Lemon Law... Arbitration - What you should know

“Arbitration” is an “alternative dispute resolution process” that many automobile manufacturers make available to purchasers of their vehicles who may want to pursue their Lemon Law rights. A consumer does not have to use the manufacturer’s arbitration process to enforce the Lemon Law. A consumer can choose to use a Lemon Law attorney.

An arbitration hearing is not necessarily a “win” or “lose” outcome for the consumer. The arbitrator may “award” another repair attempt for the vehicle's manufacturer as the “reasonable” solution to the problem(s), even though the consumer feels that they have provided the manufacturer or its dealership with more than enough repair attempts. In addition, if the arbitrator does not feel that the consumer’s problem is “substantial,” the arbitrator may reject the consumer’s claim. Often times the arbitrator will ask to test drive the consumer’s vehicle in an attempt to duplicate the consumer’s complaint, however, if the problem is of an intermittent nature this can result in a denial of the consumer’s claim. A very common arbitrator's decision is to order an additional repair attempt, typically infuriating the vehicle owner. The consumer needs to be aware that an arbitrator’s decision or opinion is not a binding determination of the consumer’s Lemon Law rights.

It is important for the consumer to know that a manufacturer’s arbitration process is VOLUNTARY in California. In other words, the consumer does not have to use the manufacturer’s arbitration process to enforce the Lemon Law. It is also important to be aware that while the arbitrator’s decision is not binding on the consumer, the decision is admissible in any later court proceeding and may be used against the consumer by the automobile manufacturer.

Often times in the course of the arbitration process, the automobile manufacturer may make an offer to the consumer to “resolve” his/her Lemon Law claim. However, such an offer by the manufacturer may not follow the requirements of the Lemon Law and may provide the consumer with substantially less than the Lemon Law would otherwise provide the consumer.

If you are considering, or have already applied for arbitration, you should consider calling our offices prior to any arbitration hearing taking place. In addition, if you have already completed the arbitration process and would like to know if you received or have been awarded your full Lemon Law entitlement, you should consider calling our office for a arbitration award review.