Squeeze On Lemons
Putting The Squeeze On Lemons
Craig Thor Kimmel is looking forward to the day when every Pennsylvania consumer will be read his or her rights upon making a purchase.
"We have the Miranda warning to protect citizens when it comes to an arrest," said Kimmel, whose practice focuses on representing Lemon Law victims. "The police have to tell you that you have the right to a lawyer. When you buy a product, you should be told, in writing, that you have rights, and here is what they are. The manufacturer should be forced to do that."
But most consumers aren't aware of their rights, especially when it comes to automobiles, said Kimmel, who helped to author changes in Pennsylvania's Automobile Lemon Law, which was first enacted in 1984.
"Back in 1984, the thinking was that by passing such a strong law, manufactures wouldn't continue to hide problems," Kimmel said. "They would start writing on the invoice whether the car had previous problems." That didn't happen at all.
As of Dec. 1, the law was amended to include used automobiles. The change in the law requires that anyone who buys a used car with problems must sign a paper saying they know it is a "lemon," and if a dealer does not adequately disclose that the car is a resold lemon, he faces a $2,000 fine and must refund the costs or provide a replacement vehicle of equal value.
The manufacturer must apply for a branded lemon title from PennDOT before the car can be resold, leased or transferred in the state. The branded title means a lemon car in Pennsylvania will be a "lemon for life."
In February, the law was amended to include automobiles that are leased. Previously, only new autos were subject to the Lemon Law.
According to R.H. Polk Co., 20 percent of new cars and 26 percent of new light-utility trucks in Pennsylvania are leases.
Under those changes, a Pennsylvania consumer who purchases or leases a car may be entitled to a new car or refund of his or her purchase price if the vehicle has a substantial defect that occurs in the first 12 months or 12,000 miles and cannot be fixed within three repair attempts, or if the car is out of service for 30 or more calendar days.
Customers are entitled to free legal representation, with the manufacturer paying all court costs and legal fees if the consumer prevails.
The provision governing leased autos was enacted too late for John Murphy Jr., who leased a 1999 GMC Jimmy that gave him problems almost immediately.
"The car had many problems," said Murphy, an auto mechanic with his own Monroeville shop. "The major problem was that the ball joints on the front suspension were no good. I knew that General Motors had problems with that kind of suspension. The ball joints were replaced four times in the first year. But the dealer kept refusing that there was any problem, and a leased car wasn't covered under the Lemon Law."
"I had no choice but to keep it," said Murphy, even though he and his wife refused to drive it. " I had to pay for the remainder of the lease." Murphy said that the vehicle was unsafe to drive, and his wife wouldn't drive it because it made so much noise when it went over bumps.
Murphy said he remains a dedicated GM buyer despite the problems he had with the Jimmy. "I just bought a Yukon, which has a totally different kind of suspension," he said. "If I had any advice for anyone, it would be not to lease. Even though there is a law protecting leased-car buyers, you are basically paying these dealers to rent their cars, and then, after three years, you turn the car in and you have nothing."
"Without private attorneys going after the manufacturers, there is no penalty," said Kimmel, who represented Murphy. "Delay and avoidance is a big element" in the manufacturer's strategy, he said. "They think that with enough delay, maybe the consumer will go away."
The state law also calls for the PennDOT to make sure that manufacturers and dealerships comply with the disclosure requirements. "They have to enforce that," Kimmel said.
"The problem is one of enforcement," he said. "In today's world, consumer law is not something which always gets enforced." He added that automobile Lemon Laws vary from state to state, and a car purchased in another state, and registered in Pennsylvania, would not be covered under Pennsylvania's law, which requires the vehicle to be both purchased and registered here.
"That's why it would be important to have a national law," Kimmel said. "I would say that a national Lemon Law which is fair would be great thing."
A federal law, the Magnuson-Moss Act, already covers all consumer purchases, but it is rarely enforced, and few consumers even know about it, he said.
"In general, the industry believes that the amendments to the law are an improvement to the law," said Charles Territo, spokesman for the Alliance of Automobile Manufacturers, a trade association of 12 car and light-truck manufacturers who account for more than 90 percent of U.S. vehicle sales.
"The changes make the law easier to administer, and it makes it much more consumer-friendly," he said. "It does increase the onus on the manufacturer, but they are always looking to do what they can to satisfy their customers. It is good business to provide protections for consumers.
Mark Czekaj, of Mt. Pleasant, who is one of Kimmel's clients, is another victim.
"I bought a Volkswagen Beetle in December 2001," Czekaj said. "I had problems with it right off the bat," mainly with the fuel line and electrical system.
"I did some research on Car-Fax, and it showed that the car was a manufacturer buy-back, a lemon," said Czekaj, who said the car had gone through three auctions, in three states. "I went back to the dealership, but they did not want to help out."
Czekaj said that his case is still in litigation, but he has a 2-year-old car that he can't get rid of.
"It's going to be worth a lot less, and it has some recurring problems," he said.
Dealerships say Lemon Laws put them in the middle of the transaction.
"The laws have much more impact on the manufacturers," said Peter Bauer, legislative aide for the Pennsylvania Automotive Association, which represents all of the 1,158 new car dealerships in the state.
"The dealers are in the secondary loop," said Bauer, who said his organization had no input in the formulation of the changes to the Lemon Law. "Dealers are required to make disclosures, and if they fail to make that, there could be problems," he said.
"We have no problem with the new law," said Paul Dowds, used-car manager at Mick's Chrysler in the North Hills. "We like the changes, because they will weed out the problem children."
"The cars that I buy are at a closed auction, with only Chrysler cars," Dowds said. "We use a system that has been in place for as long as I've been selling cars, 10 to 12 years. When we buy a car from the manufacturer that is a buy-back, we'll have a disclosure that the dealer must sign off on, the manufacturer must sign off on, and the customer, and the disclosure is also on the purchase order."
"In essence, the manufacturer is in a partnership with the dealer," Bauer said. "The manufacturer wouldn't dump a car that is branded on a dealer without disclosing that. If you have knowledge and you don't disclose it, you set yourself up for fines."
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