California Arbitration System Enlists Builders
Recreational vehicle buyers in California have a new way to settle warranty disputes with four major motorhome makers who have agreed to use the state's arbitration system, according to the Press-Enterprise, Riverside.
The change means RV buyers can address defects under the state's lemon law without hiring an attorney and within 40 days of filing a claim. And while consumers can reject the arbitrator's decision, the companies are bound by it.
It’s not uncommon for RV makers to use arbitration, but they aren't required to certify their programs with the state.
"A lot do to make sure they are in line with the state lemon law," said Department of Consumer Affairs spokesman Russ Brown. "It adds a certain amount of validity to what they do."
National RV Inc., based in Perris, Calif., was the first to get certified, late last year, followed by Elkhart, Ind.-based Coachmen Industries Inc. and its subsidiary, Georgie Boy Manufacturing.
In early February, Forest City, Iowa-based Winnebago Industries Inc. joined the group. Riverside-based Fleetwood Enterprises also is considering certification, said spokeswoman Amy Coleman.
The paper reported that nearly 20 automakers operate state-certified programs.
"We did it because we think it is a great customer service," said John Corn, general counsel to National RV. "They can address grievances in a formal manner without an attorney and in a way that is far quicker than the court system."
So far, the company has one arbitration case, and was told to buy back the faulty motor home, a gas-powered Dolphin LX.
"We came out on the losing side, but that's OK. We got it resolved, and neither side spent anything on attorney's fees, which could have cost us $50,000," Corn said.
A Coachmen representative said the company likes the state's arbitration system because it is run by people who are familiar with RVs and the industry.
"Certified motor home arbitrators understand that these vehicles are inherently more complex than the family car," said spokesman Rich Allen.
RV makers have been hesitant to get involved in the certification process because only the motorized parts of the vehicles are covered by the lemon law, Corn said.
The lemon law requires the vehicle maker to buy back or replace a product that is not repaired after a "reasonable" number of attempts.
But the law can also benefit manufacturers. For instance, if a company's process is state-certified, the consumer is required to try the system before going to court. It also limits the civil damage penalties sometimes awarded in lemon law cases.
The decision to join the certification program came out of a Recreation Vehicle Industry Association meeting of lawyers representing RV makers.
"We hope this is the beginning of a solid trend among industry manufacturers," consumers affairs department director Charlene Zettel said in a statement.