How Lemon Laws Work

Magnuson Meets Moss

When Sen. Warren G. Magnuson, D-Wash., and Rep. John E. Moss, D-Calif., got together in 1975 to sponsor the law that eventually became known as the Magnuson-Moss Warranty Act, there was widespread abuse in the U.S. of warranty provisions. Products were sold without warranties, the warranties that they were sold with weren't always clear about what was covered, and getting a warranty enforced was often more difficult than it needed to be. The Magnuson-Moss Warranty Act may not have changed all that, if only because the fine print in most warranties is intimidating to even the most detail-oriented of consumers, but at least Magnuson-Moss required that the fine print be available for the consumer to read before purchasing the product. And it told manufacturers what had to be included in that warranty. OK, so the earth didn't shake when Magnuson-Moss found its way through Congress, but consumers finally had some kind of solid, legal ground to stand on when they bought a product -- especially an expensive product like, say, a car -- that kept breaking down or didn't do the things the manufacturer claimed it would do. Magnuson-Moss may not have been the first lemon law ever passed, but it's the basis for most lemon laws in the U.S. today. It protects everyone, and individual state laws extend that protection.

The Magnuson-Moss Warranty Act is for consumer products only and doesn't apply to products that cost less than $5. It doesn't require that a product come with a warranty -- if it doesn't you're pretty much on your own as far as Magnuson-Moss is concerned. It also doesn't apply to service warranties; however, if a product comes with a warranty, the legislation spells out how that warranty has to be written.

  • The warranty has to be designated as either "full" or "limited."
  • The warranty has to be spelled out in clear, readable terms (though based on some product warranties, "readable" only seems to apply to people who carry around magnifying glasses).
  • The warranty has to be available where the consumer can read it before buying.

A full warranty guarantees that the consumer can get any parts repaired provided that they don't work as advertised (and aren't the result of damage by the consumer). A limited warranty spells out specific conditions that the warranty covers. The truth is, for full warranty coverage, the consumer is generally better protected by state warranty laws; Magnuson-Moss mostly just defines terms and spells out legal methods for getting a remedy in cases where the warranty isn't honored. So let's look at state lemon laws next.

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