Filing an Automotive Breach of Warranty Lawsuit

Many Indiana vehicle owners put up with vehicle problems, unaware that any breach of their warranty can be remedied with little effort. Consumer attorneys who work in this area of warranty law understand this all too well.

“The biggest challenge we face is educating the public that we are out there,” says Scott M. Cohen, an experienced Indiana consumer attorney who represents vehicle owners in vehicle warranty claims. “We can help people in these situations because most people are unaware that there are laws that will protect them in a situation where they buy a car or truck that has problems and can’t be fixed.”

Indiana Lemon Law

If the vehicle is relatively new, the owner may have a claim under the state’s lemon law. However, the requirements for relief under the lemon law are stringent:

• The vehicle must suffer substantial impairment to value, use, or safety
• That impairment is not repairable by the maker or dealer
• At least four repair attempts have been made—the first attempt being made within the first 18 months or 18,000 miles of the vehicle, or the vehicle is out of service a total of 30 days or more

For vehicle owners who may not meet these requirements, a federal breach of warranty claim under the Magnuson-Moss Warranty Act offers broader relief.

Breach of Warranty

If the vehicle is under warranty when a defect is discovered, the owner may be able to recover from the manufacturer. This may be possible even past the expiration of the warranty due to a four-year statute of limitations for these claims for consumer protection.

“If there is a failure of the warrantor to comply with an obligation of their warranty, you can bring a claim for damages,” Cohen says. “Many people do not realize that, let’s say seven years into a 10-year warranty, the owner begins to have problems with the vehicle’s engine and the manufacturer can’t fix it. Those people do have recourse. Unfortunately many of these people don’t realize they can do something about it. They can find a lawyer to get them damages for the manufacturer’s failure to repair.”

Differences in Breach of Warranty Claims Versus Lemon Law

Cohen says it’s easier to prove a claim under Magnuson-Moss than under state lemon law. For example, the vehicle defect doesn’t have to be significant as is required under the lemon law. However, the damages available under a breach of warranty may be less. The measure of damages under a breach of warranty claim will be the difference in the value of the goods as warranted versus the value of the goods as accepted. “Basically the amount the consumer overpaid for the vehicle,” Cohen adds.

Other differences in breach of warranty claims include:

• Owner may still have a claim after selling vehicle
• Subsequent purchasers may have a claim if still under warranty
• Lessees of vehicles can bring a claim for breach of warranty
• Owners have much longer period of time to bring a breach of warranty claim

What Is the Process for Filing a Breach of Warranty Claim?

Claimants for breach of warranty are often required to participate in a manufacturer-funded informal dispute resolution process. This process is free to consumers and the results are not binding on the vehicle owner. If the owner is dissatisfied with the result, the owner can still file a lawsuit in court. Cohen suggests reaching out to a law firm and ask for a free consultation with an attorney prior to the dispute resolution process.

What Are the Risks?

Vehicle owners face almost no risk in pursuing these claims. Many consumer law attorneys take on these claims free of charge. If the case is successful, the law allows the attorneys to recoup their fees from the manufacturer. That fee shift allows the vehicle owner to keep 100 percent of any damage award from the court, hopefully making them whole again.