A major area of interest to consumers concerns the
purchase of a defective product, in the absence of misrepresentations. California's Song-Beverly Consumer Warranty Act provides
warranty protections to purchasers and lessees of both new and used consumer goods. A consumer good is virtually any product
purchased by an individual for mostly non-commercial use, except clothing and consumables. Most protections apply
to new products accompanied by a manufacturer's written warranty, where the manufacturer or manufacturer's agent within California
is unable to conform the product to the terms of the written warranty after a reasonable number of attempts, during the warranty
period. The warranty period is extended while in for repairs, and for any delay in repairs not caused by the buyer.
The warranty does not expire until the defect has been fixed. It will be extended if the warranty repairs did not
remedy the defect, and the manufacturer is so notified within 60 days. The product is subjected to repair if it is brought
in for repair, regardless of whether repairs are attempted. What qualifies as a reasonable number of repairs varies depending
on the product, and its defect. The purchaser is normally required to deliver the product for repairs to the manufacturers
service and repair facilities within this state for repair, unless, due to reasons of size, weight, the defect, or other reasonable
factor, delivery cannot reasonably be accomplished, in which case delivery is effected by written notice to the manufacturer
or manufacturer's agent within California. A manufacturer giving a written warranty is required to maintain in California
either its own repair facilities, or independently contracted service and repair facilities, reasonably close to where its
products are sold.
The law presumes that manufacturers will occasionally produce products that prove
defective, and gives them a reasonable opportunity to fix them. The more expensive and complicated the product is, the more
that can go wrong, and the more reasonable the law presumes it is to allow the manufacturer a chance to make it right before
allowing a refund or replacement. A department store's policy of offering a refund or replacement, without attempting repair,
is simply based upon its notion of customer service, or the economics involved, and not lemon law.
If the new consumer product is in fact a lemon, i.e., has a defect which was not
repaired to conform to the written warranty, after a reasonable number of attempts, the Act obligates the manufacturer to
provide, at its option, either a replacement, or a refund (less a reasonable amount for the use before the defect was discovered).
When applied to new motor vehicles (including demonstrators, and the chassis,
cab, and propulsion components of a motor home, but not motorcycles or off-highway non-registered vehicles), the purchaser
gets to elect between a new replacement vehicle or a refund (less reasonable use), if the manufacturer or dealer is unable
to service and repair the vehicle to conform to the written warranty after a reasonable number of attempts. Either replacement
or restitution includes reasonable repair costs, towing, rental car expenses, and finance charges, actually incurred, and
includes tax, license, registration, and other official fees. Further, the definition of a consumer good is expanded to include
a new motor vehicle with a gross vehicle weight under 10,000 pounds that is bought or used primarily for business purposes
by a person, including a partnership, limited liability company, corporation, association, or any other legal entity, to which
not more than five motor vehicles are registered in California. The manufacturer is entitled to deduct from the restitution
or charge the buyer for a replacement, for the use by the consumer before the vehicle was first delivered for repair of the
nonconformity, calculated by pro-rating the actual price over 120,000 miles..
The Act contains a rebuttable presumption provision regarding whether or
not a reasonable number of attempts have been attempted, with respect to new motor vehicles. This means if the buyer meets
or exceeds the minimum standards, and other prerequisites are followed, it is presumed a reasonable number of attempts have
been made. The manufacturer is free, however, to attempt to rebut the presumption, by convincing the judge or jury that, under
the circumstances, a reasonable number of attempts have not been yet made. A buyer is not obligated to use the presumption
provision, and is free to attempt to convince a judge or jury that a reasonable number of attempts have been made, as with
any other consumer product.
The optional presumption provision presumes that a reasonable number of attempts
have been made, if, during the first 18 months or 18,000 miles, whichever occurs first, EITHER:
A defect likely to cause death or serious bodily injury if the vehicle is driven, has been subjected to
repair two or more times, or a defect which substantially impairs the vehicle's use, value, or safety has been subjected
to repair four or more times, AND, in either case, IF the manufacturer has clearly and conspicuously disclosed to the
buyer, with the warranty or the owner's manual, the requirement that the buyer must notify the manufacturer directly, THEN,
the buyer must at least once, direct notify the manufacturer of the need for repair of the nonconformity, by sending notification
to the address, if any, specified clearly and conspicuously by the manufacturer in the warranty or owner's manual; OR
The vehicle has been in the shop of the manufacturer's authorized service and repair facility (an authorized
dealer) for repair of one or more nonconformities for a total of more than 30 calendar days.
The presumption provision further requires the buyer to submit the controversy to
arbitration, if the manufacturer timely notifies the buyer that it maintains a qualified third party dispute resolution process,
which is not binding on the buyer, but is binding on the manufacturer. The results are admissible at trial if the buyer is
dissatisfied, or the manufacturer fails to comply, and the buyer then files a lawsuit. The arbitration process is not required
to include remedies in the form of awards of punitive damages or multiple damages, attorneys' fees, or of any damages other
than reasonable repair, towing, and rental car costs actually incurred by the buyer.
The Act also provides provisions detailing the existence and duration of implied warranties,
that is, non written warranties, accompanying the sale of new and used consumer goods, including an implied warranty
that a product meets its contract description and is fit for the ordinary purposes for which such goods are used, and if a
seller has reason to know any particular purpose for which the consumer goods are required that the buyer is relying on the
skill and judgment of the seller to select and furnish suitable goods, then there is an implied warranty that the goods shall
be fit for such purpose. Any new or used consumer good covered by a written warranty, is also covered by the implied warranties.
If no written warranty is given, the implied warranties still apply unless "AS-IS" provisions are strictly complied with.
With respect to leased goods, both new and used consumer goods are deemed to be covered
by a written warranty, if a buyer of the same goods receives a written warranty.
The Act provides protection for used goods, when accompanied by a written warranty from
the distributor or retailer. The obligations of such seller are identical to that of the manufacturer spelled out above, except
that the duration of the implied warranties, shall be the same duration as the written warranty, provided the duration of
the written warranty is reasonable, but shall be at least 30 days nor more than three months following the sale to a retail
buyer, and if no duration for the written warranty is stated, the duration of the implied warranties shall be three months.
Further, the Act provides the right to sue for a violation of any service contract accompanying
the sale of new or used goods. Service contracts, by the way, are cancelable by the buyer at any time, with either a full
refund due within 30 to 60 days of receipt of the (entire) service contract, depending on whether the vehicle is used or new, or
a prorated refund due, with no more than a $25.00 administration fee, after the 30 to 60 days, or if a claim is made. The
30 day period applies to home appliances and home electronic products.
A civil penalty of up to two times the actual damages may be awarded for a violation of
a written warranty or service contract (but not an implied warranty), if the buyer established that the violation was "willful".
With respect to a motor vehicle, the penalty may be imposed without a showing of willfulness, unless the optional qualified
third party dispute resolution process is maintained by the manufacturer, the buyer fails to notify the manufacturer
of demand for relacement/reimbursement after the presumption has been met, the manufacturer complies with the demand
within thirty days, or the "willful" penalty is imposed.