Used Vehicles
Used vehicles are not covered by the Texas Lemon Law, but used car purchases are governed by the Deceptive Trade Practices - Consumer Protection Act. For example, it is illegal under the Act for a car dealer to entice customers to buy cars by falsely advertising that the dealer is going out of business. It also is illegal for the dealer to make false or misleading statements regarding the reasons for a price reduction. A dealer also may not try to get a consumer to buy a vehicle by failing to disclose information about the car which, if known, would make the consumer unwilling to buy the car. For example, any car that was returned to a manufacturer after a hearing under the Lemon Law must include a notice providing this information to any potential buyer.
The only warranties that accompany a used vehicle are those expressly provided by a dealer or an unexpired manufacturer's warranty. Therefore, it is extremely important for a consumer to thoroughly inspect a used automobile before purchase, and discuss whether the car is covered by any warranty. Federal law requires that all used cars sold through dealers must indicate on the buyer's guide or window sticker whether the car is being sold with or without a warranty. The buyer's guide should clearly state whether the vehicle is being sold "as is" (without any warranty) or "warranty" (with the specific provisions of the warranty listed on the window sticker). Consumers should closely inspect the tires, suspension, engine, drive train, steering, brakes, and interior. In fact, it is probably wise to have a mechanic conduct the inspection.
Because used vehicles are "used," the number of miles a vehicle has been driven is important. Vehicles with lower mileage typically are more valuable than those with higher mileage. Federal and state laws prohibit a seller from rolling back or changing the number of miles on an odometer. Under Texas law, the seller of a used vehicle is required to state on the title assignment the total number of miles the vehicle has traveled. A consumer should get a copy of the odometer statement before signing a contract and if the odometer reading seems suspect, he or she should check the odometer statement that the current owner received when the vehicle was purchased.
Automobile Repair
According to the Texas Attorney General's Office, problems associated with repairing an automobile consistently rank as the number one consumer complaint. Texas does not have a comprehensive law specifically governing car repairs, but the Texas Deceptive Trade Practices-Consumer Protection Act includes several sections dealing with repairs. Under the Act, it is illegal for an auto repair dealer to: 1) knowingly make false or misleading statements about the need for parts, replacement, or repair service; 2) falsely represent that work or services have been performed on a car, or that parts have been replaced; (3) claim that replacement parts are original or new when in fact they are used, second-hand, or refurbished; (4) advertise goods or services with the intent not to sell them as advertised. When selecting a repair shop, a consumer may wish to contact the Better Business Bureau or the Office of the Texas Attorney General to ask if anyone has complained about the shops the consumer is considering.
Vehicle Repossession
When buying a new vehicle, and sometimes when buying a used vehicle, a consumer often will make the purchase on credit. A buyer should remember that the creditor retains significant rights over the vehicle if the buyer does not abide by the loan agreement. If a consumer defaults on a loan, the creditor has legal authority to enter the consumer's property and seize the vehicle at any time and without prior notice to or consent of the consumer, even in the middle of the night, so long as it is done peaceably. After repossession, the creditor may keep the vehicle as compensation for the unpaid debt or resell it. In either case, the creditor must inform the consumer. The consumer has the right to demand that the vehicle be sold and that any money received from the sale beyond the amount of the debt be returned to him or her. If the vehicle is to be sold at a public auction, the consumer must be notified of the date in advance (in cases of a private sale, the consumer is notified after the sale). However the vehicle is sold, the sale must be conducted in a "commercially reasonable manner" and the price must approximate the vehicle's fair market value. Of course, the creditor also may reinstate the consumer's loan or allow the consumer to buy the vehicle back. It is especially important for the consumer to keep loan documents in a safe place not in the vehicle, and to get in writing any agreement that allows for a change in the terms of payment.
The Magnuson-Moss Warranty Act
is a federal law that protects the buyer of any product with a purchase price of more than $25 that comes with an express written warranty.The law applies to any product that you buy which does not perform as it should.
The Magnuson-Moss law gives consumers considerable rights in dealing with manufacturers of lemon cars. The law guarantees a car buyer that certain minimum requirements of warranties must be met and provides for disclosure of warranties before purchase. 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.
Regarding "lemon cars", the law greatly affects the rights of car buyers. Law firms have argued successfully to juries that 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.
Uniform Commercial Code Summary
TARR BABY-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 Section 2-601 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. Smth purchased 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 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 to 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 nonconformity substantially impairs the value of the goods to him when he has accepted the goods without discovery of a nonconformity 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 or 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 nonconformity he does discover will be remedied.
What is a nonconformity substantially impairing the value of the vehicle?
1) A nonconformity may include a number of relatively minor defects whose cumulative total adds up to a substantial impairment. This is the "Shaken 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 non-conformity 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.
Substantial nonconformity 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.
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alendar days out of service within shorter of 2 years or 24,000 miles and at least 2 attempts made within shorter of 1 year or 12,000 miles. Texas Lemon Law applies only to new vehicles. Texas provides for Arbitration, but does not provide for payment of the consumer’s attorneys fees. The Manufacturers are normally represented by attorneys and individuals familiar with the process. A consumer should consult with an attorney of their choice