# Minnesota lemon law and car sale refunds

This document is general legal information about Minnesota law on defective cars, warranties, refunds and misrepresentation in car sales, and the leading court decisions that apply it. It is not legal advice, and it does not cover every situation.

## Sources and currency

- Minn. Stat. § 325F.665 (new motor vehicle warranties; manufacturer's duty to repair, refund or replace, commonly called the lemon law), § 325F.662 (sale of used motor vehicles), § 325F.6655 (extension of warranty), § 325F.664 (new motor vehicle damage disclosures), § 325F.6641 (disclosure of vehicle damage), § 325F.6642 (title branding), § 325F.666 (unlawful reassignment of certain motor vehicle contracts), § 325F.69, subd. 1 (fraud and misrepresentation), § 8.31, subd. 3a (private remedies), and § 325G.19 (express warranties).
- Uniform Commercial Code sales sections in Minn. Stat. chapter 336: §§ 336.2-313 (express warranties), 336.2-314 (implied warranty of merchantability), 336.2-316 (exclusion or modification of warranties), 336.2-608 (revocation of acceptance), 336.2-714 and 336.2-715 (buyer's damages).
- Text taken from the 2025 Minnesota Statutes, as published by the Office of the Revisor of Statutes at https://www.revisor.mn.gov/statutes/ and read on 2026-09-20. Laws passed in the 2026 legislative session may not be reflected.
- Court decisions: Minnesota Supreme Court and Court of Appeals opinions, read in the Harvard Caselaw Access Project (https://case.law/). Every passage placed in quotation marks in the case sections below was checked against the opinion text. The summaries of holdings are my own reading and are short. Older opinions apply earlier versions of these statutes, so section numbers and subdivisions in them may differ from the current text.
- Where a sentence below is my reading of how sections fit together, or my own arithmetic, and not a quotation, it says so.

## Three different sets of rules

Which rules apply depends on who sold the vehicle and whether it was new or used.

1. **New vehicles: the manufacturer lemon law, § 325F.665.** It puts the duty to repair, and then to refund or replace, on the manufacturer.
2. **Used vehicles sold by a dealer: the used vehicle warranty, § 325F.662.** It puts a written warranty duty on the dealer, and the dealer may repair, replace or refund.
3. **Any car sale: general warranty, fraud and disclosure law.** This includes the Uniform Commercial Code, the consumer fraud statutes, and the damage and title disclosure statutes. These apply alongside the two special statutes. Sections 325F.665, subd. 11, and 325F.662, subd. 11, both say the remedy is nonexclusive: "Nothing in this section limits the rights or remedies which are otherwise available to a consumer under any other law."

## New vehicles: the lemon law (§ 325F.665)

### Who and what is covered

- **Consumer** (subd. 1(b)): "the purchaser or lessee, other than for purposes of resale or sublease, of a new motor vehicle used for personal, family, or household purposes at least 40 percent of the time, and a person to whom the new motor vehicle is transferred for the same purposes during the duration of an express warranty applicable to the motor vehicle."
- **Motor vehicle** (subd. 1(f)): "a passenger automobile as defined in section 168.002, subdivision 24, including pickup trucks and vans", the self-propelled chassis or van portion of a recreational vehicle sold or leased to a consumer in this state, and the chassis or van portion of an ambulance.
- **Manufacturer** (subd. 1(c)): a person engaged in the business of manufacturing, assembling or distributing motor vehicles who will "manufacture, assemble or distribute to dealers at least ten new motor vehicles" during the year under normal conditions.
- **Lease** (subd. 1(e)): a contract for the use of personal property by a natural person for a period "exceeding four months", used for personal, family or household purposes at least 40 percent of the time.

### The duty to repair (subd. 2)

If a new vehicle "does not conform to all applicable express warranties, and the consumer reports the nonconformity to the manufacturer, its agent, or its authorized dealer during the term of the applicable express warranties or during the period of two years following the date of original delivery", whichever is earlier, the manufacturer, its agent or its dealer "shall make the repairs necessary to conform the vehicle to the applicable express warranties", even if the repairs are made after the warranty or two-year period ends.

### The duty to refund or replace (subd. 3)

Subd. 3(a): if the manufacturer, its agents or its dealers "are unable to conform the new motor vehicle to any applicable express warranty by repairing or correcting any defect or condition which substantially impairs the use or market value of the motor vehicle to the consumer after a reasonable number of attempts", the manufacturer "shall either replace the new 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".

The refund includes:

- the full purchase price, "including the cost of any options or other modifications arranged, installed, or made by the manufacturer, its agent, or its authorized dealer within 30 days after the date of original delivery";
- "all other charges including, but not limited to, sales or excise tax, license fees and registration fees, reimbursement for towing and rental vehicle expenses incurred by the consumer as a result of the vehicle being out of service for warranty repair"; and
- less "a reasonable allowance for the consumer's use of the vehicle not exceeding ten cents per mile driven or ten percent of the purchase price, whichever is less".

If the manufacturer offers a replacement, "the consumer has the option of rejecting the replacement vehicle and requiring the manufacturer to provide a refund." Refunds "must be made to the consumer, and lienholder, if any, as their interests appear on the records of the registrar of motor vehicles." Under subd. 3(h) the sales or excise tax refunded is the tax paid less the tax multiplied by a fraction in which the numerator is the use allowance deducted and the denominator is the purchase price.

**Worked example (my own arithmetic, with made-up numbers, not from any source).** A consumer bought a new car for $30,000 and drove it 8,000 miles before returning it. Ten cents per mile is $800, and ten percent of the price is $3,000. The lesser figure is $800, so the maximum use allowance is $800. The refund would start from $30,000 plus the other listed charges, less $800.

### What counts as a reasonable number of attempts (subd. 3(b) to (f))

Subd. 3(b): "It is presumed that a reasonable number of attempts have been undertaken to conform a new motor vehicle to the applicable express warranties, if":

1. "the same nonconformity has been subject to repair four or more times by the manufacturer, its agents, or its authorized dealers within the applicable express warranty term or during the period of two years following the date of original delivery of the new motor vehicle to a consumer, whichever is the earlier date, but the nonconformity continues to exist"; or
2. "the vehicle is out of service by reason of repair for a cumulative total of 30 or more business days during the term or during the period, whichever is the earlier date."

Other rules:

- **Brakes and steering** (subd. 3(c)): if the nonconformity "results in a complete failure of the braking or steering system" and "is likely to cause death or serious bodily injury if the vehicle is driven", the presumption applies if the nonconformity has been subject to repair "at least once" and continues to exist.
- **Written notice** (subd. 3(e)): the four-repairs or 30-days presumption applies against a manufacturer "only if the manufacturer, its agent, or its authorized dealer has received prior written notification from or on behalf of the consumer at least once and an opportunity to cure the defect alleged." A dealer that receives the notice "must forward it to the manufacturer by certified mail, return receipt requested."
- **Three years** (subd. 3(f)): expiry of the periods in paragraph (b) "does not bar a consumer from receiving a refund or replacement vehicle" if the reasonable number of attempts "occur within three years following the date of original delivery", provided the consumer first reported the nonconformity during the term of the express warranty.
- **Extensions** (subd. 3(d) and § 325F.6655): the warranty term and the time periods are extended by any period during which repair services are not available because of a war, invasion, strike, or fire, flood or other natural disaster.
- **Notice given to the buyer** (subd. 3(g)): at the time of purchase or lease the manufacturer must give the consumer a separate written statement in ten-point capital type saying that if the vehicle is defective the consumer may be entitled under the lemon law to replacement or a refund, that the consumer must first notify the manufacturer, its agent or its dealer of the problem in writing and give them an opportunity to repair it, and that the consumer has a right to submit the case to the consumer arbitration program the manufacturer must offer in Minnesota.

### Leased vehicles (subd. 4)

A consumer who leases a new vehicle has the same rights, except that a lessee "is not entitled to a replacement vehicle, but is entitled only to a refund". The manufacturer refunds the lessee "the amount actually paid by the consumer on the written lease", including the additional charges, less the use allowance, and refunds the lessor the vehicle's original purchase price plus early termination costs "not to exceed 15 percent of the vehicle's original purchase price", less the amount the lessee actually paid.

### Returned vehicles (subd. 5 and subd. 14)

A vehicle returned under the lemon law may not be resold or re-leased in Minnesota unless the manufacturer provides the same express warranty, though it "need only last for 12,000 miles or 12 months after the date of resale, whichever is earlier", and gives the buyer a separate capital-letter statement that the vehicle was returned because it did not conform to the manufacturer's express warranty. A vehicle returned because of a complete failure of the braking or steering system likely to cause death or serious bodily injury "may not be resold in this state." Under subd. 14 the registrar records the term "lemon law vehicle" on the certificate of title and all later titles.

### The manufacturer's arbitration program (subds. 6 to 8)

Subd. 6(a): a manufacturer doing business in the state "shall operate, or participate in, an informal dispute settlement mechanism located in the state of Minnesota". Importantly, "The provisions of subdivision 3 concerning refunds or replacement do not apply to a consumer who has not first used this mechanism before commencing a civil action, unless the manufacturer allows a consumer to commence an action without first using this mechanism."

Other features of the program:

- The consumer may be charged a fee, but it "may not exceed the conciliation court filing fee in the county where the arbitration is conducted" (subd. 6(i)).
- Any party may be represented by an attorney (subd. 6(j)).
- The consumer must be given an adequate opportunity to have a technical expert selected and paid for by the consumer contest the manufacturer's claim that a problem falls within intended specifications (subd. 6(f)).
- The decision "is nonbinding on the parties involved, unless otherwise agreed by the parties." Any party may remove the decision to district court for a trial de novo, and a manufacturer aggrieved by the decision must do so within 30 days after receiving it (subd. 7). A written decision is "admissible as nonbinding evidence in any subsequent legal action".
- If a party removes a decision in bad faith, the court "shall award to the prevailing party three times the actual damages sustained, together with costs and disbursements, including reasonable attorney's fees" (subd. 8).

### Suing, deadlines and the dealer's role

- **Civil remedy** (subd. 9): "Any consumer injured by a violation of this section may bring a civil action to enforce this section and recover costs and disbursements, including reasonable attorney's fees incurred in the civil action." The attorney general may also act under § 8.31.
- **Deadline** (subd. 10): a civil action "must be commenced within three years of the date of original delivery of the new motor vehicle to a consumer". If the consumer applies to the informal dispute settlement mechanism within three years of delivery and is aggrieved by the decision, the action must be commenced "within six months after the date of the final decision by the mechanism."
- **Dealers** (subd. 13): "Nothing in this section imposes liability on a dealer or creates an additional cause of action by a consumer against a dealer, except for written express warranties made by the dealer apart from the manufacturer's warranties." The manufacturer cannot charge back to the dealer the cost of refunds or replacements unless the dealer failed to do the related repairs properly or in time.

My reading: for a new vehicle, the lemon law refund claim is against the manufacturer and not the selling dealer.

## Used vehicles: the dealer's warranty (§ 325F.662)

### Who and what is covered

- **Consumer** (subd. 1(a)): "the purchaser, other than for purposes of resale, of a used motor vehicle used primarily for personal, family, or household purposes."
- **Dealer** (subd. 1(b)): a motor vehicle dealer or lessor, "whether licensed or unlicensed", or the dealer's agent, engaged in the business of selling or arranging the sale of used vehicles in this state. It excludes, for example, banks and licensed auctioneers whose vehicle sales are incidental.
- **Used motor vehicle** (subd. 1(d)): a vehicle "driven more than the limited use necessary in moving or road testing a new motor vehicle prior to delivery to a consumer". A private seller is not a dealer under this section.

### The required written warranty (subd. 2)

Subd. 2(a): "Every used motor vehicle sold by a dealer is covered by an express warranty which the dealer shall provide to the consumer in writing." At a minimum:

| Mileage at sale | Minimum warranty |
|---|---|
| Less than 36,000 miles | at least 60 days or 2,500 miles, whichever comes first |
| 36,000 miles or more, but less than 75,000 miles | at least 30 days or 1,000 miles, whichever comes first |
| 75,000 miles or more, but less than 200,000 miles (unless sold by a new motor vehicle dealer) | at least 15 days or 500 miles, whichever comes first |

Subd. 2(b): the warranty must require the dealer, on a malfunction, defect or failure in a covered part, "to repair or replace the covered part, or at the dealer's election, to accept return of the used motor vehicle from the consumer and provide a refund to the consumer." My reading: the choice between repair, replacement and refund belongs to the dealer.

Covered parts include the engine's lubricated parts, block and cylinder head, the transmission's case and internal parts, the drive axle, brakes (master cylinder, wheel cylinders, hydraulic lines and fittings, and disc brake calipers), the steering gear housing and internal parts, the water pump and the externally mounted mechanical fuel pump. For vehicles with less than 36,000 miles, the list also includes the radiator and the alternator, generator and starter (subd. 2(c) and (d)).

The dealer's obligations continue after the warranty period ends "if the consumer promptly notified the dealer of the malfunction, defect, or failure in the covered part within the specified warranty period and, within a reasonable time after notification, brings the vehicle or arranges with the dealer to have the vehicle brought to the dealer for inspection and repair" (subd. 2(e)(1)). The warranty does not cover defects "which result from collision, abuse, negligence, or lack of adequate maintenance following sale to the consumer" (subd. 2(g)). The terms must be disclosed on the front of the Buyers Guide (subd. 2(h)).

### Vehicles a dealer need not warrant (subd. 3)

A dealer is not required to give the express warranty for a used vehicle, for example, that:

- was sold for a total cash sale price of less than $3,000 (except a vehicle of 75,000 miles or more that falls in the third mileage tier);
- has a diesel engine, or a gross weight of more than 9,000 pounds;
- was custom-built or modified for show or racing;
- is eight years of age or older, calculated from the first day in January of the model year (with the same exception);
- has 200,000 miles or more at the time of sale; or
- has a title bearing a "salvage" brand under § 168A.151.

### Waiver and automatic warranty (subds. 4 and 5)

A consumer may waive the warranty for a covered part only if the dealer discloses "in a clear and conspicuous typed or printed statement on the front of the Buyers Guide that the waived part contains a malfunction, defect, or repair problem" and the consumer circles the statement and signs the Buyers Guide next to it. Under subd. 5: "If a dealer fails to give the express warranty required by this section, the dealer nevertheless is considered to have given the express warranty as a matter of law."

### The refund (subd. 8)

Subd. 8(a): a refund "must consist of the full purchase price of the used motor vehicle and all other charges, including but not limited to excise tax, registration tax, license fees, and reimbursement for towing expenses incurred by the consumer as a result of the vehicle being out of service for warranty repair, less a reasonable allowance for the consumer's use of the vehicle not exceeding ten cents per mile driven or ten percent of the purchase price, whichever is less." It "must include the amount stated by the dealer as the trade-in value of any vehicle traded in and applied to the purchase price". The dealer must give an itemized statement of the amounts refunded (subd. 8(c)).

### Other used-vehicle rules

- **Honoring warranties** (subd. 7): the dealer must honor every express warranty, and after a covered part is repaired or replaced "remains responsible under the express warranty for that covered part for one additional warranty period". A dealer "may limit the duration of implied warranties to the duration of the express warranty."
- **Certified vehicles** (subd. 8a): it is unlawful to advertise or sell a used vehicle as certified if, for example, the dealer knows or should know the odometer was rolled back, the vehicle was reacquired under warranty laws, the title has a lemon law buyback, salvage, flood or similar brand, the vehicle has frame damage, the dealer fails to provide a completed inspection report, the dealer disclaims the warranty of merchantability, or the vehicle is sold as is.
- **Remedies and deadline** (subds. 9 and 10): a dealer that violates the section "is subject to the penalties and remedies, including a private right of action, as provided in section 8.31", and a violation of subd. 7 is also a violation of § 325F.69. A private civil action on a warranty claim "must be commenced within one year of the expiration of the express warranty."

### How the new and used rules differ (my summary)

| Question | New vehicle (§ 325F.665) | Used vehicle from a dealer (§ 325F.662) |
|---|---|---|
| Who owes the remedy | The manufacturer | The dealer |
| Refund available | After a reasonable number of repair attempts; presumed after four repairs or 30 business days out of service | At the dealer's election, if the dealer chooses to accept return instead of repairing or replacing a covered part |
| Use allowance | Up to ten cents a mile or ten percent of price, whichever is less | The same |
| Deadline to sue | Three years from delivery (six months after arbitration) | One year after the express warranty expires |
| Notice or arbitration first | Written notice before the presumption applies; arbitration before the refund claim if the manufacturer runs a program | Prompt notice within the warranty period |

## Disclosure of damage and title history

- **New vehicle damage** (§ 325F.664, subd. 2(a)): before the sale of a new vehicle a dealer "must disclose and describe to the buyer, in a clear and conspicuous written statement and orally in the course of the sales presentation, any damage to the vehicle of which the dealer had actual knowledge, if the dealer's cost of repairs exceeded four percent of the manufacturer's suggested retail price, or $500, whichever is greater."
- **Prior damage** (§ 325F.6641, subd. 1): "If a vehicle has sustained damage by collision or other occurrence which exceeds 80 percent of its actual cash value immediately prior to sustaining damage, the seller must disclose that fact to the buyer, if the seller has actual knowledge of the damage." Under subd. 2, a licensed dealer must give a written disclosure, and orally except for online sales, of prior damage, of any title brand it actually knows of, and of flood submersion above the bottom dashboard while parked on the dealer's lot. The buyer must sign the written disclosure.
- **Title brands** (§ 325F.6642): the registrar records brands such as "flood damaged", "salvage", "prior salvage" and "reconstructed" on the certificate of title, and "each brand designation ... must be made by the registrar of motor vehicles in a clear and conspicuous manner".
- **Reassignment** (§ 325F.666, subd. 2): a person who is not a party to a vehicle contract, and who has not first obtained written authorization from the secured creditor, lessor or lienholder, may not, if the person receives consideration, "get control of the motor vehicle and then sell, transfer, assign, or lease it to another person", or assist in such a transfer. Under subd. 3 an injured person may recover actual damages, costs and reasonable attorney fees.

## Warranty and fraud law that applies to any car sale

**Express warranty** (§ 336.2-313): "Any affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain creates an express warranty that the goods shall conform to the affirmation or promise." But "an affirmation merely of the value of the goods or a statement purporting to be merely the seller's opinion or commendation of the goods does not create a warranty."

**Implied warranty of merchantability** (§ 336.2-314): "a warranty that the goods shall be merchantable is implied in a contract for their sale if the seller is a merchant with respect to goods of that kind." Goods must, among other things, be "fit for the ordinary purposes for which such goods are used".

**Disclaiming warranties** (§ 336.2-316(3)(a)): "unless the circumstances indicate otherwise, all implied warranties are excluded by expressions like 'as is,' 'with all faults' or other language which in common understanding calls the buyer's attention to the exclusion of warranties and makes plain that there is no implied warranty". Section 325G.19, subd. 1, adds that "No express warranty arising out of a consumer sale of new goods shall disclaim implied warranties of merchantability". A dealer's used vehicle warranty under § 325F.662 is separate, and § 325F.662, subd. 8a, treats an "AS IS" sale as disqualifying a vehicle from being called certified.

**Revoking acceptance** (§ 336.2-608): "The buyer may revoke an acceptance of a lot or commercial unit whose nonconformity substantially impairs its value to the buyer if it was accepted (a) on the reasonable assumption that its nonconformity would be cured and it has not been seasonably cured; or (b) without discovery of such nonconformity if the acceptance was reasonably induced either by the difficulty of discovery before acceptance or by the seller's assurances." It "must occur within a reasonable time after the buyer discovers or should have discovered the ground for it and before any substantial change in condition of the goods which is not caused by their own defects. It is not effective until the buyer notifies the seller of it."

**Damages** (§§ 336.2-714 and 336.2-715): "The measure of damages for breach of warranty is the difference at the time and place of acceptance between the value of the goods accepted and the value they would have had if they had been as warranted, unless special circumstances show proximate damages of a different amount." In a proper case incidental and consequential damages may also be recovered.

**Consumer fraud** (§ 325F.69, subd. 1): "The act, use, or employment by any person of any fraud, unfair or unconscionable practice, false pretense, false promise, misrepresentation, misleading statement or deceptive practice, with the intent that others rely thereon in connection with the sale of any merchandise, whether or not any person has in fact been misled, deceived, or damaged thereby, is enjoinable as provided in section 325F.70."

**Private lawsuit for consumer fraud** (§ 8.31, subd. 3a): "any person injured by a violation of any of the laws referred to in subdivision 1 may bring a civil action and recover damages, together with costs and disbursements, including costs of investigation and reasonable attorney's fees, and receive other equitable relief as determined by the court."

## Leading cases

I searched for published Minnesota appellate decisions on the lemon law and found one, Pfeiffer. The search service limited how many queries I could make, so that is not proof that no others exist. The remaining cases concern warranty and dealer conduct in vehicle sales.

**Pfeiffer v. Ford Motor Co., 517 N.W.2d 76 (Minn. App. 1994).** Frederick and June Pfeiffer bought a Ford F-250 pickup in January 1990, believing it provided 200 horsepower for camping and towing. After Ford's informal dispute mechanism denied relief under the lemon law, they sold the truck and sued in conciliation court about 75 days later. The district court granted Ford summary judgment, finding the suit untimely. The Court of Appeals observed that "the Lemon Law was poorly drafted and is susceptible to two meanings" on the time limit, and concluded that the correct limit was six months. But it still affirmed the dismissal of the lemon law claim, because the Pfeiffers had sold the truck and so could not return it: "as with Minnesota's Lemon Law, there is a requirement for return of the vehicle prerequisite to remedy." It reversed on the Pfeiffers' Uniform Commercial Code claims, saying "The allegations, supporting affidavits and documentary evidence raise clear fact questions under the UCC", including whether they properly revoked acceptance. It also held they could not recover lemon law attorney fees because they "have not prevailed in their Lemon Law cause of action". The opinion applied the 1992 version of the statute, which had a subdivision numbered 3a, and the current § 325F.665, subd. 10, now provides a three-year limit and a six-month period after arbitration. Holding: a consumer who sells the vehicle before suing loses the lemon law refund claim, but can still pursue Uniform Commercial Code warranty claims.

**Jacobs v. Rosemount Dodge-Winnebago South, 310 N.W.2d 71 (Minn. 1981).** George and Laura Jacobs bought a new Midas motorhome for $27,269 and it had defects the dealer and manufacturer failed to cure despite several returns for repair. The jury awarded $16,621 and the trial court cut it to $3,309.77. The Minnesota Supreme Court reinstated the jury verdict. It held: "we hold that the trial court did not err in finding that the exclusive remedies of the warranty had failed in their essential purposes and that other U.C.C. remedies, such as damages and revocation, were available to the Jacobs." It said, "If the seller refuses to repair or replace within a reasonable time, the buyer is deprived of the exclusive remedy. Commendable efforts alone do not relieve a seller of his obligation to repair." It also held that "other remedies of Chapter 336, including consequential damages, are available to them" and that evidence on consequential damages for loss of use was properly submitted to the jury. This decision came before the lemon law and is an example of the warranty law that still applies alongside it.

**International Financial Services, Inc. v. Franz, 534 N.W.2d 261 (Minn. 1995).** This case concerned a photoplotter, not a car, but the Supreme Court applied the same warranty principles. It affirmed the determination that the repair or replacement remedy in the purchase agreement had failed of its essential purpose, and affirmed in part and reversed in part on damages. It agreed "with the trial court that the consequential damage exclusion effectively barred claims for such damages", but held the trial court "erred in denying Franz the opportunity to prove damages resulting from the construction of the 'clean room.'" It is included because it addresses when a limited warranty remedy fails and what damages remain.

**Mashlan v. E.M. Trucks, Inc., 443 N.W.2d 226 (Minn. App. 1989).** A jury found that a truck dealer breached express warranties and that the Mashlans properly revoked acceptance of a defective truck. But the Mashlans had signed a 48-month lease with a financing company, United General Leasing, not a purchase agreement. The Court of Appeals held that "In all respects the contract between appellants and United is an express lease", and affirmed judgment "that appellants were lessees not entitled to recover damages from the dealer." Holding: warranty and revocation remedies against a dealer were not available to a person who was legally a lessee of a finance company and not a buyer from the dealer. The structure of the transaction matters.

**Carousel Automobiles, Inc. v. Gherity, 527 N.W.2d 813 (Minn. 1995).** Dealer Daniels signed an Odometer Statement and Assignment by Seller form as the transferor of a Mercedes he never owned, so that a buyer could purchase it through a statutory dealer-resale provision. The Minnesota Supreme Court framed the issue as "whether Daniels, in signing as transferor on an Odometer Statement and Assignment by Seller form, thereby warranted title to the motor vehicle. We conclude he did and affirm." It reasoned that "Daniels' fraudulent act of signing as transferor was essential to this transaction". Holding: a dealer who signs as transferor warrants title, even when the dealer never owned the car.

**Scott v. Forest Lake Chrysler-Plymouth-Dodge, 598 N.W.2d 713 (Minn. App. 1999).** Raymond Scott bought a Dodge Caravan under a retail installment contract, and the dealer also had him sign a conditional delivery agreement. When financing approval failed, a second contract was made at a higher interest rate and total price. The Court of Appeals held: "We hold that use of the conditional delivery agreement violated Minn.Stat. § 168.71(a)(1)." It also held that the dealer "violated Minn.Stat. § 168.71(a)(1) by failing to provide Scott with copies of the retail installment contracts that were signed by Forest Lake Chrysler". It reversed and remanded those claims but affirmed summary judgment for the dealer on Scott's consumer fraud claim. Holding: a dealer cannot use a side agreement that defeats the installment contract's disclosure of the cost of credit, and must give the buyer a copy of the contract the dealer has signed.

**Holiday Recreational Industries, Inc. v. Manheim Services Corp., 599 N.W.2d 179 (Minn. App. 1999).** A dealer bought a 1992 Saturn at auction for $4,665, made $1,105.36 in repairs, and never received title. The vehicle turned out to have a salvage title. The Court of Appeals affirmed that the auctioneer violated the title branding law: "Because appellant failed to disclose that the vehicle had branded title, we affirm." It concluded that the auctioneer, as an auctioneer, "was a licensed motor vehicle dealer under the title branding act". It affirmed the award of treble damages, saying the district court found "deliberate attempts to mislead" and "conscious disregard" of the buyer's rights, and affirmed attorney fees, noting the statute cited in the opinion, § 325F.6643(b), says an injured party "shall recover * * * reasonable attorney fees." The section numbers in that opinion are those in force in 1999, and I did not check whether they have since been renumbered. Holding: failing to disclose a branded title can lead to treble damages and mandatory attorney fees.

**Sorchaga v. Ride Auto, LLC, 909 N.W.2d 550 (Minn. 2018).** Esmeralda Sorchaga bought a pickup from a dealer that had purchased it from a salvage yard for $6,770 knowing it needed engine repairs. The purchase agreement disclaimed all warranties and stated the truck was sold "AS IS, NO WARRANTY". The Minnesota Supreme Court asked "whether a seller's fraudulent statements about the condition and fitness of a vehicle being sold prevent the seller from enforcing disclaimers in purchase documents stating that the buyer purchased the vehicle 'as is.'" It held: "we hold that Ride Auto's fraudulent statements about the fitness of the truck for the purpose for which a truck is purchased are a circumstance that make the 'as is' disclaimers of implied warranties in the purchase documents ineffective under Minn. Stat. § 336.2-316(3)(a)." The Court explained that "simply because the UCC permits parties to exclude or modify warranties does not mean that Ride Auto can 'disclaim its obligation to deliver the product which formed the basis of the parties' bargain.'" It also held the district court did not err in awarding recovery on both fraud and breach of warranty claims, since "so long as the plaintiff is not allowed 'double recovery,' a district court may conclude that the evidence supports separate claims for both common-law fraud and breach of contract", and "Sorchaga did not receive a double recovery." The Court added that "not all misstatements will constitute fraud." Holding: an "as is" clause does not protect a dealer who lied about the vehicle's condition.

## How this fits together (my summary)

- A buyer of a new car with a repeated, unfixed defect has a claim against the manufacturer for a refund or replacement, with the refund reduced by a small per-mile use allowance. The four-repair and 30-day presumptions need written notice, and a manufacturer's arbitration program must generally be used first. The buyer must be able to return the vehicle (Pfeiffer).
- A buyer of a used car from a dealer gets a written warranty of at least a minimum length based on mileage, and the dealer can choose to repair, replace or refund. A dealer that gives no warranty is treated as having given one.
- A buyer can also rely on general warranty, revocation of acceptance, consumer fraud and disclosure statutes. "As is" language does not protect a seller who made fraudulent statements (Sorchaga), and a limited repair remedy that fails opens the door to other remedies (Jacobs).
- The form of the deal matters: a lessee from a finance company is not a buyer from the dealer (Mashlan), and a dealer who signs as transferor warrants title (Carousel).
- Lawsuit deadlines differ: three years from delivery for the new vehicle lemon law claim, one year after the warranty expires for the used vehicle warranty claim.

## What this document does not cover

- Federal warranty law, except as mentioned in the cases above, and federal used-car Buyers Guide rules beyond the reference in § 325F.662.
- Motorcycles, boats and other vehicles not within the statutory definitions, and business vehicles used for personal purposes less than 40 percent of the time.
- Financing and retail installment sales rules beyond the Scott case, and repossession.
- The procedure of arbitration hearings and conciliation court.
- Court decisions not listed above. The list is a selection, and I found only one published Minnesota appellate decision applying the lemon law itself.