By Michael H. Rosenstein, Esq.
The rulings in Krotin v. Porsche Cars North America, Inc. (1995) 38 Cal.App.4th 294, 45 Cal.Rptr.2d 10 (“Krotin”) and Lukather v. General Motors, LLC, (2010) 181 Cal. App. 4th 1041, 1051, 104 Cal.Rptr.3d 853 (“Lukather”) are twin pillars of consumer protection under California’s Song-Beverly Act. While the decisions concern two very different vehicles – the former a 1987 Porsche 944 and the latter a 2005 Cadillac – they both reach the same important conclusion: that the Song-Beverly Act places the “affirmative duty” to repurchase defective vehicles squarely on the manufacturers’ shoulders.
Mikhail and Maya Krotin leased their 1987 Porsche 944 in October of 1987 and, right at the outset, began experiencing problems driving the car in the mornings after a cold start. (Krotin at 298). During the first four months of ownership, the Krotins brought their Porsche into the shop four times for repair of the problem. (Id.) The Krotins proceeded to take the vehicle to 3 different Porsche dealerships for repair of the cold-start problem and a wide array of other issues; to no avail. (Id.) Meanwhile, they called Porsche Cars North America in May of 1988 to request a “buyback” of their beleaguered 944. (Id.) Porsche refused. In January of 1991, the Krotins wrote Porsche headquarters, indicating their vehicle was a lemon and requesting a repurchase. (Id. at 299). Porsche refused, again. A month later, the Krotins wrote Porsche Financial Services advising that they were revoking acceptance of the vehicle and advising that they would no longer make payments on the now parked 944. (Id.) Eventually, Porsche repossessed the car and, then, added insult to injury by suing the Krotins.
Paul Lukather’s purchase of a 2005 Cadillac from Cadillac of Whitter in April of 2005 followed a similarly disastrous fact pattern. Right out of the gate, Mr. Lukather’s Cadillac exhibited an intermittent but recurring malfunction in the electronic stability control system. (Lukather at 1043). Mr. Lukather brought the vehicle to the dealership numerous times for the ESC system issue, braking issues, and other issues. While GM admitted at trial that the vehicle qualified as a lemon, it contended that Mr. Lukather did not do enough to trigger its obligation to repurchase or replace the vehicle.
The Courts in both Krotin and Lukather reached the same important conclusion: under California’s Song-Beverly Act, the consumer does not need to take any steps other than to provide the manufacturer with the opportunity to repair the vehicle. (Krotin at 303; Lukather 1050). Rather, the Song-Beverly Act imposes on manufacturers, “an affirmative duty to replace a vehicle or make restitution to the buyer if the manufacturer is unable to repair the new vehicle after a reasonable number of repair attempts, and the buyer need not reject or revoke acceptance of the vehicle at any time. The buyer need only provide the manufacturer with a reasonable opportunity to fix the vehicle.” (Lukather at 1050, citing Krotin at 303). Although not expressly stated, this essential conclusion is embodied in the CACI jury instruction for Failure to Repair After a Reasonable Number of Repair Attempts (CACI 3201), which imposes no obligation on consumers other than to take in their vehicles for service. (See: CACI 3201).
In Krotin, the automobile manufacturers as amici curiae argued, not so fast! How could we possibly know if our vehicles are lemons after sell them? We’re not “clairvoyant!” The court of appeal decisively smacked this argument down, stating: “An automobile manufacturer need not read minds to determine which vehicles are defective; it need only read its dealers’ service records… Computerized recordkeeping at dealership service departments could easily facilitate this task, even without any direct contact from the consumer to the manufacturer or any request for replacement or reimbursement to the dealership. It is thus apparent that a manufacturer need not be ‘clairvoyant’; it need only demonstrate more initiative in honoring warranties.” (Krotin at 303).
In conclusion, Krotin and Lukather both require that manufacturers repurchase defective and unfixable vehicles – even without the consumer asking. Although 15-years apart, both courts interpreted the Song-Beverly Act the same way: to require that the vehicle manufacturers monitor their computerized warranty records and voluntarily repurchase lemons.
Theoretically, this legal obligation should put lemon law lawyers like us out of business, right? Wrong! In reality, in this writer’s experience, in spite of Krotin and Lukather, no manufacturer actually follows the law by monitoring its computerized warranty records to voluntarily repurchase defective vehicles. While these important decisions provide substantial ammunition to California consumers, in reality, manufacturers simply pretend like they don’t exist.
If you have a vehicle that you believe is a lemon, don’t hold your breath waiting for the manufacturer to do the right thing, call the experts at CCA today for expert assistance: (833) LEMON-FIRM.
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