A Hyundai Santa Fe owner who won a lemon law suit against Hyundai Motor America is entitled to attorney fees for the time his lawyer spent to cancel third-party contracts for finance and insurance products, a New Jersey appeals court has ruled.
"The lemon law requires the consumer to be made whole and authorizes a counsel fee award if counsel is needed to obtain relief from any options sold through the dealer as part of the purchase transaction," the panel of the Appellate Division of New Jersey Superior Court said in a unanimous opinion last month.
Hyundai already had settled the underlying lemon law claim, and the plaintiff, Jorge Casal, already had been fully reimbursed for the third-party contracts, said Jane Rigby, a lawyer for Hyundai in Newark, N.J.
Casal bought the Santa Fe new from Sansone Hyundai Inc. in Avenel, N.J., in June 2011. At the same time, he bought four optional protection packages financed through Hyundai Capital America: an anti-theft etching system; a Titanium Protection Plan for roadside assistance, windshield repair, tire-and-rim protection and dent-and-ding coverage; key replacement; and guaranteed asset protection, or GAP, which waived any gap in the difference between the actual cash value of the vehicle and the loan balance in the event of a total loss.
The bottom line on the retail buyer's order was $26,798, according to Casal's lawyer, Andrew Wolf of North Brunswick, N.J.
The vehicle developed problems two days after the purchase and by mid-July met the criteria for a lemon. When Casal requested a refund or exchange, Hyundai initially offered just $3,000 plus rental expenses, the court said. After he hired a lawyer, Hyundai agreed to replace the car but declined to transfer the protection plans to a new vehicle without additional cost.
Casal's lawyer spent several months working on the problem, the court said. Casal was reimbursed for the options but only after Hyundai "put pressure" on the dealer.
Left unresolved was Hyundai's liability for Casal's attorney fees after resolution of the lemon law claim.
A lower-court judge ruled that Hyundai was on the hook only for fees incurred to settle the lemon law suit and wasn't responsible for the optional contracts.
But the appeals court disagreed, saying Hyundai had "imposed the duty of negotiating with these third parties, the dealer and the finance company on Casal" and cited the dealer's ongoing relationship with Hyundai and the third parties.
Wolf, Casal's lawyer, said the scope of the state's lemon law, not fees, had been the main issue.
But Hyundai lawyer Rigby offered a different take, saying, "This case was always about fees."
Wolf and Rigby said they've now settled the remaining fees, but neither would disclose the amount of the payment.