Wisconsin’s Lemon Law: What You Need to Know

Wisconsin Lemon Law: What You Need to Know

Wisconsin’s lemon law—found in Wis. Stat. § 218.0171—governs the rights and responsibilities of consumers and automobile manufacturers as they relate to the repair, replacement and refund of new motor vehicles suffering from one or more nonconformities, or defects, while covered by a new vehicle warranty.

This article will explain the basic legal framework of Wisconsin’s lemon law.  In doing so, the following topics will be examined: 1) the applicability of the law, including the identification of the vehicles, consumers and problems covered by the law; 2) automobile manufacturers’ obligation to repair nonconformities; 3) remedies under the law; 4) procedural requirements to demand relief; 5) automobile manufacturers’ obligation to provide a refund or a comparable new motor vehicle; 6) restrictions on the sale or lease of vehicles returned under the law; 7) pre-suit procedural requirements; 8) waiver; and 9) legal claims under the law.

I. Applicability of Wisconsin’s Lemon Law

A. Vehicles Covered by Wisconsin’s Lemon Law

Wisconsin’s lemon law applies to new motor vehicles that are purchased, leased or transferred to a consumer in Wisconsin, and which are covered by an automobile manufacturer’s express warranty.  This includes cars, trucks, SUVs, motorcycles, motor homes and heavy-duty trucks. It also includes executive and demonstrator vehicles not previously titled or which were titled by an automobile manufacturer or automobile dealer.

Wisconsin’s lemon law does not apply to used vehicles purchased from an automobile dealer.  It does not apply to mopeds, semitrailers or trailers designed for use in combination with a truck or truck tractor. It also does not apply to vehicles purchased in other states or vehicles purchased online that are not delivered to the consumer in Wisconsin.

B. Consumers Covered by Wisconsin’s Lemon Law

Wisconsin’s lemon law covers the following consumers:

  • The purchaser of a new motor vehicle, if the motor vehicle was purchased from a motor vehicle dealer for purposes other than resale
  • A person to whom the motor vehicle is transferred for purposed other than resale, if the transfer occurs before the expiration of an express warranty applicable to the motor vehicle
  • A person who may enforce the warranty
  • A person who leases a motor vehicle from a motor vehicle lessor under a written lease

C. Problems Covered by Wisconsin’s Lemon Law

Wisconsin’s lemon law covers motor vehicle nonconformities.  A “nonconformity” is a condition or defect which substantially impairs the use, value or safety of a motor vehicle, and which is covered by an express warranty applicable to the vehicle, or to a component of the motor vehicle.  A nonconformity does not include a condition or defect which is the result of abuse, neglect or unauthorized modification or alteration of the motor vehicle by a consumer.

II. Automobile Manufacturer’s Obligation to Repair Nonconformities Under Wisconsin’s Lemon Law

If a new motor vehicle does not conform to an applicable express warranty—and the consumer reports the nonconformity to the manufacturer, the motor vehicle lessor, or any of the manufacturer’s authorized motor vehicle dealers, and makes the motor vehicle available for repair before the expiration of the warranty or one year after first delivery of the motor vehicle to the consumer, whichever is sooner—the nonconformity must be repaired.

III.  Remedies Under Wisconsin’s Lemon Law

If, after a reasonable attempt to repair, the nonconformity is not repaired, the consumer may: 1) elect to receive a comparable replacement vehicle or a refund—if he or she purchased the vehicle or 2) receive a refund—if he or she leased the vehicle.

A “reasonable attempt to repair” means any of the following occurring within the term of an express warranty applicable to a new motor vehicle or within one year after first delivery of the motor vehicle, whichever is sooner:

  • The same nonconformity with the warranty is subject to repair by the manufacturer, motor vehicle lessor or any of the manufacturer’s authorized motor vehicle dealers at least 4 times and the nonconformity continues
  • The motor vehicle is out of service for an aggregate of at least 30 says because of the warranty nonconformities.

“Out of service” means that a vehicle is unable to be used by the consumer for the vehicle’s intended purpose as a result of either of the following:

  • The vehicle is in the possession of the manufacturer, motor vehicle lessor, or any of the manufacturer’s authorized motor vehicle dealers for the purpose of performing or attempting repairs to correct a nonconformity
  • The vehicle is in the possession of the consumer and the vehicle has a nonconformity that substantially affects the use or safety of the vehicle and that has been subject to an attempt to repair on at least 2 occasions

Time during which repair services are not available to the consumer because of flood or other natural disaster, war, invasion fire or strike may not be included in calculating the 30-day time period.

A. Wisconsin Lemon Law Remedies for Consumers Who Purchased Vehicles

Consumers who purchased a vehicle may elect one of the following:

  • To receive a comparable replacement vehicle and a refund of any collateral costs (such as car rental or towing costs); or
  • To receive a refund of the full purchase price of the vehicle—paid to the consumer and any holder of a perfected security interest in the consumer’s motor vehicle, as their respective interests may appear—including any sales taxes, finance charges, amount paid by the consumer at the point of sale and collateral costs, less a reasonable allowance for use

A “reasonable allowance for use” for purchased vehicles may not exceed the amount obtained by multiplying the full purchase price of the motor vehicle by a fraction, the denominator of which is 100,000 or, for a motorcycle, 20,000, and the numerator of which is the number of miles the motor vehicle was driven before the consumer first reported the nonconformity to the motor vehicle dealer.

B. Wisconsin Lemon Law Remedies for Consumers Who Leased Vehicles

Consumers who leased a vehicle are entitled to receive a refund for the current value of the written lease—paid to the consumer and any holder of a perfected security interest in the consumer’s motor vehicle, as their respective interests may appear—and a refund to the consumer of the amount the consumer paid under the written lease, plus any sales tax and collateral costs, less a reasonable allowance for use.

The “current value of the written lease” equals the total amount for which that lease obligates the consumer during the period of the lease remaining after its early termination, plus the motor vehicle dealer’s early termination costs and the value of the motor vehicle at the lease expiration date—if the lease sets forth that value, less the motor vehicle lessor’s early termination savings.

A “reasonable allowance for use” for leased vehicles may not exceed the amount obtained by multiplying the total amount for which the written lease obligates the consumer by a fraction, the denominator of which is 100,000 and the numerator of which is the number of miles the consumer drove the motor vehicle before first reporting the nonconformity to the manufacturer, motor vehicle lessor or motor vehicle dealer.

IV. Procedural Requirements to Demand Relief Under Wisconsin’s Lemon Law

To make a demand for relief under Wisconsin’s lemon law, a consumer must—on a form specified by the Wisconsin Department of Transportation—provide all of the following information to the manufacturer:

  • The consumer’s contact information
  • Identification of the motor vehicle dealer from which the vehicle was purchased
  • Identification of the date the motor vehicle dealer delivered the vehicle to the consumer
  • The purchase price of the motor vehicle
  • Identification of any holder of a perfected security interest in the consumer’s motor vehicle
  • The mileage of the motor vehicle at the time the first nonconformity is asserted to have occurred
  • The consumer’s election to receive a refund or a comparable new motor vehicle
  • An itemization of any other damages claimed by the consumer

For consumers who purchased a vehicle, the consumer must also offer to transfer title to the motor vehicle having the nonconformity to the motor vehicle manufacturer.  For consumer who leased a vehicle, the consumer must also offer to return the motor vehicle to the motor vehicle manufacturer.

If the consumer fails to provide all of the above information to the satisfaction of the manufacturer, the manufacturer may, within 30 days of receiving the form from the consumer, request that the consumer provide additional information. If the manufacturer makes a timely request for additional information, the time period the manufacturer has to respond to the consumer’s notice—discussed in more detail below—does not begin to elapse until the consumer provides the additional information.

V. Automobile Manufacturer’s Obligation to Provide a Refund or a Comparable New Motor Vehicle Under Wisconsin’s Lemon Law

Once a consumer has made a formal demand for relief under Wisconsin lemon law, the automobile manufacturer has a statutorily mandated time limit in which to either provide the consumer a refund or a comparable new motor vehicle.  The time limit is determined by whether a consumer purchased or leased a vehicle and whether the consumer elected a refund or a comparable new motor vehicle.

A. Purchased Vehicles—Election of a Refund Under Wisconsin’s Lemon Law

If a consumer who purchased a vehicle elects to receive a refund, the manufacturer must—no later than 30 days after the consumer offers to transfer title of the vehicle to the manufacturer—provide the customer with the refund.

When the manufacturer provides the refund, the consumer must return the motor vehicle having the nonconformity to the manufacturer and provide the manufacturer with the certificate of title and all endorsements necessary to transfer title to the manufacturer.

B. Purchased Vehicles—Election of a Comparable New Vehicle Under Wisconsin’s Lemon Law

If a consumer who purchased a vehicle elects to receive a comparable new motor vehicle, the manufacturer must—no later than 30 days after the consumer offers to transfer title of the vehicle to the manufacturer—agree in writing to provide a comparable new motor vehicle or a refund of the full purchase price plus any sales tax, finance charge, amount paid by the consumer at the point of sale, and collateral costs.

Upon the consumer’s receipt of the manufacturer’s written agreement, the manufacturer shall have 45 days after receiving the consumer’s offer to transfer title of the vehicle to the manufacturer to either provide the comparable new motor vehicle or the refund.

During this time period, the manufacturer is required to exercise due diligence in locating and providing a comparable new motor vehicle.  If the manufacturer agrees to provide a comparable new motor vehicle, the manufacturer retains the right to provide the refund if a comparable new motor vehicle does not exist or cannot be delivered within 45 days.

The 45-day timeline is lengthened to 120 days for heavy-duty vehicles.  A heavy-duty vehicle is defined as any motor vehicle having a gross weight rating or actual gross weight of more than 10,000 pounds.

When the manufacturer provides the comparable new vehicle to the consumer, the consumer must return the motor vehicle having the nonconformity to the manufacturer and provide the manufacturer with the certificate of title and all endorsements necessary to transfer title to the manufacturer.

A manufacturer who provides a refund to a consumer—based on either the consumer’s election of a refund or the fact that the manufacturer was unable to provide a comparable new motor vehicle—must provide the consumer with a written statement that specifies the trade-in amount applied toward the sales price of the motor vehicle having the nonconformity and the date on which the manufacturer provided the refund.

C. Leased Vehicles—Refund Under Wisconsin’s Lemon Law

If a consumer who leased a vehicle elects to receive a refund, the manufacturer must—no later than 30 days after the consumer offers to return the motor vehicle to the manufacturer—provide the customer with the refund.

When the manufacturer provides the refund, the consumer must return the motor vehicle having the nonconformity to the manufacturer.

No person may enforce a lease against a consumer after the consumer receives a refund pursuant to Wisconsin’s lemon law.

VI. Restrictions on the Sale or Lease of Vehicles Returned Under Wisconsin’s Lemon Law

No motor vehicle returned by a consumer in Wisconsin pursuant to Wisconsin’s lemon law may be sold or leased again in the state unless full disclosure of the reasons for return of the vehicle is made to any prospective buyer or lessee. 

VII.  Wisconsin Lemon Law Pre-Suit Procedural Requirements

If an informal dispute settlement procedure certified by the Wisconsin Department of Transportation is available to the consumer, the consumer must utilize the procedure prior to bringing a legal action against the automobile manufacturer under Wisconsin’s lemon law.

VIII.  Waiver Under Wisconsin’s Lemon Law

Any waiver of a consumer’s rights and remedies under Wisconsin’s lemon law is void.  However, if the consumer enters into a negotiated written settlement with the manufacturer in regards to any motor vehicle nonconformity with respect to a heavy-duty vehicle, the manufacturer is no longer subject to any of the requirements of Wisconsin’s lemon law—except those related to the restrictions on the sale or lease of vehicles previously returned by customers under Wisconsin’s lemon law.

IX. Legal Claims Under Wisconsin’s Lemon Law

A consumer has three years from the day the vehicle was delivered to bring an action for any damages caused by a violation of Wisconsin’s lemon law.  If the consumer prevails in the action, a court must award the consumer his or her pecuniary loss, together with costs, disbursements and reasonable fees.  The court may also award any equitable relief the court determines appropriate.

If a court finds that any party to an action under Wisconsin’s lemon law has failed to reasonably cooperate with another party’s efforts to comply with the obligations under the law—which hinders the other party’s ability to comply with or seek recovery under the law—the court may extend any deadlines specified in the law, reduce any damages, attorney fees or costs, strike pleadings, or enter default judgment against the offending party.