Car Dealerships vs Car Manufacturers: How Does California Lemon Law Apply?

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There are three ways you can buy a car: from the manufacturer, from a dealership, or from a private seller. In the scenario, you purchase a defective vehicle, the Song Beverly Consumer Warranty Act (California lemon law) allows you to return a defective vehicle and receive a refund. As long as the vehicle is still under warranty, a lemon law attorney in California will fight to get you the compensation you deserve.

Generally, seeking a California lemon law claim after a private car sale is pretty rare – as most of these transactions do not involve a sale at “retail” which is generally a requirement for the lemon law.

Getting compensation for a lemon from a manufacturer is a bit different than doing so from a dealership. Cars bought straight from the manufacturer are typically brand new, whereas ones from a dealership can be used vehicles.

That said, the difference comes down to how the law relates to a new car versus a used car.

In this post, we’re going to dive into the details of seeking compensation from a car manufacturer versus a car dealership.

Bought a Lemon from a Manufacturer?

Chances are, a vehicle you bought from a manufacturer was brand new. Lemon law – while it exists across the country – has slightly different qualifications in different states. In many states, you can only file a lemon law claim for a new vehicle – bought for either personal or professional use.

Generally speaking, your path to a lemon law buyback is much easier with a new vehicle.

In the state of California, a vehicle can be ruled a lemon if:

  • It presents one or more defects covered under the warranty – that impairs the use, value, or safety of the vehicle.
  • The manufacturer has made two or more unsuccessful attempts to fix the warranty-covered defect.
  • The manufacturer has made four or more unsuccessful attempts to repair any number of defects covered by the warranty.
  • The vehicle has been out of service for more than 30 total days for repairs on any number of warranty-covered defects.
  • The defect was not caused by driver abuse.

A big misconception about California lemon law is that the vehicle’s defect must be detected within the first 18 months of the purchase date or before 18,000 miles accrue on the odometer. This is not true and merely lemon law presumption.

You can seek a lemon claim as long as the defect was detected while the warranty is still in effect. Most car warranties are good for at least 36 months after the purchase date or before 36,000 miles accrue on the odometer or 5 years or 60,000 miles (for the drivetrain). This can vary based on the manufacturer/warrantor terms.

If your vehicle exhibits a recurring problem before 18 month/18K miles, your claim is much stronger. When your new vehicle is showing signs of faulty manufacturing, you need to get in touch with the manufacturer ASAP to begin the repair process. If the manufacturer is unable to repair the issue after a reasonable number of attempts, you may have a lemon.

Bought a Lemon from a Dealership?

Dealing with a used lemon from a dealership can be a little more complex than with a new car. The good news is it can still qualify as a lemon – if it was sold with a warranty from either the manufacturer, distributor, or dealership.

Let’s assume you bought a used vehicle from a dealership and the manufacturer warranty has expired. Buy-here-pay-here dealerships are required to offer a warranty that is good for at least 30 days or before 1,000 miles accrue on the odometer at no additional charge. This is the MINIMUM warranty period required by California car dealership laws. These terms should be specified in the buyer’s guide.

The dealership may offer longer warranties – which may be included or available for purchase.

If your vehicle is experiencing issues while still under the dealership warranty, it can be subjected to the same process as a defective new vehicle. In the scenario your used vehicle meets the lemon law criteria, a lemon law attorney in California will advise you on how to get a dealership to buy back your car.

Mistakes to Avoid

Truth be told, there are a bunch of ways you can ruin your chances of getting a California manufacturer buyback – even if it’s a slam dunk. I want to go over the biggest ones to steer clear of.

  • Taking the vehicle to your own mechanic

Perhaps the biggest mistake you can make in the lemon law process is taking your defective vehicle to your chosen mechanic. If the vehicle is showing signs that it’s defective (while covered under warranty), you can only take it to a manufacturer-certified repair facility for repair.

If your chosen mechanic does any work on the vehicle, it may void the warranty altogether. Moreover, it can ruin your chances of getting a buyback.

  • Not closing your repair invoices

Repair invoices are the most important pieces of documentation in the California lemon law process. An oral history of your vehicle’s repairs may not cut it. The repair invoice needs to contain the following information:

  1. The year, make, model, and VIN of your vehicle.
  2. The date you brought the vehicle into the repair facility.
  3. Mileage when you brought the car in, and mileage when you picked it up.
  4. Description of the issue.
  5. Name and ID of the employee assisting you.

Most importantly, the repair order should be closed with a signature from the employee. If the repair order is not properly closed, any subsequent repair attempts may not count towards your lemon law claim.

  • Accepting arbitration

Arbitration is not something that normally helps the consumer. In essence, arbitration is a way for the manufacturer to repress the consumer’s right to the court system. It involves taking your claim in front of an arbitrator or panel of arbitrators.

As a result, the arbitrator(s) may issue a decision that appears to be biased in favor of the manufacturer, no matter how strong your case is. In arbitration, you lose all right to appeal and the right to a jury. A jury of twelve piers is a right guaranteed by the Constitution for a reason–it is the most fair way to resolve your dispute. This is why you must avoid lemon law arbitration at all costs. Manufacturers might try to convince you that arbitration is a cheaper and quicker alternative to court – it’s not.

Now, even if you fall prey to the arbitration trap, hope is not lost. Depending on the arbitration forum you may be able to take your claim to court if the arbitrators ruled against you. The difference is the manufacturer now has more evidence to fight your case.

Some manufacturers – like Tesla and BMW – have forced binding arbitration clauses against their own customers, all in an attempt to chill the rights California law has conveyed on its citizens. In Tesla’s case, it specifies that consumers lose their Constitutional right to a jury trial and cannot take a lemon claim to court. The good news is the clause has an option to opt-out of arbitration, but it must be asserted within 30 days of purchase. The clause is hidden in the fine print. Be sure to ask your salesperson to remove this provision or why Tesla wants you to give up your right to a jury trial..

Why You Need a Lemon Law Lawyer

Chances are, you’ve never dealt with a lemon before. Choosing to pursue a lemon law case without a specialized attorney will significantly stack the cards against you. Keep in mind, automakers have some of the highest-paid legal defense under the sun – and dealerships are certainly no strangers to lemons.

Trying to win a lemon case on your own is like bringing a knife to a nuke fight.

Manufacturers and dealerships have all sorts of tricks to avoid lemon law buybacks. A skilled lemon law attorney in California knows these tricks and will be able to efficiently navigate around them.

Regardless of whether you’re dealing with new car or used car lemon law, working with an attorney is going to be instrumental in getting the maximum buyback value. Now, many consumers are deterred from hiring an attorney to save money; this is the wrong train of thought.

When you win a California lemon law claim, the manufacturer or dealership is legally responsible to cover ALL your costs, including attorney’s fees and expenses. Moreover, a trustworthy lemon law attorney in California will not take your case unless they think they can win – and they’ll never ask for any out-of-pocket-costs.

Wrap Up

Seeking a lemon buyback or replacement from a manufacturer or dealership is no picnic without a lawyer on your side – regardless of how strong your claim is. No matter what the circumstances are, the only party that will be on your side throughout the process is the lemon law attorney you hire.

Did you buy a defective vehicle – either new or used?

You’ve probably got a lot of questions. We have answers.

Don’t wait any longer in getting the support you need.

Call Cline APC at 888-982-6915, send an email to info@clineapc.com, or fill out a FREE case evaluation.

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