Refund under Lemon Law not immediate

1
Persida Acosta

Persida Acosta

Dear PAO,
I’m having trouble with the car I bought last month. It’s brand-new but two weeks after buying the car, I had to return it to the dealer because of engine trouble. A week after the repair, the same problem occurred so I had it checked again. The situation is already frustrating and very inconvenient for me. Can I just ask for a replacement or refund?
Jones

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Dear Jones,
The purchase of a motor vehicle is considered a major consumer purchase or investment. For this reason, the State deems it necessary to afford full protection to motor vehicle buyers against business and trade practices that are deceptive, unfair or otherwise inimical to consumers and the public interest through the enactment of a law particularly addressing issues arising from purchase of brand new motor vehicles. This law is Republic Act (RA) 10642 or the Philippine Lemon Law.

Under the Philippine Lemon Law, buyers of brand-new motor vehicles are given recourse in case a unit they purchased is defective. It states that a consumer who purchased a brand-new motor vehicle in the Philippines may report non-conformity of the vehicle with the manufacturer or distributor’s standards or specifications within twelve (12) months from the date of original delivery to the consumer, or up to twenty thousand (20,000) kilometers of operation after such delivery, whichever comes first (Sec. 4, RA 10642). Non-conformity refers to any defect or condition that substantially impairs the use, value or safety of a brand-new motor vehicle that prevents it from conforming with the manufacturer’s or distributor’s standards or specifications, and which cannot be repaired, except those resulting from non-compliance by the consumer of his or her obligations under the warranty, modifications not authorized by the manufacturer or distributor, abuse or neglect and damage because of accident or force majeure. (Sec. 3 (k), Id.)

To avail of this right, the consumer is required to send a written notice to the manufacturer, distributor, authorized dealer or retailer of the unresolved complaint, and the consumer’s intention to invoke his rights under RA 10642. In case the problem remains unresolved, the consumer may file a complaint before the Department of Trade and Industry (DTI). (Sec. 7, Id.) The DTI, having exclusive and original jurisdiction over disputes arising from provisions of the law, has the power to settle the matter through mediation, arbitration if the parties accede or adjudication, as the case may be. If the existence of the non-conformity is established, the DTI shall direct the manufacturer, distributor, authorized dealer or retailer to either replace the motor vehicle with a similar or comparable motor vehicle in terms of specifications and values, or accept the return of the motor vehicle and pay the consumer the purchase price plus the collateral charges. (Sec. 8, Id.)

Take note, however, that before availing of the Lemon Law rights mentioned in the preceding paragraph, the manufacturer, distributor, authorized dealer or retailer is given four (4) separate opportunities to repair the motor vehicle for each complaint. (Sec. 5, Id.) Thus, the consumer must first return the vehicle for repair at least four (4) times before invoking his Lemon Law right. In order to constitute one repair attempt, the vehicle must be returned again for repair for the same complaint within 15 days from release. This directive is in line with implementing rules, which state that if the vehicle is not returned within fifteen (15) days after release following a repair attempt, the repair is deemed accepted (Sec. 2, DTI DAO No. 14-3, S. 2014).

To compensate for the non-usage of the vehicle while under repair and during the period of the availment of the Lemon Law rights, the consumer is entitled to a reasonable daily transportation allowance to cover the transportation cost from his residence to his regular workplace or destination and vice versa, equivalent to air-conditioned taxi fare or in such amount agreed upon by the parties, or a service vehicle at the option of the manufacturer, distributor, authorized dealer or retailer (Sec. 7, RA 10642).

In accordance with the foregoing and considering that you are still on the second repair attempt, you may not yet ask for refund or unit replacement. The manufacturer or dealer must be afforded two more repair attempts, should the attempt at present fail. In the meantime, during the time that your car is under repair, you may ask the car manufacturer, distributor or your dealer for daily transportation allowance or service vehicle to compensate you for the inconvenience caused by the situation.

We hope that we were able to enlighten you on the matter. Please bear in mind that this opinion is based on the facts you narrated and our appreciation of the same. Our opinion may vary if facts are changed or elaborated.

Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to dearpao@manilatimes.net

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