Stuck between purchasing a new car and opting for a secondhand one? Perhaps your Certificate of Entitlement (COE) is due for renewal and this gives you all the reasons to get a spanking new set of wheels. Or you’re scrolling the used car section for a more economical option. Whatever it is, buying a car in Singapore is no small matter, and it’s important to choose a trusted dealership. This is because if problems start cropping up, you might just be covered under the Lemon Law.
What is Lemon Law?
The Lemon Law comes under the Consumer Protection (Fair Trading) Act’s (CPFTA) Part III. Since 2012, this statute has been protecting consumers in Singapore when they purchase goods, including motor vehicles. Under the Lemon Law, a merchant is responsible for repairing, replacing, refunding, or lowering the price of a faulty product. It also covers both brand new and used cars.
In this blog, we will talk about Lemon Law in the context of a new car purchase, its legal requirements, and how to make a claim if you think you have a lemon, or defective car, on hand.
What Does Lemon Law Cover?
As an easy point of reference, you are covered under the Lemon Law if a defect is found within six months from the date of purchase. Otherwise, you can also prove that the fault existed during this 6-month window. To safeguard your investment, it is a good idea to get hold of a vehicle evaluation report. Basically, this adds a clause to your sales agreement to have the car evaluated by a third party such as STAI or VICOM before committing to the sale.
However, bear in mind that this is an added expense usually borne by the buyer, unless the dealer promises the car to be accident or problem free. With this report, you can then request the dealer to fix all existing defects.
At times, new problems or issues may arise in your newly purchased car which have not been highlighted or acknowledged by the dealer at the time of sales. In such instances, you can still make a Lemon Law claim within the 6 months.
What Does Lemon Law Not Cover?
If your newly purchased car faces the same problem within 6 months of delivery after the initial assessment, you will not be able to make a Lemon Law claim.
You will also not be covered if the initial defect highlighted in the report is in relation to the new defect. For example, if your car was purchased with a leaky transmission defect, a failed transmission within 6 months will not be covered.
The Lemon Law in Singapore also does not apply if you have decided to change your mind after purchasing the defective car with the issues made known to you. Damage from workshop repairs are also not covered, so ensure that you visit a trusted car workshop if you are planning to do further modifications to your new car.
Think You Bought a Defective Car?
Before setting the claim process in motion, you should first think about your objective – do you want a refund, a price reduction, replacement, or repair? Next, start gathering important evidence to support your claim. This may include any pictures of the car, proof of purchase, warranty agreement, and documentation of the faulty components of your newly purchased car.
Once you have enough evidence, you can then contact your car dealer to inform them of the defects. At times, the dealer may be uncooperative or refuse to accede to your request. For such cases, you can either bring your case to the Small Claims Tribunal (for claims not exceeding $10,000) or file a complaint with the Consumers Association of Singapore (CASE).
Possible Outcomes of Your Lemon Law Claim
There are generally three possible outcomes from a successful claim under the Lemon Law in Singapore:
The dealer or seller may first offer to repair or replace the defective car within a reasonable period of time and without causing significant inconvenience to you.
You may decide to keep the defective car and request for a reduction in price.
You may also return the defective car if repair or replacement options are not available, or if the dealer or seller is unable to offer repair and replacement within a reasonable timeframe and without causing significant inconvenience to you.
Protect Your New Car Purchase and Wallet
Besides that, your car’s condition can also affect the price of your car insurance or what it covers. Therefore, even with the Lemon Law protecting your consumer rights in Singapore, you should still conduct a thorough inspection of your newly purchased car and do the necessary research beforehand.