Lemon Law Obligations Upheld

Serving Los Angeles, Riverside, Ventura, San Bernardino Counties & Nearby Areas of California

A recent story contains welcoming news for car owners who are waiting for lemon law refunds from auto manufacturer Chrysler. A new agreement has been reached between Chrysler’s new Italian owners—Fiat—and a coalition of states. The agreement is part of a bankruptcy court order which upholds the company’s obligation to pay off lemon law claims arising before the company’s bankruptcy.

The article states that as of June 1, 2009, the new agreement will allow consumers who have Chrysler vehicles made within the last five years before the company underwent bankruptcy proceedings, to collect lemon law claims if necessary.

The news comes as a welcome relief to residents of California and the seven other states that participated in the talks with Chrysler and new owner Fiat. Until the agreement was reached, the status of California lemon law claims hung in a legal limbo due to the unique standards of bankruptcy proceedings.

Under bankruptcy rules, outstanding claims for payment may not be processed without approval from the judge overseeing the proceedings. Although sources quoted in the article state that Chrysler acted promptly to request approval to begin making lemon law refunds, consumers in California and other states saw their lemon law refund checks declined by their banks due to insufficient funds.

Hopefully, the new agreement will spare future claimants the shock of having their lemon law buyback checks bounce. The new agreement will also do much to bolster consumer confidence, and may help reduce the blow being dealt to California’s Chrysler dealers. A U.S News and World report news item states that over 800 Chrysler and related dealers across the nation must cease selling Chrysler vehicles as of June 9, 2009. The beleaguered dealers have slashed prices in order to attract buyers, but until now the combination of economic uncertainty and concerns over Chrysler’s ability to honor its lemon law commitments has dampened consumer willingness to purchase a new car.

Ultimately, all car manufacturers’ futures are tied to customer satisfaction. The California lemon laws are merely an overt reminder to automotive companies that their business depends on consumers who are willing to trust a car maker’s products. More importantly, the future of any car maker depends on customers who trust that the manufacturer will do the right thing should their vehicles prove faulty.

If you have any questions about how your legal rights may be affected by a car manufacturer’s bankruptcy proceedings, please contact the Law Offices of Howard D. Silver and discuss your situation with an experienced California lemon law attorney. Call (855) 341-2611 today for a free and confidential evaluation of your case.

Posted Date: 
Wednesday, February 18, 2015
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