November 7, 2002
Honorable Hardy Myers
Attorney General of Oregon
100 Justice Building
Salem, OR 97310
Dear Attorney General Myers:
The Center for Auto Safety has just completed a study of the lemon law in every state and the District of Columbia and has ranked each state based on the results. Oregon has one of the weakest lemon laws in the country and finished tied for 42nd out of 51. With over 100,000 lemons bought back each year, a strong lemon law is vital to consumer protection. States with strong lemon laws force the auto companies to take back their lemons. States with weak lemon laws force consumers to eat their lemons.
The ranking was based on 10 different categories corresponding to fundamental elements of a strong lemon law, with each category worth a maximum of 10 points for a total of 100 points. The categories are:
1. number of repair attempts or days out of service before an automobile was considered a lemon,
2. whether law had a safety lemon provision and how protective it was,
3. the length of the presumption period or coverage of the lemon law,
4. whether law had a garden variety lemon provision to cover multiple different problems,
5. the offset for use of the car when determining a refund price,
6. if the consumer is eligible for a civil penalty or double or treble damages,
7. types of vehicles covered,
8. is there a state run arbitration program,
9. is the consumer compensated for their attorney fees, and
10. whether refund reimburses consumer for all costs of purchasing and owning lemon
Points were deducted for provisions that negated major rights under the lemon law including whether consumer (1) was liable for manufacturer's attorney fees, (2) lost rights under other laws, (3) had to file lemon lawsuit within short time, and (4) had to resort to manufacturer's unfair arbitration program before filing lemon lawsuit.
The biggest weaknesses in Oregon's lemon law are that it (1) lacks a safety lemon provision requiring auto companies to buy back or replace safety lemons after one unsuccessful repair attempt for a defect that threatens death or serious bodily injury, (2) lacks a garden variety lemon provision covering repairs for multiple different problems, (3) forces consumers to go through auto company arbitration programs before they can exert their lemon law rights in court unlike the 17 states which do not require such prior resort, (4) has a shorter presumption period than most other states, (5) limits the refund to purchase price and governmental fees, specifically excludes interest and fails to include other lemon costs such as incidental and consequential damages, alternate transportation and finance charges, and (6) provides for the award of attorney fee's to the prevailing auto company. Even though this award is discretionary, the threat of having to pay an expensive corporate law firm deters consumers from exercising their legal rights. Examples of stronger provisions from other states are contained in the attached “Best State Lemon Law Provisions.”
We urge you to review this survey and use your authority to help improve Oregon's lemon law.
Clarence M. Ditlow