Michigan Lemon Laws

MCL 257.1401 - Definitions

Sec. 1. As used in this act:

  1. "Consumer" means:
    • A person who pays a handsome amount against the acquisition of a new motor to cover up personal, family, or household needs
    • A person to whom the ownership of the car or any other vehicle is transferred
    • Who is entitled to enforce the obligations of the warranty
    • A person who buys less than 10 new vehicle a year
    • A person who purchases 10 or more new motor vehicles a year only if the vehicles are bought for personal, family, or household use
  2. "Lessee" means,
    • A renter who holds a lease
    • A person who, under a lease, get hold of the right to possession and use of a new motor vehicle
  3. "Lessor" means a person who, under a lease, transfers the right to possession and use of a new motor vehicle.
  4. "Manufacturer" is a person or a firm engaged in the business of manufacturing, importing or assembling motor vehicles.
  5. "Manufacturer's express warranty" means the warranty expressed in writing by the manufacturer of a new motor vehicle of its nonconformities and fitness for use.
  6. "Motor vehicle" means
    • A vehicle manufactured as a passenger vehicle but doesn’t include a motor home, bus, or a vehicle having less than four wheels.
    • A motor vehicle as defined in section 33 of the Michigan vehicle code,1949 PA 300, MCL 257.33
  7. "New motor vehicle" means a self-propelled vehicle, bought by a resident of Michigan, whose title has not been assigned to anyone yet.
  8. "New motor vehicle dealer" means a person who has been authorized by the manufacturer for the sale of new motor vehicles.
  9. "Resident of this state" means,
    • A person who is a legal resident of this state.
    • Incase of sole proprietorship or partnership, a sole proprietorship or partnership created in accordance with the laws of this state and its main office is located within the state.
    • For a corporation, a corporation that is a domestic corporation and was created pursuant to the laws of Michigan.
    • For an association, an association having its main office in this state and is created under the laws of this state.
    • For a government agency, a unit or agency of government located in this state.
    • For a trust, estate, or other legal entity, a trust, estate, or other legal entity created pursuant to the laws of this state and that is located in this state.
  10. "Lease price" means the actual price of a vehicle paid by the lessor that includes any amount paid by the consumer and any allowance for trade-in but excludes debt, discount, rebate, or incentive appearing in the agreement that the consumer received. Any additional charges paid by the lessor on behalf of lessee are also included in the lease price.
  11. "Purchase price" means the actual price of a vehicle which appears on the sale agreement which includes any allowance for trade-in but excludes debt, discount, rebate, or incentive appearing in the sales agreement. Any additional charges paid by the consumer are also included in the lease price.

History: 1986, Act 87, Eff. June 25, 1986;--Am. 1998, Act 486, Imd. Eff. Jan. 4, 1999.

MCL 257.1402 - Repair of Defect or Condition; Report

Sec. 2. If a new motor vehicle doesn’t conform to the manufacturer's express warranty and that nonconformity affects the utility and safety of a motor vehicle and the consumer reports the defect within the warranty period or within 1 year of the delivery of the motor vehicle, then the manufacturer or its agent will be liable for the repair of the defects as required under section 3.

History: 1986, Act 87, Eff. June 25, 1986.

MCL 257.1403 - Replacement Of Motor Vehicle Or Refund; Allowance For Use; Reimbursement For Towing Costs And Costs For Rental Vehicle; Consent To Replacement Of Security Interest; Presumption; Performing Repairs After Expiration Of Warranty; Extension Of Time For Repair Services

Sec. 3.

  1. If a defect or condition that was reported to the manufacturer or new motor vehicle dealer pursuant to section 2 continues to exist and the new motor vehicle has been subjected to a reasonable number of repairs as determined under subsection (5), the manufacturer shall within 30 days, do either of the following as applicable:
    1. If the new motor vehicle was purchased, either replace the new motor vehicle with a comparable replacement motor vehicle currently in production and acceptable to the consumer or accept return of the vehicle and refund to the consumer the purchase price. A consumer shall have the right to demand a refund.
    2. If the new motor vehicle was leased, the consumer has the right to a refund of the lease price paid by the consumer. The consumer may agree to accept a comparable replacement vehicle in lieu of a refund for the lease price paid. If the consumer agrees to accept a replacement vehicle, the lease agreement shall not be altered except with respect to the identification of the vehicle.
  2. As stated in Michigan lemon laws, “the purchase price or lease price includes the cost of any options or other modifications installed or made by or for the manufacturer, and the amount of all other charges made by or for the manufacturer, less a reasonable allowance for the consumer's use of the vehicle, and less an amount equal to any appraised damage that is not attributable to normal use or to the defect or condition. A reasonable allowance for use is the purchase or lease price of the new motor vehicle multiplied by a fraction having as the denominator 100,000 miles and having as the numerator the miles directly attributable to use by the consumer and any previous consumer prior to his or her first report of a defect or condition that impairs the use or value of the new motor vehicle plus all mileage directly attributable to use by a consumer beyond 25,000 miles. If a vehicle is replaced or refunded under the provisions of this section, if towing services and rental vehicles were not made available without cost to the consumer, the manufacturer shall also reimburse the consumer for those towing costs and reasonable costs for a comparable rental vehicle that were incurred as a direct result of the defect or condition”.
  3. If the consumer proves that the vehicle did not provide dependable transportation beyond the first 25,000 miles, then the court or the alternative dispute settlement procedure may decrease the amount for usage beyond the first 25,000 miles. For determining the utility of a vehicle, the court may consider the following:
    • The number of repairs.
    • The cost of the repairs.
    • The number of days the vehicle was out of service.
    • The vehicle’s nonconformity extensively affects the use and value.
  4. Nothing in this act of Michigan lemon laws can impair the responsibilities of a buyer under a loan, sales, or lease agreement or the secured interest of a secured party. The secured party shall permit the substitute of the security interest with an equivalent security interest on a replacement motor vehicle which the consumer has accepted in exchange. If the consumer is unsatisfied with the replacement vehicle, then s/he can ask for a refund. The refund amount stated in subsection (1) shall be given to the consumer and the secured party.
  5. Its a presumption that a reasonable number of attempts have been made to remove a defect if:
    • The manufacturer has repaired the same nonconformity 4 or more times during the first 2 years of the delivery of a motor vehicle but the defect still exists. After delivery of the vehicle to the selected repair facility, the manufacturer has 5 days to repair the defect.
    • The vehicle is out of order or in custody of a manufacturer for a cumulative of 30 days within the warranty period or 1 year period whichever comes earlier.
  6. Any repairs required to be made under this act shall be made even if the repairs need to be performed after the expiration of the manufacturer's express warranty. The defect needing repair must be a continuation of the original attempt to repair the defect.
  7. The period of repairs shall be extended anytime due to war, invasion, strike, fire, flood, or other natural disaster.

History: 1986, Act 87, Eff. June 25, 1986;--Am. 1998, Act 486, Imd. Eff. Jan. 4, 1999.

257.1404 - Other Legal Remedies Not Limited or Prohibited

Sec. 4. Michigan lemon law clearly states that this act doesn’t limit any legal cures available to a consumer relating to a violation of a manufacturer's express warranty or an implied warranty for a new motor vehicle.

History: 1986, Act 87, Eff. June 25, 1986.

257.1405 - Informal Dispute Settlement Procedure

Sec. 5. If a manufacturer has started or involves himself in an informal dispute settlement procedure, the requirements of this act shall not be applicable to any buyer who has not first chosen such procedure, if such procedure does all of the following:

  1. Complies with the Magnuson-Moss warranty--federal trade commission improvement act, Public Law 93-637, 88 Stat. 2183, and 16 C.F.R. 703 (1975). An informal dispute settlement procedure shall not be considered as complying with the provisions of this subdivision, if it does not comply with 16 C.F.R. 703 (1975).
  2. Obliges that the manufacturer is restricted by any finding reached if the consumer concurs to it.
  3. Michigan lemon law provides that the consumer cannot be forced to go with the decision and may pursue the cures provided for under this act.
  4. Requires the manufacturer to begin the procedure necessary to enforce any final settlement not more than 30 days after the settlement has been made.

History: 1986, Act 87, Eff. June 25, 1986.

257.1406 - Defects or Conditions to Which Act Inapplicable

Sec. 6 . A manufacturer shall not be forced to repair the defect, if it is a result of:

History: 1986, Act 87, Eff. June 25, 1986;--Am. 1998, Act 487, Imd. Eff. Jan. 4, 1999

257.1407 - Waiver of Rights and Remedies Prohibited; Recovery of Costs, Expenses, and Attorneys' Fees

Sec. 7.

  1. The act doesn’t waive any rights and remedies provided to a consumer.
  2. A consumer who prevails in any action brought under this act may be allowed by the court to recover as part of the judgment a sum equal to the aggregate amount of cost and expenses, including attorneys' fees based on actual time expended by the attorney, determined by the court to have been reasonably incurred by the consumer for or in connection with the commencement and prosecution of such action, unless the court in its discretion shall determine that such an award of attorneys' fees would be inappropriate.

History: 1986, Act 87, Eff. June 25, 1986

257.1408 - Written Statement to Be Included With Title; Type Size; Form

Sec. 8.

  1. Until 31st December 1999, the secretary of the state will include a written statement with the vehicles which looks like,

    "IMPORTANT: IF THIS VEHICLE IS DEFECTIVE YOU MAY BE ENTITLED UNDER STATE LAW TO REPLACEMENT OF IT OR A REFUND OF ITS PURCHASE PRICE. TO OBTAIN REPLACEMENT OR A REFUND, YOU MUST FIRST REPORT THE DEFECT IN WRITING TO THE MANUFACTURER AND YOU MAY BE REQUIRED TO FIRST ARBITRATE THE DISPUTE. IN ORDER TO PROTECT YOUR RIGHTS UNDER THIS LAW, YOU SHOULD:

    1. KEEP COPIES OF ALL CORRESPONDENCE TO AND FROM THE MANUFACTURER AND THE DEALER.
    2. KEEP COPIES OF ALL WORK ORDERS FOR REPAIRS ON THE VEHICLE INCLUDING THE DATE(S) THE WORK WAS PERFORMED AND THE MILEAGE ON THE VEHICLE AT THE TIME OF REPAIR.
    3. FOLLOW ALL REQUIREMENTS OF THE WARRANTY, INCLUDING ANY REQUIREMENT THAT THE REPAIRS MUST BE DONE BY AN AUTHORIZED DEALER SPECIFIED BY THE MANUFACTURER. IF YOU HAVE ANY QUESTIONS REGARDING YOUR RIGHTS UNDER THIS LAW, CONSULT AN ATTORNEY OR OTHER QUALIFIED INDIVIDUAL."
  2. Commencement January 1, 2000, the secretary of the state will include a written statement with the vehicles which looks like,

    "IMPORTANT: IF THIS VEHICLE IS DEFECTIVE YOU MAY BE ENTITLED UNDER STATE LAW TO REPLACEMENT OF IT OR A REFUND OF ITS PURCHASE PRICE OR LEASE PRICE, AS APPLICABLE. TO OBTAIN REPLACEMENT OR A REFUND, YOU MUST FIRST REPORT THE DEFECT IN WRITING TO THE MANUFACTURER AND YOU MAY BE REQUIRED TO FIRST ARBITRATE THE DISPUTE. IN ORDER TO PROTECT YOUR RIGHTS UNDER THIS LAW, YOU SHOULD:

    1. KEEP COPIES OF ALL CORRESPONDENCE TO AND FROM THE MANUFACTURER AND THE DEALER.
    2. KEEP COPIES OF ALL WORK ORDERS FOR REPAIRS ON THE VEHICLE INCLUDING THE DATE(S) THE WORK WAS PERFORMED AND THE MILEAGE ON THE VEHICLE AT THE TIME OF REPAIR.
    3. FOLLOW ALL REQUIREMENTS OF THE WARRANTY, INCLUDING ANY REQUIREMENT THAT THE REPAIRS MUST BE DONE BY AN AUTHORIZED DEALER SPECIFIED BY THE MANUFACTURER. IF YOU HAVE ANY QUESTIONS REGARDING YOUR RIGHTS UNDER THIS LAW, CONSULT AN ATTORNEY OR OTHER QUALIFIED INDIVIDUAL."
  3. At January 1, 2000, the state secretary shall upload a summary of the requirements of this act on the internet to make it accessible for the public.

History: 1986, Act 87, Eff. June 25, 1986;--Am. 1998, Act 487, Imd. Eff. Jan. 4, 1999.

257.1409 - Applicability of Act

Sec. 9. in accordance with the Michigan lemon laws, “this act shall be applicable to all new motor vehicles that are sold or on or after the effective date of this act”.

History: 1986, Act 87, Eff. June 25, 1986.

257.1410 - Effect

Sec. 10. This act shall take effect 60 days after its enactment.

History: 1986, Act 87, Eff. June 25, 1986;--Am. 1998, Act 486, Imd. Eff. Jan. 4, 1999;--Am. 1998, Act 487, Imd. Eff. Jan. 4, 1999.