Men and Markets Observed: CANADA NEEDS NEW LAW AROUND High-tech 'lemon cars'

I PERSONALLY ENDORSE THE LEMON AID BOOKS, IF YOU ARE IN THE MARKET FOR A NEW OR USED CAR. HE WILL SAVE YOU MONEY AND HELP YOU AVOID COSTLY MISTAKES...

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CBC News

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Canada needs a "lemon law" now more than ever as the increasing computerization of cars makes problem vehicles harder and costlier to repair, a consumer advocate says.

"The more high-tech cars become, the more lemons you see because there's so much more to go wrong," Phil Edmonston, author of the Lemon-Aid car guides, said in an interview with CBC's Marketplace.

Edmonston estimates about one in 10 cars are irreparable and should be replaced.

"The main reason people need a lemon law now is cars are getting much, much more complicated than ever before," he added.

Electronics are sensitive to vehicle vibrations, extreme temperature fluctuations and moisture, Edmonston cautions.

"This is what causes your lights to fail often or causes a vehicle to stall out," said Edmonston.

"Then they have to find what is the cause, and it's very difficult tracing these electrical problems."

In the U.S., state and federal laws exist that protect consumers who buy a so-called "lemon," a car found after purchase to be faulty beyond repair.

In Canada, two provinces — Manitoba and Nova Scotia — have introduced legislation requiring used car dealers to disclose whether a car has been deemed a lemon elsewhere.

But there's no legislation that defines what a lemon is or deals with new vehicles that turn out to have serious defects.

'The lemon law is a big stick. … And no one wants to get whacked by this big stick.' —Phil Edmonston

Consumer author Edmonston says the case demonstrates Canada's need for "lemon laws" to protect those who buy new cars that end up being defective.

"A lemon law defines what is a lemon," said Edmonston. "It takes more than three times to repair? It's a lemon."

Lemon laws a 'big stick'

Introducing a lemon law similar to those in the United States would also define the obligations of car manufacturers and stipulate when a buyer is entitled to a refund or replacement.

"The lemon law is a big stick. Whether you wield it or not, all the players in the car industry know it’s there. And no one wants to get whacked by this big stick."

B.C.'s minister responsible for consumer affairs, Shirley Bond, declined a request for an interview with CBC's Marketplace.

When the show tracked her down, Bond said that there's no current lemon law legislation.

"We are looking at whatever options are appropriate for British Columbia. We'll continue to do that," added Bond.

In the United States, lemon laws vary by state. California, which introduced its 'lemon car' legislation in 1983, protects buyers who discover defects in their new or used cars when safety, use or value is affected.

If the manufacturer is unable to fix the problem vehicle after a reasonable number of attempts, they must replace or repurchase it.

Christopher Leyva, who lives in Los Angeles, benefitted from the clarity of the lemon law in California. Shortly after buying his vehicle, the car stalled while driving on the freeway.

"I was going 65 miles per hour and the car started making these noises and then it just completely stopped," said Leyva. "Luckily, I was near the ramp, the exit ramp. I pulled over and that, that really freaked me out."

When repairs didn't fix the problem, Leyva hired a lawyer and got a full refund. "Win or lose, I didn't pay a thing," he said.

The lawyer who represented the L.A. car owner, Norman Taylor, says Walls' B.C. case would be a "dream case" in California.

"In California I would take this case in a heartbeat," said Taylor. "And I can almost assure you that Chrysler would step up and settle this case very quickly."

Canadian consumers can take an auto manufacturer to small claims court to claim less than $25,000, but the process is costly.

A free national arbitration process, called the Canadian Motor Vehicle Arbitration Process (CAMVAP), exists to help consumers try to resolve vehicle defect issues with manufacturers. If no resolution can be found, the buyer can apply for a hearing. A ruling in the consumer's favour can result in a refund for repairs or a vehicle buy back.

But Edmonston is critical of the process.

"It hasn’t worked all that well because it doesn’t have a prevention aspect like you would have with a lemon law," said Edmonston.

"We need something to show the manufacturers and dealers this is what your responsibility is."

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