You receive an email from the manufacturer.
There is an offer.
Maybe it is a buyback.
Maybe it is a cash payment.
Maybe it is a replacement vehicle.
The manufacturer wants you to sign an agreement and resolve the dispute.
The natural reaction is:
“Is this a good deal?”
That question is harder to answer than it sounds.
The first question is: good compared to what?
You need to compare it with the alternatives.
For example:
Option A: Accept the manufacturer’s offer.
Option B: Negotiate for better terms.
Option C: Pursue a buyback instead of cash compensation.
Option D: Pursue a replacement vehicle.
Option E: Continue with a formal claim or litigation.
The appropriate choice depends on the facts.
Look beyond the headline number
Suppose the manufacturer says:
“We will pay you $8,000.”
That sounds simple.
But then you discover that the agreement requires you to:
- release all claims;
- keep the vehicle;
- waive certain rights;
- pay your own attorney fees.
The actual value of the offer may be very different from $8,000.
Review the release
The release is one of the most important documents in the transaction.
A release can determine what claims disappear once you sign.
Read for language involving:
- warranty claims;
- Lemon Law claims;
- Magnuson-Moss claims;
- fraud or misrepresentation;
- personal injury;
- future claims;
- unknown claims;
- attorney fees;
- arbitration;
- confidentiality; and
- dismissal of any existing proceedings.
If you do not understand a provision, don’t guess.
What about attorney fees?
This is particularly important in Lemon Law and warranty cases.
Consumers often assume that because they hired a lawyer, the manufacturer automatically pays whatever the lawyer charges.
The law is more nuanced.
Nevada’s basic Lemon Law provisions do not simply state that every manufacturer must
automatically pay every attorney bill in every ordinary Lemon Law dispute.
Federal warranty law, including Magnuson-Moss, can provide for recovery of reasonable
attorney fees in qualifying cases when the consumer ultimately prevails.
Settlement agreements can also specifically address attorney fees.
That is why the fee provision should be reviewed as part of the overall settlement if you are working with the lawyer.
What if the manufacturer offers to pay your lawyer separately?
That can be important.
Suppose the manufacturer offers:
$25,000 to you
plus
$2,500 toward attorney fees.
That is different from:
$27,500 total, including everything.
Make sure you know which it is.
What if the manufacturer says the offer expires tomorrow?
Sometimes settlement offers have deadlines.
That does not necessarily mean you should panic.
If you need additional time to evaluate an agreement, ask for it.
A settlement should be understood before it is signed.
What if the offer is actually reasonable?
Not every manufacturer offer is a bad offer.
Sometimes the manufacturer proposes a resolution that is fair.
The goal of representation is not to reject every offer.
The goal is to determine whether the offer appropriately resolves the client’s problem.
A strong settlement can sometimes save months of litigation.
What if you want a buyback instead?
This is where understanding the available remedies becomes particularly important.
Nevada’s Lemon Law provides for replacement or refund in qualifying circumstances after a reasonable number of repair attempts, subject to the statute’s requirements.
If the manufacturer is offering cash to keep the vehicle but you don’t want the vehicle anymore, the question is not simply whether the cash number is large enough.
It is whether the proposed resolution matches the remedy you actually want.
What if the manufacturer refuses to improve the offer?
At that point, you need to understand your leverage.
That may include:
- repair history;
- warranty language;
- time out of service;
- severity of the defect;
- safety implications;
- manufacturer communications;
- diagnostic evidence;
- applicable statutory deadlines;
- dispute-resolution requirements; and
- potential federal warranty claims.
Negotiation is strongest when it is based on evidence.
Don’t negotiate from emotion
It is completely understandable to be angry.
You paid for a new vehicle.
You expected a new vehicle free of problems.
You received a vehicle that required repeated repairs instead.
But settlement negotiations generally work better when they are organized around facts.
Instead of responding emotionally with:
“This car is a piece of junk and I’m never accepting your offer.”
a more effective approach is:
“The vehicle has been presented for the same defective condition four times, has been unavailable for 37 cumulative days, and the condition continues. The proposed settlement does not adequately address the requested repurchase.”
Facts create leverage.
Should you accept?
There is no universal answer.
A good settlement is one that solves the client’s actual problem on acceptable terms.
Before signing, understand:
What am I getting?
What am I giving up?
What happens to my vehicle?
What happens to my warranty?
Who pays attorney fees?
What happens to my loan?
What claims are released?
If you cannot answer those questions, the agreement deserves further review.
Take the 30-Second Nevada New Car Problem Quiz
If your new car has been in the shop repeatedly, you don’t have to figure out whether it might be a lemon by yourself.
Take our 30-second Nevada New Car Problem Quiz.
We’ll ask about your vehicle, warranty, repair history and time out of service.
Precision Injury Law represents Nevada consumers with qualifying vehicle warranty and Lemon Law problems.
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