Dissatisfied consumers in Missouri have four years to file breach-of-warranty lawsuits involving new vehicles, not the shorter 18-month period provided by the state's Lemon Law, the Missouri Court of Appeals has ruled.
The unanimous decision reinstates a case by a couple who bought a new 2001 Elantra in September 2001 but didn't sue until January 2004. Hyundai Motor America contended the suit came too late.
Jammy and Julie Edwards alleged that the vehicle, which carried a six-year, 72,000-warranty, had defects in the transmission, brakes, engine and trim and that Hyundai failed to repair the problems. They sought damages under the Magnuson-Moss Warranty Act, the federal law governing warranties on consumer products, for the diminished value of the Elantra.
A St. Louis County Circuit Court judge dismissed the suit as untimely under the Missouri Lemon Law's 18-month statute of limitations.
But the Court of Appeals reversed the decision, saying the four-year deadline of Missouri's Uniform Commercial Code governs breach-of-warranty claims under Magnuson-Moss, which does not contain its own statute of limitations.
"Applying the statute of limitations found in the Lemon Law to all breach of warranty claims would essentially render virtually all new-car warranties fraudulent," Judge Lawrence Crahan wrote for the three-member panel.
"Although a dealer may entice purchasers with a promise of a six-year or 72,000 bumper-to-bumper warranty, such a warranty would be a fraud because it would be unenforceable unless suit is filed within 18 months from delivery of the vehicle. This effect simply could not have been what the legislature intended when it enacted the Lemon Law."
Plaintiffs' lawyer Scott Cohen of Chicago said, "The implications are huge for consumers in Missouri" because lower-court judges had been dismissing such claims as untimely.
If the court had upheld Hyundai's position, "consumers would be without a remedy if a problem occurred with their vehicles after 18 months and a day," Cohen said.
But Hyundai counsel Wilfredo Hernandez Jr. emphasized that the court also upheld the 18-month deadline for consumers to demand replacement or repurchase under the Lemon Law. He said Hyundai will not appeal further.