Used Car -Recourse

[srijay]

I purchased a used car-1998 Nissan Centra from a second hand dealer based in Rochester,NY.However from Day1 I have a problem with the car.The 'Service Engine Soon' Light started from Day1. I went to the dealer back but somehow he is not fixing the problem.So I had been to a Nissan dealer and he has given me an estimate of 500dollars+Tax.My dealer is not helping me.

Its 28 days since I purchased this car and I have a 30 days warranty.The problem is reported to the dealer right from day1 but he somehow gives some reason or other.Is there any remedy available to me?Please advice.

 

[Michael Wechsler]

Some states have used car lemon laws, such as New York. It can be found at the site listed and an excerpt is below.

http://www.oag.state.ny.us/consumer/cars/usedqa.html

Originally posted by srijay
I purchased a used car-1998 Nissan Centra from a second hand dealer based in Rochester,NY.However from Day1 I have a problem with the car.The 'Service Engine Soon' Light started from Day1. I went to the dealer back but somehow he is not fixing the problem.So I had been to a Nissan dealer and he has given me an estimate of 500dollars+Tax.My dealer is not helping me.

Its 28 days since I purchased this car and I have a 30 days warranty.The problem is reported to the dealer right from day1 but he somehow gives some reason or other.Is there any remedy available to me?Please advice.

 

[Michael Wechsler]

WHAT IS THE PURPOSE OF THE USED CAR LEMON LAW?

The Used Car Lemon Law (General Business Law, section 198-b) provides a legal remedy for consumers who are buyers or lessees of used cars that turn out to be lemons. The law requires dealers to give consumers a written warranty. Under this warranty, dealers must repair, free of charge, any defects in covered parts. If the dealer is unable to repair the car after a reasonable number of attempts, the consumer is entitled to a full refund. No used car covered by this law can be sold by a dealer "as is." (A copy of the law may be found at the back of this book.)
WHICH USED CARS ARE COVERED BY THE LEMON LAW?

Under the law, a used car is a vehicle which satisfies all the following conditions:
(1) it was purchased, leased or transferred after the earlier of
(a) 18,000 miles of operation or
(b) two years from the date of original delivery; and
(2) it was purchased or leased from a New York dealer; and
(3) it had a purchase price or lease value of at least $1,500; and
(4) it had been driven less than 100,000 miles at the time of purchase or lease; and
(5) it is primarily used for personal purposes.
ARE MOTORCYCLES, MOTOR HOMES AND OFF-ROAD VEHICLES COVERED?

Used motorcycles, motor homes, off-road vehicles, and "classic" cars registered under section 401 of the vehicle and traffic law, are not covered.
WHAT DOES THE PHRASE "PRIMARILY USED FOR PERSONAL PURPOSES" MEAN?

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 mixed personal and business use provided that the personal use is predominant.
WHO ELSE IS PROTECTED BY THE USED CAR LEMON LAW?

Any person to whom a used car was transferred by the purchaser during the used car lemon law warranty period is covered.
ARE PRIVATE SALES COVERED?

Used car buyers who purchase their cars from private individuals (rather than from a dealer) are not protected by the Used Car Lemon Law. They should consult a lawyer for advice as to other possible remedies. If the purchase price was $2,000 or less, they may wish to pursue their claims in Small Claims Court.
ARE CARS OWNED OR LEASED BY BUSINESSES COVERED?

Yes, provided the car is primarily used for personal, family or household purposes.
WHICH USED CAR DEALERS ARE INCLUDED?

Under the Used Car Lemon Law, a dealer is any person or business which sells or leases a used car after selling or leasing three or more used cars in the previous twelve month period. Banks or other financial institutions, except in the case of a lease, are not included. Others excluded are: a business selling a used car to its own employee; a regulated public utility which sells at public auction cars used in the ordinary course of its operations; a lessor selling a leased car to the lessee, a member of the lessee's family or the lessee's employee; and the state and local government or any of their agencies.
ARE CARS PURCHASED AT AUTO AUCTIONS COVERED?

If you buy a used car at a retail auto auction, the auction company must be a used car dealer registered with the Department of Motor Vehicles and it must provide you with your lemon law rights.
WHAT DOES THE LAW REQUIRE THE DEALER TO DO?

A dealer who sells or leases a used car to a consumer is required to give a written warranty, the terms of which are specified in the law. The warranty may be referred to at times as a "statutory warranty" because it is mandated by statute and must be honored by the dealer. The statutory warranty must specify that while it is in effect the dealer or his agent will repair, free of charge, any part covered by the warranty. The dealer may elect to reimburse the consumer for the reasonable cost of repairing any covered part.
WHEN MUST THE STATUTORY WARRANTY BE GIVEN?

The dealer must give the consumer a copy of the statutory warranty at or before the time the consumer signs the sales contract or lease.
HOW IS THE WARRANTY GIVEN?

The warranty may be included in the sales contract or lease or on a separate sheet of paper. If it is part of the sales contract or lease, it must be separated from the other contract provisions and headed by a conspicuous title.
WHAT IF THE DEALER DOES NOT GIVE THE STATUTORY WARRANTY?

If a dealer fails to give a consumer the written statutory warranty, the dealer is nevertheless considered to have given the warranty and the consumer is entitled to all the protections under the law.
HOW LONG IS THE WARRANTY PROTECTION?

Miles at time of Purchase Duration of Warranty or
Lease (the earlier of
18,001 to 36,000 miles 90 days or 4,000 miles
36,001 to 79,999 miles 60 days or 3,000 miles
80,000 to 100,000 miles 30 days or 1,000 miles

WHAT PARTS ARE COVERED?

Covered parts must include at least:
Engine --All lubricated parts, water pump, fuel pump, manifolds, engine block, cylinder head, rotary engine housings and flywheel.
Transmission -- The transmission case, internal parts, and the torque converter.
Drive Axle -- Front and rear axle housings and internal parts, axle shafts, propeller shafts and universal joints.
Brakes -- Master cylinder, vacuum assist booster, wheel cylinders, hydraulic lines and fittings and disc brake calipers.
Steering -- The steering gear housing and all internal parts, power steering pump, valve body, piston and rack.
Radiator, Alternator, Generator, Starter, Ignition System (excluding battery).
CAN A DEALER LIMIT COVERAGE OF THE STATUTORY WARRANTY?

The law permits a dealer to add language to the statutory warranty to exclude coverage for the following:
(a) For a failure of a covered part caused by a lack of customary maintenance.
(b) For a failure of a covered part caused by collision, abuse, negligence, theft, vandalism, fire or other casualty and damage from the environment (windstorm, lightning, road hazards, etc.).
(c) If the odometer has been stopped or altered such that the car's actual mileage cannot be readily determined, or if any covered part has been altered such that a covered part was thereby caused to fail.
(d) For maintenance services for the parts used in connection with such services such as seals, gaskets, oil and grease unless required in connection with the repair of a covered part.
(e) For a motor tune-up.
(f) For a failure resulting from racing or other competition.
(g) For a failure caused by towing a trailer or another vehicle unless the used car is equipped for this as recommended by the manufacturer.
(h) If the used car is used to carry passengers for hire.
(i) If the used car is rented to someone else.
(j) For repair of valves and/or rings to correct low compression and/or oil consumption which are considered normal wear.
(k) To the extent otherwise permitted by law, for property damage arising or allegedly arising out of the failure of a covered part.
(l) To the extent otherwise permitted by law, for loss of the use of the used car, loss of time, inconvenience, commercial loss or consequential damages.

CAN A CONSUMER'S RIGHTS UNDER THE USED CAR LEMON LAW BE WAIVED?

Any contract clause which seeks to waive a consumer's rights under the Used Car Lemon Law is void.
CAN A DEALER GIVE ADDITIONAL WARRANTY PROTECTION?

A dealer may agree, as part of the sale or lease, to give a consumer more warranty protection than the law requires. The statutory warranty sets only minimum obligations for dealers. Many dealers, for example, offer consumers extended service contracts which provide protection beyond the statutory warranty. The price of such extended service contracts may be negotiated with the dealer.

WHAT SHOULD CONSUMERS DO IF THEY BECOME AWARE OF A PROBLEM WITH THEIR USED CAR?

The consumer should immediately report any malfunction or defect of a covered part to the dealer and request the necessary repairs. If the consumer has notified the dealer of a problem within the warranty period, the dealer must make the repair even if the warranty has subsequently expired. 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.

 

[Michael Wechsler]

WHAT HAPPENS TO THE WARRANTY WHILE THE CAR IS BEING REPAIRED?

The warranty is extended for each day that the car is in the shop for repairs.
WHAT ARE A CONSUMER'S RIGHTS IF THE DEALER DOES NOT REPAIR THE CAR?

If the dealer fails to repair the problem after a reasonable period of time, and if the problem substantially impairs the value of the used car to the consumer, the dealer must accept the return of the car and make a refund.
DOES THE LAW SPECIFY WHAT CONSTITUTES A "REASONABLE PERIOD OF TIME" TO REPAIR THE CAR?

It is presumed that the dealer has had a reasonable opportunity to repair a problem if, during the statutory warranty period, either: (1) the same problem has been subject to repair three or more times and the problem continues to exist; or (2) the car is out of service by reason of repair or malfunction for a cumulative total of 15 or more days and the problem continues to exist. The 15-day period begins to run from the day you notify the dealer of the problem. When calculating the 15-day total, the days during which repairs could not be completed due to the unavailability of necessary parts are not included. However, the dealer is required to exercise due diligence in attempting to get the necessary parts and there is an absolute 45-day limit.
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 may add up to a substantial impairment of value.
WHAT IS TO BE INCLUDED IN THE REFUND TO THE CONSUMER?

The refund must include the full purchase price. The dealer may deduct a reasonable amount for any damage beyond normal wear or use. An adjustment may also be made for any modification to the car which either increases or decreases its market value. There is no deduction for mileage.
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. 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. (This form may be obtained from the Commissioner of Taxation and Finance.)
IF A TRADE-IN WAS INVOLVED, HOW IS THE REFUND DETERMINED?

The dealer need not include in the refund the value of the trade-in car as listed in the sales contract. The dealer can choose either to return any car traded-in by the consumer at the time of the sale or lease of the used car (together with a refund of whatever moneys the consumer paid), or, to include in the refund to the consumer the wholesale value of the car when it was traded-in. The wholesale value must be determined by referring to the "NADA Used Car Guide". However, the New York State Department of Motor Vehicles is authorized to approve the use of an alternative guidebook. An adjustment in the listed value may be taken for mileage, improvements or major defects that existed at the time of the trade-in.
MUST DEALERS NOTIFY CONSUMERS HOW TRADE-IN VALUES ARE CALCULATED?

Dealers must inform consumers, by means of a written notice, of the method of calculating the value of any trade-in car which is not returned to the consumer. The notice must be given at or before the time the consumer signs the sales contract or lease. The notice may be on the sales contract or lease or on a separate sheet of paper. If it is on the sales contract or lease, it must be separated from the other contract provisions and headed by a conspicuous title.
WHAT IS THE DEALER'S REFUND OBLIGATION IF THE CAR IS FINANCED?

The refund by the dealer 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 is usually 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, however, the amount the consumer owes the lender is more than the refund from the dealer, the dealer must notify the consumer in writing, by registered or certified mail, that the consumer has 30 days to pay the additional amount owed to the lender. The notice must also contain a conspicuous warning that the failure to pay the additional amount to the lender within 30 days will terminate the dealer's obligation to provide a refund.
IF THE CAR WAS LEASED, HOW IS THE REFUND CALCULATED?

When the car is leased, the refund due the consumer consists of all payments made under the lease.
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, either by a court or an arbitrator, that a car is a lemon, the lease is terminated. As a result, no early termination penalties under the lease may be collected.
UNDER THE LAW, CAN THE DEALER PROVIDE A REPLACEMENT CAR INSTEAD OF A REFUND TO THE CONSUMER?

The dealer may provide a replacement car if the consumer is willing to accept a replacement instead of a full refund. Thus, the decision to offer a replacement car rests with the dealer and the decision to accept or decline such an offer rests with the consumer. If the dealer offers a replacement car and the consumer agrees, the parties must negotiate between themselves any adjustments in price.
ARE THERE ANY EXCEPTIONS TO THE DEALER'S DUTY TO MAKE A REFUND OR OFFER A REPLACEMENT CAR?

The dealer does not have 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 unreasonable alteration of the car.
HOW CAN CONSUMERS PROVE THEY OWN A LEMON?

The consumer must be able to document the required repair attempts. Therefore, it is very important to keep careful records of all complaints and copies of all work orders, repair bills and correspondence. To help document the duration the car is out of service, it is advisable to notify the dealer of any problem in writing. A dealer is required by Department of Motor Vehicles (DMV) regulations to provide a legible and accurate written work order, upon the request of a consumer, 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 in obtaining their repair orders.
HOW CAN A CONSUMER'S RIGHTS UNDER THE LEMON LAW BE ENFORCED?

A consumer has the choice of either participating in an arbitration program or suing the dealer directly in court. If a dealer has established an arbitration procedure which complies with federal regulations, the dealer 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 to the consumer.
IF THE CONSUMER WINS IN COURT, CAN ATTORNEY'S FEES ALSO BE RECOVERED?

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 YORK?

Consumers may participate in the New York State Used Car Lemon Law Arbitration Program (the "New York Program"), established by the Used Car 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 subject only to judicial review pursuant to CPLR Article 75. Consumers may also choose to participate in any arbitration program established by the auto dealer. Decisions under dealer programs are not binding on consumers. Therefore, consumers who have gone through the dealer's program and are not satisfied with the outcome may still apply for arbitration under the New York Program.

 

[Michael Wechsler]

HOW DOES A CONSUMER PARTICIPATE IN THE NEW YORK PROGRAM?

A consumer must first complete a "Request for Arbitration" form.

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 may be found in this booklet following this "Question & Answer" section.)
WHO ARE THE ARBITRATORS?

The arbitrators are volunteers who have been trained in the Used Car Lemon Law and in arbitration procedures by the Attorney General's Office and the Administrator.
IS A CONSUMER ENTITLED TO AN ORAL --IN PERSON--HEARING?

Consumers have an absolute right to an oral hearing. At an oral hearing, both the consumer and the dealer's representative will 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 dealer may object, in which case an oral hearing will be scheduled.
MAY A STENOGRAPHIC RECORD OR TAPE RECORDING BE MADE OF THE HEARING?

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 HEARING?

The New York Program is designed to be accessible to consumers without the need for an attorney. However, both the consumer and the dealer 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 warranty.
(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 the consumer to present and remember relevant information.
(d) Prepare questions to ask the dealer: This will assure that no important question is omitted.
(e) Arrange for witnesses: The presence of witnesses, especially car mechanics, or their sworn statements, is helpful to document the problem.
WHAT IF CONSUMERS DO NOT HAVE ALL THE DOCUMENTS?

Upon payment of the filing fee and anytime prior to the hearing, consumers may make a written request to the arbitrator, through the Administrator, to direct the dealer 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 later in this booklet.
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.
(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 submitted.
(e) Offer proof of each point, especially those the dealer may dispute.
(f) Present any witness that can provide relevant information.
(g) State the relief requested.
(h) At the end of the presentation, briefly summarize the facts discussed.
WHAT HAPPENS IF EITHER PARTY FAILS TO APPEAR AT THE HEARING?

Unless the hearing has been properly rescheduled, if either the dealer 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 fee.
WHEN MUST A DEALER COMPLY WITH AN ARBITRATOR'S DECISION?

Within thirty days. In most cases, the dealer should 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 dealer 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 dealer does not voluntarily pay any applicable penalty, the consumer may sue to recover this penalty in Small Claims Court. However, this deadline and penalty are not applicable where a consumer has requested a particular replacement car or otherwise made compliance impossible.
HOW IS A RETURN OF THE CAR IMPLEMENTED?

The common procedure is to have both parties -- the consumer and the dealer -- meet at an agreed time and place to execute the necessary papers to exchange the car for a refund or replacement.
WHAT HAPPENS IF THE DEALER DOES NOT COMPLY WITH THE ARBITRATOR'S AWARD?

If the dealer does not comply, 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 reasonable attorney's fees. The court may also award reasonable attorney's fees incurred to enforce the collection of the award.
UNDER WHAT CIRCUMSTANCES CAN AN ARBITRATOR'S DECISION BE MODIFIED?

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 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 necessary.
CAN AN ARBITRATOR'S DECISION BE CHALLENGED?

Either the consumer or the dealer 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 DEALER CHALLENGES AN AWARD IN COURT?

Neither the Attorney General's Office nor the Administrator is authorized to represent an individual consumer in such a challenge; this is the responsibility ofthe consumer's own attorney. The Administrator is finished when the arbitrator's award is sent to the parties.
DOES THE LEMON LAW LIMIT ANY OF THE OTHER LEGAL REMEDIES ALREADY AVAILABLE TO CONSUMERS?

The Used Car Lemon Law adds to the consumer's arsenal of existing legal remedies. These legal remedies can be explained by the consumer's attorney. The most important of these remedies is the warranty of serviceability (Vehicle and Traffic Law, section 417). This warranty cannot be waived by the buyer. For example, no car can be sold by a dealer to a consumer "as is." It requires the dealer to certify to the used car buyer that the car is in condition and repair to render, under normal use, satisfactory and adequate service at the time of delivery. In addition, specified safety equipment must be in good working order. If the dealer fails to honor this duty, complain to the Department of Motor Vehicles, Division of Vehicle Safety Services, Empire State Plaza, Albany, NY 12228.
HOW IS A CONSUMER PROTECTED WHEN BUYING A USED CAR PREVIOUSLY REPURCHASED 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 YORK LAW.

This disclosure must also be printed on the car's certificate of title by the New York State Department of Motor Vehicles.