New York Lemon Law
New York Lemon Laws and the federal Lemon Law (the Magnuson-Moss
Warranty Act) provide for compensation to New York consumers of
defective automobiles and trucks and other vehicles and
products including motorcycles, RV's, boats, computers and other
consumer appliances and products. To qualify under the New York
Lemon Law or the federal Lemon Law, you must generally have a
product that suffered multiple repair attempts under the
manufacturer's factory warranty. Lemon Law compensation can include
a refund, replacement or cash compensation. If you think you
qualify for a Lemon Law, click here for a free
New York Lemon Law case review or for an immediate
evaluation, simply fax your repair records to 866-773-6152. An
experienced Lemon Law attorney will personally review your inquiry
and records and quickly contact you for a free consultation.
other useful New York Lemon Law information, click here to visit
the New York State Lemon Laws Statutes and Guide
pages. Or just keep reading below for the entire New
York Lemon Law, or click here to read
the federal lemon law.
What Is The Purpose Of The New York New Car Lemon Law?
The New Car Lemon Law (General Business Law 198-a) provides a
legal remedy for consumers who are buyers or lessees of new cars
and certain used cars (see next question) that turn out to be
lemons. If the car does not conform to the terms of the written
warranty and the manufacturer or its authorized dealer is unable to
repair the car after a reasonable number of attempts during the
first 18,000 miles or two years, whichever comes first, the
consumer can choose a full refund or a comparable replacement car.
A copy of the law may be found in the back of this booklet.
Which Cars Are Covered By The Lemon Law?
The law covers both new and used cars, including "demos," which
satisfy the following four conditions:
- The car was covered by the manufacturer's new car warranty at
the time of original delivery; and
- The car was purchased, leased or transferred within the earlier
of the first 18,000 miles or two years from the date of original
- The car either: (a) was purchased, leased or transferred in New
York, or (b) is presently registered in New York; and
- The car is primarily used for personal purposes. Some examples
of cars that are covered by the new car lemon law are:
- a new car purchased or leased from a New Jersey dealer and
registered in New York;
- a year-old, demonstrator car with less than 18,000 miles
purchased from a New York dealer and registered in New Jersey;
- a used car with less than 18,000 miles and less than 2-years
old, purchased from a Connecticut dealer and registered in New
- a used car with less than 18,000 miles and less than 2-years
old, received as a gift from a friend and registered in New
What Does The Phrase "Primarily Used For Personal Purposes"
A car is primarily used for personal purposes when its principal
use is for personal, family or household purposes. Such purposes
include, for example, using the car for household errands or to
drive to and from work. A car may be used for both personal and
business use provided that the personal use is predominant (more
than 50% of the usage).
Are Motor Homes Covered?
Motor homes are also covered under the law, except as to defects
in systems, fixtures, appliances or other parts that are
residential in character. However, motor home complaints are
subject to special notification requirements.
Are Motorcycles And Off-Road Vehicles Covered?
Motorcycles and off-road vehicles are not covered by the
Are All Leased Cars Covered?
The law covers only those leased cars where the lessee is
responsible for repairs of the car.
Are Cars Owned Or Leased By Businesses Covered?
Yes, provided the car is primarily used for personal, family or
What Is The Manufacturer's Duty To Repair?
With respect to those covered cars sold and registered in New
York, the law imposes a duty upon the manufacturer to repair, free
of charge and without any deductible, any defect covered by
warranty, if the consumer notifies the manufacturer or its
authorized dealer of such defect within the first 18,000 miles of
operation or two years from the original delivery date, whichever
comes first. Once timely notice of the defect is given, the
manufacturer may not charge for the repairs, regardless of when the
repairs are performed. Any consumer who has been charged for such
repairs or a deductible during such period should contact the
Attorney General's office.
What Should Consumers Do If They Become Aware Of A Problem With
The consumer should immediately report any defect or "condition"
either directly to the manufacturer or to its authorized dealer. A
"condition" is a general problem, such as a difficulty in starting,
repeated stalling, or a malfunctioning transmission, that can
result from a defect of one or more parts. If the consumer reports
the problem to the dealer, the law requires the dealer to forward
written notice to the manufacturer within seven days. Under the
law, notice to the dealer is considered notice to the manufacturer.
Unless otherwise advised by their lawyer, consumers should continue
to make their monthly payments if the car is financed or leased.
Failure to do so may result in a repossession which may adversely
affect a consumer's lemon law rights.
What Should A Consumer Do If The Dealer Refuses To Make
If the dealer refuses to make repairs within seven days of
receiving notice from the consumer, the consumer should immediately
notify the manufacturer in writing, by certified mail, return
receipt requested, of the car's problem and that the dealer has
refused to make repairs. A sample notice to the manufacturer may be
found in this book.
What Must The Manufacturer Do Upon Receipt Of The Consumer's
Notice Of The Dealer's Refusal To Make Repairs?
The manufacturer or its authorized dealer must commence repairs
within 20 days from receipt of the consumer's notice of the
dealer's refusal to make repairs.
What Are A Consumer's Rights If The Manufacturer Does Not Meet
Its Duty To Repair?
If the problem is not repaired after a reasonable number of
attempts, or the manufacturer or the dealer refuses to commence
repairs within 20 days from the manufacturer's receipt of the
"refusal to repair" notice from the consumer, and if the problem
substantially impairs the value of the car to the consumer, the
manufacturer, at the consumer's option, must either refund the full
purchase or lease price, or offer a comparable replacement car.
Does The Law Specify The Number Of Required Repair
It is presumed that there have been a reasonable number of
attempts to repair a problem if, during the first 18,000 miles of
operation or two years from the original delivery date, whichever
comes first, either: (1) the same problem has been subject to
repair four or more times and the problem continues to exist; or
(2) the car is out of service by reason of repair of one or more
problems for a cumulative total of 30 or more calendar days and the
problem continues to exist.
What Special Notification Requirements Exist For Motor Home
The law imposes special notification requirements for motor
homes which are designed to afford motor home manufacturers one
final chance to repair the defect before consumers can take
advantage of the remedies offered by the lemon law. If the motor
home was subject to three repair attempts or was out of service by
reason of repair for 21 days, whichever occurs first, the consumer
must report such fact to the manufacturer or its authorized dealer
by certified mail, return receipt requested, before seeking
arbitration or commencing a lawsuit under the lemon law.
Must A Motor Home Manufacturer Give Consumers Prior Written
Notice Of These Special Requirements?
The special notification requirements are only applicable if the
manufacturer or its authorized dealer has provided the consumer
with a written copy of these requirements. Receipt of the notice
must be acknowledged by the consumer in writing.
What If A Consumer Fails To Comply With These Special
Requirements For Motor Homes?
Where a consumer fails to comply with the special notification
requirements, additional repair attempts or days out of service
will not be taken into account in determining the consumer's right
to relief. However, additional repair attempts or down time will be
considered if they occur after the consumer has complied with the
What Constitutes A Substantial Impairment Of Value?
It will depend on the facts in each case. In general, the
consumer's complaint must be about a serious problem. For example,
a defect in the engine which makes the car inoperable is clearly
substantial. Some courts have found that the cumulative effect of
numerous lesser defects can add up to substantial impairment of
Are There Any Exceptions To The Manufacturer's Duty To Refund
The manufacturer does not have a duty to make a refund or
provide a replacement car if:
(1) the problem does not substantially impair the value of the car
to the consumer, or
(2) the problem is a result of abuse, neglect or unauthorized
alteration of the car.
How Can Consumers Prove They Own A Lemon?
The consumer must be able to document repeated repair attempts.
Therefore, it is very important to keep careful records of all
complaints and copies of all work orders, repair bills and
correspondence. A dealer is required by Department of Motor
Vehicles (DMV) regulations to provide a legible and accurate
written work order each time any repair work is performed on a car,
including warranty work. Consumers may contact the DMV in Albany at
518-474-8943 if they have a problem obtaining their repair
What Should Be Included In The Consumer's Refund?
The refund should include the price of the car (cash plus
trade-in allowance), including all options, plus title and
registration fees and any other governmental charges, less any
What Are The "Lawful Deductions?"
The manufacturer may deduct an amount for mileage in excess of
the first 12,000 miles. No deductions may be made for the first
12,000 miles of use. The law states that such deduction shall be
calculated by taking the mileage in excess of 12,000 miles times
the purchase (or lease) price, divided by 100,000. For example, if
a defective car has 15,000 miles on its odometer and cost $10,000,
the deduction for use would be $300 (3,000 multiplied by $10,000
divided by 100,000). In addition, a reasonable deduction may be
taken for any damage not due to normal wear.
Is The Refund Amount Different If The Purchase Was
The refund by the manufacturer is the same whether the car was
financed or not. However, when the car is financed, instead of the
entire refund going to the consumer, the refund must be divided
between the consumer and the lender (the bank or finance company).
Generally, the lender will calculate how much is still owed by the
consumer and apply the refund to that amount. The balance of the
refund will then go to the consumer.
If The Car Was Leased, How Is The Refund Calculated?
When the car is leased, the refund due from the manufacturer is
divided between the consumer/lessee and the leasing company (the
company to which the consumer makes lease payments) according to a
formula provided by the law. The lease price to be refunded to the
consumer/lessee is the total of the lessee's down payment
(including any trade-in allowance) plus the total of monthly lease
payments, minus interest charges and any other service fees. For
example, suppose that a consumer leases a new car under a
three-year lease, makes a $1,500 down payment, and pays a monthly
lease payment of $300. Of the $300 monthly payment, $75 is
allocated as interest charges. After making twelve monthly
payments, the lessee is granted a refund under the lemon law. The
refund will be $4,200 calculated as follows: Deposit . . . $1,500 +
Monthly Payments. $3,600 (12x300) $5,100 - minus interest(12x75)
900 total refund: $4,200 If the monthly payment includes other
service fees, such as insurance or other costs, paid for the
benefit of the lessee, such amounts will be deducted from the
lessee's refund. The leasing company's portion of the refund is the
balance of the "lease price," as that term is defined by the
If The Car Is Leased, Does A Determination That The Car Is A
Lemon Terminate The Lease?
Once a determination has been made under the lemon law that a
car is a lemon, the lease is terminated. As a result, no early
termination penalties under the lease may be collected.
Does A Successful Consumer Recover Sales Tax?
State and local sales taxes are refunded directly by the New
York State Commissioner of Taxation and Finance who will determine
the appropriate amount to be refunded under the law. Consumers must
complete and submit an "Application for Refund of State and Local
Sales Tax" (Form AU-11) to the New York State Department of
Taxation and Finance, Central Office Audit Bureau - Sales Tax,
State Campus, Albany, N.Y. 12227. (Such form may be obtained
through the manufacturer or directly from the Commissioner of
Taxation and Finance.) A consumer has three years from the date a
refund is received from the manufacturer to apply for the tax
What Is A "Comparable Replacement Vehicle"?
Appellate courts have ruled that the lemon law does not entitle
a consumer who elects to receive a "comparable replacement vehicle"
instead of a refund, to receive a new vehicle. Rather, the consumer
is entitled to receive a car of the same year and model and which
has approximately the same mileage as the car being replaced.
How Can A Consumer's Rights Under The Lemon LawBe
A consumer has the choice of either participating in an
arbitration program or suing the manufacturer directly in court. If
a manufacturer has established an arbitration procedure which
complies with federal regulations and the state's lemon law, the
manufacturer may refuse to provide a refund until the consumer
first participates in such procedure or in the state-run
arbitration program. Any action under the lemon law must be
commenced within four years of the date of original delivery.
If The Consumer Wins In Court, Can Attorney's Fees Also Be
The law authorizes the court to award reasonable attorney's fees
to a successful consumer.
What Is An Arbitration Proceeding?
An arbitration proceeding is much less complicated, time
consuming and expensive than going to court. The arbitration
hearing is informal and strict rules of evidence do not apply.
Arbitrators, rather than judges, listen to each side, review the
evidence and render a decision.
What Arbitration Programs Are Available To Consumers In New
Consumers may participate in the New York State Lemon Law
Arbitration Program ("New York Program"), established by the lemon
law. The New York Program is administered by the New York State
Dispute Resolution Association ("NYSDRA") under regulations issued
by the Attorney General. (A copy of the regulations may be found in
the back of this booklet.) Decisions under the New York Program are
binding on both parties. Consumers may also choose to participate
in arbitration programs established by auto manufacturers.
Decisions under manufacturer programs are not binding on consumers.
Consequently, consumers who have gone through the manufacturer's
program and are not satisfied may still apply for arbitration under
the New York Program. However, any prior arbitration decision may
be considered at any subsequent arbitration hearing or court
proceeding. The law permits manufacturers to require that consumers
first participate in the manufacturer's program, if it complies
with federal regulations and the state's lemon law, before suing in
court for relief under the lemon law.
How Does A Consumer Participate In The New York Program?
A consumer must first complete a "Request for Arbitration" form,
which may be obtained from any of the Attorney General's regional
offices. (A list of the Attorney General's regional offices may be
found at the end of this booklet). The completed form must be
returned to the Attorney General's New Car Lemon Law Arbitration
Unit, Office of the Attorney General, 120 Broadway, New York, New
How Does The New York Program Operate?
The Attorney General's office will review the form to determine
whether the consumer's claim is eligible under the lemon law to be
heard by an arbitrator. If accepted, the form will be forwarded to
the Administrator for processing. The Administrator will then ask
the consumer to pay the required filing fee. Upon receiving the
filing fee, the Administrator will appoint an arbitrator and
schedule a hearing to be held within 35 days. If rejected, the form
will be returned to the consumer together with an explanation for
the rejection. A complete step-by-step description of the New York
Program follows this "Question & Answer" section in this
Who Are The Arbitrators?
The arbitrators are volunteers who have been trained in the
lemon law and in arbitration procedures by the Attorney General's
office and the Administrator.
Is A Consumer Entitled To An Oral Hearing?
Consumers have an absolute right to an oral hearing.
At an oral hearing, both the consumer and the manufacturer's
representative have the opportunity to present their case in person
before an arbitrator.
May A Consumer Choose A Hearing On Documents Only?
A consumer may elect to have a hearing on documents only by
indicating this preference on the "Request for Arbitration" form .
In a "documents only" hearing, both sides must present their
positions in writing. If a consumer requests a "documents only"
hearing, the manufacturer may object, in which case an oral hearing
will be scheduled.
May A Stenographic Record Or Tape Recording Be Made Of The
Any party to the arbitration may arrange, on its own, for a
stenographic record or a tape recording of the hearing at their own
expense even if the other party objects. If a stenographer or tape
recorder will be used, reasonable prior notice, through the
Administrator, must be given to the other party.
Does The Consumer Need An Attorney For The Arbitration
The New York Program is designed to be accessible to consumers
without the need for an attorney. However, both the consumer and
the manufacturer may use an attorney or any other person to assist
them if they so choose.
How Should Consumers Prepare For The Hearing?
Consumers should keep a copy of their "Request for Arbitration"
form to use as a guide in preparing for the hearing. The form
contains much of the information needed at the hearing. In
addition, consumers are advised to:
(a)Gather Documents.Bring to the hearing records of everything
pertaining to the purchase and the problem, including a copy of the
purchase contract (invoice), all correspondence, work orders, and
(b)Organize Records.Keep records in chronological order. This
will serve as a guide in presenting the history of the problem.
(c)Prepare an Outline.This will help to present and remember
(d)Prepare Questionsto Ask the Manufacturer's Representative.
This will assure that no important question is omitted.
(e)Arrange for Witnesses.The presence of witnesses, especially
auto mechanics, or their sworn statements may be helpful to
document the problem.
What If Consumers Do Not Have All The Documents?
Upon payment of the filing fee and prior to the hearing,
consumers may make a written request to the arbitrator, through the
Administrator, to direct the manufacturer to provide any necessary
documents or other information. Consumers may also request the
arbitrator to subpoena documents or witnesses to appear at the
hearing. A sample letter requesting documents may be found in this
How Should Consumers Present Their Case At The Hearing?
At the hearing, consumers should present their case in a clear,
organized and concise manner. Consumers are advised to:
(a) State the specific nature of the problem.
(b) State any conversations with the dealer's or manufacturer's
(c) Describe and document each repair attempt.
(d) Describe and document any new developments which may have
occurred since the "Request for Arbitration" form was
(e) Offer proof of each point, especially those the manufacturer
(f) Present any witness that may provide relevant
(g) State the relief requested.
(h) At the end of the presentation, briefly summarize the facts
What Happens If Either Party Fails To Appear At The
Unless the hearing has been properly rescheduled, if either the
manufacturer or the consumer fails to appear at an oral hearing,
the arbitrator will nevertheless conduct the hearing and issue a
decision based upon the evidence presented and any documents
contained in the file.
When Can A Consumer Expect A Decision?
A consumer may expect a decision, generally, within 10 days of
the hearing. Sometimes, however, the arbitrator requests that
additional documents or information be submitted, in which case the
decision may be delayed.
Can A Consumer Recover The Filing Fee?
If the consumer is successful, the arbitrator's decision in
favor of the consumer must include the return of the filing
When Must A Manufacturer Comply With An Arbitrator's
Within thirty days. In most cases, the manufacturer's
representative will contact the consumer within this period to
arrange for the return of the car in exchange for either a refund
or a replacement car. Failure of the manufacturer to comply within
this time period entitles the consumer to recover an additional $25
for each business day of noncompliance, up to $500. If the
manufacturer does not voluntarily pay any applicable penalty, the
consumer may sue to recover this penalty in Small Claims Court.
However, this deadline and penalties are not applicable where a
consumer requests a car built to order or with options which are
not comparable to the car being replaced.
How Is A Return Of The Car Implemented?
The common procedure is to have all the affected parties --the
consumer, the manufacturer's representative, and, if the car is
financed or leased, the lender's or the leasing company's
representative-- meet at an agreed time and place to execute the
necessary papers to exchange the car for a refund or replacement.
The consumer may choose to return the car to either the selling
dealer or the dealer which attempted to repair the car. No further
shipping charges may be imposed on the consumer for the return of
What Happens If The Manufacturer Does Not Comply With The
If the manufacturer does not comply with the award, a consumer
can enforce the arbitrator's decision through the courts by
bringing an action to confirm the award. This action must be
commenced within one year of receipt of the decision. Consumers
should consult a private attorney if they wish to pursue this
remedy. If the consumer is successful, the Court will convert the
arbitrator's award into a court judgment and may award attorney's
fees. The court may also award reasonable attorneys' fees incurred
to enforce the collection of the award.
Under What Circumstances Can An Arbitrator's Decision Be
The grounds for modification are very limited. Generally, awards
may be modified only to correct a miscalculation or a technical
mistake in the award. For example, a modification may be requested
where the mileage deduction was miscalculated or the filing fee was
omitted from the refund.
When Must A Request For Modification Be Made?
Either party may seek a modification by the arbitrator of the
award by written application to the Administrator within 20 days of
receiving the award. The other party will be given the opportunity
to object to the modification. The arbitrator must rule on all such
requests within 30 days after the request is received. To modify an
award after 20 days, an application to a court may be
Can An Arbitrator's Decision Be Challenged?
Either the consumer or the manufacturer may commence a lawsuit
to challenge an arbitrator's award within 90 days of receipt of the
award. However, the grounds for such challenges are limited by law.
Generally, the courts will uphold an arbitrator's award if it is
supported by evidence and is grounded in reason. Reasonable
attorneys fees may be awarded by the court to a consumer who is
successful in challenging or defending an arbitration award.
What Role Will The Attorney General's Office Or The
Administrator Play If A Manufacturer Challenges An Award In
Neither the Attorney General's Office nor the Administrator is
authorized to represent an individual consumer in such a challenge;
this is the responsibility of the consumer's own attorney. The
Administrator's role is finished when the arbitrator's award is
sent to the parties.
Can Consumers Apply For Another Hearing Under The New York
Program If They Lost The First One?
A decision under the New York Program is binding on both
parties. However, if new facts arise after a hearing was held, the
consumer may reapply for a new hearing based on the new facts. For
example, if a consumer originally applied to the New York Program
based on four unsuccessful repair attempts (Jan. 5, Jan. 25, Feb.
10, Feb. 25) and lost the arbitration, he or she may reapply if
there were four additional repair attempts not previously
considered (after Feb.25) even if the repair attempts were for the
Does The Lemon Law Limit Any Of The Other Legal Remedies
Already Available To Consumers?
The Lemon Law adds to the consumer's arsenal of existing legal
remedies. These legal remedies can be explained by the consumer's
Can A Consumer's Rights Be Waived Under The Lemon Law?
Any contract clause which seeks to waive a consumer's rights
under the Lemon Law is void.
How Is A Used Car Buyer Protected When Purchasing A Car
Previously To The Manufacturer Under The Lemon Law?
A used car buyer must be given a written, conspicuous disclosure
statement by the dealer reading:
IMPORTANT:This vehicle was returned to the manufacturer or
dealer because it did not conform to its warranty and the defect or
condition was not fixed within a reasonable time as provided by New
This disclosure must also be printed on the car's certificate of
title by the New York State Department of Motor Vehicles.
For complete advice concerning your legal rights, click here to
consult a New York Lemon Law attorney.
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