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N.J. Court: Magnuson Moss Warranty Act Protects Lessees

March 14, 2006

TRENTON, N.J. -- Car lessees in New Jersey should have the same rights as buyers, according to a ruling that came down from the New Jersey Supreme Court. The Court ruled 6-1 that the Magnuson Moss Warranty Act protects both consumers who purchase and lease their vehicles, and they reinstated the case of a Camden County consumer who leased a defective Honda Passport. The plaintiff, Christopher Ryan, is represented by the Cherry Hill, NJ-based lemon law firm of Kimmel and Silverman.

In the case of Christopher Ryan vs. Honda, Ryan leased a 1999 Honda Passport and experienced engine problems on the vehicle starting at 22,000 miles. At first, the dealer concluded that the problem was not covered under warranty and instructed Ryan to file an insurance claim, which he did. But, after the insurance company covered the repairs, and Ryan covered the deductible, he continued to experience problems with the engine.

Because the problems occurred after the first 18,000 miles of protection provided by the New Jersey Lemon Law, Ryan had to enforce his warranty rights under federal warranty law.

The Magnuson Moss Warranty Act is designed to protect consumers who suffer a non-conformity during their warranty period which can't be fixed despite repeated repair attempts. Like the New Jersey Lemon Law, the statute contains a fee-shifting provision, which enables consumer firms, like Kimmel and Silverman, to provide cost-free legal representation to distressed drivers. If the consumer prevails, the manufacturer must pay all attorneys fees and legal costs on top of what the plaintiff receives.

In the case, Honda argued that they owned the vehicle, not Ryan, and therefore Ryan was not entitled to enforce any rights. The Camden County Superior Court agreed with Honda. Kimmel and Silverman immediately appealed to the New Jersey Appeals Court and received a unanimous appeal in their favor. Honda then appealed the decision to the state's Supreme Court.

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