In two separate cases against the former Chrysler Corp., the Wisconsin Court of Appeals has limited the scope of the state's lemon law, making it more difficult for dissatisfied purchasers to obtain legal relief.
'The Court of Appeals indicated we need some limitations on cases brought under the labor law,' said Shawn Govern, the Milwaukee lawyer representing DaimlerChrysler in both appeals. 'Consumers and their attorneys have run pretty loose with the lemon law.'
Vincent Megna of Waukesha, who represents the plaintiffs in the suits, said the decisions do help clarify the law in Wisconsin. 'At least we know where we are now.'
In one case, the appellate court ruled that the purchaser of a lemon demo is entitled to a refund or a comparable demo, but not a new vehicle.
In the other decision, the three-judge panel said the lemon law does not apply to defects that are evident at the time a new vehicle is delivered.
DaimlerChrysler won both appeals.
GREEN VS. PURPLE
The demo dispute involved Michele Dussault's purchase of an emerald green 1994 Eagle Vision with 6,302 miles from John Lynch Chevrolet-Pontiac Sales Inc. in Burlington. The dealership also is an authorized Jeep dealer. At the time, the vehicle's suggested retail price was $25,787.
During the first year of ownership, Dussault experienced at least one warranty nonconformity that was not repaired despite Chrysler's attempts to fix it, the court said. In 1997, she sent Chrysler a lemon law notice demanding a comparable new vehicle.
Chrysler conceded it had been offered a reasonable attempt to fix the vehicle and failed to do so. It offered her a 1997 Eagle Vision with 5,728 miles and a suggested retail price of $26,290. The replacement had similar features as the 1994 model but was purple.
She turned down the offer, demanded a new vehicle and also claimed that purple was unacceptable to her and her husband.
She then sued Chrysler and the dealership in Waukesha County Circuit Court. Judge Kathryn Foster dismissed the case without trial, ruling that Chrysler had fulfilled its lemon law duties.
Dussault's lawyer, Megna, said, 'The reason we challenged it was because the (lemon law) statute says the manufacturer must provide a comparable new motor vehicle. A demo is not `new' by law.'
The appeals court upheld Chry-sler's position, saying the intent of the lemon law is to put consumers in the position they thought they were in at the time of purchase.
'We conclude that Chrysler fulfilled its obligation by offering to replace Dussault's lemon with a vehicle that put her in the position she thought she was in at the time she purchased the original car,' Judge Harry Snyder said.
'The lemon law permits the replacement of a nonconforming demonstrator with a comparable demonstrator.'
The court also said color is not a factor in determining whether a replacement is 'comparable' under the lemon law.
Defense lawyer Govern said the case will have a lasting effect because it addresses the issue of what a 'comparable vehicle' is.
At the same time, the appeals court denied Chrysler's request for floorplan costs and depreciation on the replacement vehicle caused by Dussault's refusal to accept it. The panel said the lemon law does not authorize manufacturers to recover their costs when a consumer refuses to accept a replacement vehicle.
In the aftermath of the July decision, lawyers are negotiating over whether Dussault will get a refund or a recent-model demo. A refund is most likely, Govern said, since the Eagle Vision is no longer manufactured.
The second case involved a new 1996 Dodge Ram that Kerry Dieter and Donna Hermes bought from Frascona Chrysler-Plymouth-Dodge Trucks in East Troy. They ordered aftermarket accessories and, when they came to pick up the Ram, noticed the vehicle had been scratched during installation of the accessories.
They complained and at first refused to accept the vehicle but completed the transaction after the dealership declined to refund their deposit but promised to fix the scratches.
They found the subsequent repainting job unsatisfactory and tried to rescind the deal. They then sued Chrysler but not the dealership for a lemon law violation, breach of warranty and breach of contract. Waukesha County Circuit Judge Marianne Becker found no lemon law violation or breach of warranty and dismissed the suit.
The appeals court upheld her decision.
'Wisconsin's lemon law was meant to protect consumers from hidden flaws discovered following delivery of a new motor vehicle, not from visible defects apparent to the consumer prior to delivery,' appeals Judge Richard Brown said.
'The lemon law does not apply because the consumers were aware of the defects before delivery of the vehicle but accepted it anyway,' the court said. The coverage period under the lemon law and warranty began with delivery of the vehicle to Dieter and Hermes.
Megna said his clients expect to ask the Wisconsin Supreme Court to review the case.