Monetary Recovery Under the California Lemon Law

TYPES OF RECOVERY UNDER THE CALIFORNIA LEMON LAW

Under the California lemon law, a consumer who purchased a defective car or truck is entitled to: (1) have the manufacturer either replace the vehicle with a new one or repurchase the automobile, subject to a “mileage offset” for the consumer’s use of the vehicle; (2) be reimbursed for all incidental damages suffered by the consumer as a result of the malfunctioning car or truck; (3) if the manufacturer “willfully” violated the California lemon law’s provisions, receive a “civil penalty” of up to two times the consumer’s other monetary recovery; and (4) upon winning a California lemon law lawsuit, to have the manufacturer pay the consumer’s attorney’s fees and costs. Each of these legal remedies is described in greater detail below.

If you want to find out how much money you are entitled to as a result of your defective automobile, then you should call the Vachon Law Firm right now at 1-855-4-LEMON-LAW (1-855-453-6665). Consultations are always FREE!

The California Lemon Law’s “Repurchase” and “Replacement” Remedies

Perhaps the most important of these provisions is the lemon law buyback remedy contained in California Civil Code Section 1793.2(d).  Specifically, if a manufacturer cannot repair a substantial defect within a “reasonable number of attempts” then the manufacturer must either (1) repurchase the vehicle, or (2) replace it.

Although the California lemon law statute permits a manufacturer to comply by either repurchasing or replacing a defective vehicle, Civil Code Section 1793.2(d)(2) also expressly states that a consumer cannot be forced to accept the replacement remedy if they do not wish to do so.  Accordingly, car buyers can always choose to get their money back if that is the remedy that they want.

The “Repurchase” Remedy

If a consumer chooses the repurchase remedy, then (subject to the offset for mileage discussed below) Civil Code Section 1793.2(d)(2)(B) states that he or she is entitled to receive the total amount of money that they paid for the vehicle, including all sales tax, license fees, registration and other official fees.  In practical terms, for someone who financed their vehicle it means that the manufacturer has to reimburse a consumer’s down payment and all monthly payments made towards the vehicle, and pay off the remaining balance on the vehicle loan.

However, Civil Code Section 1793.2(d)(2)(B) also states that a consumer who chooses the buyback remedy is not entitled to recover any money that either they or the selling car dealership spent installing non-manufacturer aftermarket items.  So if items like these were included in the cost of the vehicle, they will have to be deducted from any lemon law recovery.

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The “Replacement” Remedy Permits the Consumer to Receive a New Vehicle – But Manufacturers Cannot be Forced to Provide This Remedy if They Would Rather Buy Back the Lemon Vehicle

If a consumer and manufacturer choose the vehicle replacement option, rather than the repurchase remedy, then Civil Code Section 1793.2(d)(2)(A) requires that the manufacturer must give the consumer a new vehicle that is substantially similar to his or her old car, and to pay all sales tax, registration, license and other official fees associated with the sale. The new car or truck must also come with all of the standard new vehicle warranties typically accompanying the sale of that vehicle.

Although this page has described what a consumer is entitled to under the replacement remedy, it is worth pointing out that manufacturers have become increasingly reluctant to replace vehicles. Under the California lemon law, both the consumer and the manufacturer have to agree to the replacement remedy. So a manufacturer cannot be forced to provide a replacement if it would rather simply repurchase the vehicle.

Nonetheless, since the California lemon law statute permits this type of relief, if a consumer desires this remedy they should let their attorney know, so that he or she can at least propose the option to the manufacturer defendant.

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The California Lemon Law Also Permits Recovery of “Incidental Damages” Caused by the Malfunctioning Car or Truck

Regardless of whether or not the consumer chooses the buyback or replacement, in addition to the amounts described above, the consumer is entitled to compensation for all “incidental damages” that they incurred.  Incidental damages means any money that you had to spend as a result of the defective vehicle.  It includes things like tow charges, rental car charges for a replacement vehicle, and out-of-pocket repair expenses.  It generally does not however include things like lost wages (if you missed work) or compensation for the time you spent dealing with the numerous repairs.

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The “Mileage Offset” Under the California Lemon Law

If the manufacturer repurchases a malfunctioning vehicle pursuant to the lemon law buyback remedy, then under Civil Code Section 1793.2(d)(2)(C) the manufacturer is entitled to reduce the amount paid to the consumer by a “mileage offset.” The mileage offset is intended to make the consumer pay for the use of the vehicle that he or she had prior to the defects appearing in the vehicle.  The California lemon law has a specific and precise formula for determining the mileage offset.  Basically, every car and truck is presumed by the lemon law to have a useful life of 120,000 miles.  The mileage offset is determined by the mileage that was on the vehicle’s odometer when the car owner first took it in for repair of the malfunction that resulted in the vehicle being deemed a lemon.  This mileage is divided by 120,000 miles and multiplied by the vehicle’s purchase price, and then the resulting amount is the mileage offset that the manufacturer can deduct from its payment to the consumer to repurchase the vehicle.

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The “Civil Penalty” Provision of the California Lemon Law

In addition to the monetary recovery listed above, under Civil Code Section 1794(c) the California lemon law permits a consumer whose car or truck turned out to be defective to also recover a “civil penalty” payment if the consumer can prove that the manufacturer willfully violated the California lemon law statute.  A “civil penalty” means a payment that is not intended to compensate the car buyer, but is instead intended to punish the manufacturer.  In essence, if you are lucky enough to recover a civil penalty payment, this equates to ‘free money.’  The California lemon law statute permits the amount of the civil penalty to be up to two times the amount of actual damages.  Since actual damages can include the price the consumer paid for the vehicle, the civil penalty amount can be a very substantial payment.

So how does the consumer prove that the manufacturer “willfully” violated the California lemon law?  Leave that to your attorney to advise you regarding whether a civil penalty is realistic in your case.  Typically (although not necessarily always), proving a willful violation is done by showing that the consumer contacted the manufacturer, informed it of the defective vehicle’s repair history, requested a lemon law buyback or vehicle replacement, and the manufacturer refused to do so – even though it should have.

If you would like to find out whether you qualify to receive a “civil penalty” payment under the California lemon law, call the Vachon Law Firm right now at 1-855-4-LEMON-LAW (1-855-453-6665). Consultations are always FREE!!.

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Other Types of Monetary Recovery Under the California Lemon Law

As stated above, the repurchase or replacement remedy is usually by far the most attractive option for consumers who qualify for relief under the California lemon law.  Nonetheless, it is also worth mentioning that Civil Code Section 1794(b)(2) also permits a consumer to obtain damages equal to the amount necessary to repair the vehicle.

The California lemon law statute (at Civil Code Section 1794(a)) also permits a consumer who purchased a defective automobile to seek “equitable relief.”  Theoretically, this means that a consumer could seek things like a court order requiring a manufacturer to provide information to consumers who purchased similarly malfunctioning cars or trucks, or an order requiring the manufacturer to turn over any profits that it earned on money that it was supposed to pay over to you (this particular equitable remedy is called a “constructive trust”). 

As a practical matter, however, these other types of relief permitted by the California lemon law statute are usually nothing but theoretical.  In almost all conceivable circumstances, it will be in a consumer’s best interests to seek the repurchase or replacement remedies discussed above.

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The California Lemon Law Requires the Manufacturer to Pay Your Attorney’s Fees, Costs & Expenses

Finally, under Civil Code Section 1794(d) the California lemon law statute also permits a consumer who wins his or her lawsuit against a manufacturer to recover his or her attorney’s fees, costs, and expenses.  This is arguably the most important section of the California lemon law, because it effectively permits anyone with a valid lemon law claim to retain an attorney to professionally prosecute the lemon law lawsuit knowing that when it is all over the manufacturer, and not the consumer, will have to pay all the legal fees incurred in the case.

The attorney fee provision in the California lemon law is the reason why consumers in practically every California city, from San Diego to San Francisco, and Imperial Beach to Humboldt, can log onto the Internet and find professional attorneys willing to represent them on a contingency fee basis with no money down. See this Web site’s page on Choosing a California Lemon Law Attorney for a discussion of important considerations in choosing a California lemon law lawyer to represent you.

The Vachon Law Firm accepts California lemon law cases on a contingency fee basis with no money down. Call 1-855-4-LEMON-LAW (1-855-453-6665) for a FREE consultation to find out how much money you may be entitled to because of your lemon!

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