What Is a Lemon Law?
A lemon law is a statutory remedy, originating in the Magnuson-Moss Warranty Act and the Uniform Commercial Code, for consumers who have purchased defective vehicles. The purpose is to protect consumers by providing a remedy for defective cars, motorcycles, trucks, ATVs, RVs, boats, and other consumer products which are subject to warranties. In other words, if an automobile cannot be repaired after a reasonable number of attempts, the lemon law will provide a remedy.
The statute is straightforward. Under the statute, a manufacturer must repair a defect after a reasonable number of attempts . The manufacturer must buy back the vehicle if the problem cannot be fixed. A vehicle is covered under the lemon law if it is has a problem. A problem includes defects, nonconformities, failures, and malfunctions.
If the manufacturer cannot repair the vehicle after a reasonable number of attempts, then the vehicle must be replaced or repaid. A reasonable number of attempts means:
The statute does not define "reasonable number of attempts" and courts are given the power to interpret this provision.
Does Iowa Have a Lemon Law?
Yes, Iowa has passed a Lemon Law. The Iowa Lemon Law is a part of the Iowa Consumer Protection Statutes (Chapter 322G). Iowa lemon law applies to defects and damages having been incurred within the 24 month or 24,000 mile warranty period, whichever is greater. The period in which a defect is exposed need only come within the 24 month or 24,000 mile warranty period. Once the car has been deemed lemons, the law states that replacements, refunds, etc. should be in a form of the "MSRP", or the manufacturer’s suggested retail price.
Which Cars and Trucks Qualify for Iowa’s Lemon Law?
Iowa’s lemon law covers "new motor vehicles." The Iowa lemon law defines a "new motor vehicle" as one that is "in the possession of the purchasor or lessee for not more than twelve months after the date of delivery to the purchaser or lessee." Iowa Code § 321F. 2(3). Motor vehicles driven or leased for more than a year are not eligible under Iowa’s lemon law. All motor vehicles sold by manufacturers or dealers that include a warranty are covered, including motor homes, vans, buses and trucks. Iowa’s lemon law applies to manufacturers only. Dealers are not included under Iowa’s lemon law statute. Iowa lemon law claims must be filed against the manufacturer.
Rights and Remedies of Iowa Residents
The Iowa Lemon Law creates rights and remedies for consumers who buy or lease new motor vehicles from authorized dealers in the state under certain terms and conditions. If a vehicle is deemed a lemon, the consumer can receive either a comparable vehicle replacement or a full refund of the purchase price, plus any collateral costs such as taxes, license fees, and other official fees, as well as any other collateral charges. If the manufacturer has created a voluntary buy-back program, the consumer may be entitled to participate in that program.
Eligible vehicles include passenger cars, motor homes, motorcycles, pickup trucks, vans, vans-based multipurpose vehicles, and trucks with a gross vehicle weight rating of 10,000 pounds or less. Note that the consumer may obtain relief under the Lemon Law only once and that any subsequent claims must be based on contract rather than on the Lemon Law. Additionally, the law places the burden on the consumer to prove that the vehicle is a lemon through clear and convincing evidence.
Many but not all issues qualify under the Lemon Law and the Iowa Lemon Law website spells out some of those issues: Since the manufacturer is responsible for repairs, some issues are specifically excluded from protection. These include anything that causes damage or impairment to the motor vehicle because the consumer abused, neglected, misused or improperly stored or maintained the vehicle. This may include: The Iowa Lemon Law does permit the manufacturer to have a final opportunity to fix a problem before the consumer obtains remedies under the law.
The Process: Filing a Lemon Law Claim in Iowa
When dealing with a potential lemon in Iowa, the car buyer must be aware of the claim process for these types of defective vehicles. First and foremost, whether it is a auto manufacturer, subsidiary or hundreds of dealerships, an Iowa lemon law claim must begin with a notice to the manufacturer during the "Lemon Law rights period". This notice should then be provided by certified mail to the car maker at their national office. For instance, if one purchases a Toyota and has a lemon, then that consumer must notify the Toyota national corporation. If that vehicle was sold by a dealership, notice to the dealership is not sufficient to trigger lemon law rights as it is not the car manufacturer. Although the vehicle goes through many parties from the time of manufacture to sale , the Iowa lemon law only requires notice to the maker of the automobile through a certified letter with the following information:
Initial notice is not the end of the claim process. If the manufacturer does not fix the automobile through this procedure and the buyer qualifies as a consumer, then the Iowa lemon law gives a specific amount of time to enter into a formal procedure for the buyer to prevail. This formal procedure in Iowa is not binding arbitration but rather goes to state court within the county the vehicle owner resides, as opposed to federal court where diversity exists.
Common Challenges in Iowa Lemon Law Cases
Understanding and navigating the complexities of a lemon law case can be a challenging endeavor for consumers. Some of the common challenges consumers may face include:
- Lack of knowledge about Iowa lemon laws: Many consumers are not fully aware of their rights under state lemon laws.
- Dealers or manufacturers denying liability: Sometimes a manufacturer or dealer may not accept responsibility for a defective vehicle or may dispute the claim.
- Difficulty gathering evidence: Consumers may have a hard time collecting the necessary documentation and evidence to support their lemon law claim.
- Delays and prolonging the process: Manufacturers or dealers may attempt to prolong the process by delaying repairs or responses to service requests, making it difficult for consumers to pursue their claim.
- Knowing when to take action: It can be difficult for consumers to know when they should bring a lemon law claim and what steps they need to take.
To overcome these challenges, you can:
- Do your research: Familiarize yourself with Iowa lemon laws and consult with lemon law experts to clarify your legal rights.
- Document everything: Keep meticulous records of all communications and transactions related to the defective vehicle.
- Consult legal counsel: Seek the advice of a lemon law attorney to help you navigate the process.
- Be persistent: Follow up with manufacturers or dealers regularly and stay organized to ensure your claim stays on track.
How to Get Help with Lemon Law Cases in Iowa
Lemon laws are fairly straightforward in Iowa. In fact, Iowa has one of the most consumer friendly lemon laws in the country. In addition, in Iowa the consumer is entitled to attorneys’ fees if he or she successfully prevails on a lemon law claim while dealing with a power train warranty. For those that do not know, power train warranty’s are much longer than standard bumper to bumper warranties and cover things like the transmission or other expensive mechanical components. (Most lemon laws are triggered only under a standard bumper to bumper warranty).
Therefore, you may be tempted to try to do your lemon law case without the assistance of an attorney. Although that is tempting due to the fact that hiring an attorney will cut into the amount of money you get, hiring an attorney is almost always the smart choice. The reason is simple: lion’s don’t need lawyers but sheep do. By hiring an attorney you are leveling the playing field vs the manufacturer.
It is worth noting that all lemon law attorneys are not created equally. You must hire a lemon law attorney who understands the law. You must make sure they have had prior success in handling lemon law claims. Failure to do so could result in lost time, wasted effort and most importantly it could result in a lemon law claim being barred.
What Iowa Residents Must Know Before Buying a Vehicle
In Iowa, vehicle buyers should be aware of the following important considerations when purchasing a vehicle to avoid possible lemon law situations:
- First, insist that all verbal representations regarding a vehicle be put into writing, even if it is an internally-prepared "as is" form. In recent cases in my office, it has been represented to clients that an internal reconditioning check of a vehicle (usually a cosmetic touch up) was done. However, if a client did not receive a copy of this form, there is no proof of this. In one of our current cases, the dealership prepared such a form, but because the dealership refused to provide a copy to my client, the client relied on their representations and persuaded me to file an action under the Iowa Lemon Law. The claim was, of course, denied, because of the lack of proof. I now strongly encourage clients not to sign any written ads or "as is" forms until a copy is given to them and gave this particular client a bad bill of goods.
- Second, vehicle buyers should be wary when a dealership tries to sell a vehicle as "certified pre-owned." This, ostensibly, means that the dealer will stand by the vehicle, guaranteeing that it has been reviewed, serviced, inspected, and repaired to meet its standards. If I am talking with a client who is stuck with a defective vehicle state, I always try to determine if the dealership itself, or the manufacturer, has provided any certification of this vehicle. If so, this can be an additional avenue to pursue. We routinely ask the dealer for its term definitions of this status, and we have also made manufacturers uphold various guarantees when the dealership relies on the manufacturer’s certification status.
- Buyers should also obtain a full and complete copy of the vehicle (full color) history report before purchase, not after. This is generally available through Carfax, AutoCheck, or other various sources . Unfortunately, some dealers do not complete a vehicle history report or do not supply the entire history. This is more difficult to check than you might expect. Some dealers run a special report based on their own inventory, so the dealership could provide a report that doesn’t coincide with the Carfax report. For example, a manufacturer generally keeps track of its recalls, but a dealer is not always required to submit the vehicle to the manufacturer for same. The manufacturer is not alerted to the recall and does not send a notice to the new owner. While you can research and subscribe to various websites for these recalls, you can consistently get new information that makes it impossible to keep track of a vehicle on your own. Your best bet is to have a car dealer that fully discloses the entirety of the vehicle report.
- Finally, ask yourself, "Am I paying too much money for this vehicle and am I paying money for unrepaired problems?" I regularly talk with potential clients who tell me that they are paying for a serveral thousand dollar vehicle, and have heard from independent mechanics the vehicle has many outstanding defects. In addition to being very unhappy with their dealer, these clients have spent thousands fixing physical problems to a vehicle that do not have any benefit.
- Paying for defective, outstanding problems may affect the value you will have available as damages under the Iowa Lemon Law. Also, you should check your insurance to determine if you are paying for damage protection plans offered by various vehicle manufacturers, which you may not need, and if you are paying for "gap" insurance, which may be unnecessary if you have vehicle savings and vehicle equity.
Review these issues before purchase, whether you are purchasing a vehicle from a dealer, third party, or even leasing. While you may have a lax approach to pre-purchase, understanding the risk you are taking (and then paying a premium) will help you determine if you are being taken advantage of.
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