Most analysts figured that the GM and Chrysler bankruptcies would hurt their sales and it appears that the experts were right. Ford, on the other hand, seems to have won a lot of consumer confidence by refusing government bailouts and remaining self-sufficient.

Chrysler fared much worse than GM, at least on a one-month basis and a good question is why the difference? There is probably not a single answer. One reason might be in how the two manufacturers have dealt with warranty matters (i.e. demands for buybacks under the California lemon law and other state lemon laws) while under bankruptcy court protection. Early in the process, GM got court approval to continue to honor warranty claims as it always had. Chrysler, on the other hand, created a lot of ill will and bad publicity by bouncing settlement checks. It has tried to use the bankruptcy to change the terms of settlements previously agreed to. Did the public conclude that Chrysler was using the bankruptcy to hide from its responsibilities? Hard to tell for sure, but one thing is certain. Your rights to warranty protection are an essential part of car ownership. When these are threatened, you should request legal assistance and consider taking your future business elsewhere.

The idea behind the gas guzzlers law, which President Obama is expected to sign, is a simple one. Cars with poor gas mileage will be gotten off the road while at the same time stimulating flagging car sales. There is a lot of skepticism as to whether the idea will work and critics in Congress scaled back the duration of the program from a year to four months.

The government has put up a web site where you can learn if you qualify. The Car Allowance Rebate System can be found at www.cars.gov. Should you decide to take advantage of the program you should fully check out the warranty protection of your new car to see if it will meet your needs and to determine what protection you will have if the car is defective.

Remember: just because a car is a fuel-sipper doesn’t mean it can’t be a lemon car. The California lemon law and federal lemon laws don’t take fuel economy into consideration.

There are three cardinal rules that every consumer should follow

1. Take your car to the dealership for repairs when it first starts to give trouble or if the defect is still not fixed after repair. Sometimes people with busy lives prefer to limp along with a defective car, figuring that they’ll take it up when they next bring the car in for service. This can be a big mistake. Why? When manufacturers buy a car back, California lemon law allows them to deduct an amount from the refund proportional to the mileage on the car at the time it was first presented for repair of the major defect. In other words, every mile you drive the car after it starts acting up could cost you money. If you make follow-up visits promptly, it will be easier for your attorney to prove that you were diligent in trying to get your problems addressed.

2. Always give the service writer a complete description of your car’s problems to the best of your knowledge and make sure that he writes down exactly what you say. Lemon laws generally require that a manufacturer be given a “reasonable number of opportunities” to repair the defect. Without repair orders that say exactly what the problem is, it is hard to prove that the manufacturer’s authorized dealers were given the required chances to fix the problem.

3. Always remember to get a repair order and keep it in a safe place for as long as you own the car. Dealerships may try to avoid giving them out. If you have already been in for the same problem several times you might hear, “you already know we can’t fix it (or we don’t think there’s a problem) and so we didn’t do any work. So, we don’t have to give you a repair order.” This creates a problem. They can’t repair your car but they won’t give you the document you need to prove it. If polite persistence doesn’t work, you can write them a letter stating the date and time you presented the car with a statement of the defect you brought it in for. If relations have deteriorated to this point, it is probably already time to consult a lemon law attorney.

The California Bureau of Automotive Repair publishes a guide called “Write it Right” which is also available on their web site (www.bar.ca.gov/). It states exactly what needs to be written on a repair order in California.

Hopefully, technicians will be able to fix the problems with your car somewhere during the repair process and you will wind up with the car you paid for. But if not, you may need to seek a warranty refund. Following the three cardinal rules of repair orders will give you vital documentation you need when requesting a buyback in a lemon law case.

A hint of what may become the prevailing attitude amongst manufacturers happened during the recent Chrysler bankruptcy proceedings. It appeared as though all outstanding lemon law claims and the bouncing checks were going to be swept up and discharged in the bankruptcy leaving many lemon owners out in the cold. There was a public uproar carried by various consumer groups speaking on behalf of those who had purchased a lemon, went through the process and were poised for their refund. The media was such that it gave Chrysler a black eye, and in what appeared to a PR effort to secure a future with the buying public the “New Chrysler” switched its course and decided to honor the outstanding lemon law claims.

Just prior to GM’s recent bankruptcy filing I was informed by someone in a position to know that GM did not want to make the same mistake Chrysler did by giving the appearance that it didn’t give a hoot about it’s buying public or those stuck with a lemon. I took this to mean GM is already looking to the future with a message they will stand behind their product, which includes honoring the lemon law.

Auto manufacturers in this country will survive only if they deliver a high quality product and stellar service. No manufacturer is immune from producing a bad one every now and then. It is the nature of mass production. So when it does happen, manufacturers are smart to stand behind their product and “exchange in abundance” with their public by honoring lemon law claims. Gone should be the days whena  consumer has to fight to get what the manufacturer promised at the time of sale; a vehicle free of defefcts for a given term.

Under most states lemon laws, a manufacturer is suppose to either buyback or replace a lemon vehicle where the consumer has given the manufacturer a reasonable opportunity to repair a major problem.

Prior to the agreement reached between Chrysler and Fiat it was unclear how consumers who had initiated claims under the lemon law would be affected by the bankruptcy. Some consumers who had requested refunds on their lemons had been issued checks that bounced because of the bankruptcy filing. After many protests by consumer groups and attorneys on behalf of consumers, Chrysler said it immediately requested and received approval from the court to honor warranties in the bankruptcy case. The court decided that all warranty and lemon law obligations will be assumed by the new company after the close of the transaction between Chrysler and Fiat.

Chrysler consumers can now rest easy knowing their warranty is safe and they will still have rights to seek a refund or replacement under the lemon law if they find they have purchased a lemon, whether it was prior to the bankruptcy, during or after.

After a reasonable number of failed attempts to repair a vehicle under warranty, you should have the right to a refund or replacement (lemon law). However you could theoretically have over one hundred failed attempts to repair the same major defect under a service contract, yet still have no right to a refund or replacement.

The price of a service contract is typically based on several factors: the make and model of the vehicle; whether the vehicle is new or used; and the desired overage and length of the service contract. The cost can range from several hundred dollars to over a thousand dollars or even more.

Some people will gladly pay for extra coverage for their vehicle, just for the comfort of knowing that defects will be taken car of no matter what happens, after the manufacturer’s warranty expires. For people who keep a close eye on their budgets, service contracts make sense if they plan to put a lot of miles on their vheicles in a short period of time. In such cases the original warranty will expire much sooner, so a service contract could be worth it’s weight in gold. Otherwise, the manufacturer’s basic warranties are usually adequate.

Most consumers think by so doing they are going to a neutral forum where justice will be served. However what they don’t know is that the manufacturer pays for this service, and arbitrations are a majority of the time in favor of the manufacturer. All too often a consumer is “awarded” additional repairs to the defect they have already given the manufacturer a reasonable opportunity to repair. Ironically, this is no award at all because typically the consumer still has warranty coverage, or if the general warranty expired, the warranty as to the defect they failed to repair (at least in California) is extended for the defect the manufacturer failed to repair during the existence of the warranty. In the few instances where an award is made, many times it is not in accordance with the laws i.e. it may look like a “lemon law buyback” but the consumer is shorted the complete remedy the law allows.

Why bother going to a forum that is more often than not biased in favor of the manufacturer? Why put yourself through the frustration of having your case fall on deaf ears? Most people would like to give the benefit of the doubt to a process like this. It sounds appealing; it avoids lawyers and the court. But the truth of the matter is, you’d be better off not going through this process (unless it is required in your state; it is not required in California) and retaining a lemon law attorney to help you. Many times cases can be resolved without going to court. Many attorneys will represent the consumer at no cost.

Don’t fall prey to this pretentious trap. Bypass any offers to go to arbitration and get a lemon law attorney today!

Americans are waiting with baited breath to see if General Motors will file for Chapter 11 Bankruptcy on June 1, 2009, or whether their efforts to reorganize on their own can stave off the prospect of doing so. On May 21, 2009 GM reported it had reached a tentative agreement with the United Auto Workers to modify its labor contract with GM, removing a major hurdle to GM’s government-mandated restructuring. Reducing union costs are crucial for GM as it tries to shrink its debt before the restructuring deadline. To avoid bankruptcy, GM and Obama’s Auto Task Force still must reach a deal with bondholders to significantly reduce the $27 billion in debt securities owed. GM must convince its lenders (bondholders) to forgive about 90 percent of the company’s debt. GM is currently being kept afloat by $15.4 billion in government loans. Can GM make it before the June 1 deadline? Will the bondholders force GM into bankruptcy? Those are billion dollar questions. This week we should know the answer.

The “lemon law community” is still waiting to see just how the Chrysler bankruptcy is going to affect lemon law claims. There are consumers who have a legitimate lemon law claim who haven’t filed yet. There are those who have filed lemon law claims and are mid cycle, and finally those who resolved their lemon law claims and haven’t been paid.

It is wise to hold on to claims that haven’t been made yet so as not to be swept into the bankruptcy mess. By all accounts the bankruptcy process is supposed to be fast, and Fiat has a purchase agreement in place to buy Chrysler and among other things will assume specified liabilities including “certain liabilities for product warranties, product returns and rebates…”

There is a big question whether claims that are mid-stream can be resumed with the “New Chrysler.” The language of the proposed sale is ambiguous in this regard.

Just what the purchase agreement between Fiat and Chrysler means in the lemon law context remains to be seen. I think it is safe to assume that the “New Chrysler” will continue to honor Chrysler warranty claims for the driver who goes to the dealer but, one would argue that after a reasonable opportunity to repair defects, that one should be entitled to invoke the lemon law and seek a replacement or refund. The “New Chrysler” cannot have an infinite number of repair attempts while “honoring their warranty.” After all, that is what the lemon law is all about. There comes a time when enough is enough, right?

As for those who have returned their vehicle and got a bounced check in return, hope is on the horizon. There has been a lot of publicity about bounced refund checks from Chrysler, the Los Angeles Times recently wrote an article describing this fiasco. If the “New Chrysler” intends to honor its warranties, they had better honor the lemon law buy back too. They go hand in hand.

All right, that’s pretty harsh but it does apply if you were thinking of handling your own lemon law case. If you want to teach yourself to play the guitar, it would be much easier. You can do it evenings or weekends in your spare time. If you work at it and practice you may get good enough to play songs for your friends and enjoy what you learn. The key words here were evenings and weekends. The law keeps no such schedule. You are going to have to interrupt your work day, travel wherever the courts, or witnesses or other related legal activities demand.

If you are an attorney, practicing another kind of law, perhaps you could do this but there’s still a lot of work to it; a lot of travel, a lot of detailed paperwork. Do you have the time? Most people don’t. Hopefully for you your lemon law battle is going to be a one-time thing. Therefore if you are thinking about doing it yourself, you are going to have to learn a great many skills which you are going to use just once. Your opponents, the attorneys representing Ford, GMC, Chrysler, Honda or any of the other big car companies do this work every day.

When it is just you struggling with a defective car and trying to be a lemon law attorney it is a bit like an out of shape salesman getting in the ring with Muhammad Ali in his prime. When you go to meet them there may two of three attorneys. They will talk in a language you cannot understand. Their goal is to win and that means you get nothing and are left with your defective car or truck.

Then there is the cost. You will have to pay for your travel to meetings with their attorneys, perhaps even informal meetings with a judge. Proper paperwork has to be made and presented. Maybe it will be necessary to get an expert involved.

Here’s another consideration which I doubt the average person thinks about. When we as individuals have a problem with our car it is difficult for us to be realistic about the defects. It is hard for us to judge what is substantial and what is not, and this substantiality certainly has an effect on whether we have a lemon law case or not. To us that squeak in the trunk sound like nails on chalk board, but to a judge or jury it may seem trivial. Lemon law attorneys have the experience of years of lemon law work and thousands of cases that allows them to know what makes a successful case.

I wish for your sakes that it was simpler to get a fair hearing and resolution to your lemon car miseries. It’s not simple if you are going to try to teach yourself. Believe me I would be the last person to tell someone not to learn things on their own. I have taught myself many more things since leaving school than I learned while I was there. Certainly before you decide to use the lemon law you should learn as much about it as possible. Read everything you can find. It will help you understand the process and why the various actions occur. It can help you select the best legal representation. You can learn to understand what rights you have and what the limits are.
www.normantaylor.com