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Virginia Lemon Law

• Ford, Subaru, VW Win Insurance Industry Picks: By Ken Thomas
  Jan 05, 2010

  Provided by: Associated Press. The insurance industry's annual list of the safest new vehicles.
  http://autos.yahoo.com/articles/autos_content_landing_pages/1168/ford-subaru-vw-win-insurance-industry-picks/ - 1 - 10

• Final Frontier: Below Dealer Cost: by Jonathan Welsh
  Jun 22, 2009

  provided by
  
  Plunging auto sales are making this one of the worst times ever to sell cars. But if you're one of the relatively rare consumers shopping for a new vehicle, you're already in the driver's seat. - 2 - 10

• Virginia Lawyers Weekly, January 26, 2009 - Lemon Law Verdict
  Feb 02, 2009

  Richmond, Va., September 5, 2008 - A Henrico County Circuit Court jury issued a verdict that Chrysler L.L.C., violated Virginia’s Lemon Law.  The fees were paid on December 17, 2008.
  
  An article about the verdict appeared in Virginia Lawyers Weekly on January 26, 2009.  Read our article here.

  - 3 - 10

• Chrysler Violates Lemon Law, Has To Repurchase the Vehicle And Pays Over $70,000 in Legal Fees
  Dec 23, 2008

  Chrysler Violates Lemon Law, Has To Repurchase the Vehicle And Pays Over $70,000 in Legal Fees
  
  

  Richmond, Va., September 5, 2008 - A Henrico County Circuit Court jury issued a verdict that Chrysler L.L.C., violated Virginia’s Lemon Law. The Plaintiff’s 2006 Jeep Commander had a bad odor from the a/c and heating vents causing the plaintiff serious nosebleeds and exacerbation of her allergies. The Plaintiff’s husband and several other people that rode in the car also complained of various ailments, such as light headedness, sinus drainage, and upper respiratory problems. Chrysler initially tried to fix the complaint of a "musty smell" or bad odor coming from the vehicle’s dash vents by cleaning it with chemicals, but then, according to the Plaintiffs, the chemical treatment caused such a bad odor, that it resulted in respiratory problems and the Plaintiff refused to drive it. Chrysler and its expert claimed the problem had been corrected and that there was no abnormal odor in the vehicle at any time during its inspections.

  After two years of litigation, the Henrico jury found that Chrysler LLC had violated the Virginia Lemon Law and that it had to reimburse the Plaintiffs for all lease payments made to date, in the amount of $11,898.09, plus $2000 for their trade in, plus $1,613.91 for rental charges, plus $2,777.50 for the extra mileage they put on a substitute vehicle, plus payoff Chrysler Financial the remaining balance due on the lease, but that Chrysler was entitled to $986.27 for the mileage put on the Jeep Commander up to the date of the first notice of the problem to the Chrysler. Under the Lemon Law Chrysler was responsible for the Plaintiffs’ reasonable legal and expert fees, which, by agreement was to be heard in a separate, bifurcated hearing in front of trial judge on a later date if they were contested.

  Chrysler did not agree that the trial fees of $69,000 were reasonable, and initially offered to pay $45,825.00. The disagreements continued, with fees continuing to increase. Chrysler’s attorney offered his "full authority" of $60,000, Plaintiffs’ countered with a final offer of $65,000, which was rejected. Plaintiffs’ filed their Motion For Expert and Legal Fees, and requested $76,680.00 in legal fees, plus their expert fees of about $4,000.00. Further negotiations continued, with Chrysler eventually agreeing to pay $75,250.00 for the fees and costs within thirty days, in addition to the jury award. These fees were paid on December 17, 2008.

  John Cole Gayle, Jr., of The Consumer Law Group, P.C., in Richmond, Va., noted the fees incurred were avoidable since the Plaintiffs had offered to accept another comparable vehicle, an offer Chrysler not only rejected, but in when he asked if Chrysler wanted to settle, Chrysler’s attorney said, "John, that ship sailed long ago", but I will accept a nonsuit." Mr. Gayle estimates that this two year battle over a $30,000 Jeep cost Chrysler between $125,000.00 to $200,000.

   

  - 4 - 10

• Fine Print Binds Car Buyers
  Mar 01, 2005

  On February 23, 2005, John Cole Gayle, Jr., of The Consumer Law Group, appeared on ABC World New Tonight. ABC news was covering a story about the binding arbitration clause that many consumers are forced to sign when they purchase a vehicle. The story was called “Reading the Fine Print...The legal rights you may be signing away without knowing it.” To view a copy of the story, please go to: - 5 - 10

• Virginia Lemon Law - Motor Vehicle Warranty Enforcement Act
  Dec 10, 2004

  TYPE OF ACTION: Virginia Lemon Law - Motor Vehicle Warranty Enforcement Act Type of Damages: Full refund of money paid towards price of car, costs, attorney fees Name of Case: W. and C. Williams v. Daimler Chrysler Corporation Court: Henrico County Circuit Court Name of Judge: The Honorable Daniel T. Balfour Settlement: Last demand was to take the car and agree to payoff the loan which was approximately $15,000 plus pay attorney fees accumulated to that point (estimated to be about $10 -15K at that point). Chrysler refused, offered the client $5K while keeping the car. Jury Award: $55,028.59 Breakdown: $33,829.76 for payments made to date, payoff of the lien and court costs, $23,250.00 in attorney’s fees (a compromised amount agreed upon by the parties), minus $2,051.17 for mileage). Plaintiff returned the vehicle Attorney for Plaintiffs: John Cole Gayle, Jr. Other Useful Information: This vehicle, a 2002 Jeep Liberty, resided in the Tidewater area and was used by Mr. Williams primarily for commuting. Plaintiffs first consulted counsel in March, 2003, when the Jeep had about 50,000 miles on it, but by the time of trial, in June 2004, it had over 90,000 miles. Counsel knew a car with 50,000K miles was a risk, but decided to take the case anyway. Mrs. Williams refused to drive it after it was purchased for her since she alleged the speedometer and odometer would fluctuate wildly on occasion and the air bag light coming on scared her. Both plaintiffs alleged that at times the engine ran rough, there was a banging and clanging in the engine, the engine would stall out, and the engine light would come on, and the air bag light would come on for a while then go out. Some of these problems began with the purchase of the car, and, despite numerous repair attempts both before the warranty expired and afterwards, some of the problems continued to exist up to the present mileage of 90,000 miles. At trial the only problem that Mr. Williams, the primary driver, testified to experiencing was the engine banging and air bag light, however Mrs. Williams claimed the electrical problems continued to exist. Chrysler’s expert could find nothing wrong with the vehicle. No expert for plaintiffs testified at the trial. Shortly before trial Chrysler moved for a continuance since its expert could not appear in person, to which counsel for plaintiffs objected, which motion was denied. Prior to trial the court granted DaimlerChryler’s motion that any repairs made to the vehicle after the warranty ran out at 36,000 miles would not be admissible at trial, but on motion of plaintiffs’ counsel also ruled that, since no repair after warranty expiration at 36K miles was admissible, whatever happened to the vehicle after 36k miles, including the current mileage , was not be relevant and thus was not admissible. The court also ruled that the Lemon Law’s remedies are mandatory, and thus the jury’s only decision was that of liability. If the jury found the Lemon Law had been violated, then the remedy would be imposed by the court, along with a determination of what the reasonable attorney fees and costs would be. The trial lasted one day, and the jury returned a verdict for the plaintiffs. - 6 - 10

Auto Fraud

• CONSUMER WATCH: The downside of voluntary repossession
  Jul 24, 2008

  IRIS TAYLOR

  TIMES-DISPATCH COLUMNIST

  Sunday, January 14, 2007

  Nedra Peyton of Richmond, a working mother of two small children, purchased a used car in October.

  She agreed to make payments every two weeks for three years. She had no experience buying cars. The car came with a 180-day limited warranty.

  Within the first month, Peyton said, the car broke down twice and had to be towed to the place she bought it for repair. It also was missing a heating and air-conditioning part and she said the front end was making a rubbing noise.

  Each time she took the car back, the repairs were made but she was given a hard time, she said. The second time it was towed, she angrily told them to keep the car and refund her money.

  She was told that if she left it, it would be a voluntary repossession and she'd still have to pay the note.

  A voluntary repossession means the person voluntarily gave the vehicle back for whatever reason as opposed to it being involuntarily repossessed.

   . . .

  If this happens to you or someone you love, what should you do?

  John C. Gayle Jr. of The Consumer Law Group on Libbie Avenue in Richmond responded.

  Gayle cautioned against abandoning a newly purchased car at the dealership. "It doesn't make any sense," he said. For one reason, "it goes on their books as a voluntary repossession." That negatively impacts a person's credit score.

  Steve Katz of the credit reporting agency TransUnion in Chicago and Rod Griffin of Experian in Dallas said whether it's a voluntary or involuntary repossession, a person's score will be impacted equally.

  A repossession is "very, very bad," Griffin said.  Another reason not to abandon the vehicle is the dealer may have misrepresented its condition at the time of sale.

  If you've given it back, "How are you going to prove anything?" Gayle said.

  Dealers resell repossessed vehicles at auction for whatever they can get, then come after the one it was repossessed from to collect the difference.

  If a newly purchased used car turns out to be a clunker, you can sue under Virginia's so-called "Lemon Law" only if you bought it while there was still time left on the original manufacturer's warranty.

  You have up to 18 months from the date that the warranty first went into effect to sue, Gayle said.

  If you've purchased a used car that turns out to be a heap: 

  • Read your contract. If it says you purchased the car "as is," you're responsible for repairs and the dealer has no obligation to assist with repairs.

  • Stay current on your payments. If you're late, the dealer has the right to take back the vehicle and sell it.

  • You may be able to rescind the sale. "You really ought to get an attorney's advice" before doing this, Gayle said.

  But, if you can't, stop driving the car and put the dealership on notice, by certified mail, that in 30 days you intend to rescind the sale unless it corrects the problem.

  • Read your rights. Go to www.theconsumerlawgroup.com.

  If you're planning to, but haven't yet purchased a used vehicle, run its vehicle identification number, or VIN, through Carfax.

  It might be free through the dealership or $24.99 at www.carfax.com.

  If possible, have it checked out at a body shop and by a mechanic.

  What happened with Peyton?

  She did not leave her car at the place she bought it. "I believe I have an oil leak" and the check engine light was on but "just went off," she said.

  However, "I haven't had any major problems recently"

  Peyton said she looked up the car's book value after buying it. "I am stuck with a $20,000 car worth only $7,000 [$13,000 for the car, plus interest]," she said.

  Contact staff writer Iris Taylor at itaylor@timesdispatch.com or (804) 649-6349.

  - 7 - 10

• Misrepresentation costly for Norfolk dealership
  May 24, 2007

  Virginia Lawyers Weekly, Volume 21, Number 36, February 12, 2007 Sunshine Hardison told the salesman at Checkered Flag Motor Car Co. in Norfolk that she wanted a one-owner vehicle in her price range that had not been wrecked. The salesman assured her that the 2000 Hyundai Elantra she bought for $6,400 was just what she had asked for. In fact, the car had had several owners. It had been in a major front-end collision, and it had been repossessed. The salesman did not disclose that the car had been repossessed, as Virginia Code §59.1-200 requires. The transaction proved to be very expensive for the dealership. Retired Judge John E. Clarkson arbitrated Hardison’s claims of fraud and violations of the Virginia Consumer Protection Act and awarded her a total of $114,400 - $2,500 in actual damages trebled under the VCPA because of what Clarkson found to be the willful and fraudulent misrepresentations of the dealership, $50,000 in punitive damages for fraud, $60,400 in attorneys’ fees and costs and $4,700 in arbitration costs, less a $7,500 offset for the duplication of the VCPA willful misconduct and punitive damage awards. John Cole Gayle Jr. Of Richmond, who represented Hardison along with John M. Barrett of Virginia Beach, said the attorneys’ fees reflected extended litigation before the arbitration. Hardison won a $10,000 judgment in general district court, which the dealership appealed to circuit court. The sales contract required arbitration of any claims, and the trial court finally decided to enforce the clause after several hearings on the issue. The parties agreed the The McCammon Group would arbitrate the claim, Gayle said. Gayle said the dealership contended that it was unaware of the vehicle’s history. That contention was refuted by the company’s own records, which showed multiple owners and the repossession, and the testimony of the owner of the car when it was wrecked. She said she had bought it from Checkered Flag and sold it back to the dealership after the wreck. - 8 - 10

• USED-VEHICLE PURCHASE
  Mar 09, 2006

  The following article appeared in The Virginian-Pilot on February 23, 2006: Bill is dropped over consumer concerns A bill that opponents called "a wolf in sheep's clothing" has been dropped before it could be considered in the House of Delegates. The legislation, SB153 , required auto dealers to inform potential buyers about the right to request an inspection before purchasing a used vehicle. The legislation also would have given legal protection to a car dealer if the buyer later contended that he or she was not informed of mechanical problems. It was that part of the proposal that drew criticism from a coalition of statewide poverty advocacy groups, consumer protection lobbyists, and Richmond-based used car dealer CarMax. In a press conference Wednesday, John Gayle, the Virginia coordinator for the National Association of Consumer Advocates, said the bill's death was a victory for poor people. At a time when a large number of hurricane-damaged vehicles are appearing on the market, residents need protection from dealers who might pass off salvaged cars as perfectly fine, he said. "Virginia would become a dumping ground for those vehicles," Gayle said. "This bill is terrible for Virginia consumers. The only people it would help is disreputable car dealers." The bill had passed the Senate 31-8, but Sen. Thomas Norment , R-James City, withdrew it from consideration this week after stronger opposition arose. Norment, who is part owner of a car dealership, had said the bill would have given drivers an unprecedented legal right to an inspection. He also had said that buyers were better off knowing a car's defects before the purchase, rather than going to court for damages after buying the vehicle. - Meghan Hoyer - 9 - 10

• J. Smith v. Casey Chevrolet, Circuit Court of Newport News, Virginia:
  Jul 21, 2005

  Virginia has a statute called the “3% Rule,” which permits car dealers to sell vehicles that have been damaged and repaired, without having to disclose the damage and repair, if the retail cost of repair is less than 3% of the vehicle’s MSRP (Manufacturer’s Suggested Retail Price). In this case, in which Mr. Gayle is co-counsel for the Plaintiff, the Plaintiff bought a new Corvette, which he later discovered had been damaged prior to sale. When the Plaintiff confronted the dealer, Casey, it said the repairs were from “lot” damage, that they were minor, and that it did not have to tell him about them. Casey said the repairs cost less than $1,500, but the Plaintiff’s expert said the cost to repair the car properly would be over $5,000.00. The court has ruled that the 3% Rule was not meant to allow car dealers to conceal any type of damage, such as “lot” damage, but only applies to pre-delivery factory damage or in-transit damage. Thus, Casey Chevrolet can not use the 3% Rule as a defense in this case unless the damage was from pre-delivery factory damage or in-transit damage. Car dealers in Virginia, and in other states that have similar rules, have been using this rule to conceal any damage done to new vehicles, whether from accidents in transit or on the lot. As is alleged in this case, sometimes a car dealer will make sure that the repairs it makes are half measures, keeping the cost under 3% of the “MSRP,” and then not mentioning anything to the new car buyer. - 10 - 10