Tennessee State Statutes
Title 55, Chapter 24
Motor Vehicle Warranties
55-24-201. Definitions.
As used in this part, unless the context otherwise requires:
(1) "Consumer" means the purchaser (other than for purposes of
resale) or the lessee of a motor vehicle, any person to whom such motor vehicle is
transferred during the duration of an express warranty applicable to such motor vehicle,
and any other person entitled by the terms of such warranty to enforce the obligations
of the warranty. "Consumer" does not include any governmental entity or any
business or commercial entity which registers three (3) or more vehicles;
(2) "Lessee" means any consumer who leases a motor vehicle pursuant
to a written lease agreement by which a manufacturer's warranty was issued as a
condition of sale or which provides that the lessee is responsible for repairs to such
motor vehicle;
(3) "Motor vehicle" means a motor vehicle as defined in 55-1-103,
which is sold and subject to the registration and certificate of title provisions in
chapters 1-6 of this title in the state of Tennessee, and classified as a Class C
vehicle according to 55-4-111. For the purposes of this part, "motor vehicle"
does not include motorized bicycles as defined in 55-8-101, motor homes as defined in
55-1-104, lawnmowers or garden tractors, recreational vehicles or off-road vehicles and
vehicles over ten thousand (10,000) pounds gross vehicle weight;
(4) "Substantially impair" means to render a motor vehicle
unreliable or unsafe for normal operation or to reduce its resale market value below the
average resale value for comparable motor vehicles; and
(5) "Term of protection" means the term of applicable express
warranties or the period of one (1) year following the date of original delivery of the
motor vehicle to a consumer, whichever comes first; or, in the case of a replacement
vehicle provided by a manufacturer to a consumer under this part, one (1) year from the
date of delivery to the consumer of the replacement vehicle.
55-24-202. Nonconforming vehicles.
Reports - Repairs.
If a new motor vehicle does not conform to all applicable express warranties and the
consumer reports the nonconformity, defect or condition to the manufacturer, its agent or
its authorized dealer during the term of protection, the manufacturer, its agent or its
authorized dealer shall correct the nonconformity, defect or condition at no charge to the
consumer, notwithstanding the fact that such repairs are made after the expiration of such
term. Any corrections or attempted corrections undertaken by an authorized dealer under
the provisions of this section shall be treated as warranty work and billed by the dealer
to the manufacturer in the same manner as other work under warranty is billed.
55-24-203. Replacement or repair of vehicles.
Refunds - Refinancing agreements - Defenses.
(a) The manufacturer must replace the motor vehicle with a comparable motor
vehicle or accept return of the vehicle from the consumer and refund to the consumer the
full purchase price if:
(1) The nonconformity, defect or condition substantially impairs the motor
vehicle; and
(2) The manufacturer, its agent or authorized dealer is unable to conform
the motor vehicle to any applicable express warranty after a reasonable number of
attempts.
(b) For purposes of this section:
(1) "Collateral charges" means manufacturer-installed or
agent-installed items or service charges, credit life and disability insurance
charges, sales taxes, title charges, license fees, registration fees, any similar
governmental charges and other reasonable expenses incurred for the purchase of the
motor vehicle;
(2) "Comparable motor vehicle" means a new motor vehicle of
comparable worth to the same make and model with all options and accessories, with
appropriate adjustments being allowed for any model year differences;
(3) "Full purchase price" means the actual cost paid by the
consumer, including all collateral charges, less a reasonable allowance for use; and
(4)
(A) "Reasonable allowance for use" means that amount directly
attributable to use by a consumer prior to such consumer's first report of the
nonconformity to the manufacturer, agent or dealer and during any subsequent period
when the vehicle is not out of service by reason of repair, plus a reasonable amount
for any damage not attributable to normal wear.
(B) A reasonable allowance for use shall not exceed one half (1/2) of the
amount allowed per mile by the internal revenue service, as provided by regulation,
revenue procedure or revenue ruling promulgated pursuant to 162 of the Internal
Revenue Code, for use of a personal vehicle for business purposes, plus an amount to
account for any loss to the fair market value of the vehicle resulting from damage
beyond normal wear and tear, unless the damage resulted from nonconformity to an
express warranty.
(c) Refunds shall be made to the consumer, and lien holder, if any, as their
interests appear. The provisions of this section shall not affect the interests of a
lien holder; unless the lien holder consents to the replacement of the lien with a
corresponding lien on the vehicle accepted by the consumer in exchange for the vehicle
having a nonconformity, the lien holder shall be paid in full the amount due on the
lien, including interest and other charges, before an exchange of automobiles or a
refund to the consumer is made.
(d) In instances where a vehicle which was financed by the manufacturer or its
subsidiary or agent is replaced under the provisions of this section, the manufacturer,
subsidiary or agent shall not require the consumer to enter into any refinancing
agreement which would create any financial obligations upon such consumer beyond those
imposed by the original financing agreement.
(e) It shall be an affirmative defense to any claim under this part:
(1) That an alleged nonconformity does not substantially impair a motor
vehicle; or
(2) That a nonconformity is the result of abuse, neglect or unauthorized
modifications or alterations of a motor vehicle by a consumer.
55-24-204. Leased vehicles - Refunds.
(a) In the case of a leased vehicle, refunds will be made to the lessor and
lessee as follows: The lessee will receive the lessee cost and the lessor will receive
the lease price less the aggregate deposit and rental payments previously paid to the
lessor for the leased vehicle.
(b) For purposes of this section:
(1) "Lease price" means the aggregate of:
(A) Lessor's actual purchase cost;
(B) Freight, if applicable;
(C) Accessories, if applicable;
(D) Any fee paid to another to obtain the lease; and
(E) An amount equal to five percent (5%) of subdivision (b)(1);
(2) "Lessee cost" means the aggregate deposit and rental payments
previously paid to the lessor for the leased vehicle less service fees; and
(3) "Service fees" means the portion of a lease payment
attributable to:
(A) An amount for earned interest calculated on the rental payments
previously paid to the lessor for the leased vehicle at an annual rate equal to two
(2) points above the prime rate in effect on the date of the execution of the lease;
and
(B) Any insurance or other costs expended by the lessor for the benefit of
the lessee.
55-24-205. Presumptions
Term of protection - Notice to manufacturer.
(a) It shall be presumed that a reasonable number of attempts have been
undertaken to conform a motor vehicle to the applicable express warranties, if:
(1) The same nonconformity has been subject to repair four (4) or more times
by the manufacturer or its agents or authorized dealers, but such nonconformity
continues to exist; or
(2) The vehicle is out of service by reason of repair for a cumulative total
of thirty (30) or more calendar days during the term of protection.
(b) The term of protection and such thirty-day period shall be extended by any
period of time during which repair services are not available to the consumer because of
a war, invasion, strike or fire, flood or other natural disaster.
(c) It shall be the responsibility of the consumer, or the representative of
the consumer, prior to proceeding under the provisions of 55-24-203, to give written
notification by certified mail directly to the manufacturer of the need for the
correction or repair of the nonconformity. If the address of the manufacturer is not
readily available to the consumer in the owner's manual or manufacturer's warranty
received by the consumer at the time of purchase of the motor vehicle, such written
notification shall be mailed to an authorized dealer. The authorized dealer shall upon
receipt forward such notification to the manufacturer. If, at the time such notice is
given, either of the conditions set forth in subsection (a) already exists, the
manufacturer shall be given an additional opportunity after receipt of the notification,
not to exceed ten (10) days, to correct or repair the nonconformity.
55-24-206. Informal dispute settlement procedure.
(a) If a manufacturer has established or participates in an informal dispute
settlement procedure which complies with the provisions of Title 16, Code of Federal
Regulations, Part 703, as those provisions read on November 3, 1983, and of this part,
and causes the consumer to be notified of the procedure, the provisions of 55-24-203
concerning refunds or replacement shall not apply to any consumer who has not first
resorted to such procedure. The attorney general and reporter shall, upon application,
issue a determination whether an informal dispute resolution mechanism qualifies under
this section.
(b)
(1) The informal dispute settlement panel shall determine whether the motor
vehicle does or does not conform to all applicable express warranties.
(2) If the motor vehicle does not conform to all applicable express
warranties, the informal dispute settlement panel shall then determine whether the
nonconformity substantially impairs the motor vehicle.
(3) If the nonconformity does substantially impair the motor vehicle, the
informal dispute settlement panel shall then determine, in accordance with this part,
whether a reasonable number of attempts have been made to correct the nonconformity.
(4) If a reasonable number of attempts have been made to correct the
nonconformity, the informal dispute settlement panel shall determine whether the
manufacturer has been given an opportunity to repair the motor vehicle as provided in
55-24-202.
(5) If the manufacturer has been given an opportunity to repair the motor
vehicle as provided in 55-24-202, the panel shall find that the consumer is entitled
to refund or replacement as provided in 55-24-203(a).
(6) The informal dispute settlement panel shall determine the amount of
collateral charges, where appropriate.
55-24-207. Statute of limitations.
(a) Any action brought under this part shall be commenced within six (6)
months following:
(1) Expiration of the express warranty term; or
(2) One (1) year following the date of original delivery of the motor
vehicle to a consumer, whichever is the later date.
(b) The statute of limitations shall be tolled for the period beginning on the
date when the consumer submits a dispute to an informal dispute settlement procedure as
provided in 55-24-206 and ending on the date of its decision or the date before which
the manufacturer, its agent or its authorized dealer is required by the decision to
fulfill its terms, whichever comes later.
55-24-208. Recovery of costs and expenses - Attorneys' fees.
If a consumer finally prevails in any action brought under this part, such consumer may
be allowed by the court to recover as part of the judgment a sum equal to the aggregate
amount of costs and expenses, including attorneys' fees based on actual time expended,
determined by the court to have been reasonably incurred by the plaintiff for or in
connection with the commencement and prosecution of such action.
55-24-209. Copy of repair order to consumer.
A manufacturer, its agent or authorized dealer shall provide to the consumer, each time
the consumer's vehicle is returned from being serviced or repaired, a copy of the repair
order indicating all work performed on the vehicle, including, but not limited to, parts
and labor provided without cost or at reduced cost because of shop or manufacturer's
warranty, the date the vehicle was submitted for repair, the date it was returned to the
consumer, and the odometer reading.
55-24-210. Election of remedies.
(a) Nothing in this part shall in any way limit the rights or remedies which
are otherwise available to a consumer under any other law.
(b) In no event shall a consumer who has resorted to an informal dispute
settlement procedure be precluded from seeking the rights or remedies available by law.
However, if the consumer elects to pursue any other remedy in state or federal court,
the remedy available under this part shall not be available insofar as it would result
in recovery in excess of the recovery authorized by 55-24-203 without proof of fault
resulting in damages in excess of such recovery.
(c) Any agreement entered into by a consumer for, or in connection with, the
purchase or lease of a new motor vehicle which waives, limits or disclaims the rights
set forth in this part shall be void as contrary to public policy. These rights shall
inure to a subsequent transferee of such motor vehicle.
55-24-211. Commencing actions against sellers or lessors.
No action shall be commenced or maintained under the provisions of this part against
the seller or lessor of a motor vehicle unless the seller or lessor is also the
manufacturer, or unless the manufacturer of the motor vehicle is not subject to service of
process in the state of Tennessee, or service cannot be secured by the long-arm statutes
of Tennessee, or unless the manufacturer has been judicially declared insolvent.
55-24-212. Manufacturer's warranty - Disclosure to purchaser.
Any business entity which purchases a fleet of new motor vehicles, titles such motor
vehicles in the business entity's name and sells such vehicles to an individual purchaser
shall disclose in writing any remaining manufacturer's warranty on such motor vehicles to
such purchaser.
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