Attorney General Patrick Lynch says a new law will be in effect starting today to handle complaints from people who have bought or leased faulty cars from a Rhode Island dealer.

The law creates a Motor Vehicle Arbitration Board, a five-member panel that will review complaints received by the Consumer Protection Unit.

Consumers can receive protection from the new law if their new car must be repaired for the same reason four times in the first year -- or if the car spends 30 days in the garage for the same repairs.

The Rhode Island Consumers Council was abolished in 1993. That was the body that had previously been responsible for arbitrating and enforcing complaints.

(Copyright 2005 by The Associated Press. All Rights Reserved.)

Anti-fee lawsuit tossed by judge. Used car salesman fought Lemon Law.

By TOM QUIGLEY
The Express-Times
BELVIDERE -- A Warren County judge has dismissed a lawsuit filed by a used car salesman who claimed he's the victim of an unconstitutional tax.
Ed Smith, 51, of Franklin Township, is the co-owner of a small auto consignment shop in Hampton.
The state Division of Consumer Affairs requires Smith and all licensed used car dealers to collect a 50-cent fee from car buyers to cover the administrative costs of the state's used car Lemon Law, according to the state administrative code.
Smith refused to collect the tax and eventually paid it out of his own pocket, along with a $500 penalty imposed by the consumer affairs division.
In addition to his work at the car lot, Smith is the chairman of the Warren County Community College Board of Trustees and a part-time legislative aide to Republican Assemblyman Michael Doherty.
He has said sales are modest at the Countdown Consignment shop and so the Lemon Law fees had amounted to only $7.50 when the state began fee collection efforts against him in 2003.
Smith argues it's unconstitutional for the state Legislature to grant an executive branch division the power to set discretionary fees. He also sought a return of the money.
Superior Court Judge James L. Pfeiffer ruled Smith failed to follow procedural requirements that gave him the right to have his case heard in an administrative hearing.
Pfeiffer said Smith could also have appealed an adverse ruling to the state Appellate Division.
"The plaintiff has no one else to blame but his own stubbornness in this case," the judge wrote. "The plaintiff refused to participate in the administrative process that was designed to protect his due process rights."
Pfeiffer also cited case law concluding regulatory fees differ from taxes. The judge concluded Smith failed to show the used car Lemon Law fee was anything other than a fee charged to offset the cost of regulating used-car dealers. The judge also dismissed two other allegations in the Smith lawsuit.
In one, Smith sought to force the state Attorney General's Office to prosecute the state Legislative Commission for appointing the same person, Albert Porroni, to serve as both its executive director and legislative counsel. Smith claims the commission violated state law by appointing one person to both jobs.
Pfeiffer dismissed the allegation, ruling state Attorney General Peter C. Harvey has prosecutorial discretion and a court order requiring him to prosecute the commission would be a violation of the constitutional separation of powers.
The judge also dismissed an allegation brought by Smith alleging some state officials failed to take an oath of office before assuming their jobs.
"I am very proud of my effort to address behavior by state officials that is inconsistent with the laws that were duly established to regulate them," Smith said in a prepared statement.
Smith said the judge used legal technicalities, redefinition of words and omission of material facts to substantiate the dismissal of the lawsuit.

Refusal to provide refund for defective car: Fraud: Nondisclosure under "lemon law": Settlement: Verdict: Punitive damages

Johnson v. Ford Motor Co., Cal., Fresno County Super. Ct., No. 647076-9, Dec. 20, 2001.
The Johnsons bought a 1997 Ford Taurus for approximately $8,000 with 10,000 miles on it. At the time of the purchase they asked for the car's repair history from the dealership but were told that the car had none. A few months later they began experiencing problems with the car's transmission. They asked the dealership's service shop for the car's repair history and learned that the car's transmission problems dated back to the previous owner. They complained to the manufacturer, which offered to extend the warranty but would not take back the car.
The Johnsons sued the dealership and the manufacturer, alleging fraud and violations of the state's "lemon law," Cal. Civ. Code 1793.23. Plaintiffs contended that California law defines a car as a "lemon" if it was repurchased by a dealer or manufacturer because it could not be repaired after a "reasonable number of repair attempts." Plaintiffs showed that the manufacturer told its dealers, through its official training manuals, that only cars that underwent four or more repair attempts within 12 months or 12,000 miles qualified as lemons. The same manuals stated that a complaint did not qualify as a "repair attempt" if the dealer checked for a problem and could not find it, even though state law provides otherwise.
Plaintiffs argued that the manufacturer circumvented the lemon law by offering unhappy customers "owner appreciation certificates" that enabled them to trade in their defective vehicles for more credit than they would otherwise have gotten. This allowed dealers to resell vehicles without disclosing their earlier repair problems, because the vehides had not been reacquired as part of the lemon law buyback system. Plaintiffs asked for punitive damages based on the amount of excess profits reaped by the manufacturer in its use of this policy throughout the state.
The dealership reached a settlement with plaintiffs for $100,000 before trial began.
A jury awarded about $17,800 in compensatory damages and $10 million in punitive damages. The manufacturer's motion for a new trial was denied, and it plans to appeal.
Plaintiffs' Counsel
William Krieg, Fresno, Cal.
Copyright Association of Trial Lawyers of America Jun 2002
Provided by ProQuest Information and Learning Company. All rights Reserved

Dealership resells car with brake problems: Lemon law violation: Lost use of car: Repair costs: Verdict: Punitive damages
CONSUMER PROTECTION
Dealership resells car with brake problems: Lemon law violation: Lost use of car: Repair costs: Verdict: Punitive damages.
Pearn v. Chrysler Corp., Ohio, Summit County C.C.P., No. CV99-07-2761, Dec. 20, 2000.
Pearn attempted to purchase a pickup truck from a dealership. A salesman told her that her application for the truck had been denied, but that she could purchase a demonstration car that would retain its value for a year, at which time she could trade it in for the truck she wanted. Pearn signed the purchase contract and other documents without reading them because the salesman rushed her through the process. Concealed among the documents was a statement that the car had been repurchased by the manufacturer from its first owner due to "brake vibration" and that it had been repaired. The purchase price was $14,000.
Pearn drove the car for 10 months. She experienced several mechanical problems and spent more than $500 on repairs. When she tried to trade the car back, the dealership refused to accept it. Another local dealer informed her that the car was a repurchased lemon. It had originally been owned by a consumer in Michigan and had a history of serious brake problems. A mechanic examined the car and found that it still posed a risk of serious injury or death. When the manufacturer bought the car back it was designated as "not to be sold in Ohio," because the "lemon law" provisions of the state Consumer Sales Practices Act (CSPA), Ohio Rev. Code 1345.01 et seq., forbid the resale of cars that have safety-related defects. The manufacturer reportedly had notice that the car had been purchased at auction by an Ohio dealership but did nothing to stop the resale.
Pearn sued the manufacturer and dealership, alleging fraud, breach of warranty, and violation of the Ohio statute. Plaintiff's counsel was able to obtain from the manufacturer the vehicle identification numbers of 974 other lemons that had been resold in Ohio and conducted title searches to find the names of the owners. They attempted to call some of these consumers as witnesses at trial. The trial court granted the manufacturer's motion to exclude these witnesses, but the jury was told of this pattern of conduct by the manufacturer.
The jury awarded $319,000, including treble damages under the CSPA-$57,500 from the manufacturer, and $36,500 from the dealer-$150,000 punitive damages against the manufacturer, and $75,000 punitive damages against the dealership. Plaintiff was also awarded $225,000 in attorney fees and costs.
Plaintiff's experts were Craig Jenkins, automobile repair, Akron, Ohio, and David Stivers, automobile industry practices, Wellington, Fla.
Defendant's expert was Ronald Sy, automobile industry practices, Auburn Hills, Mich.
Plaintiffs Counsel
*Dean A. Young, Akron, Ohio
Rocco Yeargin, Akron, Ohio
Comment: Plaintiff's counsel have filed a class action lawsuit on behalf of many of the other consumers who unknowingly bought the repurchased lemons.
Copyright Association of Trial Lawyers of America Nov 2001
Provided by ProQuest Information and Learning Company. All rights Reserved

Make "lemon law" lemonade - Brief Article. Squeeze cash out of the manufacturer of your defective vehicle
A decade ago, in 1991, Mark Mitchell envisioned a custom-built recreational vehicle (RV) in which his family could take cross-country summer and Christmas vacations. The cabinetry and marble floors were specially designed. And a primary, custom feature was insulated windows to safeguard against frigid weather. After the RV was assembled, the final price tag was $500,000.
"My family and I traveled down to Fort Valley, Georgia, to pick up the RV. Upon delivery, the problems started," says Mitchell, a financial planner who resides in San Juan Capistrano, California. "The engine quit in Texas. Although a repairperson came out, he couldn't fix it. After a few hours, it started up again and we drove home."
Over the course of four years, that problem persisted for the Mitchells. The extra money he paid for the insulated windows was for naught. The heating system failed, causing layers of ice to form on the windows. "There were numerous other related and nonrelated electrical and mechanical problems that made it unfit, unserviceable, and unsafe," says Mitchell.
In short, the very expensive, quite defective vehicle turned out to be what is commonly referred to in the automobile industry as a lemon. Because the RV was new, Mitchell was protected under California's lemon law, also called the manufacturer's consumer warranty law. After more than 20 attempts to repair the vehicle--far more than the three required under California law--Mark Mitchell and his attorney, Stephen Barnes, successfully sued the company. The manufacturer wrote him a check for $240,000, paid the $280,000 balance on the loan, and covered his legal and court fees.
If you believe that your vehicle is defective, you don't have to spend time, money, and energy repairing it year after year or trading it in for another without reimbursement. You have rights under your state's lemon laws that you may not be aware of and that your manufacturer probably will not tell you about. Although all 50 states have such laws, the law varies between states.
"Contact the office of consumer affairs in your state. They can give you basic knowledge of its specific laws and what you will need to do," advises E. Noreen Banks-Ware, a general practice attorney in Lithonia, Georgia. "Also research on the Internet, contact consumer agencies, and get information from university law school Websites."
According to the Center for Auto Safety in Washington, D.C., a nonprofit consumer group, all state lemon laws essentially maintain that a manufacturer must provide a replacement or refund if the vehicle is not repaired within a reasonable number of attempts. This includes four tries for a substantial defect and two for a safety defect. If the car is out of service for 30 days within the first 12,000 to 18,000 miles or 12 to 24 months, then the law kicks in. In addition to state laws, consumers are entitled to a refund or replacement of a lemon vehicle under the Uniform Commercial Code (UCC).
"I was still making payments of $3,000 per month and paying insurance and taxes for several years for a vehicle I couldn't use," says Mitchell. "When you take a loss and you don't have to, it's unfortunate. But it happens every day because people do not know their rights."
There are several steps that you must take to effectively use the lemon laws of your state. (1) Keep a detailed repair record, complete with dates of the car repair attempts, when the car was out of service, and a list that explains exactly what the trouble is, such as "cutting off" or "stalling"; (2) send a certified, return receipt requested letter to the manufacturer's consumer relations office and the manufacturer's nearest regional office listed in your manual; (3) after you have followed the previous steps and met the criteria as defined by your state's lemon law, request a refund or replacement, less depreciation, of the vehicle.
The repairs on your "new" defective vehicle should be covered under your manufacturer's warranty, which is typically bumper-to-bumper coverage. If you buy a used vehicle "as is," you are pretty much on your own. However, if you purchase a warranty for a used vehicle, you can sue for breach of contract if repairs are not made according to your contract.
"Read all of your contracts carefully. Some of your rights can be contracted away, so ensure that you will not lose your lawsuit because of a contract that you signed," cautions Banks-Ware.