Dealership Demands BMW Back, Then Claims You Never Returned It

By Meg Marco, http://consumerist.com/, Thu Nov 20 2008
(as modified by the author of this blog, including as to links and omissions)

Two years ago, a lemon law arbitrator ordered a car dealership in Queens, NY to refund a customer's money under the "lemon law." You'd think that would be the end of the story, but no... it's the beginning. Jessica Harrison says she returned the "lemon" 2004 BMW to "Planet Auto Mall" but the dealer claims that they don't know what happened to the vehicle. Now Jessica has to keep making payments on the missing BMW.

Fox 5 in New York did one of their notorious "Shame, Shame, Shame" segments about the debacle, confronting the dealer with pictures of the car being accepted and the $1700 in parking tickets that racked up as they left it out on the street for several months.

The whole story began when Jessica bought the BMW from Planet Auto Mall in Queens for around $45,000. Soon after she bought the car, it began shaking when she drove it. Planet Auto Mall's mechanics tried to fix the car — but couldn't. When she took it to a BMW specialist they found that there were so many things wrong with the vehicle that it wasn't even safe to drive. Jessica filed a "lemon law" claim against the dealership and won — but that's when her real problems started.

The auto dealer filed a legal challenge to the arbitrator's decision — based on the fact that Jessica had not returned the car. So she did. And she took pictures. And now the dealer says they never got the car. Even though it was sitting outside their dealership for months:

Fox 5: "There were like, 17 or more tickets that were issued to the car... right on the street around here."

Dealership Manager: "Sure. Somebody can say 'OK, you know what? Hey. Here is... I'm bringing the car and I'm parking it over there.'"

Fox 5: "So you're saying she might have..."

Dealership Manager: "She might have. I'm not sure."

Fox 5: "She might have put the car on the street."

Dealership Manager: "She might have put the car wherever she wants to put it."

The dealership lost their case in May, but have still not paid up because they've filed an appeal. Fox 5 stormed in with their cameras and demanded answers of the dealership's owner, but, of course, got none.

Jessica's next payment is still due on the 14th.

Planet Auto Mall [MyFoxNY]

Q&A How California's 'lemon law' applies

Originally by Steven Chae, Mercury News

(as slightly modified by this blog's author, including as to added links and omitted references)

Q We purchased a Chrysler PT Cruiser about seven months ago. After less than a month, the reverse gear stopped working. Soon after that repair was done, the car started to jerk and sputter. After a month in the shop, that problem was said to be fixed, but the symptoms returned the next day. The car is now having to be taken into their shop daily because the mechanics cannot replicate the problem. Would the state "lemon law" apply here? The dealership is telling us the law only applies to cars that are sold as new.

A That's not entirely true. California's lemon law protections also apply to used vehicles if the manufacturer's new vehicle warranty is still valid. Otherwise, used cars are sold as-is.

In essence, the California Lemon law requires manufacturers to replace a vehicle or refund the purchase price if a serious warranty defect can't be fixed after a "reasonable" number of attempts; or the car has spent more than 30 days in the shop during the first 18 months of ownership.

The accepted standard for "reasonable" attempts is about four, though two attempts may suffice for serious defects that could result in death or serious injury.

Owners of problem vehicles are required to submit cases to lemon law arbitration/informal dispute resolution, if the manufacturer participates in such a program. Arbitration decisions are binding only for manufacturers. However, unhappy consumers may proceed with lemon law litigation if they wish, or arbitrate again after another unsuccessful repair attempt.

However, Chrysler is the only Big Three automaker that does not participate in the arbitration process. While hiring a lemon law attorney might be daunting, the lemon law process holds manufacturers liable for legal fees if the consumer prevails in court.

Could a GM Bailout or BK Affect Your GM Warranty and/or Lemon Law Rights?

NEW YORK (CNNMoney.com) -- The stock of General Motors plunged Monday to a six-decade low as investors worried that a federal government bailout of the embattled automaker could essentially wipe out the stakes of current shareholders.

GM (GM, Fortune 500) warned on Friday, when announcing a $4.2 billion operating loss, that it was running dangerously low on the capital it needs to fund the business unless it receives government assistance or the battered U.S. auto market turns around.

GM's news and a direct appeal to Congress on Thursday by the heads of GM, Ford Motor, Chrysler LLC and the United Auto Workers union have pushed the cause for federal help forward. President-elect Barack Obama said Friday that he supported the concept of helping for the auto industry.

Over the weekend, House Speaker Nancy Pelosi, D-Calif, and Senate Majority Leader Harry Reid, R-Nev., wrote to Treasury Secretary Henry Paulson asking that he look into using a $700 bailout package originally aimed at the nation's banks and Wall Street firms to help the automakers.

The letter Pelosi and Reid suggested that the government should receive equity in the auto companies in exchange for any federal bailout.

GM stock fell nearly 22.9% on Monday to $3.36 a share, its lowest close since finishing at a split-adjusted $3.35 on June 22, 1949, according to data from the University of Chicago's Center for Research in Security Prices.

Analysts said Monday that current shareholders were now in a lose-lose situation: They may be wiped out as part of a federal bailout, or they may be wiped out if the government stays away and GM ended up in bankruptcy.

"When you come hat in hand to Washington, there's a price that has to be paid," said Art Hogan, chief market analyst at Jefferies & Co. At the least, Hogan said, the taxpayers' equity position would greatly dilute common shareholders' current holdings, valued in the market today at less than $2 billion.

"And that's assuming a bailout works," said Hogan. "Who knows if it's too little too late?"

Two analysts -- Rod Lache of Deutsche Bank and Brian Johnson of Barclay's Capital -- downgraded GM to a sell recommendation on Monday.

Lache shook up the street by setting a $0 target price target, the only such target by any analyst for any S&P 500 company, according to Thomson Reuters. Lache's note echoed the idea that shareholders stood to be wiped out either way, with a bailout being akin to a bankruptcy as far as shareholders are concerned.

Of the 12 analysts tracked by Thomson Reuters who follow GM stock, eight of them with either a sell or strong sell recommendation, three have hold recommendations and only one has a buy recommendation.

Efraim Levy, the equity auto analyst at Standard & Poor's, is one of those with a sell recommendation and a $3 target price. He agrees that even with a bailout, it's going to be a tough time ahead for GM shareholders.

"To me it looks likely there will be a bailout," said Levy. "But the situation keeps looking worse and worse. You keep thinking you've hit the center of the storm, and we'll come out the other end and things will get better, but every month demand shrinks."

GM Chief Executive Rick Wagoner said during the conference call with investors Friday that the company isn't ready to speculate on the chance of bankruptcy, despite their dire cash situation.

Company executives said they were encouraged by the support the industry has been getting on possible federal assistance, but GM President Fritz Henderson said it was "premature at this point" to discuss whether GM would grant shareholders stock or stock warrants in return for assistance.

By Chris Isidore, CNNMoney.com senior writer
Source: www.CNN.com
(as modified by the author of this blog, including as to links)
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Learn about your GM manufacturer warranty, State lemon law rights, federal breach of warranty/lemon law rights, and the GM
technical service bulletins and recalls your vehicle needs before a potential GM bankruptcy or bail-out.

Next time you buy a used car, don't get squeezed by a Tropical Storm Fay lemon

When Tropical Storm Fay blew through town in August, some of the more striking images were of cars and trucks half-submerged in murky floodwaters.

Dozens of local vehicles were among the 100,000 cars damaged nationwide by Fay, said Chris Basso, spokesman for Carfax, provider of vehicle histories.

Such vehicles suffer from electrical problems and malfunctioning antilock brakes and airbags. Still, more than half will be resold to unwitting consumers, often after being refurbished and moved across state lines, Basso said.

"They're called gray-market cars," said Paul Mattfield, owner of Indian River Insurance Agency in Fellsmere. "They've been in accidents, but they don't look like they've been in accidents."

In most states, including Florida, a salvage title is reissued on the car to indicate flood damage. But variations in state title law and lack of communication between state agencies creates loopholes.

Title history can be erased by title-washing, when an individual moves the car to a state that doesn't recognize the title. When that state reissues the auto title, the damage often goes unrecorded. Another common technique is VIN cloning, when an individual swaps the car's vehicle information number with that of an undamaged car in another state.

State lemon laws do not cover used cars, and buyers have little recourse if they discover flood damage after the fact.

"If you purchase a car 'as is,' then you're kind of out of luck," said Stuart-based attorney Lee Feinberg. "There's nothing you can do about it unless you can show (the dealer) knew something was wrong with the vehicle — it's tough to prove."

Experienced car dealers say, however, it's almost impossible to erase all signs of the original VIN number, but you must know where to look.

"The VIN number — that's your thumbprint," said John Morello, general manager for City Cars in Fort Pierce. "It's on the fender; it's on the motor."

In September, a federal judge in California imposed a six-month deadline on the government to enforce a law Congress passed in 1992. Under the ruling, insurance companies, salvage yards and junkyards will be required to report totaled vehicles to a national database.

For now, experts recommend having a mechanic check the car for rust, discoloration and other signs of water damage.

"You can't cover it up," said Hoyt Roberts, president of Stuart-based used car dealer Good Rides Inc. "You can put all the perfume stuff you want; it's still going to have a musty smell."

Source: DEEPA SEETHARAMAN, TC Palm.com

Lawmakers should review Lemon Law

Fran Fontanez and his wife bought their dream car at a Skowhegan dealer in 2006. A 2003 Saab 9-3 with 23,000 miles on the odometer, it had heated leather seats and was a $17,000 "extravagance" that Fontanez and his wife could finally afford.

Now, the car sits, idle, in the Fontanez garage. After 17 visits to the repair shop and almost $10,000 in work that was covered under the warranty, the car engine kicked the bucket and no longer runs. When the engine died at 44,000 miles, the warranty no longer applied and the Skowhegan dealer, Cold Brook Saab, wouldn't take the car back.

It turns out, the fancy Saab was a lemon. It was branded a lemon in California, where the law required that dud cars must be bought back by manufacturers. While Fontanez knew that the car was a "buyback," he didn't know that Saab had re-acquired the car.

That's because Maine law -- unlike a number of other states -- doesn't require that disclosure on cars that come in from other states. Maine law does require that cars that are declared lemons in Maine and are resold in the state must disclose that fact.

"Lemon buybacks" are a problem across the country. While some states, such as Minnesota and California, require a car title be branded with the label "lemon" once it's re-acquired by the manufacturer, that doesn't prevent manufacturers from reselling those cars to dealers in other states that don't have such labeling laws.

Manufacturers may claim that they've fixed the problems with the lemons they're reselling -- but given that those cars have been deemed lemons because those problems couldn't be fixed, that's a stretch. And at the very least, if those cars have, indeed, been fully repaired, it's still reasonable that prospective buyers should be informed about the full history of the vehicle they want to buy.

State Sen. Joseph Brannigan, D-Cumberland, the lead sponsor of Maine's original lemon law, has just this week, in response to the Fontanez situation, asked Attorney General Steven Rowe to draft legislation requiring disclosure for lemons from out of state that are resold in Maine.

Brannigan's fellow lawmakers should seriously consider this proposal and determine whether it offers an appropriate level of protection for consumers.

In the meantime, consumer experts say there are steps prospective used-car buyers can take to learn about a car's history.

Before you buy a used car, take advantage of services like CARFAX, which will help you research the general history of the vehicle. Be careful about late-model used cars with low mileage that are being sold as "demonstrator" or "executive cars" because that's one way lemons may be sold. And if you do purchase a car with a murky background, make sure you fully understand the warranty that comes with it, if there is one.

And finally, it's the rare car dealer who is disreputable. But that doesn't let you, the buyer, off the hook for doing your homework.

Source: Kennebec Journal, ME - Sep 23, 2008

Lemon Laws

Lemon laws are American state laws that provide a remedy for purchasers of cars that repeatedly fail to meet standards of quality and performance. These cars are called lemons. The federal lemon law (the Magnuson-Moss Warranty Act) protects citizens of all states. State lemon laws vary by state and may not necessarily cover used or leased cars. The rights afforded to consumers by lemon laws may exceed the warranties expressed in purchase contracts. Lemon law is the common nickname for these laws, but each state has different names for the laws and acts.

In California, lemon laws cover anything mechanical, as do the federal lemon laws. The federal lemon law also provides that the warranter may be obligated to pay your attorney fees if you prevail in a lemon law suit, as do most state lemon laws.

Used Car Purchases

If you purchased a used car there are two situations in which you may be qualified for cash or other lemon law benefits:

Situation #1: You may be entitled to compensation for breach of warranty if you had one of the following warranties:

Any warranty left from the manufacturer when you purchased your vehicle (for example, almost all vehicles sold with fewer than 36,000 miles will have this. But if the warranty is longer, you may have even more time).
Your vehicle was "Certified" by the Manufacturer (in which case it came with a short Manufacturer's Warranty, typically 1 year).

You purchased an Extended Warranty backed by the Manufacturer (typically 5 years or longer).

Normally, these types of cases fall outside the scope of the state lemon law but are covered under special federal lemon laws.

Situation #2: When No Manufacturer's Warranty Exists If you do not have a manufacturer's warranty of any kind you may be entitled to compensation for violations of consumer protection laws that fall outside of the lemon laws.

The following is a list of some of the problems and/or issues which may be present in your vehicle.

- Prior history of mechanical problems known to the seller: Laundered Lemon.
- Previously salvaged or wrecked.
- Fraudulently rolled back odometer.
- Rental car, police car, taxi, or similar.
- Stolen, stripped and rebuilt.
- Involved in a flood.

Lemon Laws vary from state to state.

If you knowingly purchase a car in "as is" condition you DO NOT void your rights under applicable lemon laws.

Technical service bulletins are instructions from the manufacturer that alert dealerships of specific defects or necessary repairs in certain models. Usually car dealers will not voluntarily inform you about such defects; however technical service bulletins do not necessarily mean the vehicle has a recall or mean the repair will be paid for by the manufacturer.

Lemon laws are not limited to cars. There are RV lemon laws, boat lemon laws, motorcycle, wheelchair, and computer lemon laws.

Source: Wikipedia

For more information about the Lemon Law visit www.CarLemon.com

GM Recalls 2006-2008 HHR's

General Motors Corp. is recalling about 300,000 Chevrolet HHR SUVs in the United States to fix a storage bin door that failed to remain closed during government testing.

The National Highway Traffic Safety Administration said on its Web site Monday that the recall involves HHR SUVs from the 2006-08 model years.

During a test last spring, the glove compartment box in the top center of the instrument panel failed to remain closed in line with a federal safety standard. GM will send owners a latch reinforcement.

Owners will receive instructions to install the part or have their dealer install it.

From the Free Press, FreePress.com

Recalls for Chevrolet by Model