California’s lemon laws are designed to protect consumers who have purchased defective new vehicles from dealerships. Recent legislative changes have made these laws more difficult to understand than ever. Many drivers are wondering, “What is the SB 26 lemon law in California?”
Lemon Law Pro can explain its details and how they can influence your case.
Understanding the Song-Beverly Consumer Warranty Act
California’s lemon laws are codified primarily under the Song-Beverly Consumer Warranty Act. While SB 26 updates this act, it does not remove it. Manufacturers are still obligated to repurchase or replace vehicles with substantial, covered defects that they cannot fix after a reasonable number of repair attempts.
A reasonable number of attempts can be defined as:
- Four attempts to repair an issue that is serious but not life-threatening
- Two attempts to repair an issue that could cause death or serious bodily injury
- More than 30 days of total repairs requiring the vehicle to be out of commission
Under California lemon laws, buyers are allowed to take legal action against manufacturers that refuse to offer restitution or a vehicle replacement.
How SB 26 Changes the Song-Beverly Consumer Warranty Act
Senate Bill 26 is designed to address several issues that came up following the passing of Assembly Bill 1755, which made substantial alterations to how vehicle buybacks were handled under the Song-Beverly Act. SB 26 was intended to remove opportunities for manufacturers and dealers to avoid their obligations due to loopholes created by AB 1755. Issues the bill addresses include:
- Disclosure requirements. Any vehicle repurchased by a manufacturer under the state’s lemon law must have that status disclosed before resale. Under SB 26, a failure to disclose this in a written notice to a prospective buyer could constitute fraud.
- Procedural requirements. SB 26 and earlier legislation established both disclosure obligations and underlying substantive rights. While AB 1755 altered the procedures for enforcing those rights, both layers of law operate together. Lemon law claims must satisfy the substantive requirements of not just Song-Beverly but also AB 1755.
- Delayed effective dates. SB 26 also pushed back the mandatory operative date for AB 1755’s new pre-claim written notice requirement, giving consumers and manufacturers alike more time to adjust to the new procedure.
- Manufacturer opt-in. The manufacturer opt-in allows auto manufacturers to decide if they want to be governed by AB 1755’s structured procedures or stay with the older litigation frameworks. SB 26 requires the California Department of Consumer Affairs’ Arbitration Certification Program (ACP) to publish an annual list of which auto manufacturers have opted into the new process.
Given the complexity of California’s current lemon laws, it’s more important than ever to seek the counsel of a qualified lemon law attorney if you decide to pursue a lemon law claim. There is no single legal statute that details all the laws regarding defective vehicles, and case law also has a direct impact on which claims are considered viable.
Working with a skilled attorney who is current on all applicable state laws allows you to take full advantage of their knowledge and experience. If you believe that prior statutory changes specifically affect your situation, discuss this with your attorney.
Lemon Law Claim Statistics
Lemon law claims are very common in California, which is part of why so many legislative changes have been pushed through in recent years. In 2023, there were over 22,000 claims filed. Lemon law claims constituted nearly 10% of all the civil claims filed in Los Angeles, and they are also common in many other jurisdictions.
While recent legislative changes have altered the timelines for filing a lemon law case, including the statute of limitations, these claims are still quite frequent.
FAQs
How Likely Are You to File a Successful Lemon Law Claim?
How likely you are to file a successful lemon law claim depends on the strength of your case. Strong lemon law cases have a few things in common. They have substantial evidence and clear documentation to show that:
- The vehicle has a serious problem that impacts its use, value, or safety.
- The manufacturer has been given a reasonable number of attempts to repair the case.
You can improve your odds of success by hiring a California lemon law attorney.
Do You Have to Pay Taxes on a Lemon Law Claim Settlement in California?
You do not usually have to pay taxes on a lemon law claim settlement in California, as vehicle refunds and replacements are considered make-whole compensation for the original purchase. However, there are some exceptions. If you receive a cash settlement that exceeds the original purchase price of the vehicle, any excess amount is taxable. That includes interest accumulated during the settlement process and civil penalties.
What Is the Average Lemon Law Settlement in California?
There is no average lemon law settlement in California. Every case is different. The amount of compensation you receive can depend on factors such as:
- The original purchase price of your vehicle
- The number of miles you put on the vehicle before filing your lemon law claim
- Whether the court mandates that civil penalties be paid in response to a dealer’s refusal to pay out a valid claim
Can I File a Civil Claim Against a Dealership for Selling Me a Lemon Used Car?
You can file a civil claim against a dealership for selling you a lemon used car only under certain circumstances. It used to be the case that the Song-Beverly Consumer Warranty Act protected buyers of used vehicles, so long as those vehicles were still under their original manufacturers’ warranties. However, that changed in 2023 with the court’s ruling on Rodriguez v. FCA US, which indicated that used cars are not generally covered under California lemon laws.
Hire a Lemon Law Attorney Today
If you have questions about the SB 26 lemon law in California, don’t worry. You can hire a lemon law attorney from Lemon Law Pro to handle all the details of your case for you at no cost to you. We have been in practice for years; in that time, we have focused exclusively on helping our clients seek restitution or replacements for their defective vehicles. We can help you, too. Contact us today to schedule a free initial consultation.
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