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Timestamp: 2019-04-21 16:53:25+00:00

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What is the California Lemon Law?
Generally speaking, the California Lemon Law says a consumer is entitled to a refund or a new replacement vehicle if their defective car has been to the shop 4 or more times for warranty repairs and the vehicle suffers from a substantial impairment in use, value or safety.
The California Lemon Law is both complex and technical. To learn more about your rights, please contact the Lemon Law Firm of Michael A. Saunders for a free case evaluation.
This case presents the issue whether the coach portion of a motorhome is subject to the provisions of the Song-Beverly Consumer Warranty Act (Civ. Code, fn. 2 § 1790 et seq.). We conclude it is.
In May 1990, Julius E. Foreman and his wife, Maxine I. Foreman, purchased a new 1990 Dolphin motorhome from 10,000 R.V. Sales for $56,905.41. National R.V., Inc., (National) manufactured and expressly warranted the coach portion of the motorhome, that is, the portion of the motorhome designed primarily for human habitation. National purchased the chassis portion of the motorhome from General Motors Corporation and attached the coach portion to the chassis. General Motors Corporation expressly warranted the chassis of the motorhome.
Within days of the purchase, the engine battery of the motorhome died. A Chevrolet dealership told Foreman the wrong battery had been installed. Foreman called 10,000 R.V. Sales, where he purchased the motorhome, and was told to take it to Budget R.V., which is an authorized service center for National. Budget put in a new battery. After a week, this battery died, and Foreman took the motorhome back to Budget R.V. Budget R.V. replaced the battery two more times, but the replacement batteries died as well. Because the battery would not hold a charge, Foreman was required to unhook the battery cables each time he left the coach sitting for any period of time during the entire time that he and his wife owned the motorhome. According to expert testimony, the draw on the engine battery was caused by a component or components installed by National.
The Foremans testified the motorhome had 25 manufacturing defects, including a stalling defect that made the motorhome stall on countless occasions during every trip they took. When the motorhome stalled, it lost the power assist feature for steering and braking, making it extremely difficult to control the motorhome. The Foreman's sought repair of this defect six times, but it was never fixed. In July 1991, the Foremans decided not to drive the motorhome anymore because of the dangers posed by the stalling problem.
When the motorhome stalled and Foreman could not get it started again, he called National to request a tow and/or repairs. National arranged a tow and directed Foreman to a General Motors dealership for repair.
The Foremans' expert opined the stalling defect was most probably caused by General Motors components. The expert for General Motors opined that the stalling defect was caused by a pinched wire running along the rail frame and National was responsible for pinching the wire.
Other defects in the motorhome included misaligned window screens that could not be repaired and allowed bugs to enter the coach at will, a toilet that would not flush strongly enough to carry away solid waste because of an improperly designed drain pipe, low shower pressure, a coach water pump that did not operate properly and made the coach's lights flicker, sagging of the coach to the left caused by overloading, sagging of the entry step, and a defective electrical converter. Most of the defects, including the stalling condition, were never repaired by either National or General Motors.
The Foreman's brought the motorhome in for repairs 14 times; all told, the motorhome was out of service during these repairs for more than 2 months.
On July 19, 1991, counsel for the Foremans wrote National and General Motors and demanded rescission. General Motors and National each responded by offering to repair the motorhome. The Foreman's rejected these offers and filed this lawsuit on August 22, 1991.
The jury returned a special verdict that found: (1) the motorhome contained a nonconformity covered by National's warranty that substantially impaired the use, value or safety of the motorhome; (2) the Foremans gave National or its representatives a reasonable number of attempts to repair the motorhome; (3) National or its representatives failed to service or repair the Foreman's motorhome to make it conform to the express warranty after a reasonable number of attempts to repair; and (4) National's failure to service or repair the motorhome caused damages to the Foremans. The jury also found the Foremans suffered $96,000 in damages. The jury assessed a civil penalty of $115,200 against National after finding that National failed to replace the motorhome or reimburse the Foremans, and National willfully failed to comply with the Song-Beverly Consumer Warranty Act.
I. Does Song-Beverly Apply to Motorhome Coaches?
National, joined by the Recreation Vehicle Industry Association (RVIA) as amicus curiae, contends the Song-Beverly Consumer Warranty Act (Act) does not apply to the coach portion of a motorhome and therefore concludes section 1793.2, subdivision (d)-the replace-or-refund provision of the Act-is likewise inapplicable. The contention is without merit.
National's contention is predicated on the erroneous assumption that because a motorhome coach is not a "new motor vehicle" as that term is defined in section 1793.22, subdivision (e)(2), motorhome coaches are therefore excluded from all aspects of the Act. As will be explained, this reasoning is flawed and evidences a fundamental misconception of the interrelation between the Act, which regulates express warranties on consumer goods, and the so-called "Lemon Law" provisions of the Act, which relate exclusively to "new motor vehicles."
Section 1793.2 incorporates several aspects of the Act's comprehensive regulation of express warranties for consumer goods. (Ibrahim v. Ford Motor Co. (1989) 214 Cal.App.3d 878, 884 [263 Cal.Rptr. 64].) This statute requires manufacturers of consumer goods sold in California to arrange for sufficient service and repair facilities to carry out the terms of warranties (§ 1793.2, subd. (a)); it sets a time limit for the repair of consumer goods (§ 1793.2, subd. (b)); it delineates rules for delivering nonconforming goods for service and repair (§ 1793.2, subd. (c)); and it requires a manufacturer to replace the consumer good or reimburse the buyer if the manufacturer or its representative is unable to repair the consumer good after a reasonable number of attempts (§ 1793.2, subd. (d)).
Section 1793.2, subdivision (d) the replace-or-refund provision of the Act-consists of two parts or paragraphs, one for consumer goods in general (§ 1793.2, subd. (d)(1)) and one strictly for new motor vehicles (§ 1793.2, subd. (d)(2)). Section 1793.2, subdivision (d)(2), differs from section 1793.2, subdivision (d)(1), in that it gives the new motor vehicle consumer the right to elect restitution in lieu of replacement; provides specific procedures for the motor vehicle manufacturer to follow in the case of replacement (subpar. (A)) and in the case of restitution (subpar. (B)); and sets forth rules for offsetting the amount attributed to the consumer's use of the motor vehicle in the case of both replacement and restitution (subpar. (C)). These "Lemon Law" provisions clearly provide greater consumer protections to those who purchase new motor vehicles than are afforded under the general provisions of the Act to those who purchase other consumer goods under warranty.
By virtue of section 1793.22, subdivision (e)(2), the chassis portion of a motorhome is included in the definition of a new motor vehicle, but the coach portion is not included for purposes of the "Lemon Law." Consequently, as all parties to this appeal agree, motorhome coaches are not subject to section 1793.2, subdivision (d)(2). The question for us is whether motorhome coaches are consumer goods covered by section 1793.2, subdivision (d)(l)-the Act's replace-or­ refund provision of general application.
From an examination of the statutory language, it is clear that the Act's definition of "consumer goods" encompasses a motorhome coach, which is a unit designed for human habitation that is attached to a motor vehicle chassis. Moreover, had the Legislature desired to exclude the coach portion of motorhomes from the definition of "consumer goods," it could have specifically done so, as it did with clothing and consumables.
Our examination of the Act and its interrelation with the "Lemon Law" also convinces us that motorhome coaches are subject to the Act's provisions of general application, including section 1793.2, subdivision (d)(1).
From its inception almost a quarter of a century ago, the purpose of the Act has been to provide broad relief to purchasers of consumer goods with respect to warranties. (Stats. 1970, ch. 1333, p. 2478 et seq.; see Comment, Toward An End to Consumer Frustration-Making the Song-Beverly Consumer Warranty Act Work (1974) 14 Santa Clara Law. 575.) Since then, the Act has been amended numerous times. One of the most significant amendments occurred in 1982 when the Legislature, in response to the public's complaints about warranties affecting new motor vehicles, added the so-called "Lemon Law" to the Act. (Stats. 1982, ch. 388, § 1, pp. 1720-1723.) In effect, the "Lemon Law" provisions identified a special subcategory of consumer goods, namely "new motor vehicles," and attached distinct presumptions and rules to disputes involving express warranties on new motor vehicles. As a result, the "Lemon Law" augmented the relief afforded to dissatisfied consumers of new motor vehicles (Ibrahim v. Ford Motor Co., supra, 214 Cal.App.3d at p. 884); it did not reduce or otherwise affect the rules applicable to other types of consumer goods.
National offers a tortured statutory construction analysis to support its premise that motorhome coaches are exempt from the general replace-or-refund provision of the Act covering consumer goods (§ 1793.2, subd. (d)(1)). National argues that the "[e]xcept as provided in paragraph (2)" language of section 1793.2, subdivision (d)(1), incorporates the motorhome coach exemption of section 1793.22, subdivision (e)(2), since the exemption is referenced in paragraph (2).
This argument is unpersuasive. The "[except for" introductory clause of section 1793.2, subdivision (d)(1), clearly excludes motor vehicles, which are to be covered by section 1793.2, subdivision (d)(2)-the more specific "Lemon Law" replace-or-refund provision. Section 1793.2, subdivision (d)(2), excludes motorhome coaches by specific reference to the definition of motor vehicle contained in section 1793.22, subdivision (e)(2). Section 1793.2, subdivision (d)(1), the Act's replace-or-refund provision of general application, neither explicitly nor implicitly incorporates the motorhome coach exemption. It simply covers all consumer goods other than new motor vehicles.
The result of National's proposed construction would be that motorhome coaches would be exempt from the replace-or-refund provisions of the Act-both the provision of general application and the specific provision for new motor vehicles. In other words, motorhome coaches would be treated differently from all other consumer goods that carry express warranties, rendering the express warranties that accompany these coaches largely meaningless. Such a result cannot be in keeping with the Legislature's intent.
"[T]he Act is manifestly a remedial measure, intended for the protection of the consumer; it should be given a construction calculated to bring its benefits into action." (Kwan v. Mercedes-Benz of North America, Inc. (1994) 23 Cal.App.4th 174, 184 [28 Cal.Rptr.2d 371].) Specifically, the Act was aimed at eliminating consumer frustration caused by defective products and easing some of the difficulties inherent in pursuing claims arising out of product warranty disputes. (See Toward An End to Consumer Frustration-Making the Song-Beverly Consumer Warranty Act Work, op. cit., supra, 14 Santa Clara Law. 575.) National has presented no good reason to exempt motorhome coaches from the Act; such exemption would diminish consumer protections and thereby contravene the purposes of the Act.
We also find it is somewhat ironic that National is using the motorhome coach exemption contained in the 1988 expansion of the "Lemon Law" (now codified at § 1793.22, subd. (e)(2)), which clearly was intended to expand consumer protections, as the basis for arguing that coaches covered by warranty are not subject to any replace-or-refund provision under the Act. It also is incorrect; the law exempts motorhome coaches from the specific provisions of the "Lemon Law," but not from the general provisions of the Act that apply to consumer goods.
Amicus RVIA offers a statutory construction argument based on the one-time inclusion of "mobilehome" in the definition of "consumer goods" under the Act (see Stats. 1971, ch. 1523, § 2, p. 3001) and the subsequent deletion of "mobilehome" from the definition (see Stats. 1978, ch. 991, § 1, p. 3058). RVIA argues the Legislature's deletion of "mobilehome" from the definition of "consumer goods" demonstrated an intent to do just that. We are not persuaded.
warranties, which are the subject of the Act.
In sum, while it is clear that motorhome coaches are not covered by the so-called "Lemon Act," they clearly are "consumer goods" within the meaning of the Act and are subject to the general application provisions of the Act, such as section 1793.2, subdivision (d)(1).
Respondent Marcelino Oregel leased a new 1998 Isuzu Rodeo (the car) manufactured by appellant American Isuzu Motors, Inc. (Isuzu). Approximately one year later Oregel demanded, pursuant to the Song-Beverly Consumer Warranty Act (Civ. Code, 1790 et seq., hereafter the Act), that Isuzu repurchase the car, claiming it had a chronic oil leak that Isuzu was unable to fix. Isuzu declined to repurchase the car and Oregel filed this lawsuit alleging Isuzu willfully violated its obligations under the Act. The jury found in favor of Oregel. Isuzu argues the jury's verdict is not supported by substantial evidence.
Oregel leased the car in late March 1998 from the Ron Baker Chevrolet Isuzu dealership (Ron Baker). It was Oregel's practice to have all maintenance, including oil changes, performed by Ron Baker. Oregel had Ron Baker change the car's oil every 3,000 miles. The car was serviced in June 1998 and September 1998; the invoices for these services do not include a request to check for an oil leak.
In October 1998 Oregel received a letter from his homeowners association complaining that there was an oil spill on the driveway where he parked the car and asking him to clean the oil from the driveway. He removed the oil, and the following day took the car to Ron Baker and asked the service department to check for an oil leak. Ron Baker retightened the EGR valve adapter and added dye to check for other possible leaks. During the next two weeks, Oregel drove the car about 800 miles and then returned it to Ron Baker. The invoice for that visit reflected that the purpose of the visit was to check for an oil leak; Ron Baker concluded a faulty gasket was the cause and replaced the gasket.
Approximately five weeks later, the car was again leaking oil; Oregel returned to Ron Baker for an oil change and also asked that the oil leak be fixed. The invoice for that December 17, 1998, visit reflects "parts on order," but does not identify what (if anything) Ron Baker did to repair the oil leak. However, Ron Baker told Oregel the oil leak had been fixed.
On January 2, 1999, Oregel returned to Ron Baker for another oil change. He also reported that oil was still leaking. The oil was changed and again Oregel was told the oil leak was fixed. However, the car continued leaking oil onto Oregel's driveway and garage floor, and his coworkers noticed and commented on the oil spots where Oregel parked the car at his place of employment. On January 12, 1999, Oregel returned to Ron Baker and complained about the continuing oil leak, and also complained that the gas gauge was malfunctioning. Ron Baker kept the car for two days, and Oregel was told the leak had been fixed. The invoice for that visit stated, "engine failure" under the notation concerning the oil leak. When Oregel returned the car to Ron Baker around January 28, 1999, to have the gas gauge part installed, he was told Ron Baker inspected the car and no oil leak was found.
One month later, Oregel again returned the car to Ron Baker and complained the car was continuing to leak oil and asked Ron Baker to fix the leak. The invoice from that February 25, 1999 visit, reflecting Oregel's request that Ron Baker again fix the oil leak, stated that "oil from filter gets [caught] in cross member" but does not identify what Ron Baker did to attempt to repair the oil leak. However, Oregel was told the oil leak was fixed.
The car continued to leak oil despite Ron Baker's efforts to locate and fix the problem. Oregel began taking photographs documenting the oil stains on his driveway, in his garage and at work. He did not return to Ron Baker, or any other Isuzu dealer after his visit on February 25, 1999. Because he was concerned about the safety and reliability of the car, Oregel bought a different vehicle in mid-April 1999. Thereafter, he did not drive the car and instead kept it in his garage.
Oregel initially contacted Isuzu in mid-January about the problems with the car. He explained the chronic oil-leaking problem and asked that the car be replaced. Isuzu told Oregel that it was awaiting the results of the dye test that would be checked when he returned the car for the gas gauge replacement. However, in a subsequent January 1999 conversation, Isuzu told Oregel that there was a pan under the motor that collected oil and that it would drop some oil for about two weeks after it was cleaned but that it should stop after that two-week period. However, the leaking did not stop.
On February 25, 1999, Oregel again called Isuzu to report the continued leaking, and Isuzu advised him to take the car back to a dealer for inspection and repair. Oregel then turned the matter over to an attorney. Oregel's attorney wrote to Isuzu revoking acceptance of the car and demanded that Isuzu agree to repurchase it. After Isuzu informed Oregel's attorney that the matter had been referred to its regional office for investigation, Oregel filed the present lawsuit.
Mr. Reynolds, an expert employed by Isuzu to investigate warranty claims involving Isuzu vehicles, examined and tested the car and testified the only oil leakage came from a loose oil pan drain plug bolt. He also testified the loose drain plug was attributable to improper maintenance and was therefore not covered under the warranty. However, he could not explain how Ron Baker's mechanics, on the six different occasions they searched for the source of an oil leak, could have missed finding such an obvious source of leakage as a loose drain plug, and conceded it was not likely that well-trained mechanics would repeatedly overlook that obvious explanation for oil leakage.
Oregel's complaint alleged a claim against Isuzu under the Act. The liability issues were bifurcated from the damage issue. In the liability phase, the jury found the car's oil leak was a nonconformity that substantially impaired the use, value or safety of the car and that Isuzu was unable to fix the leak after a reasonable number of attempts. The jury also found Isuzu willfully violated its obligation to repurchase the car under the Act and should pay a civil penalty to Oregel equal to the amount of the damage award. In the damages phase, the court awarded $11,131.82 as damages,plus a civil penalty of $11,131.82, plus interest, and entered judgment in accordance with the verdict and damage award.
Isuzu argues there is insufficient evidence to support the essential elements of Oregel's case. Isuzu claims there was no evidence the car contained or developed a nonconformity covered by the express warranty because the oil leak was a problem caused by improper maintenance; maintenance problems are not covered by the express warranty. Isuzu also argues there was no evidence that Isuzu was unable to repair the nonconformity after a reasonable number of attempts. Isuzu finally argues there is no evidence to support the civil penalty.
The evidence supports the jury's conclusion that the car developed a persistent oil leak, and Isuzu does not dispute that a new car that persistently leaks a significant amount of oil despite proper maintenance does not conform to Isuzu's express warranty. However, Isuzu notes the express warranty excludes any defects or failures caused by "improper adjustments or improper maintenance," and argues there is no evidence to support the jury's conclusion that the leaking oil was caused by a warranted defect rather than improper maintenance. Isuzu argues the nonconformity element is not supported by any evidence because Oregel produced no evidence the cause of leaking oil was something other than the loose drain plug, and Isuzu's expert opined the loose drain plug and resulting leakage were attributable to improper maintenance.
We are not persuaded by Isuzu's argument. First, there was some evidence to support a conclusion that the oil leak was attributable to a source other than the loose drain plug; Reynolds conceded it was unlikely Ron Baker's mechanics would have repeatedly overlooked a loose drain plug as a source of the leak. Reynolds' testimony would permit a jury to conclude the mechanics did replace the gasket and tighten the drain plug but despite this procedure oil continued to leak, raising an inference the leak was attributable to some other cause. Additionally, in the last visit in which Ron Baker checked for oil leaks, the mechanic reported on the repair order that "oil from filter gets caught in cross member," from which a jury could infer that the leak was attributable to an inability to create a seal between the engine and the oil filter.
Second, even if the oil leak emanated from the loose drain plug, there is evidence from which a jury could infer that the car suffered from a nonconformity covered by the express warranty. The evidence showed Oregel took the car for oil servicing to Ron Baker, whose mechanics had expertise in performing the steps required when changing the oil in the car. The Isuzu manual specified that, as the ultimate step for an oil change, the drain plug be reinstalled with a new gasket and be properly tightened. The invoices for the oil change services reflect Ron Baker did install a new gasket on each occasion, and presumably tightened the plug to manufacturer specifications. However, Oregel testified that after a few hundred miles of leak-free operation the oil leak reappeared. This evidence, coupled with Reynolds's observation that it was unlikely the mechanics would have overlooked the need to check for a tightened drain plug, permits a jury to infer that when the car was driven for a short period of time some defect or anomaly in the car permitted a properly tightened drain plug to slowly loosen, causing oil to leak.
Isuzu concedes that four failed repair attempts for the same problem is a reasonable number of attempts. Isuzu nevertheless argues there is no evidence that Ron Baker attempted on four occasions to fix the car's oil leak. Although Oregel presented the car to Ron Baker to fix the leak on six occasions, there was only one attempt to repair the leak: the visit at which the head gasket was replaced. Isuzu argues the other visits do not qualify as repair attempts because Ron Baker merely looked for the source of the leak during those remaining visits.
The Act is a remedial measure intended for the protection of consumers and should be given a construction consistent with that purpose. (Reveles v. Toyota by the Bay (1997) 57 Cal.App.4th 1139 , 1158 [67 Cal.Rptr.2d 543, 82 A.L.R.Sth 781], disapproved on other grounds by Snukal v. Flightways Manufacturing, Inc. (2000) 23 Cal.4th 754 , 775, fn. 6 [98 Cal.Rptr.2d 1, 3 P.3d 286].) We believe, as did the court in Krotin v. Porsche Cars North America, Inc. (1995) 38 Cal.App.4th 294 [45 Cal.Rptr.2d 10], that the only affirmative step the Act imposes on consumers is to "permit the manufacturer a reasonable opportunity to repair the vehicle." (Id. at pp. 302-303, italics added.) Whether or not the manufacturer's agents choose to take advantage of the opportunity, or are unable despite that opportunity to isolate and make an effort to repair the problem, are matters for which the consumer is not responsible. There was sufficient evidence to support the conclusion Oregel satisfied the presentation element by, on six different occasions, bringing the car in and requesting that Ron Baker repair the oil leak.
Isuzu finally argues there is no evidence that it willfully violated its obligations under the Act to repair the car or refund the purchase price. Whether a manufacturer willfully violated its obligation to repair the car or refund the purchase price is a factual question for the jury that will not be disturbed on appeal if supported by substantial evidence. (Jensen v. BMW of North America, Inc. (1995) 35 Cal.App.4th 112 , 134-136 [41 Cal.Rptr.2d 295].) The proper standard, as explained by the court in Kwan v. Mercedes-Benz of North America, Inc. (1994) 23 Cal.App.4th 174, 185 [28 Cal.Rptr.2d 371] is that: "a violation is not willful if the defendant's failure to replace or refund was the result of a good faith and reasonable belief the facts imposing the statutory obligation were not present. This might be the case, for example, if the manufacturer reasonably believed the product did conform to the warranty, or a reasonable number of repair attempts had not been made, or the buyer desired further repair rather than replacement or refund.
Our interpretation of section 1794(c) is consistent with the general policy against imposing forfeitures or penalties against parties for their good faith, reasonable actions. Unlike a standard requiring the plaintiff to prove the defendant actually knew of its obligation to refund or replace, which would allow manufacturers to escape the penalty by deliberately remaining ignorant of the facts, the interpretation we espouse will not vitiate the intended deterrent effect of the penalty. And unlike a simple equation of willfulness with volition, which would render 'willful' virtually all cases of refusal to replace or refund, our interpretation preserves the Act's distinction between willful and non willful violations."
The jury was properly instructed on this standard. Because the evidence supports the determination Isuzu had the obligation to repurchase the car, we consider only whether there is evidence to support the jury's conclusion that Isuzu's refusal to repurchase did not result from a good faith and reasonable belief the car did not have an unrepairable defect covered by the warranty or that a reasonable number of attempts had not been made to effect a repair.
Finally, there was evidence that Isuzu adopted internal policies that erected hidden obstacles to the ability of an unwary consumer to obtain redress under the Act. This latter evidence would permit a jury to infer that Isuzu impedes and resists efforts by a consumer to force Isuzu to repurchase a defective car, regardless of the presence of an un repairable defect, and that Isuzu's decision to reject Oregel's demand was made pursuant to Isuzu's policies rather than to its good faith and reasonable belief the car did not have an unrepairable defect covered by the warranty or that a reasonable number of attempts to effect a repair had not yet occurred.
The judgment is affirmed. Oregel is entitled to costs on appeal.
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