California Lemon Law Guide: Emotional Distress and Loss of Use Damages Are Not Recoverable Under the Lemon Law,, But Punitive Damages Are: Bishop v. Hyundai Motors

Our lemon law clients, most of whom have suffered mightily at the hands of car makers that can’t fix but won’t buy back their cars, often ask “what about all the hassle of not having my vehicle, what about the stress of repeated life-threatening engine failures”?  These are good and fair questions.  Unfortunately, the case Bishop v. Hyundai Motors, 44 Cal.App.4th 750 (1996), held that manufacturers do not have to pay consumers for “loss of use” damages or “emotional distress” damages.  Not under the lemon law, anyway.   This arguably wrongly decide case did clarify some points, however, in ways more friendly to consumers.  For one, it noted that actually incurred rental costs ARE recoverable for a needed replacement vehicle.  This much is clearly set out in the lemon law.  It also noted that the lemon law allows for a 2 X multiplier of actual damages as a statutory penalty where the failure to promptly repurchase the vehicle was willful.  The court found “overwhelming” evidence supporting the statutory penalty in the case because “Hyundai [the manufacturer] first delayed, then “low-balled” its offers and finally ‘stone-walled’ [the consumer] even after notice of its contractual and statutory obligations…”