California Used Car Lemon Law

Used cars, which are also referred to as pre-owned vehicles or second-hand cars, are motor vehicles that have had more than one retail owner, including:

• Car dealerships;
• Rental car companies;
• Car leasing offices;
• Private party sales.

This is different from a new car, which is a motor vehicle that has only been sold by the original manufacturer and whose legal title has never been transferred to a purchaser. Although purchasing a used car may offer incentives, such as lower auto insurance rates, a more affordable price, and extended warranties, the decision to purchase a used vehicle as opposed to a new one comes with many considerations.

For example, an individual may be required to spend extra money to make repairs because a used car is usually less reliable than a new car. In addition, due to their unreliable nature, a used car tends to have a higher interest rate than a new vehicle.

If an individual has purchased a used vehicle from a private party instead of a dealership, they may not receive an extended warranty or service plan. The decision of whether to buy a new or used vehicle is up to the buyer, but being aware of the laws that apply to used car sales and doing some research on the subject can help an individual make the right choice for them.

If an individual needs assistance or advice regarding California used car laws, they should consult with a local lawyer in California.

Federal Lemon Law Used Cars

There are federal and state laws that apply to the sale of used vehicles. Used car laws were enacted to protect consumers and their rights when buying a used car and to outline the rights and responsibilities of dealerships when selling used cars.

Federal laws that govern the sale of used cars include:

• The used car rule: The Federal Trade Commission (FTC) enacted this rule to discourage sellers of used cars from omitting significant facts about the condition of the used car and from misrepresenting warranty information;
  • The rule specifically requires car dealers to display a window sticker, called the Buyer’s Guide, on any used cars that are offered for sale;
    • This Buyer’s Guide sticker has to provide details about the used vehicle, including:
      • Whether or not a warranty exists, and if so, all the terms and conditions, such as:
        • The duration of coverage;
        • What the warranty actually covers;
        • A percentage of total costs that a dealer will pay for repairs;
      • The make, model, and year; and
      • The Vehicle Identification Number (VIN);
• The Magnuson-Moss Warranty Act: This Act is the primary federal law that governs consumer product warranties. It prevents car dealers from abusing or manipulating warranty language;
  • In addition, the Act makes it illegal for dealers to deny or void coverage simply for using a company other than the dealer to make repairs or for having aftermarket or recycled car parts installed in a vehicle; and
• Uniform Commercial Code (UCC): Although it is not technically a federal law, the UCC is a model statute adopted by the majority of states that applies to sale of goods;
  • The UCC also provides various conditions about contracts and explains the differences between express and implied warranties, which is important to understand when purchasing a used car.

There are also other laws that impact use car sales in the United States, including:

• The Disposal Rule;
• The Fair Credit Reporting Act;
• The Red Flags Rule;
• General safety standards.

It is important for an individual to review both state and federal laws, especially when they are purchasing a vehicle from a different state. A consumer should be aware of the regulations for emission requirements, sales tax collection, and temporary registration rules to transport vehicles to their home state.

California Used Car Lemon Laws

Under California car dealership laws, specific laws that apply to used car sales in California include:

• The Song-Beverly Consumer Warranty Act: This Act requires that dealers who try to waive implied warranties have to do so with plain and obvious language;
  • The Act also states that any implied warranty waivers must clearly state whether the buyer or seller is responsible for repair costs;
• California warranty law: California is one of the only states that does not require a used car to be sold with a warranty. Generally, if a dealer states that a used car is to be sold “as is,” it acts as notice to the buyer that the dealer is not providing any warranties and that the vehicle may have some defects;
• California used car return laws: In California, a licensed dealer must offer the purchaser of a used vehicle that costs $40,000 or less the option to buy a two-day cancellation policy before they sign any paperwork;
  • In addition to the two-day rule, a dealer can refuse to accept a return or a cancellation if the car does not meet the following conditions under a standard used car return policy:
    • It must be free from tickets or liens;
    • The buyer must return the vehicle in the same condition as when it was purchased;
    • All original paperwork must be available; and
    • The odometer on the used vehicle must not display mileage that is higher than what the contract allows;
  • If all of the conditions are met, the buyer is entitled to receive a full refund from the dealer, including the deposit, sales tax, and registration fees.

What Is the California Used Car Lemon Law?

The California Lemon Law provides protections for consumers who purchase defective vehicles that cannot be repaired despite multiple attempts to do so. In these cases, the manufacturer has to either replace or repurchase the defective vehicle as long as it is still under the manufacturer’s new car warranty.

In general, consumers are usually entitled to a replacement or refund of the defective used vehicle if it meets the following lemon law requirements:

• The vehicle is purchased from a retailer, not from a private individual;
• The warranty on the car is still active, either the original manufacturer’s warranty or an extended one;
• The used car has a substantial defect;
• Because of the substantial defect, the used vehicle remained at a repair shop for an excessive amount of time; and
• Despite the reasonable amount of repair attempts, the issues with the used car are still not resolved.

It is important to note that what may be considered reasonable will depend upon which part of the vehicle needs repair. For example, if the vehicle’s brakes need repairing, only one or two attempts may qualify as reasonable.

If the repair work is done to a less important area of the vehicle, the number of attempts that will be considered reasonable may be as high as four or more. The California lemon laws application to used cars may be more difficult to calculate.

In many cases, the purchaser may be required to contribute some funds to buy a new vehicle from the dealer, or they may lose money if the manufacturer agrees to reimburse them for their defective used vehicle purchase.

What Types of Remedies are Available in a Used Car Lawsuit?

If the consumer prevails against a car manufacturer or dealer in a used car lawsuit, they may be entitled to the following remedies:

• Monetary damages to make all necessary repairs to the used vehicle;
• A refund for the cost of the used car, which may be lower than the original price;
• The dealer or manufacturer may be ordered to replace the buyer’s vehicle;
• Punitive damages if the dealer or manufacturer used outrageous tactics to sell the vehicle.

In certain cases, the car dealer or manufacturer may be found guilty in criminal court if they are prosecuted for potentially unlawful conduct.

What Defenses Might Be Raised?

There are defenses that a car dealer or manufacturer may be able to raise in a used car lawsuit, such as:

• Having an “as is” clause, which is commonly asserted against fraud claims;
• The warranty has expired, or the condition of the vehicle does not meet warranty requirements;
• The plaintiff is responsible for the car damage or defect;
• The vehicle was not returned in the condition or by the time that was required by the return policy;
• The plaintiff did not make a sufficient number of attempts to repair a specific defect;
• The used car was not covered according to Lemon Law factors; or
• The Statute of limitations expired.

It is important to note that certain defenses do not apply under some state laws, and states may provide other defenses within their respective statutes.

Do I Need a Lawyer for Help with California Used Car Laws?

If you are considering purchasing a used vehicle or have purchased a used vehicle in California, an individual should consult with a California auto attorney. The laws governing used cars in the state are specific, which may make them difficult to interpret without legal assistance.

Your lawyer can examine your issue, explain the provisions in any contracts you signed, and advise you how they affect your case. Your lawyer can also help you file a lawsuit, if necessary, determine what remedies or defenses may be available in your case, and represent you in court.