Chapter 24, Motor Vehicle Warranties
As used in this part, unless the context otherwise requires:
(1) "Consumer" means the purchaser (other than for purposes of
resale) or the lessee of a motor vehicle, any person to whom such
motor vehicle is transferred during the duration of an express warranty
applicable to such motor vehicle, and any other person entitled
by the terms of such warranty to enforce the obligations of the
warranty. "Consumer" does not include any governmental entity or
any business or commercial entity which registers three (3) or more
(2) "Lessee" means any consumer who leases a motor vehicle pursuant
to a written lease agreement by which a manufacturer's warranty
was issued as a condition of sale or which provides that the lessee
is responsible for repairs to such motor vehicle;
(3) "Motor vehicle" means a motor vehicle as defined in § 55-1-103,
which is sold and subject to the registration and certificate of
title provisions in chapters 1-6 of this title in the state of Tennessee,
and classified as a Class C vehicle according to § 55-4-111. For
the purposes of this part, "motor vehicle" does not include motorized
bicycles as defined in § 55-8-101, motor homes as defined in § 55-1-104,
lawnmowers or garden tractors, recreational vehicles or off-road
vehicles and vehicles over ten thousand (10,000) pounds gross vehicle
(4) "Substantially impair" means to render a motor vehicle unreliable
or unsafe for normal operation or to reduce its resale market value
below the average resale value for comparable motor vehicles; and
(5) "Term of protection" means the term of applicable express
warranties or the period of one (1) year following the date of original
delivery of the motor vehicle to a consumer, whichever comes first;
or, in the case of a replacement vehicle provided by a manufacturer
to a consumer under this part, one (1) year from the date of delivery
to the consumer of the replacement vehicle.
[Acts 1986, ch. 857, § 1.]
55-24-202. Nonconforming vehicles - Reports - Repairs.
If a new motor vehicle does not conform to all applicable express
warranties and the consumer reports the nonconformity, defect or
condition to the manufacturer, its agent or its authorized dealer
during the term of protection, the manufacturer, its agent or its
authorized dealer shall correct the nonconformity, defect or condition
at no charge to the consumer, notwithstanding the fact that such
repairs are made after the expiration of such term. Any corrections
or attempted corrections undertaken by an authorized dealer under
the provisions of this section shall be treated as warranty work
and billed by the dealer to the manufacturer in the same manner
as other work under warranty is billed.
[Acts 1986, ch. 857, § 2.]
55-24-203. Replacement or repair of vehicles - Refunds - Refinancing
agreements - Defenses.
(a) The manufacturer must replace the 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 if:
(1) The nonconformity, defect or condition substantially impairs
the motor vehicle; and
(2) The manufacturer, its agent or authorized dealer is unable
to conform the motor vehicle to any applicable express warranty
after a reasonable number of attempts.
(3) "Full purchase price" means the actual cost paid by the consumer,
including all collateral charges, less a reasonable allowance for
(4) (A) "Reasonable allowance for use" means that amount directly
attributable to use by a consumer prior to such consumer's first
report of the nonconformity to the manufacturer, agent or dealer
and during any subsequent period when the vehicle is not out of
service by reason of repair, plus a reasonable amount for any damage
not attributable to normal wear.
(B) A reasonable allowance for use shall not exceed one half (1/2)
of the amount allowed per mile by the internal revenue service,
as provided by regulation, revenue procedure or revenue ruling promulgated
pursuant to § 162 of the Internal Revenue Code, for use of a personal
vehicle for business purposes, plus an amount to account for any
loss to the fair market value of the vehicle resulting from damage
beyond normal wear and tear, unless the damage resulted from nonconformity
to an express warranty.
(c) Refunds shall be made to the consumer, and lienholder, if
any, as their interests appear. The provisions of this section shall
not affect the interests of a lienholder; unless the lienholder
consents to the replacement of the lien with a corresponding lien
on the vehicle accepted by the consumer in exchange for the vehicle
having a nonconformity, the lienholder shall be paid in full the
amount due on the lien, including interest and other charges, before
an exchange of automobiles or a refund to the consumer is made.
(d) In instances where a vehicle which was financed by the manufacturer
or its subsidiary or agent is replaced under the provisions of this
section, the manufacturer, subsidiary or agent shall not require
the consumer to enter into any refinancing agreement which would
create any financial obligations upon such consumer beyond those
imposed by the original financing agreement.
(e) It shall be an affirmative defense to any claim under this
(1) That an alleged nonconformity does not substantially impair
a motor vehicle; or
(2) That a nonconformity is the result of abuse, neglect or unauthorized
modifications or alterations of a motor vehicle by a consumer.
[Acts 1986, ch. 857, § 3.]
55-24-204. Leased vehicles - Refunds.
(a) In the case of a leased vehicle, refunds will be made to the
lessor and lessee as follows: The lessee will receive the lessee
cost and the lessor will receive the lease price less the aggregate
deposit and rental payments previously paid to the lessor for the
(b) For purposes of this section:
(1) "Lease price" means the aggregate of:
(A) Lessor's actual purchase cost;
(B) Freight, if applicable;
(C) Accessories, if applicable;
(D) Any fee paid to another to obtain the lease; and
(E) An amount equal to five percent (5%) of subdivision (b)(1);
(2) "Lessee cost" means the aggregate deposit and rental payments
previously paid to the lessor for the leased vehicle less service
(3) "Service fees" means the portion of a lease payment attributable
(A) An amount for earned interest calculated on the rental payments
previously paid to the lessor for the leased vehicle at an annual
rate equal to two (2) points above the prime rate in effect on the
date of the execution of the lease; and
(B) Any insurance or other costs expended by the lessor for the
benefit of the lessee.
[Acts 1986, ch. 857, § 4.]
55-24-205. Presumptions - Term of protection - Notice to manufacturer.
(a) It shall be presumed that a reasonable number of attempts
have been undertaken to conform a motor vehicle to the applicable
express warranties, if:
(1) The same nonconformity has been subject to repair four (4)
or more times by the manufacturer or its agents or authorized dealers,
but such nonconformity continues to exist; or
(2) The vehicle is out of service by reason of repair for a cumulative
total of thirty (30) or more calendar days during the term of protection.
(b) The term of protection and such thirty-day period shall be
extended by any period of time during which repair services are
not available to the consumer because of a war, invasion, strike
or fire, flood or other natural disaster.
(c) It shall be the responsibility of the consumer, or the representative
of the consumer, prior to proceeding under the provisions of § 55-24-203,
to give written notification by certified mail directly to the manufacturer
of the need for the correction or repair of the nonconformity. If
the address of the manufacturer is not readily available to the
consumer in the owner's manual or manufacturer's warranty received
by the consumer at the time of purchase of the motor vehicle, such
written notification shall be mailed to an authorized dealer. The
authorized dealer shall upon receipt forward such notification to
the manufacturer. If, at the time such notice is given, either of
the conditions set forth in subsection (a) already exists, the manufacturer
shall be given an additional opportunity after receipt of the notification,
not to exceed ten (10) days, to correct or repair the nonconformity.
[Acts 1986, ch. 857, § 5.]
55-24-206. Informal dispute settlement procedure.
(a) If a manufacturer has established or participates in an informal
dispute settlement procedure which complies with the provisions
of Title 16, Code of Federal Regulations, Part 703, as those provisions
read on November 3, 1983, and of this part, and causes the consumer
to be notified of the procedure, the provisions of § 55-24-203 concerning
refunds or replacement shall not apply to any consumer who has not
first resorted to such procedure. The attorney general and reporter
shall, upon application, issue a determination whether an informal
dispute resolution mechanism qualifies under this section.
(b) (1) The informal dispute settlement panel shall determine
whether the motor vehicle does or does not conform to all applicable
(2) If the motor vehicle does not conform to all applicable express
warranties, the informal dispute settlement panel shall then determine
whether the nonconformity substantially impairs the motor vehicle.
(3) If the nonconformity does substantially impair the motor vehicle,
the informal dispute settlement panel shall then determine, in accordance
with this part, whether a reasonable number of attempts have been
made to correct the nonconformity.
(4) If a reasonable number of attempts have been made to correct
the nonconformity, the informal dispute settlement panel shall determine
whether the manufacturer has been given an opportunity to repair
the motor vehicle as provided in § 55-24-202.
(5) If the manufacturer has been given an opportunity to repair
the motor vehicle as provided in § 55-24-202, the panel shall find
that the consumer is entitled to refund or replacement as provided
in § 55-24-203(a).
(6) The informal dispute settlement panel shall determine the
amount of collateral charges, where appropriate.
[Acts 1986, ch. 857, § 6.]
55-24-207. Statute of limitations.
(a) Any action brought under this part shall be commenced within
six (6) months following:
(1) Expiration of the express warranty term; or
(2) One (1) year following the date of original delivery of the
motor vehicle to a consumer, whichever is the later date.
(b) The statute of limitations shall be tolled for the period
beginning on the date when the consumer submits a dispute to an
informal dispute settlement procedure as provided in § 55-24-206
and ending on the date of its decision or the date before which
the manufacturer, its agent or its authorized dealer is required
by the decision to fulfill its terms, whichever comes later.
[Acts 1986, ch. 857, § 7.]
55-24-208. Recovery of costs and expenses - Attorneys' fees.
If a consumer finally prevails in any action brought under this
part, such consumer may be allowed by the court to recover as part
of the judgment a sum equal to the aggregate amount of costs and
expenses, including attorneys' fees based on actual time expended,
determined by the court to have been reasonably incurred by the
plaintiff for or in connection with the commencement and prosecution
of such action.
[Acts 1986, ch. 857, § 8.]
55-24-209. Copy of repair order to consumer.
A manufacturer, its agent or authorized dealer shall provide to
the consumer, each time the consumer's vehicle is returned from
being serviced or repaired, a copy of the repair order indicating
all work performed on the vehicle, including, but not limited to,
parts and labor provided without cost or at reduced cost because
of shop or manufacturer's warranty, the date the vehicle was submitted
for repair, the date it was returned to the consumer, and the odometer
[Acts 1986, ch. 857, § 9.]
55-24-210. Election of remedies.
(a) Nothing in this part shall in any way limit the rights or
remedies which are otherwise available to a consumer under any other
(b) In no event shall a consumer who has resorted to an informal
dispute settlement procedure be precluded from seeking the rights
or remedies available by law. However, if the consumer elects to
pursue any other remedy in state or federal court, the remedy available
under this part shall not be available insofar as it would result
in recovery in excess of the recovery authorized by § 55-24-203
without proof of fault resulting in damages in excess of such recovery.
(c) Any agreement entered into by a consumer for, or in connection
with, the purchase or lease of a new motor vehicle which waives,
limits or disclaims the rights set forth in this part shall be void
as contrary to public policy. These rights shall inure to a subsequent
transferee of such motor vehicle.
[Acts 1986, ch. 857, § 10.]
55-24-211. Commencing actions against sellers or lessors.
No action shall be commenced or maintained under the provisions
of this part against the seller or lessor of a motor vehicle unless
the seller or lessor is also the manufacturer, or unless the manufacturer
of the motor vehicle is not subject to service of process in the
state of Tennessee, or service cannot be secured by the long-arm
statutes of Tennessee, or unless the manufacturer has been judicially
[Acts 1986, ch. 857, § 12.]
55-24-212. Manufacturer's warranty - Disclosure to purchaser.
Any business entity which purchases a fleet of new motor vehicles,
titles such motor vehicles in the business entity's name and sells
such vehicles to an individual purchaser shall disclose in writing
any remaining manufacturer's warranty on such motor vehicles to
[Acts 1994, ch. 672, § 1.]
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