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Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
AT A GLANCE:
In the case of DEPARTMENT OF TRADE AND INDUSTRY vs. TOYOTA BALINTAWAK, INC. AND TOYOTA MOTOR PHILS. CORP., G.R. Nos. 254978- 79, October 11, 2023, the Supreme Court held that the Lemon Law is not an exclusive remedy for consumers or purchasers of defective brand-new vehicles. The last paragraph of Section 7 of RA 7394 or the Philippine Lemon Law specifically provides that “Nothing herein shall be construed to limit or impair the rights and remedies of a consumer under any other law.” (Emphasis added).
The Court reiterated in the said case the basic rule on statutory construction that when the law is clear and unambiguous, the Court is left with no alternative but to apply the same according to its clear language. Therefore, based on the said principle, the Court ruled that RA 10642 is an alternative remedy granted to the consumer or purchaser of a defective brand-new vehicle and that he or she is free to choose to enforce his or her rights under RA 7394 or any other law.
Acquiring a brand-new vehicle nowadays is no longer an easy feat, with the rising inflation rate and other basic necessities that we Filipinos would have to prioritize before anything else. Therefore, to ensure that our hard-earned money would not be put to waste, we have to ensure that we get good value for money and the necessary warranties should there be any defect in the vehicles we purchase.
Aside from warranties, various Philippine laws provide remedies for defective brand-new vehicles, such as the Consumer Act of the Philippines and the Philippine Lemon Law.
Legal remedies available for defective brand-new vehicles
The remedies under Article 100 of Republic Act (RA) No. 7394 otherwise known as the Consumer Act of the Philippines are as follows:
“Article 100. Liability for Product and Service Imperfection. – The suppliers of durable or nondurable consumer products are jointly liable for imperfections in quality that render the products unfit or inadequate for consumption for which they are designed or decrease their value, and for those resulting from inconsistency with the information provided on the container, packaging, labels or publicity messages/advertisement, with due regard to the variations resulting from their nature, the consumer being able to demand replacement to the imperfect parts.
If the imperfection is not corrected within thirty (30) days, the consumer may alternatively demand at his option:
a) the replacement of the product by another of the same kind, in a perfect state of use;
b) the immediate reimbursement of the amount paid, with monetary updating, without prejudice to any losses and damages;
c) a proportionate price reduction. The parties may agree to reduce or increase the term specified in the immediately preceding paragraph; but such shall not be less than seven (7) nor more than one hundred and eighty (180) days.
The consumer may make immediate use of the alternatives under the second paragraph of this Article when by virtue of the extent of the imperfection, the replacement of the imperfect parts may jeopardize the product quality or characteristics, thus decreasing its value.
If the consumer opts for the alternative under sub-paragraph (a) of the second paragraph of this Article, and replacement of the product is not possible, it may be replaced by another of a different kind, mark or model: Provided, That any difference in price may result thereof shall be supplemented or reimbursed by the party which caused the damage, without prejudice to the provisions of the second, third and fourth paragraphs of this Article.”
On the other hand, the legal remedies under Sections 4 to 7 of RA 10642, otherwise known as the Philippine Lemon Law, are as follows:
“Section 4. Coverage. – This Act shall cover brand new motor vehicles purchased in the Philippines reported by a consumer to be in nonconformity with the vehicle’s 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. The following causes of nonconformity shall be excluded:
(a) Noncompliance by the consumer of the obligations under the warranty;
(b) Modifications not authorized by the manufacturer, distributor, authorized dealer or retailer;
(c) Abuse or neglect of the brand new motor vehicle; and
(d) Damage to the vehicle due to accident or force majeure.
Section 5. Repair Attempts. – At any time within the Lemon Law rights period, and after at least four (4) separate repair attempts by the same manufacturer, distributor, authorized dealer or retailer for the same complaint, and the nonconformity issue remains unresolved, the consumer may invoke his or her rights under this Act.
The repair may include replacement of parts components, or assemblies.
Section 6. Notice of Availment of Lemon Law Rights. – Before availing of any remedy under this Act and subject to compliance with the provisions of Section 5 hereof, the consumer shall, in writing, notify the manufacturer, distributor, authorized dealer or retailer of the unresolved complaint, and the consumer’s intention to invoke his or her rights under this Act within the Lemon Law rights period.
The warranty booklet issued by the manufacturer, distributor, authorized dealer or retailer shall clearly state the manner and form of such notice to constitute a valid and legal notice to the manufacturer, distributor, authorized dealer or retailer. It shall also clearly state the responsibility of the consumer under this section.
Section 7. Availment of Lemon Law Rights. – Subsequent to filing the notice of availment referred to in the preceding section, the consumer shall bring the vehicle to the manufacturer, distributor, authorized dealer or retailer from where the vehicle was purchased for a final attempt to address the complaint of the consumer to his or her satisfaction.
It shall be the duty of the manufacturer, distributor, authorized dealer or retailer, upon receipt of the motor vehicle and the notice of nonconformity required under Section 6 hereof, to attend to the complaints of the consumer including, as may be necessary, making the repairs and undertaking such actions to make the vehicle conform to the standards or specifications of the manufacturer, distributor, authorized dealer or retailer for such vehicle.
In case the nonconformity issue remains unresolved despite the manufacturer, distributor, authorized dealer or retailer’s efforts to repair the vehicle, pursuant to the consumer’s availment of his or her Lemon Law rights, the consumer may file a complaint before the DTI as provided for under this Act: Provided, however, That if the vehicle is not returned for repair, based on the same complaint, within thirty (30) calendar days from the date of notice of release of the motor vehicle to the consumer following this repair attempt within the Lemon Law rights period, the repair is deemed successful: Provided, finally, That, in the event that the nonconformity issue still exists or persists after the thirty (30)-day period but still within the Lemon Law rights period, the consumer may be allowed to avail of the same remedies under Sections 5 and 6 hereof.
To compensate for the non-usage of the vehicle while under repair and during the period of availment of the Lemon Law rights, the consumer shall be provided a reasonable daily transportation allowance, an amount which covers the transportation of the consumer from his or her residence to his or her regular workplace or destination and vice versa, equivalent to air-conditioned taxi fare, as evidenced by official receipt, or in such amount to be agreed upon by the parties, or a service vehicle at the option of the manufacturer, distributor, authorized dealer or retailer. Any disagreement on this matter shall be resolved by the DTI.
Nothing herein shall be construed to limit or impair the rights and remedies of a consumer under any other law.” (Emphasis added)
The SC held that the Lemon Law is not an exclusive remedy
In the case of DEPARTMENT OF TRADE AND INDUSTRY vs. TOYOTA BALINTAWAK, INC. AND TOYOTA MOTOR PHILS. CORP., G.R. Nos. 254978- 79, October 11, 2023 the Supreme Court held that the Lemon Law is not an exclusive remedy for consumers or purchasers of defective brand-new vehicles. The last paragraph of Section 7 of the Lemon Law specifically provides that “Nothing herein shall be construed to limit or impair the rights and remedies of a consumer under any other law.” (Emphasis added).”
The Court reiterated in the said case the basic rule on statutory construction that when the law is clear and unambiguous, the Court is left with no alternative but to apply the same according to its clear language. Therefore, based on the said principle on construction, the Court ruled that RA 10642 is an alternative remedy granted to the consumer or purchaser of a defective brand-new vehicle and that he or she has the option to choose to enforce his or her rights under RA 7394 or any other law.
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Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries regarding legal services, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/ 0917-5772207/ 09778050020.
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