 30 days or less. (For further information, refer to Warranties.)
Points To Remember
- Read the manufacturer's warranty carefully when you buy a new car. Know what is and is not covered.
- When you take your new car for servicing, give the dealer's service manager a list of symptoms (if anything is wrong) and keep a copy for your records.
- Keep copies of repair orders which should state the reported problem, all necessary repairs, and the dates the vehicle was in the shop.
- Carefully consider whether you need to buy a service contract or extended warranty. If your car has an excellent repair record, you may not need or want this extra coverage. For more information about service contracts, refer to Service Contracts and Extended Warranties.
Where To Go If You Have A Problem
33 Hazen Drive
Concord, NH 03301
|Better Business Bureau
48 Pleasant Street
Concord, NH 03301-3459
|NH Consumer Protection Bureau
Department of Justice
33 Capitol Street
Concord, NH 03301-6397
603-271-3641 or 1-888-468-4454
Contact the New Hampshire Motor Vehicle Arbitration Board for arbitration if your car's problem DOES fall under the New Hampshire "Lemon Law."
Contact the Better Business Bureau for mediation and arbitration assistance if your car's problem DOES NOT fall under New Hampshire's "Lemon Law."