Informal Arbitration: Lemon Law
The Lemon Law is intended to resolve complaints involving chronic car problems. It allows the owner a refund or replacement when a new vehicle has a substantial problem that is not fixed within a reasonable time. Nebraska’s criteria for a ‘lemon’ is strict, but there may be other options available, such as warranty claims, even if your car does not fit the Nebraska criteria for the lemon law.
The Nebraska Lemon Law provides these options:
Arbitration is an informal process that is used to obtain speedy resolution of a warranty dispute without going to court, and it is legally binding on the manufacturer only. At an arbitration hearing, you and the manufacturer testify before an impartial arbitrator about the condition and repair history of the vehicle. The arbitrator will decide what is fair based on the facts of the case.
Arbitration is a quick and does not require an attorney. Cases take less than 40 days once you have supplied the repair and service information for the arbiter’s consideration.
Arbitration does not require that a vehicle be a “lemon,” but it must be under warranty. The arbiter’s decision is binding on the manufacturer only; that is, you may accept or reject the arbiter’s decision. If you accept, the manufacturer will have to do as the arbiter decides. If you reject, then nothing will happen. The manufacturer will do nothing, and you are free to sue in court, if you wish.
A "lemon" is a motor vehicle with a defect which substantially impairs the use or market value and cannot be repaired after reasonable attempts. The vehicle must be:
The vehicle may be used for any purpose: business, family, household or personal purposes. It may be any size, from a motorcycle to a semi-truck. It may be leased from a dealer in Nebraska.
The vehicle cannot be a trailer or self-propelled motor home.
A vehicle is presumed to be a lemon if
A manufacturer, however, is allowed to argue that the problem does not substantially impair the use or market value of the vehicle or that the problem is a result of abuse, neglect, or unauthorized modifications of the vehicle.
A lemon law dispute is between you and the manufacturer, and it does not include your dealer. You must give the manufacturer written notification by certified mail, and he must have an opportunity to fix the problem. As a practical matter, you should probably send notification after the third repair attempt or after the vehicle has been in the shop 30 cumulative days.
The Nebraska Lemon Law provides that a manufacturer must pay, should a vehicle be a lemon, the full purchase price for the vehicle including all sales tax, license and registration fees, and any similar governmental charges (minus a reasonable amount for the use of the vehicle.) It will also pay your reasonable attorney’s fee.
If you accept a buy-back that does not include taxes and fees, the Nebraska Department of Revenue will not refund taxes or fees. You will simply loose that money.
As with any legal matter, you must present your best case. Present all records and documentation of every repair from the dealer. This includes times that the dealer could find nothing wrong. It also includes every trip into the shop, e.g., taking the vehicle for diagnosis and bringing it back for the part to be installed is two trips.
You may hire an attorney to help you organize and present your case. You will probably need one if you decide to sue the manufacturer in court rather than going through arbitration. An attorney is optional at arbitration.
You will have to notify the manufacturer of your vehicle by certified mail to begin the lemon law claim. The claim will be arbitrated through the BBB AUTO LINE and application may be made on the internet. The BBB Auto Line phone number is: 1-800-334-2406
General Motors prefers that you use the following addresses to notify them, by certified letter, about your lemon law claim.
The following manufacturers are not certified, that is, they will not refund taxes and fees, although they may agree to repurchase or replace the defective vehicle. You do not have to use arbitration: you may sue directly in court. If you wish to try arbitration contact:
BBB AUTO LINE 1-800-334-2406.
_______________________________________________________page updated 12/22/14