New Motor Vehicles Warranties Act
§ 20-351. Purpose.
This Article shall provide State and private remedies against motor
vehicle manufacturers for persons injured by new motor vehicles
failing to conform to express warranties.
(1987, c. 385.)
§ 20-351.1. Definitions.
As used in this Article:
(1) "Consumer" means the purchaser, other than for purposes of
resale, or lessee from a commercial lender, lessor, or from a
manufacturer or dealer, of a motor vehicle, and any other person
entitled by the terms of an express warranty to enforce the
obligations of that warranty.
(2) "Manufacturer" means any person or corporation, resident or
nonresident, who manufactures or assembles or imports or distributes
new motor vehicles which are sold in the State of North Carolina.
(3) "Motor vehicle" includes a motor vehicle as defined in G.S.
20-4.01 which is sold or leased in this State, but does not include
"house trailer" as defined in G.S. 20-4.01 or any motor vehicle with
a gross vehicle weight of 10,000 pounds or more.
(4) "New motor vehicle" means a motor vehicle for which a
certificate of origin, as required by G.S. 20-52.1 or a similar
requirement in another state, has never been supplied to a consumer,
or which a manufacturer, its agent, or its authorized dealer states
in writing is being sold as a new motor vehicle.
(1987, c. 385; 1989, c. 43, s. 2, c. 519, s. 2.)
§ 20-351.2. Require repairs; when mileage warranty begins to
(a) Express warranties for a new motor vehicle shall remain in
effect at least one year or 12,000 miles. If a new motor vehicle does
not conform to all applicable express warranties for a period of one
year, or the term of the express warranties, whichever is greater,
following the date of original delivery of the motor vehicle to the
consumer, and the consumer reports the nonconformity to the
manufacturer, its agent, or its authorized dealer during such period,
the manufacturer shall make, or arrange to have made, repairs
necessary to conform the vehicle to the express warranties, whether or
not these repairs are made after the expiration of the applicable
(b) Any express warranty for a new motor vehicle expressed in terms
of a certain number of miles shall begin to accrue from the mileage on
the odometer at the date of original delivery to the consumer.
(1987, c. 385; 1989, c. 14.)
§ 20-351.3. Replacement or refund; disclosure requirement.
(a) When the consumer is the purchaser or a person entitled by the
terms of the express warranty to enforce the obligations of the
warranty, if the manufacturer is unable, after a reasonable number of
attempts, to conform the motor vehicle to any express warranty by
repairing or correcting, or arranging for the repair or correction of,
any defect or condition or series of defects or conditions which
substantially impair the value of the motor vehicle to the consumer,
and which occurred no later than 24 months or 24,000 miles following
original delivery of the vehicle, the manufacturer shall, at the
option of the consumer, replace the vehicle with a comparable new
motor vehicle or accept return of the vehicle from the consumer and
refund to the consumer the following:
(1) The full contract price including, but not limited to,
charges for undercoating, dealer preparation and transportation, and
installed options, plus the non-refundable portions of extended
warranties and service contracts;
(2) All collateral charges, including but not limited to, sales
tax, license and registration fees, and similar government charges;
(3) All finance charges incurred by the consumer after he first
reports the nonconformity to the manufacturer, its agent, or its
authorized dealer; and
(4) Any incidental damages and monetary consequential damages.
(b) When consumer is a lessee, if the manufacturer is unable, after
a reasonable number of attempts, to conform the motor vehicle to any
express warranty by repairing or correcting, or arranging for the
repair or correction of, any defect or condition or series of defects
or conditions which substantially impair the value of the motor
vehicle to the consumer, and which occurred no later than 24 months or
24,000 miles following original delivery of the vehicle, the
manufacturer shall, at the option of the consumer, replace the vehicle
with a comparable new motor vehicle or accept return of the vehicle
from the consumer and refund the following:
(1) To the consumer:
a. All sums previously paid by the consumer under the terms of
b. All sums previously paid by the consumer in connection with
entering into the lease agreement, including, but not limited to,
any capitalized cost reduction, sales tax, license and
registration fees, and similar government charges; and
c. Any incidental and monetary consequential damages.
(2) To the lessor, a full refund of the lease price, plus an
additional amount equal to five percent (5%) of the lease price,
less eighty-five percent (85%) of the amount actually paid by the
consumer to the lessor pursuant to the lease. The lease price means
the actual purchase cost of the vehicle to the lessor.
In the case of a refund, the leased vehicle shall be returned to
the manufacturer and the consumer's written lease shall be
terminated by the lessor without any penalty to the consumer. The
lessor shall transfer title of the motor vehicle to the manufacturer
as necessary to effectuate the consumer's rights pursuant to this
Article, whether the consumer chooses vehicle replacement or refund.
(c) Refunds shall be made to the consumer, lessor and any
lienholders as their interests may appear. The refund to the consumer
shall be reduced by a reasonable allowance for the consumer's use of
the vehicle. A reasonable allowance for use is that amount directly
attributable to use by the consumer prior to his first report of the
nonconformity to the manufacturer, its agent, or its authorized
dealer, and during any subsequent period when the vehicle is not out
of service because of repair. "Reasonable allowance" is presumed to be
the cash price or the lease price, as the case may be, of the vehicle
multiplied by a fraction having as its denominator 100,000 miles and
its numerator the number of miles attributed to the consumer.
(d) If a manufacturer, its agent, or its authorized dealer resells
a motor vehicle that was returned pursuant to this Article or any
other State's applicable law, regardless of whether there was any
judicial determination that the motor vehicle had any defect or that
it failed to conform to all express warranties, the manufacturer, its
agent, or its authorized dealer shall disclose to the subsequent
purchaser prior to the sale:
(1) That the motor vehicle was returned pursuant to this Article
or pursuant to the applicable law of any other State; and
(2) The defect or condition or series of defects or conditions
which substantially impaired the value of the motor vehicle to the
consumer. Any subsequent purchaser who purchases the motor vehicle
for resale with notice of the return, shall make the required
disclosures to any person to whom he resells the motor vehicle.
(1987, c. 385; 1989, c. 43, s. 1, c. 519, s. 1.)
§ 20-351.4. Affirmative defenses.
It is an affirmative defense to any claim under this Article that
an alleged nonconformity or series of nonconformities are the result
of abuse, neglect, odometer tampering by the consumer or unauthorized
modifications or alterations of a motor vehicle.
(1987, c. 385.)
§ 20-351.5. Presumption.
(a) It is presumed that a reasonable number of attempts have been
undertaken to conform a motor vehicle to the applicable express
(1) The same nonconformity has been presented for repair to the
manufacturer, its agent, or its authorized dealer four or more times
but the same nonconformity continues to exist; or
(2) The vehicle was out of service to the consumer during or
while awaiting repair of the nonconformity or a series of
nonconformities for a cumulative total of 20 or more business days
during any 12-month period of the warranty, provided that the
consumer has notified the manufacturer directly in writing of the
existence of the nonconformity or series of nonconformities and
allowed the manufacturer a reasonable period, not to exceed 15
calendar days, in which to correct the nonconformity or series of
nonconformities. The manufacturer must clearly and conspicuously
disclose to the consumer in the warranty or owners manual that
written notification of a nonconformity is required before a
consumer may be eligible for a refund or replacement of the vehicle
and the manufacturer shall include in the warranty or owners manual
the name and address where the written notification may be sent.
Provided, further, that notice to the manufacturer shall not be
required if the manufacturer fails to make the disclosures provided
(b) The consumer may prove that a defect or condition substantially
impairs the value of the motor vehicle to the consumer in a manner
other than that set forth in subsection (a) of this section.
(c) The term of an express warranty, the one-year period, and the
20-day period shall be extended by any period of time during which
repair services are not available to the consumer because of war,
strike, or natural disaster.
(1987, c. 385.)
§ 20-351.6. Civil action by the Attorney General.
Whenever, in his opinion, the interests of the public require it,
it shall be the duty of the Attorney General upon his ascertaining
that any of the provisions of this Article have been violated by the
manufacturer to bring a civil action in the name of the State, or any
officer or department thereof as provided by law, or in the name of
the State on relation of the Attorney General.
(1987, c. 385.)
§ 20-351.7. Civil action by the consumer.
A consumer injured by reason of any violation of the provisions of
this Article may bring a civil action against the manufacturer;
provided, however, the consumer has given the manufacturer written
notice of his intent to bring an action against the manufacturer at
least 10 days prior to filing such suit. Nothing in this section shall
prevent a manufacturer from requiring a consumer to utilize an
informal settlement procedure prior to litigation if that procedure
substantially complies in design and operation with the Magnuson-Moss
Warranty Act, 15 USC § 2301 et seq., and regulations promulgated
thereunder, and that requirement is written clearly and conspicuously,
in the written warranty and any warranty instructions provided to the
(1987, c. 385.)
§ 20-351.8. Remedies.
In any action brought under this Article, the court may grant as
(1) A permanent or temporary injunction or other equitable relief
as the court deems just;
(2) Monetary damages to the injured consumer in the amount fixed
by the verdict. Such damages shall be trebled upon a finding that
the manufacturer unreasonably refused to comply with G.S. 20-351.2
or G.S. 20-351.3. The jury may consider as damages all items listed
for refund under G.S. 20-351.3;
(3) A reasonable attorney's fee for the attorney of the
prevailing party, payable by the losing party, upon a finding by the
a. The manufacturer unreasonably failed or refused to fully
resolve the matter which constitutes the basis of such action; or
b. The party instituting the action knew, or should have known,
the action was frivolous and malicious.
(1987, c. 385.)
§ 20-351.9. Dealership liability.
No authorized dealer shall be held liable by the manufacturer for
any refunds or vehicle replacements in the absence of evidence
indicating that dealership repairs have been carried out in a manner
substantially inconsistent with the manufacturers' instructions. This
Article does not create any cause of action by a consumer against an
(1987, c. 385.)
§ 20-351.10. Preservation of other remedies.
This Article does not limit the rights or remedies which are
otherwise available to a consumer under any other law.