Oregon Lemon Law Statutes

Oregon's Lemon Law - Oregon Revised Statutes 646.315-375

646.315 Definitions for ORS 646.315 to 646.375. As used in ORS 646.315 to 646.375:

1. "Consumer" means:
   
   
   1. The purchaser or lessee, other than for purposes of resale, of a new motor vehicle normally used for personal, family or household purposes;
   
   
   2. Any person to whom a new motor vehicle used for personal, family or household purposes is transferred for the same purposes during the duration of an express warranty applicable to such motor vehicle; and
   
   
   3. Any other person entitled by the terms of such warranty to enforce the obligations of the warranty.
   
   


2. "Motor vehicle" means a passenger motor vehicle as defined in ORS 801.360 that is sold in this state. <1983 c.469 s1; 1985 c.16 s468; 1987 c.476 s1; 1989 c.171 s 74; 1989 c.202 s1>

646.325 Availability of remedy.

The remedy under the provisions of ORS 646.315 to 646.375 is available to a consumer if:

1. A new motor vehicle does not conform to applicable manufacturer's express warranties;



2. The consumer reports each nonconformity to the manufacturer, its agent or its authorized dealer, for the purpose of repair or correction, during the period of one year following the date of original delivery of the motor vehicle to the consumer or during the period ending on the date on which the mileage on the motor vehicle reaches 12,000 miles, whichever period ends earlier; and



3. The manufacturer has received direct written notification from or on behalf of the consumer and has had an opportunity to correct the alleged defect. "Notification" under this subsection includes, but is not limited to, a request by the consumer for an informal dispute settlement procedure under ORS 646.355. <1983 c.469 s2; 1987 c.476 s6>

646.335 Consumer's remedies; manufacturer's affirmative defenses.

1. If the manufacturer or its agents or authorized dealers are unable to conform the motor vehicle to any applicable manufacturer's express warranty by repairing or correcting any defect or condition that substantially impairs the use, market value or safety of the motor vehicle to the consumer after a reasonable number of attempts, the manufacturer shall:
   
   
   1. Replace the motor vehicle with a new motor vehicle; or
   
   
   
   2. Accept return of the vehicle from the consumer and refund to the consumer the full purchase or lease price paid, including taxes, license and registration fees and any similar collateral charges excluding interest, less a reasonable allowance for the consumer's use of the vehicle.


2. Refunds shall be made to the consumer and lienholder, if any, as their interests may appear. A reasonable allowance for use is that amount directly attributable to use by the consumer prior to the first report of the nonconformity to the manufacturer, agent or dealer and during any subsequent period when the vehicle is not out of service by reason of repair.



3. It shall be an affirmative defense to any claim under ORS 646.315 to 646.375:
   
   
   1. That an alleged nonconformity does not substantially impair such use, market value or safety; or
   
   
   
   2. That a nonconformity is the result of abuse, neglect or unauthorized modifications or alterations of the motor vehicle by the consumer. <1983 c.469 s3; 1987 c.476 s2>

646.345 Presumption of reasonable attempt to conform;

extension of time for repairs; notice to manufacturer.

1. It shall be presumed that a reasonable number of attempts have been undertaken to conform a motor vehicle to the applicable manufacturer's express warranties if, during the period of one year following the date of original delivery of the motor vehicle to a consumer or during the period ending on the date on which the mileage on the motor vehicle reaches 12,000 miles, whichever period ends earlier:
   
   
   1. The same nonconformity has been subject to repair or correction four or more times by the manufacturer or its agent or authorized dealer, but such nonconformity continues to exist; or
   
   
   
   2. The vehicle is out of service by reason of repair or correction for a cumulative total of 30 or more business days.


2. A repair or correction for purposes of subsection (1) of this section includes a repair that must take place after the expiration of the earlier of either period.



3. The period ending on the date on which the mileage on the motor vehicle reaches 12,000 miles, the one-year period and the 30-day period shall be extended by any period of time during which repair services are not available to the consumer because of a war, invasion, strike, fire, flood or other natural disaster.



4. In no event shall the presumption described in subsection (1) of this section apply against a manufacturer unless the manufacturer has received prior direct written notification from or on behalf of the consumer and has had an opportunity to cure the defect alleged. <1983 c.469 s4>

646.355 Use of informal dispute settlement procedure as condition for remedy; binding effect on manufacturer.

If the manufacturer has established or participates in an informal dispute settlement procedure that substantially complies with the provisions of Title 16, Code of Federal Regulations, Part 703, as from time to time amended, and causes the consumer to be notified of the procedure, ORS 646.335 concerning refunds or replacement shall not apply to any consumer who has not first resorted to the procedure. A decision resulting from arbitration pursuant to the informal dispute settlement procedure shall be binding on the manufacturer. <1983 c.469 s5>

646.357 Informal dispute settlement procedure; recordkeeping; review by Department of Justice.

A manufacturer which has established or participates in an informal dispute settlement procedure shall keep records of all cases submitted to the procedure under ORS 646.355 and shall make the records available to the Department of Justice if the department requests them. The department may review all case records kept under this section to determine whether or not the arbitrators are complying with the provisions of ORS 646.315 to 646.375 in reaching their decisions. <1987 c.476 s4>

646.359 Judicial review; damages; attorney fees.

1. If a consumer appeals to a court from a decision resulting from the informal dispute settlement procedure established by ORS 646.355 because the consumer was not granted one of the remedies specified in ORS 646.335 (1), and the consumer is granted one of the specified remedies by the court, the consumer shall also be awarded up to three times the amount of any damages if the court finds that the manufacturer did not act in good faith in the dispute settlement procedure.



2. If a consumer brings an action under ORS 646.315 to 646.375 against a manufacturer who has not established informal dispute settlement procedures and the consumer is granted one of the remedies specified in ORS 646.335 (1), the consumer shall also be awarded three times the amount of the damages.



3. The court may award reasonable attorney fees to the prevailing party in an appeal or action under this section. <1987 c.476 s5; 1995 c.618 s96>

646.361 Limitations on actions against dealers.

1. Nothing in ORS 646.315 to 646.375 creates a cause of action by a consumer against a vehicle dealer.



2. A manufacturer may not join a dealer as a party in any proceeding brought under ORS 646.315 to 646.375, nor may the manufacturer try to collect from a dealer any damages assessed against the manufacturer in a proceeding brought under ORS 646.315 to 646.375. <1987 c.476 s7>

646.365 Limitation on commencement of action.

Any action brought under ORS 646.315 to 646.375 shall be commenced within one year following whichever period ends earlier:

1. The period ending on the date on which the mileage on the motor vehicle reaches 12,000 miles; or



2. The period of one year following the date of the original delivery of the motor vehicle to the consumer. <1983 c.469 s6>

646.375 Remedies supplementary to existing statutory or common law remedies; election of remedies.

Nothing in ORS 646.315 to 646.375 is intended in any way to limit the rights or remedies that are otherwise available to a consumer under any other law. However, if the consumer elects to pursue any other remedy in state or federal court, the remedy available under ORS 646.315 to 646.375 shall not be available insofar as it would result in recovery in excess of the recovery authorized by ORS 646.335 without proof of fault resulting in damages in excess of such recovery. <1983 c.469 s7>

The Magnuson-Moss Warranty Act

The Magnuson-Moss Warranty Act is a Federal Law that protects the buyer of any product which costs more than $25 and comes with an express written warranty. This law applies to any product that you buy that does not perform as it should.

The Magnuson-Moss statute gives consumers considerable rights in dealing with manufacturers of lemon cars. A car buyer is guaranteed that certain minimum requirements of warranties must be met, and provides for disclosure of warranties before purchase.

Regarding "lemon cars", this law greatly affects the rights of car buyers. For any product which has a written warranty if any part of the product, or the product itself is considered defective, the warrantor must permit the buyer the choice of either a refund or replacement of the product.

Law firms have argued successfully to juries that the lemon manufacturers should be given three attempts to fix the defect. Continued attempts to repair beyond the initial three should not be allowed. This is called the "three strikes and you're out" principle.

A consumer may pursue legal action in any court of general jurisdiction in the United States to enforce his rights under the Magnuson-Moss Law. Attorney's fees based on actual time spent will be covered if the consumer does prevail.

Due to this particular condition, there is quite a bit of financial pressure on the manufacturer to settle consumers disputes before going to court, as this would keep their expenses down.

The narrative information on Magnusson-Moss, UCC and lemon laws on these pages is provided by T. Michael Flinn, attorney.

Uniform Commercial Code Summary

The Uniform Commercial Code or UCC has been enacted in all 50 states and some of the territories of the United States. It is the primary source of law in all contracts dealing with the sale of products. The TARR refers to Tender, Acceptance, Rejection, Revocation and applies to different aspects of the consumer's "relationship" with the purchased goods.

TENDER -

The tender provisions of the Uniform Commercial Code contained in Section2-601 provide that the buyer is entitled to reject any goods that fail in any respect to conform to the contract. Unfortunately, new cars are often technically complex and their innermost workings are beyond the understanding of the average new car buyer. The buyer, therefore, does not know whether the goods are then conforming.

ACCEPTANCE -

The new car buyer accepts the goods believing and expecting that the manufacturer will repair any problem he has with the goods under the warranty.

REJECTION -

The new car buyer may discover a problem with the vehicle within the first few miles of his purchase. This would allow the new car buyer to reject the goods. If the new car buyer discovers a defect in the car within a reasonable time to inspect the vehicle, he may reject the vehicle. This period is not defined. On the one hand, the buyer must be given a reasonable time to inspect and that reasonable time to inspect will be held as an acceptance of the vehicle. The Courts will decide this reasonable time to inspect based on the knowledge and experience of the buyer, the difficulty in discovering the defect, and the opportunity to discover the defect.

The following is an example of a case of rejection: Mr. Zabriskie purchase a new 1966 Chevrolet Biscayne. After picking up the car on Friday evening, while en route to his home 2.5 miles away, and within 7/10ths of a mile from the dealership, the car stalled and stalled again within 15 feet. Thereafter, the car would only drive in low gear. The buyer rejected the vehicle and stopped payment on his check. The dealer contended that the buyer could not reject the car because he had driven it around the the block and that was his reasonable opportunity to inspect. The New Jersey Court said;

To the layman, the complicated mechanisms of today's automobile are a complete mystery.To have the automobile inspected by someone with sufficient expertise to disassemble the vehicle in order the discover latent defects before the contract is signed, is assuredly impossible and highly impractical. Consequently, the first few miles of driving become even more significant to the excited new car buyer. This is the buyer's first reasonable opportunity to enjoy his new vehicle to see if it conforms to what it was represented to be and whether he is getting what he bargained for. How long the buyer may drive the new car under the guise of inspection of new goods is not an issue in the present case because 7/10th of a mile is clearly within the ambit of a reasonable opportunity to inspect. Zabriskie Chevrolet, Inc.v. Smith, 240 A. 2d 195(1968)

It is suggested that Courts will tend to excuse use by consumers if possible.

REVOCATION -

What happens when the consumer has used the new car for a lengthy period of time? This is the typical lemon car case. The UCC provides that a buyer may revoke his acceptance of goods whose non-conformity substantially impairs the value of the goods to him when he has accepted the goods without discovery of a non-conformity because it was difficult to discover or if he was assured that non-conformities would be repaired. Of course, the average new car buyer does not learn of the nonconformity until hundreds of thousands of miles later. And because quality is job one, and manufacturers are competing on the basis of their warranties, the consumer always is assured that any noncomformities he does discover will be remedied.

What is a noncomformity substantially impairing the value of the vehicle?

1. A noncomformity may include a number of relatively minor defects whose cumulative total adds up to a substantial impairment. This is the "Shake Faith" Doctrine first stated in the Zabrisikie case. "For a majority of people the purchase of a new car is a major investment, rationalized by the peace of mind that flows from its dependability and safety. Once their faith is shaken, the vehicle loses not only its real value in their eyes, but becomes an instrument whose integrity is substantially impaired and whose operation is fraught with apprehension".


2. A substantial noncomformity may include a failure or refusal to repair the goods under the warranty. In Durfee V. Rod Baxter Imports, the Minnesota Court held that the Saab owner that was plagued by a series of of annoying minor defects and stalling, which were never repaired after a number of attempts, could revoke, "if repairs are not successfully undertaken within a reasonable time", the consumer may elect to revoke.


3. Substantial Non Conformity and Lemon Laws often define what may be considered a substantial impairment. These definitions have been successfully used to flesh out the substantial impairment in the UCC.

narrative information on Magnusson-Moss, UCC and lemon laws on these pages is provided by T. Michael Flinn, attorney.