What Will I Get?
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You are probably wondering what you would get from a lemon law buy back.
Basicly, you will recover all of the money that you put into your lemon vehicle, minus an offset for usage. In addition to the money paid directly to the consumer, the bank will be paid off, if there is money owing on the sale/lease contract.
It’s time to calculate your potential recovery. In order to illistrate a lemon law buy back, let’s use Orange County Carl as an example. Orange County Carl buys a new sportscar from a Newport Beach dealership for $80,000.00. Carl pays $20,000.00 down, with payments of $1,000 per month. Carl drives his “baby” for a year without incident before he experiences a knock from the engine to which he returns the vehicle to the dealership for repair under warranty. Upon his first presentation of the engine knock, Carl’s sportscar had 8,000 miles.
After 6 months and 4 failed repair attempts, the manufacturer of Carl’s sportscar decides to buy back the defective vehicle under the California lemon law. So after 18 months, Carl had driven the defective car 15,000 miles, and paid out a total of $38,000.00, with more than $40,000.00 still owed to the bank under the sales contract.
In order to calculate how much Orange County Carl will recover for a statutory buy back of his lemon car, you first need to determine the mileage at the first presentation of Carl’s lemon car for repair of the defect. Here, that number is 8,000. Next you would divide said number by 120,000 (which represents the expected life of a new motor vehicle in miles.) Then you would multiply that number by the purchase price of the vehicle ($80,000.00.) The result of that calculation would be Carl’s offset.
Carl would like to get all his money back but the California legislature decided that a California consumer should not recover monies for usage of a lemon vehicle prior to the inception of the defect that gives rise to the lemon law buy back.
So here is Carl’s calculation: 8,000 divided by 120,000 = .0666666. Now multiply .666666 X 80,000 = 5,333.33. So Orange County Carl’s offset is $5,333.33. Therefore, under this lemon law buy back scenerio, Carl is entitled to receive $32,666.67 from the manufacturer of his defective car ($38,000.00 minus $5,333.33.)
To complete the lemon law buy back, the manufacturer will pay the bank the full amount still owed under the sales contract.
In the event that you are unlucky enough to purchase or lease a defective vehicle and the manufacturer or its authorized representative is unable to repair your defective vehicle after a reasonable number of repair opportunities, you may then be entitled to a lemon law buy back under the California lemon law.
The consumer may elect either a lemon law buy back or a replacement of their defective vehicle. Whereas the manufacturer or dealership will push the consumer toward a replacement of the defective vehicle, it is often in the consumer’s best interest to choose a lemon law buy back of the defective vehicle.
The law provides that in the case a lemon law buy back, “the manufacturer shall make restitution in an amount equal to the actual price paid or payable by the buyer, including any charge for transportation and manufacturer-installed options, but excluding nonmanufacturer items installed by a dealer or the buyer, and including any collateral charges such as sales tax, license fees, registration fees, and other official fees…” California Civil Code Section 1793.2(d)(2)(B).
It is important to note that most lemon law buy backs are subject to an offset for usage or mileage. This means that the consumer will not be reimbursed for the amount directly attributable to the use of the defective vehicle prior to the time the consumer first delivered the defective vehicle to the manufacturer for repair of the defect that gave rise to the lemon law buy back.
To put in simple terms, the manufacturer will reimburse the consumer for the amount paid on the contract including any down payment and monthly payments, and the manufacturer will pay-off the lender any amount owed on the contract. Although consumers are entitled to incidental damages, (i.e. rental car, towing, insurance and maintenance costs) manufacturers are often unwilling to reimburse consumers for these types of damages.
Don’t fret, the lemon law attorneys at Lemon Law Attorney.Net will put their experience and reputation to work to get you the full amount to which you are entitled under the law.
For a clear example of what you may be entitled to, click on What Will I Get? to determine the amount of your lemon law buy back
