Every year, thousands of auto buyers are stuck with a lemon because they think they can’t afford an attorney. And it’s easy to see why. California lemon law attorney fees can be as much as $700 an hour.
But California’s fee-shifting provision under the Song-Beverly § 1794 shifts the burden to the manufacturer, so consumers can afford to fight large auto corporations. The goal is to ensure every consumer has legal access, regardless of their income level.
If you’re considering filing a lemon law claim, it’s important to understand how the consumer wins attorney costs, the manufacturer pays fees, and what no cost to consumer really means.
How California’s fee-shifting statute works
Lemon laws are designed to protect consumers who purchased or leased a defective car. They typically apply to new automobiles, but can be expanded to cover used vehicles, RVs, motorcycles, and boats.
FCRA fee shifting
Most lemon law attorneys take cases on contingency. This means you pay zero upfront costs, and your attorney is only paid if you win or settle your case. What’s more, the vehicle manufacturer is legally required to pay your attorney’s fees, court costs, and expenses on top of a vehicle refund or replacement.
The California Consumers Legal Remedies Act
Along with the Song-Beverly § 1794(d), consumers are also protected against unfair, deceptive, and fraudulent sales tactics under the CLRA. If a dealer hides a car’s accident history or rolls back an odometer, the dealer is responsible for separate CLRA attorney fees.
Both laws enable consumers (the prevailing plaintiff) to seek damages with no financial risk and attorneys to aggressively pursue compensation.
Hourly rates
While contingency fees are the industry standard, some attorneys charge an out-of-pocket hourly retainer. This is rare in lemon law cases and usually only occurs when:
- A case involves complex legal matters like simultaneous warranty laws, different car models, or fraud.
- A dealer breaches the sales/lease contract.
How fees are calculated
First, if your claim is successful, the manufacturer must provide one of the following remedies:
- Replacement vehicle free of defects
- Refund of your purchase price, registration fees, taxes, and incidental expenses
- Cash settlement that compensates you without replacing your car
Next, your lawyer and the manufacturer’s lawyer will negotiate the exact amount of attorney fees to be paid. If your lawyer accepts, your case is closed without the courts getting involved.
But if the manufacturer digs their heels in, refuses to pay, or tries to lowball excessively, your attorney can file a fee petition. This asks a judge to review the time spent, your attorney’s hourly rates, and out-of-pocket costs to determine the exact amount the automaker must pay.
The lodestar calculation
California courts evaluate attorney fees based on several factors. To get the correct fee award, a judge multiplies:
- The actual hours reasonably spent on litigation.
- Reasonable attorney fees according to the local market rate for consumer defense, case complexity, and your attorney’s experience.
If an auto manufacturer delays or aggressively fights a clear-cut claim, their stalling tactics drive up your attorney’s billable hours. Consequently, the manufacturer ends up paying a much higher final bill, which gives them a financial incentive to settle valid claims early.
Why fee shifting lets anyone afford a Consumer Lawyer
Auto manufacturers have large legal teams and unlimited budgets, making it easy to use stall tactics to wear consumers down. A corporate defense team can easily bankrupt a consumer even before going to court.
To fight back, understanding contingency vs fee shifting is important. With a contingency agreement, you pay no upfront cost, but fee-shifting regulation changes the game entirely. Because the manufacturer bears the cost of legal fees and compensation, they can’t simply out-spend or bully the consumer.
The Song-Beverly and other laws create genuine access to justice, turning a corporate battle into a fair fight. If you’re ready to file a lemon law claim, your first step is an attorney consultation. Call Brennan Law, Los Angeles consumer law attorney, today for a free case review and find out what your case is worth.
Let’s make lemon law work for you.