Hawaii lemon car laws 2011
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Transcript of Hawaii lemon car laws 2011
www.AlohaLemonLaw.com © 2011 R.L.Burdge
Hawaii Lemon Car LawHawaii Lemon Car Law
www.AlohaLemonLaw.comwww.AlohaLemonLaw.com
Hello Lemon Law, Goodbye LemonHello Lemon Law, Goodbye Lemon
www.AlohaLemonLaw.com © 2011 R.L.Burdge
4 Lemon Car Laws
1. HRS 481I-1, Lemon Law
- HAR 16-181-1, Lemon Law Rules
2. 15 USC 2301, Magnuson Moss Act
3. HRS 490:2-101, Commercial Code
4. HRS 480-2, -13, Unfair & Deceptive Acts
Statutory Grounds
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The Good
1. It’s there
2. Black letter presumptions of a “lemon”
3. Covers most cars, light trucks, motorcycles
Hawaii’s Lemon Vehicle Law
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The Bad
1. Presumptions are rebuttable
2. No right to court action
3. Not easy to understand
4. Debatable defenses available to Manufacturer
Hawaii’s Lemon Vehicle Law
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And The Ugly
1. Replacement vehicle? Not free, Not new
2. Consumer needs an attorney
3. No mandatory attorney fee recovery
4. Consumer can settle and still not get check
Hawaii’s Lemon Vehicle Law
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3 Part Definition
1. Public Road Vehicles
2. Consumer Vehicles
3. 10,000 pounds GVW max
Vehicles Covered
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Typical Vehicles
• Cars, Trucks, Vans
• Motorcycles, 5 hp +
• Motor Homes, under 10k GVW
• Demonstrators
Vehicles Covered
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Not Typical Vehicles
• Business vehicles covered, if
• individually registered and
• used in both business & consumer use
Vehicles Covered
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Not Typical Vehicles
• Business owned vehicle covered, if
• business purchases one per year, and
• used in both business & consumer use
Vehicles Covered
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Date of Sale Notice, 481I-3(g)
Plain language rights notice
1. Existence of SCAP arbitration program
2. Consumer rights
3. Requirement of advance written notice
4. Name and address for notice mailing
Notice of Lemon Law Rights
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Lemon Law Rights Period, 481I-2
• 24 months after original consumer delivery,
or
• 24,000 miles of operation
Definitions
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“Nonconformity,” 481I-2
• Any defect or condition
• That substantially impairs the use, market value, or safety
• Not “to the consumer” (is an objective test)
Definitions
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Substantial Impairment, 481I-2
• For normal use:
• Unfit
• Unreliable
• Unsafe
• Significantly diminishes value
Definitions
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Different Sections = Different Rights
• HRS 481I-3(a)
• Repair Obligation Only
• Refusal = Waiver of presumptions ?
• HRS 481I-3(b)
• Buyback or Replace Obligation Only
Repair, Buyback, or Replace
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Applicable Period: 24 Mo. or 24,000 Miles
(1) same defect = 3 strikes and you’re out• “documented” attempts• Dlr notice to Mfg: 2nd repair & 20 days
(2) Deadly Defect = 1 chance
(3) 30 business days out of service max• For all defects
HRS 481I-3(d) - Presumptions
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Defense: “Defects not within two years - 24k miles”
Plaintiff:
• Only applies to 481I-3(a)
• 481I-3(b): “Reasonable” Number of Attempts
• Question of Fact
• Nothing in (b) says “during the term of the LL rights period”
24 Months or 24,000 Miles
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Defense: “If the engine runs, it’s usable”
Plaintiff:
• Consumer Had No Real Choice
• Miles Driven after “lemon”, Not Relevant
Substantial Impairment of Use
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Defense: “What do you think it’s worth?”
Plaintiff:
• “significantly diminish the value”
• Measure of Damages: Difference in Value• HRS 490:2-714
• Expert vs Owner Opinion
Substantial Impairment of Market Value
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Defense: “You never had an accident, did you?”
Plaintiff:
• “Expert Opinion says its dangerous”
• “But I nearly did”
• “But I could have”
• “I adapted my driving to avoid accidents”
Substantial Impairment of Safety
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The “No Problem Found” Problem
1. “N P F” = It’s No Excuse
2. “N P F” Counts Toward Presumptions
3. Existence of Defect = Question of Fact
4. Symptom + Expert Opinion = Defect
Interpretations
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Court Cases -
What court cases ?
Court Cases
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HRS 481I-3(c)
“Nonconformity” exclusions:
• Abuse
• Neglect
• Unauthorized Modification
• Alteration
Defenses
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HRS 481I-3(f) – TSB’s
• Upon request, or• After consumer reports to Manufacturer
• Then,•manufacturer must provide “notice”
• “it exists”• “you can ask us for a copy”
Secret Warranty Notice Mandated
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Replacement Vehicle, 481I-3(b)
• “identical or reasonably equivalent”
• Offsets
• Mileage up to presumption point• 1% of purchase price per 1,000 miles
• Excess damage
Remedies
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Buyback =
Total Cost – Offsets & Deductions
Remedies
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Arbitration, 481I-4
• At option of consumer• Then, is mandatory on manufacturer
• Attorney Fees• Prevailing party “may” recover fees
• Mfg’s Inspection Report• Copy to consumer
Other Remedies: Arbitration
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Arbitration, 481I-4
• Binding vs non-binding arbitration
• later Court rights w/ non-binding arb only
• - 25% improvement, loser pays fees +
• Mfg fails to comply w/arb decision?
•Prima facie unfair act, HRS 480
Other Remedies: Arbitration
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Lemon Resale Requirements, 481I-3(k)
• Notice signed by buyer• conspicuous• was repurchased due to defects• list of defects
• Defects fixed
• Warranty: 12 mo – 12,000 mile
Lemon Laundering
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481I-3(j)
• 1 Year after Lemon Law Rights period expires
• Length of Mfg Warranty
• 2 years from first retail sale
• 24,000 miles of operation
Limitations Period
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Back to The Ugly
1. Consumer needs an attorney
2. No mandatory attorney fee recovery
3. Consumer can settle and still not get paid
Hawaii’s Lemon Vehicle Law
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Fundamentals, 15 USC 2301
1. Federal claim for UCC breach of warranty
2. Covers virtually all consumer products
3. Consumer’s attorney fees paid by losing merchant
4. Privity not necessary element of a claim
Magnuson Moss Act
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Elements
1. A consumer product, and
2. A warrantor’s failure to comply with MM, or
3. Breach of Written Warranty or Service Contract
Magnuson Moss Act
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Cumulative Remedies
1. Damages, and
2. Equitable relief, and
3. Attorney Fees
Arbitration ?
Magnuson Moss Act
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Fundamentals, HRS 480-2, -13
1. Unfair or deceptive acts prohibited
2. Covers consumers
3. Cumulative Remedies:1. $1,000 or 3x damages (Elder, $5,000)2. Attorney fees3. Injunction, Rescission
Unfair or Deceptive Act
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Jeff CrabtreeJeff CrabtreeEmail:Email:
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Ronald L. BurdgeRonald L. BurdgeEmail:Email:
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