Summary of the Lemon Law

The Lemon Law extends manufacture warranties on assistive technology to a minimum of one year and allows individuals using assistive technology devices to declare them "lemons" after meeting certain criteria.

Like a car, assistive devices can suffer from a substantial defect which arises in the device itself, and not from consumer abuse. After a "reasonable attempt" to repair the device, or being without the device for thirty accumulative days due to a substantial defect, the device can be returned to the manufacturer for a comparable device, or refunded as defined in the statute.

Due to technological advancements, assistive devices have greatly improved but have also become increasingly complex and intricate in nature. Assistive devices are CRITICAL in the lives of persons with a disability, and are heavily relied on at work, school, home and in leisure.

The "Lemon Law" (SB198) reads as follows:

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AN ACT

ENTITLED, An Act to provide protection to consumers who own or lease
assistive devices.

Section 1. Terms used in this Act mean:
As used in this section, the following terms mean:

1. "Assistive device," any device, including a demonstrator, that a consumer purchases or accepts transfer of in this state which is used for a major life activity, including manual wheelchairs, motorized wheelchairs, motorized scooters, and other aides that enhance the mobility of an individual; hearing aide, telephone communication devices (TTY), assistive listening devices, and other aides that enhance an individual's ability to hear; voice synthesized computer modules, optical scanners, talking software, Braille printers, and other devices that enhance an individual's ability to communicate; and breathing, feeding or any other assistive devices that enables a person with a disability to perform other major life activities, communicate, see, hear, or maneuver;
2. "Assistive device dealer," a person who is in the business of selling assistive devices;
3. "Assistive device lessor," a person who leases an assistive device to a consumer or who holds the lessor's rights under a written lease;
4. "Collateral costs," expenses incurred by a consumer in connection with the repair of a nonconformity, including the costs of obtaining an alternative assistive device;
5. "Consumer," any of the following:
   The purchaser of an assistive device if the assistive device was purchased from an assistive device dealer or manufacturer for purposes other than resale; A person to whom the assistive device is transferred for purposes other than resale if the transfer occurs before the expiration of an express warranty applicable to the assistive device; A person who may enforce the warranty; and A person who leases an assistive device from an assistive device lessor under a written lease;
6. "Demonstrator," an assistive device used primarily for the purpose of demonstration to the public;
7. "Early termination cost," any expense or obligation that an assistive device lessor incurs as a result of both the termination of a written lease before the termination date set in that lease and the return of an assistive device to a manufacturer pursuant to this Act. Early termination costs include a penalty for prepayment under a finance arrangement;
8. "Early termination saving," any expense or obligation that an assistive device lessor avoids as a result of both the termination of a written lease before that termination date set forth in that lease and the return of an assistive device to a manufacturer pursuant to this Act. Early termination saving include an interest charge that the assistive device lessor would have paid to finance the assistive device or, if the assistive device lessor does not finance the assistive device, the difference between the total amount for which the lease obligates the consumer during the period of the lease term remaining after the early termination and the present value of that amount at the date of the early termination;
   8a. "Major life activity," a function such as caring for oneself, performing
   manual tasks, walking, seeing, hearing, speaking, breathing, learning and working;
9. "Manufacturer," person who manufactures or assembles assistive devices and agents of that person, including an importer, a distributor, factory branch, distributor branch, and any warrantors of the manufacturer's assistive device, but does not include an assistive device dealer;
10. "Nonconformity," a condition or defect that substantially impairs the use, value or safety of an assistive device and that is covered by an express warranty applicable to the assistive device or to a component of the assistive device, but not a condition or defect that is the result of abuse, neglect or unauthorized modification or alteration of the assistive device by a consumer;
11. "Reasonable attempt to repair," either or both of the following occurring within the term of an express warranty applicable to a new assistive device or within 1 year after first delivery of the assistive device to a consumer, whichever is sooner:

    a. The same nonconformity is subject to repair at least twice by the manufacture, assistive device lessor or any of the manufacturer's authorized assistive device dealers;

    b. The assistive device is out of service for at least thirty cumulative days because of a nonconformity. "Express warranty," an express warranty as determined under (SD Codified Law 57A-2-313.)

Section 2. A manufacturer who sells or leases an assistive device to a consumer, either directly or through an assistive device dealer, shall furnish the consumer with an express warranty for the assistive device. The duration of the express warranty may not be less than one year after first delivery of the assistive device to the consumer. In the absence of an express warranty from the manufacturer, the manufacturer is deemed to have expressly warranted to the consumer of an assistive device that, for a period of one year from the date of first delivery to the consumer, the assistive device will be free from any condition or defect which substantially impairs the value of the assistive device to the consumer.

Section 3. If a new assistive device does not conform to an applicable express warranty and the consumer reports the nonconformity to the manufacturer, the assistive device lessor or any of the manufacturer's authorized assistive device dealers and makes the assistive device available for repair before one year after delivery of the assistive device to a consumer, the nonconformity shall be repaired as required by this Act at no charge to the consumer. If the manufacture has authorized the dealer or lessor to make the repair, the dealer or lessor shall be reimbursed by the manufacture for the dealer's or lessor's cost for the repair. If, after a reasonable attempt to repair the device, the nonconformity is not repaired, the manufacturer, at the direction of a consumer described under subsection (5) (a), (5) (b), or (5) (c) of section 1 of this Act, shall do one of the following:

Accept return of the assistive device; replace the assistive device with a new assistive device of comparable quality, size, and function; and refund any collateral costs; Accept return of the assistive device and refund to the consumer and to any holder of a perfected security interest in the consumer's assistive device or any third party who purchased the assistive device, as their interest may appear, the full purchase price plus any finance charge, sales tax, shipping costs and collateral costs paid by the consumer at the point of sale, less a reasonable allowance for use. A reasonable allowance for use may not exceed the amount obtained by multiplying the full purchase price of the assistive device by a fraction, the denominator of which is one thousand ninety-five and the numerator of which is the number of days that the assistive device was used before the consumer first reported the nonconformity to the assistive device dealer.

If the assistive device is leased, accept return of the assistive device, refund to the assistive device lessor and to any holder of a perfect security interest in the assistive device the current value of the written lease and refund to the consumer or third party the amount that the consumer or third party paid under the written lease, plus any collateral costs, less a reasonable allowance for use. The current value of the written lease equals the total amount for which that lease obligates the consumer during the period of the lease remaining after its early termination, plus the assistive device dealer's early termination costs and the value of the assistive device at the lease expiration date if the lease sets forth that value, less the lessor's early termination savings. A reasonable allowance for use shall not exceed the amount obtained by multiplying the total amount for which the written lease obligates the consumer by a fraction, the denominator of which is one thousand ninety-five and the numerator of which is the number of days that the assistive device was used before the consumer first reported the nonconformity to the assistive device dealer, lessor, or manufacturer.

Section 4. To receive an assistive device of comparable quality, size, and function or a refund, the consumer shall offer to transfer possession of the nonconformity assistive device to the manufacturer. Not more than thirty days after such an offer the manufacturer shall provide the consumer with an assistive device of comparable quality, size and function or a refund. When the manufacturer provides the assistive device or refund, the consumer shall return the nonconforming assistive device to the manufacturer, along with any endorsements necessary to transfer real possession to the manufacturer.

Section 5. To receive a refund due under a leased assistive device, a consumer shall offer to return the nonconforming assistive device to the lessor. Not more than thirty days after such an offer, the lessor of the assistive device shall provide the refund to the consumer. When the lessor provides the refund, the consumer shall return to the lessor the nonconforming assistive device.
To receive a refund due under a leased assistive device, an assistive device lessor shall offer to transfer possession of the nonconforming assistive device to its manufacturer. Not more than thirty days after such an offer, the manufacturer shall provide the refund to the assistive device lessor. When the manufacturer provides the refund, the assistive device lessor shall provide to the manufacturer any endorsements necessary to transfer legal possession to the manufacturer.

Section 6. No person may enforce a lease against a consumer after the consumer receives a refund due under section (5) of this Act.

Section 7. Reserved

Section 8. This Act does not limit rights or remedies available to a consumer under any other law, Any waiver by a consumer of rights under this Act is void. In addition to pursuing any other remedy, a consumer may bring an action to recover for any damages caused by a violation of this Act. The court shall award a consumer who prevails in such an action twice the amount of pecuniary loss, together with cost, disbursements, and reasonable attorney fees and equitable relief that the court determines is appropriate.

Section 9. No nonconforming assistive device returned by a consumer or assistive device lessor in this state, or by a consumer or assistive device lessor in another state under similar law of that state, may be sold or leased again in this state unless full disclosure of the reasons for return is made to any prospective buyer or lessee.

Section 10. Nothing in this Act may be interpreted to make the assistive device dealer or lessor responsible for the obligations of the manufacturer.