When Did the First Defect Arise?

In Lemon Law the Standard Reference Guide we write about mileage offset (also called mileage allowance). “Almost all states permit the manufacturer to deduct some allowance for your use of the vehicle. Some states allow a deduction only for the miles driven up to the first repair attempt. [California] This recognizes that the failure to repair the vehicle is the manufacturer’s responsibility, and that being forced to continue using a lemon is not a valuable benefit…”

Here is an example of how the mileage offset is calculated under the California lemon law. It also shows the difference to the consumer if he or she doesn’t get the correct first instance of the defects that make the case.

  • Vehicle has repeating transmission defects (4+) that despite all efforts, the dealer cannot repair.
  • The gross capitalized cost of the vehicle is $56,500.
  • The mileage for the first transmission repair is 2,105 miles; the second repair is 8,475 miles; the third repair occurs at 14,760 miles, and the fourth repair occurs at 26,300 miles.

This is the formula for calculating mileage offset using the numbers above:

[Mileage at repair attempt/120,000 (life of the average car)] x agreed upon value of the vehicle.

  • (1st repair attempt: 2,105 /120,000) X $56,500 =$991 Offset
  • (2nd repair attempt: 8,475 /120,000) X $56,500 =$3,990 Offset
  • (3rd repair attempt: 14,760/120,000) X $56,500 =$6,949 Offset
  • (4th repair attempt: 26,300/120,000) X $56,500 =$12,382 Offset

Imagine for an instant that the dealership personnel and the folks at the manufacturers are very aware of what determines the first repair attempt. Is it possible that they might be motivated to use the last repair attempt instead of the first? Or perhaps they might take steps to have your transmission defect appear as some other problem.

It always comes down to the repair orders, how accurate they are, always. Bad paperwork makes difficult lemon law cases. Be a neat freak. Instead of giving back $3990 through carelessness, get the mileage of the first repair attempt right and give back $991.

Remember, if you don’t properly document that first repair attempt, your repair orders may only show three repair attempts and you may need more. This delays the case and may mean more money given back to the manufacturer for usage. The California lemon law is the best in the country, but even the best law cannot be effective if the documentation is wrong.