Instead of buying a vehicle, 20-25% of drivers in the US go with leasing long term. There are a lot of advantages to this, including getting to drive late model cars, plus potentially lower monthly payments (depending on the model you buy). The lessee also doesn’t have to worry about selling the vehicle; they get to walk away when the lease is done.
With all these advantages, things can still go wrong. If the leased car exhibits a substantial defect, what state lemon law protections are there? What do lessees need to know?
Key point: Not all states cover leased vehicles under their lemon laws. For example, New Mexico and Nevada don’t (but a lemon law attorney can use federal law – the Magnuson-Moss Warranty Act – to pursue compensation for leased cars in those and other states that don’t cover leased vehicles.)
So, how does a lessee pursue a potential claim? A lemon law attorney (866-440-2460) can answer questions relating to leases, usually through a free consultation. The first thing a lemon law attorney will do is determine if the vehicle is a lemon per the state’s lemon laws (or applicable federal law). Then, if the vehicle does qualify, the lawyer will follow a specific process to prove the problem is a vehicle defect, requiring the manufacturer to be held accountable for compensation.
To see how this process works, let’s follow an example scenario of a consumer in Texas who leased a new truck. How will the lessee be able to get out of their current lease and get their preferred compensation (a buyback or a new, replacement leased vehicle), without getting bogged down in complex laws, rules, and potential manufacturer pushback? A skilled and experienced lemon law attorney can bring this claim to a positive resolution, so the lessee can leave this lemon vehicle behind.
The Lemon Law Process for Leased Vehicles
The point of covering leased vehicles under state lemon laws is so lessees don’t get stuck with unfixable vehicles that have exhibited a substantial defect during the original manufacturer’s warranty. If the vehicle satisfies the criteria to be classed as a lemon, then the attorney will move forward to build the case, showing that the vehicle is demonstrating a substantial problem that severely impacts its use, value or safety.
Key point: The lawyer will also take into account the state’s particular laws for timing of the claim and contacting the manufacturer by certified letter regarding the claim. Most often, the manufacturer is given one last opportunity to repair the vehicle. If that doesn’t happen, the attorney will move forward to resolve the claim and gain compensation for the client.
For more information on arbitration and other frequently asked lemon law questions, click here.
The Goal: To Get Out of the Lemon Car Lease and Gain Compensation
That is the ultimate win in a lemon law lease case; to prove the car is a lemon and end the lease. Then the attorney can negotiate the compensation, which can be either a replacement vehicle, or a buyback (return of all payments, fees, rental car costs, etc.) The attorney will inform their client about the state’s law regarding the mileage deduction from the refund; it’s based on a formula for mileage driven before the first defect report.
Getting back to our example of the lessee with the malfunctioning truck: let’s say she’s really into the truck brand. She decides to choose a replacement vehicle as compensation. She can usually make that choice in most states. The attorney will work to negotiate that outcome for her. She could have selected the buyback option we discussed above, and many people do that. That’s because often, people who lease want to walk away from the entire issue when they win their lemon law case. They want the freedom to either lease or buy a completely different vehicle.
But what steps does the lawyer follow to win compensation, and what potential challenges might the attorney face along the way?
1) Gathering evidence and proving the substantial defect
This is the key step to winning the case. The client’s evidence, that can include all correspondence with the dealer and manufacturer, repair records, photos and videos of the defect – it all gives the lawyer the proof of the problem’s severity and how it can impact the vehicle’s use, value or safety.
The attorney can also bring additional evidence to bear, such as technical service bulletins and expert witnesses, all of which can be used to support the claim that the vehicle has exhibited a substantial defect.
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For example, with our truck lessee, she kept careful records of all her interactions with the dealer and manufacturer. Plus, she had the records from visiting the repair center, and also several photos of when the engine stalled out, and what was occurring at the time when it intermittently did this. The manufacturer tried to sidestep the problem, but the attorney built a timeline showing that the issue was indeed substantial, and the claim was valid.
2) Withstanding manufacturer challenges
To follow our lessee example, another challenge arose from the manufacturer: it held that the client’s truck was actually fixed two repair visits ago. The manufacturer said the issue was probably one of client neglect of the truck. The client disagreed, because the engine still unexpectedly stalled out, even though it did seem better for a while.
The attorney structured the case to show that the client kept to the vehicle’s scheduled maintenance routine, so no neglect of maintenance occurred. The client never engaged in rough handling of the truck, in fact, it was always garaged and never used in any way that would push it beyond what it should normally be capable of handling. She mostly drove it back and forth to work. The attorney worked to get a settlement from the manufacturer, but initially that didn’t occur.
Lemon laws are confusing. Read our guide to the lemon law complaint process.
3) Representing the client in arbitration
Once the attorney has all the evidence in hand, and even deals with potential objections by the manufacturer, it may be necessary to go through arbitration to gain a decision regarding the case. The lawyer will advise the client if this is required by the state, and what the potential outcomes might be. If the decision does not go in favor of the lessee, they often are not bound by it and can try to settle or go to court against the manufacturer.
4) Negotiation, Standing Firm & Potential Litigation
Let’s say the manufacturer has dug in and refuses to negotiate a settlement. The lemon law attorney is always prepared to fight in court for their client’s interests. Sometimes, even after trying to avoid a claim, when faced with a court case, the manufacturer will finally settle and the client will receive compensation. The lawyer is ready to aggressively protect the client’s rights and go to court, if necessary, to prove the vehicle’s substantial defect.
Why You Need a Lemon Law Attorney
As we’ve seen throughout our discussion, a lemon law lawyer follows a defined process to ensure their client’s rights are protected. The goal is to end the lease on the faulty vehicle, and get the client a buyback or a replacement vehicle. In our example, the manufacturer, when faced with the prospect of going to court, decided against doing so. It settled the case along the lines that the attorney proposed, which got the client a replacement truck. She was thrilled, and got the old lease terminated, and a new lease begun with similar terms. Her attorney went over all the particulars with her to ensure a streamlined result.
Trust Allen Stewart, P.C. for Expert Lemon Law Representation
Through our review and example case, we’ve seen how a lease-related lemon law claim could play out. The attorney follows much the same process (in general) as they would with a purchased vehicle: the lawyer must prove that the vehicle has exhibited a substantial defect that is unfixable and has taken into account warranty details, state law requirements, and potentially any federal avenues to pursue the claim and win compensation. In the lease scenario, ending the lease on the lemon vehicle and either getting a buyback and walking away, or a new lease and a replacement vehicle, are the potential compensation outcomes the attorney works to achieve.
The Manufacturer Will Defend Its Rights, You Need a Top Attorney to Protect Yours
Do you wonder if you need a lawyer for your lemon law case? The complexities of lemon law, plus the fact that the manufacturer will defend its rights with its legal team, make hiring a lawyer essential. You won’t have to worry about cost, as the manufacturer is obligated to pay your legal fees when you win your case.
Take Advantage of Our Free Consultation Now
Don’t wait to make your lemon law claim. Take advantage of Allen Stewart, P.C.’s free consultation. Allen Stewart, P.C. lemon law lawyers are recognized as top attorneys across the nation, including in New York, California and Texas. Give yourself the advantage of representation from a winning lemon law firm. Call Allen Stewart, P.C. now (866-440-2460) or schedule your free consultation online.
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