Get the Squeeze on California Lemon Laws: Here’s What You Need to Know
What is a Lemon Car?
A lemon car refers to any motor vehicle that repeatedly fails to operate as it should, both in terms of performance and quality. If your car keeps having the same issue despite having the car looked at by the dealership, then you might have a lemon on your hands.
While the phrase is synonymous with vehicles, the term “lemon” can be used to refer to any consumer good, especially electronic goods or products with a motor that consistently breaks down or needs repair.
In the United States, consumers who purchase faulty goods can find protections under lemon laws. These laws are legislated at the state level, and every state plus the District of Columbia have laws in place safeguarding consumers. However, the details of the laws and what is protected differ from state to state.
What Do California Lemon Laws Protect?
According to the Center for Auto Safety, California ranks 12th in the nation with the best lemon law protections. In case you were wondering, New York and Washington state top the list while Illinois is dead last.
If you live in California and own one of the 150,000 estimated lemon cars sold in the state every year, then you might be wondering what protections you might have. While California's lemon laws may offer you some protections on your big purchase, there are some stipulations for you and your vehicle in order to enjoy these protections. If your vehicle meets these qualifications, then you might be able to move forward with a claim:
- If you have purchased a new vehicle, a used one, or are leasing one, and the vehicle is still covered by the manufacturer’s new vehicle warranty, then your vehicle could qualify. If the vehicle’s manufacturer warranty has expired, but you have an extended warranty, then you are also protected.
- California lemon laws only apply to vehicles sold or leased within the state.
- Protection covers you for the first 18 months of your new purchase or lease or until your vehicle has reached 18,000 miles, whichever of the two comes first.
- The manufacturer has made a “reasonable number of attempts” to fix the vehicle.
The goal is to be able to use the original retail installment sales contract (RISC) because that is the highest value of the car and would give you the highest value for damages.
While the law does not stipulate what a “reasonable number of attempts” is, it does offer some guidance. An attempt is deemed reasonable if it adheres to the following:
- Either the dealership or the manufacturer has tried at least two times to repair a problem that could cause serious injury or death.
- When it comes to all other issues, the dealer or manufacturer has tried to fix the problem at least four times.
- The manufacturer or dealer cannot have held onto the car for more than 30 days for repair.
An interesting question arises when someone is gifted or inherits a vehicle that has repeated repairs under the factory warranty. California lemon law attorney Nick Nita of Nita Lemon Law explains that the lemon law would apply in these situations, but the question then becomes what damages the individual consumer would be entitled to. “The goal is to be able to use the original retail installment sales contract (RISC),” says Nita, “because that is the highest value of the car and would give you the highest value for damages.”
Nita recalls a case where the parents purchased a vehicle and then later transferred title to their daughter. “In this case,” he says, “we successfully argued that the lemon vehicle was purchased for “family or household purposes” and were able to use the original RISC to prove damages.”
In another case, Nita had a client who passed away in the middle of a lemon law claim, and the vehicle was transferred to the next of kin. “There,” says Nita, “we amended the pleadings to add the next of kin as the “successor of interest” to step into the shoes of the deceased consumer and therefore be entitled to the damages under the original RISC.”
Nita even had one case where a client won a new car as a prize that turned out to be a lemon. “We proved liability, and the manufacturer agreed to buy back the car, but then the question became what damages did the client incur?” Nita continues, “in that case, since there was no RISC we were able to use the “fine print” in the sweepstakes documents that disclosed what the value of the new car with sales tax was, and those were the damages to the consumer.”
If you are unsure whether or not your vehicle qualifies under California’s lemon laws, you can contact the Department of Consumer Affairs Arbitration Certification Program. Their services are free and can help you determine if your vehicle is protected. Arbitration is like a trial. Like a judge, the arbitrator holds a hearing and receives evidence and testimony from both sides, and then renders a decision. A consumer who is dissatisfied with the arbitration result can still proceed to litigation.
Attorney Nita, however, cautions against using this program. “Attorneys cannot represent consumers at those hearings,” he says, “which is a big disadvantage to consumers who may not know all their rights and remedies available under the lemon law.” In litigation, on the other hand, Nita points out that consumers who file claims under the lemon law can have their attorney fees paid by the manufacturer. Finally, going into litigation after arbitration can put the consumer at a disadvantage in court, where the manufacturer can argue that an arbitrator already agreed with the manufacturer that the vehicle is not a lemon or that the manufacturer denied the repurchase in good faith.
California is one of the best states, if not the best, in offering great protection to consumers with lemon cars brought in California.
If you do try the arbitration program on your own and are unsuccessful, it might still be worthwhile to discuss your case with a lawyer. As attorney Nita explains, “Over the years, I have had clients who went through the Arbitration Program and were denied any economic justice, only to have their cars bought back in litigation later on.”
How Can California Lemon Laws Protect You?
If you purchased or leased a vehicle or any other consumer good for your personal use, for your family, or your household, then you have protections under lemon laws. California lemon laws however do not apply to clothing or consumable goods. These might include things like food, over-the-counter drugs, and cosmetics.
Lemon laws don't cover just new vehicles. They can apply to used vehicles and vehicles that are leased out to consumers as well.
If you find yourself with a lemon, the manufacturer must first try to repair the vehicle within a reasonable number of repair attempts. This means if your vehicle has an issue, there can only be so many times that you should be bringing your car in to get looked at. If the manufacturer cannot repair the car within that reasonable number of attempts, then the car must either get replaced or refunded.
When it comes to the manufacturer, California lemon laws stipulate that they must do the following:
- Have adequate facilities throughout the state so that customers can access the facility without having to drive far distances.
- Repairs should not take more than 30 days.
- Do not exceed the reasonable number of attempts to repair.
- Offer a replacement or a refund for goods that cannot be fixed. The refund on vehicles is typically how much the vehicle was purchased for minus any “trouble-free” value that the consumer received from the vehicle.
- The manufacturer must pay for reasonable attorneys fees and costs of a complaint.
When it comes to determining the reasonable repair attempts and the refund price, several factors are considered. For reasonable repair attempts, the number of attempts will typically depend on the type of issue the car is having. For safety issues, fewer attempts are allotted. When it comes to the refund of a vehicle, the odometer is typically used for measuring the “trouble-free” value, though this measure can be contested and differs from case to case. Because lemon vehicles differ in severity and situation, refunds and repair attempts will vary from case to case.
When it comes to consumers, vehicle owners will typically find themselves with three options if they have a lemon car on their hands. After filing a complaint, the owner will either get a refund on their car, get a replacement, or get a cash settlement. If you find yourself with a lemon, you do not have to suffer with it. California’s lemon laws are meant to protect consumers. According to attorney Nita, “California is one of the best states, if not the best, in offering great protection to consumers with lemon cars brought in California.”