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Lemon Law and Arbitration



Lemon laws protect the rights of consumers and provide them with certain protections against manufacturers who do not live up to their promises. These laws were created to protect American consumers from purchasing sub-standard or defective products and to help in improving the quality of American products. They can cover many different types of consumer products including automobiles, refrigerators, household appliances, tires and washing machines. The Lemon Law has three distinct branches; the federal law, the local governments and states.


Federal Lemon Law The federal lemon law covers all vehicles, boats, RVs, motor cycles and motorcycles. It is enacted by the federal law requiring each manufacturer to honor a refund or replacement policy that applies to defective products. Lemon laws also cover various parts of a vehicle, such as the engine, transmission, brakes, etc., that are susceptible to the elements, the driving habits of the consumer and the proper maintenance of the vehicle. A defective product can be a car, truck, van, boat, motorcycle, trailer or other consumer item.


State Lemon Law On the state level, there are several variations to the federal law. Each state issues its own lemon laws protecting consumers, but most include some provision for repair or replacement of defective products. In addition to repairing or replacing defective products, the state lemon law allows the consumer to obtain an adjustment to the rate of interest on a loan, credit card or other revolving account. The consumer may also obtain adjustments to the rate of interest on a home equity loan or new vehicle loan based on the cost of repair or replacement of the item. The states may also allow the consumer to repair or replace the defective item at no cost to them or require the purchase of a new item with the proceeds of the sale of the second defective item.


Vehicle Warranties The vehicle warranty protects a vehicle from defect in materials and workmanship for one year from the date of purchase. Under the federal law, a consumer is entitled to one free test drive within the first two years of purchase. If after the first test drive a vehicle fails to pass the test, then the consumer may have a lemon problem. The warranties provide limited rights of repair and replacement, if applicable. A consumer has to notify the manufacturer or dealer within a reasonable amount of time that they are dissatisfied with their vehicle's performance.


Automobile Recalls One provision of the automobile lemon law CA covers motor vehicles and trucks sold by certain dealers. Those dealers must obtain a consumer's release form from the U.S. Department of Transportation before selling any motor vehicles. Automobile recalls are subject to certain limitations under the law. A manufacturer who makes a recall does not have to fix any vehicle that becomes defective unless it can be repaired and the dealership agrees to do so. It also requires the dealer to notify customers in writing that they have received a recall and that they should avoid using that vehicle if possible. The exception to this requirement is when a motor vehicle is used for business purposes and only the owner is allowed to drive it.


Arbitration Another provision of the law covers defective vehicles and truck sold by dealers. Under the arbitration provision, a consumer can receive compensation for a vehicle they bought that was defective. The consumer must hire an attorney to draw up the dispute between the parties. If the arbitration clause is found to be illegal, then both the consumer and the seller can go to court. If a court case would occur, then the Consumer Reporting Bureau would be where the arbitration process will take place. View here for more information about lemon law! Read additional details here: https://en.wikipedia.org/wiki/Lemon_(automobile)

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