Understanding Alaska Lemon Law
Auto manufacturers sell 150,000 cars in America every year classified as lemons: cars with repeated, unfixable problems. Lemons can come from any manufacturer: Honda, Chevrolet, Ford and every other manufacturer has built lemon vehicles over the years.
“Lemon laws” enacted across the United States help protect consumers who purchase defective vehicles and compensate them for their losses. Additionally, a powerful federal law known as the Magnuson-Moss Warranty Act provides protection for consumers who purchase cars that are having problems under the manufacturer’s warranty. Some lemons may eventually be recalled by the manufacturer, if the problems are systemic.
The Alaska Motor Vehicle Warranties Act, also known as the Alaska lemon law, covers vehicles registered in Alaska used for personal, family or household purposes.
The lemon law does not cover tractors, farm vehicles, off-road vehicles or used vehicles.
The Alaska lemon law provides protection to consumers who purchase new vehicles, as well as anyone to whom the vehicle’s ownership is transferred. The lemon law does not cover consumers who lease vehicles.
Alaska’s lemon law covers vehicle nonconformities. The lemon law defines a “nonconformity” as a defect or condition in a vehicle caused by a manufacturer, distributor, dealer, or repairing agent that substantially impairs the vehicle’s use or market value. The problem must cause the vehicle to not conform to an applicable manufacturer written warranty.
The Alaska lemon law defines “substantially impairs the use” as preventing a motor vehicle from being operated or making the vehicle unsafe to operate. It defines “substantially impairs the market value” as decreasing the dollar value of a vehicle when compared to the dollar value of a similar, conforming vehicle.
The lemon law’s definitions don’t include any problem stemming from abuse, neglect or unauthorized modification or alteration of the vehicle.
Think you have a lemon, click here to fill out a 60 second form.
The manufacturer must repair any nonconformity if the consumer reports it within the period of the written warranty. The manufacturer must do so even if the repairs begin after the warranty term expires. If the manufacturer cannot conform the vehicle to its warranty within a reasonable number of attempts, they are bound by law to repurchase or replace the vehicle.
The consumer must allow the manufacturer a “reasonable number of repair attempts” to fix the nonconformity. The Alaska lemon law defines this as three or more attempts without success. The lemon law’s provisions also take effect if the vehicle is out of service for 30 calendar days because of a nonconformity.
The manufacturer must repurchase or replace the vehicle if they or their agents are unable to repair the nonconformity after a reasonable number of attempts. The consumer must give written notice by certified mail to the manufacturer and dealer before 60 days has elapsed after the expiration of the express written warranty or one year after the vehicle’s delivery. The written notice must state the vehicle has a nonconformity and describe the nonconformity. The notice must state the manufacturer has made a reasonable number of repair attempts to fix the problem, and demand a refund or replacement vehicle.
The manufacturer may make a final attempt to repair the nonconformity within 30 days of receiving the notice. If unsuccessful, they must repurchase or replace the vehicle within 60 days of receiving the notice.
The Alaska lemon law requires manufacturers to repay the full purchase price of the vehicle when repurchasing. This includes registration and transportation fees, dealer preparation and dealer installed options. The manufacturer may withhold a reasonable allowance for use, calculated from the amount of miles driven by the vehicle. The reasonable allowance may not exceed an amount equal to the depreciation in value of the vehicle while the vehicle is in use, plus an amount equal to depreciation caused by owner neglect or body damage.
When replacing a vehicle under the Alaska lemon law, the manufacturer must provide a new, comparable vehicle.
The Alaska lemon law’s provisions covering refund or replacement don’t apply until the consumer has first resorted to an “informal dispute settlement procedure,” i.e. arbitration. The manufacturer’s procedure must comply with state and federal law and be approved by the Alaska Attorney General.
In some instances, arbitration can allow for a faster resolution of conflicts between consumers and manufacturers. Arbitration hearings usually last only one day, and take place in a much less formal setting than a court. Consumers should bring all documents relating to the vehicle and the repair process, including the letters exchanged with the manufacturer. They should also arrange for witnesses to appear at the hearing, including friends who have witnessed the vehicle’s problems.
However, arbitration often ends with an outcome unfavorable to the consumer. The third party arbitrator may award the consumer with additional repair attempts, which doesn’t provide any remedy they didn’t have before. They may also decide to dismiss the claim, siding with the manufacturer. The law makes no mention of the ability to recoup attorney’s fees during arbitration. Fortunately, the federal Magnuson-Moss Warranty Act allows for consumers to sue for attorney’s fees alongside damage awards in court.
The manufacturer must abide by the decision of the arbitrator, while the consumer does not. If dissatisfied with the outcome, a consumer can bring action in the civil court system. By filing a claim under the Magnuson-Moss Warranty Act, Alaska consumers can hire lawyers who will represent them without the vehicle owner having to pay any attorneys’ fees directly out of their pocket. The Act provides that the vehicle manufacturer shall pay the claimants’ reasonable attorneys’ fees if the claimant prevails against the manufacturer. Lemonlawusa.org encourages vehicle owners with a lemon to obtain legal counsel. You can bet the car manufacturers have legal counsel at the ready to help defend against lemon law claims both in arbitration and in court. Shouldn’t you have competent legal counsel in your corner?