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Texas Lemon Law.
How do I resolve a problem with my car? I need help getting the dealer /
manufacturer to fix my car. My car is a lemon, what do I do? State
of Texas.
The Texas Lemon Law
The best thing to ever come out
of Austin
 
This page is the
opinion of the author, who is not an attorney, and is not intended to
be legal advice. While the resolutions of these cases are documented
facts, the circumstances are the opinions of the car owners of the
cases mentioned below. This page is intended to assist people with
legitimate problems to get through the process, and is not intended to give
advice to those who simply want to take advantage of a manufacturer. You
should always consult an attorney if you feel it's needed. TxDOT has been
made aware of this page and their opinions have been solicited; however,
we make no representation of an endorsement by TxDOT. This is an
overview; additional information may be obtained by clicking
here.
This page addresses
problems with new cars only, and provides real examples of lemon law
cases.
Why don't people use the Lemon Law?
The Texas Lemon Law was
enacted by the Texas Legislature in 1983, for the purpose of assisting people
who buy or lease new vehicles and have repeated problems in getting their cars
repaired. (Used cars with warranties may also qualify, as well as other
types of vehicles, but this page is about new passenger cars and trucks only.)
The Lemon Law can help a consumer get their car repurchased, replaced, or
repaired.
It's too complicated:
The booklet available from the Texas Department of Transportation (TxDOT) is
actually quite clear, and fairly simple. If you have a repeated serious
defect or abnormal condition that is covered by warranty, and the dealer has
been provided a reasonable number of attempts to repair it, the manufacturer can
be ordered to repurchase, replace, or repair your vehicle. There are
several limitations, but the overall requirement is that you must file the
complaint within 6 months of (a) the expiration of the warranty period, (b) 24
months from the date of purchase, or (c) 24,000 miles, whichever comes first. And, like most laws, there are exceptions to that, as well (for example, you may still be
able to file for repairs, if your vehicle is still under warranty).
It's too expensive:
There is no filing fee for a request for repairs. For replacement
requests, a $35 non-refundable filing fee is required, but, if you win your
case, the manufacturer has to reimburse you the fee. And, an attorney is
normally not required.
The
consumer never wins: According to
TxDOT, of complaints closed in 2002, 62.5% of consumers received some type of
relief, totaling more than $5.9 million in benefits. That demonstrates the
odds are in the favor of the consumer. If you don't believe it, read the
examples below.
I don't
like attorneys: Attorneys are not
generally required. In the examples below, an attorney was used only to
write a letter in the first case, and no attorney was used in the second. Yet,
the consumer was elated with the success of the lemon law in both cases.
I don't like
courtrooms: This is technically a court of
law (no firearms), but you wouldn't know it to be in there. Dallas-area cases are held
in a conference room at the TxDOT building in Mesquite. Everyone sits at a
conference table, and the "administrative law judge" is actually a very nice
person who sits at the head of the table. In the examples below, no
attorneys were in the hearing. While the GM rep was considered to be rude
and obnoxious, the Chrysler rep was cordial and pleasant. There's no
bailiff, and no "all rise" when the judge comes in. In fact, until you're
seated, you may not even know which person the judge is. In the Chrysler
example below, one of the witnesses (who didn't want to testify in "court") stated afterwards,
"That was fun! And, the judge was SO nice!"
I didn't maintain my documentation: While
documentation is needed, it can be obtained from your servicing dealer. In
fact, they're required to provide it for the hearing. However, you should
fill-out all the forms, have the documentation easy to see and understand, and
know the facts of your case. In both cases below, the judges were
impressed by the documentation provided by the complainant. In the case
against Chrysler, the documentation probably swayed the case. (These are
simple forms, nothing like the ones used by the IRS.)
I don't want to deal with
government bureaucracy: The people at TxDOT are known for their
courtesy and concern. Your case will be assigned to a representative, who
will be in contact with you throughout the process. In both cases below,
that representative was Tim Bargsley, who constantly followed-up on all issues,
and treated the complainants as valued customers. The judges were both
impartial, yet extremely polite. The whole process is simpler than you
could possibly think, and the most you'll lose is a little bit of time and $35
(if filing for re-purchase).
What do you have to lose?
Even if I win, I won't get anything:
This is the real beauty of the lemon law. It works! Consider how
your normal mileage depreciation is calculated. You lose considerable
value of your car when you drive it off the lot -- it's now a used car.
The unfortunate thing about the loss is that you're losing value at a time when
the car needs very little maintenance. The first 40,000 miles could easily be
considered to be almost maintenance-free, except for oil changes. Latter
mileage costs you less in depreciation, but more in actual repairs: tires,
brakes, belts, and hoses need replacing, the transmission has to be serviced,
etc. The car is now showing its age, but, by normal depreciation
standards, the loss is less at this time. It's backwards!
The Lemon Law isn't
backwards! Don't let the calculations in the TxDOT look complicated:
Your vehicle's life is considered to be 120,000 miles, and each mile is
considered the same amount; i.e., the purchase price of the vehicle is
divided by 120,000 miles to determine the cost per mile. Since you're in
the most expensive miles (first 24,000 or so) of depreciation, you come out way
ahead! But wait, there's more! Miles after the problem are "charged"
to you at 1/2 price! Therefore, the "lemon law" value of your vehicle
could be considerably more than the current market value.
As an example, let's
assume you had a problem at 3,000 miles, and you went to the hearing at 24,000
miles. If you win, your value will be calculated as the price of the car
minus 3,000 miles (using the "flat" rate as described above), minus 21,000 miles
at 1/2 the rate above. You can quickly see the law is in your favor, and
now you know why manufacturer's don't want to go to the lemon law (filing a
lemon law complaint will often get your problem resolved without having a
hearing).
CASE EXAMPLES OF THE TEXAS LEMON LAW
These are real cases.
The names have been changed to protect the privacy of the complainants. In
the first two cases, the problem was intermittent, unable to duplicate, and the car
owners thought they were wasting their time with the lemon law. You'll
read two very different examples, and see very different responses from GM &
Daimler-Chrysler. The third case showed another side of Daimler-Chrysler,
and was resolved by the owner finding the problem with the car, which
Daimler-Chrysler then fixed.
"Smith" vs. GM:
Mr. & Mrs. Smith bought
a 1999 Pontiac Bonneville SE from Forrest Pontiac in Cleburne (sticker price >
$30,000) in the summer of 1999; a GM extended warranty was also purchased.
After about 3,000
miles, Mr. Smith pressed the windshield washer to clean the windshield.
The washers sprayed soapy water on the windshield, but the wipers didn't come
on, blocking the driver's vision in traffic. He turned to the right to go
off the road as he slammed on his brakes. Luckily, there was no collision.
After fumbling with the wiper switch, the wipers came on, and the Smith's
resumed their trip.
The Bonneville was taken
back to Forrest, but they couldn't find anything wrong with the wipers.
The Smith's discovered that by placing the wiper switch on "high," the wipers would resume
operating, so the Smith's now had a work-around for their still-dangerous
situation. When they used the washers, they would now be ready to turn the
wipers on manually, if required.
This situation repeated itself
at least 5 times, but the dealership still couldn't find
the problem. Once, it occurred when Mr. Smith was testing the wipers in
his garage, and he took a video of it.
The car experienced many
other electrical and mechanical issues, as well. They also reported
problems with the turn signals, paint peeling, the trunk lid wouldn't open by
its springs (after opening, it once fell and hit Mr. Smith's head as he was
putting items into the trunk), and the engine was sometimes difficult to start.
However, the windshield wiper problem stood out as the major safety issue.
After about a year of
the windshield wiper problem not getting fixed, the Smith's requested GM's zone rep.
The zone rep viewed the tape, and accused the Smith's of faking the problem,
saying, "I could re-create that problem with 2 wires. We're not going
to work on that problem any more." Mr. Smith said if they weren't
going to fix it, he'd file on the lemon law. The zone manager retorted, "Go
ahead," and Mr. Smith did.
The Smith's complaint to
GM was declined by Carolyn Miller in GM's legal department, so the Smith's
continued with the lemon law process.
At
the hearing, the tape was viewed, and the GM rep still insisted the car had no
problem. The judge, the GM zone rep, Forrest's service manager, and Mr.
Smith went to the parking lot to inspect the car. The wipers failed, and
the zone rep's mouth fell open.
Returning to the hearing
room, the judge offered to step outside and allow the parties to resolve the
case. The GM rep refused. The judge asked, "You realize their
case just got a whole lot better?" The GM rep still refused, so the
hearing continued.
The judge ordered GM to re-purchase the vehicle. GM appealed the
calculation, due to credits used on the GM credit card to purchase the car ...
they wanted those excluded. The judge said "no," and GM appealed again.
The Smith's hired Dale Slaton, Esq., to write a letter to TxDOT, and the judge
ruled again in the Smith's favor. The cost of the attorney: $50.
(The $35 filing fee was refunded by GM when they repurchased the car.)
Please note that while the
windshield wipers failed during the test at the hearing, the Smiths are
convinced they would have won the case even if they hadn't. Their feeling
was the judge believed them, and the video tape was a real asset.
The bottom line: The Smiths were able to continue to drive the car free
from mileage charges (mileage is established at the hearing) while GM whined.
They drove the car over two years and were then paid over $25,000 for it.
Their cost per mile (cost/mileage, not including gas, oil, insurance, etc.):
3 cents! The lemon law worked!
Was this car a lemon?
The car spent one night in the shop for every 287 miles driven.
Would the Smiths buy
another GM product? Mr. Smith responded: "No way. The
dealership did little to help us, and the GM zone rep was cocky, arrogant, and a
real jerk. It was obvious to me that GM didn't care about us at all."
"Jones" vs. Chrysler (Docket # 05-0683CAF):
This is an extremely unusual
case, in that the Jones waited until after 24,000 miles to file the complaint,
and the hearing never actually occurred. Yet, the Jones were quite
satisfied! (You won't find this solution in the Lemon Law guide, so, don't
think there's no resolution for your problem until you try.)
Mr. & Mrs. Jones bought a
2002 Chrysler Town & Country (sticker price: $35,235) on 9/27/2001;
a Chrysler extended warranty was also purchased.
They reported many
problems with their Town & Country: the driver's seat belt malfunctioned
at only 1,070 miles (difficult to latch, difficult to unlatch), the automatic
door would be activated to open but wouldn't (until the car was in motion, then
it would fly open unexpectedly), the rear window windshield wiper quit working
and then started working again, the power window motors went out several times,
and the instrument panel lights quit working for a few days but then came back
on.
However, the most
difficult problem occurred on 1/13/2004, with 31,032 miles on the car: the
battery was dead. The Jones "jumped" the battery and drove the car to the
dealership, but the battery tested okay. Please note the car was over 2
years old, and had over 24,000 miles on it (24,000 is the limit for filing a
re-purchase lemon law complaint). It was, however, still in the original 3
year/36,000 manufacturer's warranty.
The Jones, at their own
expense, replaced the battery after the 3rd failure, but the battery would
continue to fail a total of 9 times. The interval between failures ranged
from 17 days to 248 days.
After the 8th failure
(7/30/2005; 53,734 miles), the Jones contacted the lemon law personnel,
asking if there was anything they could do to help them get the car repaired.
They were told to file the complaint, and they did, but they didn't expect
anything from it since they had waited so long to file. The car was now
out of the original warranty, but still under the extended warranty.
They filed the complaint
(requesting "repair"), thinking they wouldn't get anything from the lemon law,
but hoping it would get Chrysler to send a "super tech" to find the problem.
Chrysler sent their "super tec h," but he couldn't find the problem, either.
(The cost of filing? A 37 cent stamp; there's no charge for filing
when requesting "repair.")
The problem was so bad,
they had been keeping a portable battery jumper in their car for about a
year so they wouldn't get stranded.
They went to the hearing
on 10/25/2005 (about 57,000 miles), not expecting to get anything done.
They brought two
witnesses. Previously, the witnesses had visited the Jones at work, and
they all decided to go to dinner. Since the Jones were in their truck,
they drove to the Jones' house to get the Town & Country for more comfort for
the four of them. The battery was dead -- no dome lights, nothing.
The Jones thought the witnesses might help.
Judge Herring was in
charge of the hearing, but said he wanted to chat a little prior to the actual
hearing. (The hearing was never officially held.) He asked the Jones
to give a brief rendition of what their car was doing, and he told them they
made a mistake: they should have filed on the lemon law much earlier in
the process when the other electrical problems occurred.
Why did they wait so
long? Mr. Jones said he waited because every time he had a problem,
Chrysler tried to fix it. Many of the times he took the car to Smith
Chrysler Dodge in Waxahachie. Service Manager Robert Blumrich treated Mr.
Jones so well, he didn't want to create a hassle. It wasn't until it was
apparent that there wasn't going to be any other resolution that he filed.
"I have nothing but praise for Smith Chrysler and Robert. They never
doubted my problems, and always worked to resolve any issue my car had.
But it's almost impossible to fix a problem you can't duplicate."
Judge Herring said there was
an "MSRP swap" option. (You won't find this in the lemon law guide.)
In an MSRP swap, the car owner buys another car from the same manufacturer for
the difference in MSRP prices, plus the depreciation of the current car.
(Several options were
presented. The judge said he could order Chrysler to fix the car, but that
they'd just replace the battery, and the whole would start all over again when
it failed. Chrysler also offered to reimburse the Jones for the cost of
the extended service contract, a little less than $2,000, to put up with the
problem. The MSRP swap was obviously the best deal.)
It took the Jones only a
few seconds to realize what a good deal this was, and the Chrysler rep, Dana
Nance, agreed to it.
The Jones ordered a 2006
Chrysler Pacifica, which had an MSRP of $640 more than their 2000 Town &
Country. Their depreciation was set at $10,000, so they were able to go
from a 2002 Town & Country to a 2006 Pacifica for $10,640. They figure
they "made" about $10,000 in the deal, based upon the actual trade-in value of
the Town & Country.
The bottom line: The
Jones were able to continue to drive the car free
from mileage charges (mileage is established at the hearing) while Chrysler
built the car they ordered (another 8,000 miles after the hearing, although the
battery failed again).
They drove the car for 4 1/2 years, put 65,000 miles on it, and were charged
$10,000 in depreciation.
Their cost per mile (cost/mileage, not including gas, oil, insurance, etc.):
15 cents! The lemon law worked!
Was this car a lemon?
The battery failed 9 times, in addition to numerous other electrical problems.
The Jones never knew if their car would start or not. The car spent one
night in the shop for every 1,248 miles driven.
Would the Jones buy
another Chrysler product? Mr. Jones responded: "Yes. I was
disappointed we had to file the lemon law complaint just to get the zone rep to
look at the car, but Chrysler was very professional and polite through the whole
process. And, their offer of an MSRP swap was very generous, indicating
they wanted to keep us as a customer."
"Jones" vs. Chrysler (again!):
Mr. & Mrs. Jones bought a
2006 Pacifica for $38,140 on 3/21/2006; this is the MSRP swap documented
in the case above. A Chrysler extended warranty was also purchased.
On 4/14/2006, they went
out to a dead battery. This happened 3 more times, after which the
dealership (now Bossier Chrysler) identified the Body Control Module (BCM) as
turning on electrical items, running the battery down. The BCM, now
manufactured by a different company (Panasonic, reportedly), was replaced.
The battery failed again (5th time to consumer), and the car is presently
(August, 2006) at Dallas Dodge for repair.
As of April, 2006, this car had
spent one night in the shop for about every 400 miles driven. It had a
little over 6,000 miles on it, and had failed 5 times to the consumer, plus once
in the shop. A lemon law notice has been mailed to Chrysler.
To quote Mr. Jones, "At
least this time a Chrysler dealership has witnessed and documented the problem.
We were ecstatic, as we thought the problem had been identified and fixed.
But, the battery has failed again, and Chrysler made us take OUR time and gas to
drive over 100 miles (round trip) to take our car to another dealership.
It's ridiculous -- the car was at an authorized Chrysler dealer, but Chrysler
wanted it taken to a dealer that was over 50 miles away, and we were required to
transport it. This should be Chrysler's problem, but they don't seem to
want to assume responsibility."
"From what I've read,
the Pacifica is based upon the Daimler-designed Mercedes Class R. I
thought since it was "almost a Mercedes" that it would be a more reliable car.
Then again, one would think a $38k Chrysler would start in the morning."
"The Chrysler rep also
promised us they'd put us into another Pacifica as a rental car, as we really
like the Pacifica, but that was a broken promise. In fact, it took 1 1/2
hours to get our Pacifica checked in to Dallas Dodge and to get a rental car
from Enterprise (an hour and 10 minutes at Dallas Dodge, another 20 minutes at
Enterprise). Enterprise told us they told Dallas Dodge they didn't even
carry the Pacifica on the day Dallas Dodge promised the Chrysler rep they'd have
one for us. This was customer service at its worst. We absolutely
love the Pacifica -- it's a great car -- but we want it to start, and we're
tired of dealing with Chrysler with the hassles of getting rentals. We
don't like promises that aren't fulfilled. Much of the time, we've been
without a car ... apparently, if they can't identify
the problem, it's the customer's fault, and the customer doesn't get a rental
car. It's not my fault if they can't fix the car. They're
being real jerks about it."
UPDATE: Mr. Jones noticed one morning
when he touched the key that the dash came on, even though the key was in the
"off" position. As a result, the dealership determined the ignition switch
had a bent pin that was allowing it to turn the car "on" while in the "off"
position. They replaced the ignition switch, and the problem appears to be
resolved.
CAUTION: Mr. Jones learned this the
hard way: Watch out for the "free" rental car provided as part of
your warranty. When Hertz asked for Mr. Jones' credit card, he
asked why and was told it was in case he damaged the car.
About a month later, he
was billed by Hertz for the rental. The dealership told Mr. Jones the
dealership, not Chrysler, pays Hertz for the rental, and that it was apparently
lost in paperwork, but it would be handled.
After another month, Mr.
Jones saw the rental charged to his American Express card
-- the rental Chrysler was supposed to pay. He finally got it taken off,
but it took a lot of his time. Mr. Jones stated, "They give us pure heck
about getting a car, even though the car is under warranty and I purchased an
extended warranty which is supposed to increase my rental car benefits.
Then, they don't pay for it and sneak it onto my American Express bill. I
love my Pacifica, but dealing with Chrysler this time was nothing like our
previous experience. I'll never buy another Chrysler product."
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