In a September 6 piece, Why you should avoid home warranties, Consumer Reports again takes a shot at service contracts. Noting a recent complaint filed by New Jersey regulators against Choice Home Warranty for allegedly making it difficult to obtain benefits, CR “recommend[s] avoiding service contracts” because those “that cover homes and cars, for example, can cost hundreds of dollars.” But what if the car or home costs many thousands of dollars? Isn’t spending a few hundred bucks on a service contract worth it to minimize risk and secure peace of mind? “No,” says CR, “it makes much more sense to buy reliable products and maintain them as the manufacturer recommends.” Now it’s clear, just buy things that won’t malfunction or fail. Continue reading
Tag Archives: automobiles
“Merchantability” is one of those legal terms-of-art that defies precise definition. Courts ruling on implied warranty of merchantability claims generally frame the question as whether the product was “reasonably fit for its intended purpose.” But what any given jury will find to be “reasonable” is anyone’s guess. So better for the defendant that the case never get to the jury. I think Chrysler might agree. Continue reading
It is quickly moving beyond dispute that federal consumer protection law favors binding arbitration over litigation. A North Carolina federal trial court recently joined two federal appellate courts in ruling that the federal warranty law, the Magnuson-Moss Warranty Act, does not ban binding arbitration provisions in consumer product warranties. This is good news for consumer product manufacturers, and better news for consumers if more companies turn to binding arbitration.
The Global Warranty and Service Contract Association (“GWSCA”) (www.gwsca.org) is now developing the agenda for our first annual conference, to be held in Chicago, the week of October 6, 2014. Continue reading
Presumably without intending to do so, a recent Consumer Reports article, reporting the results of a recently conducted consumer survey, makes a pretty strong case for buying a “bumper-to-bumper” extended car warranty depending on which make you buy and how long you intend to keep it. Continue reading
A recent “victory” for the New York Times strikes a blow to consumers. By bullying Hyundai into abandoning arbitration to resolve warranty disputes, it robbed consumers of a fair and efficient alternative to costly, time-consuming, and economically inefficient litigation. Continue reading
Earlier this week, Steve Anderson, C.O.O. at The PHC Company, forwarded an article detailing a new Lemon Law now in effect in China. It is considerably more stringent than the prior law and commentators believe it will drive consolidation in China’s auto industry because of the increased economic pressures it places on smaller car makers. Continue reading