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
(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
(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 use; and
(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
[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 leased
(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
(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
(a) It shall be 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 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
(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
(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 §
(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 declared
[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 such
[Acts 1994, ch. 672, § 1.]