Auto Manufacturer Liable for Purchase Price for Lemon, not Dealer's Inflated Price

The New Hampshire Supreme Court recently ruled that Daimler Chrysler was not liable for the price on the retail installment contract for a lemon sold to a consumer, but only for the actual purchase price.  (Click here to read decision.)  The car had oil leaking into the cooling system, and was not working properly even after three repair attempts.

The amount on the retail installment contract was artificially high because the dealer added the difference between the amount paid for the trade-in and the amount still owed for the financing on the trade-in vehicle.  This technique was apparently used to allow the financing for the new vehicle to cover the amount remaining due on the old vehicle, after the trade-in allowance was applied.

The Court held that that applicable law did not allow the consumer to recover the inflated price listed on the installment contract because, in essence, the consumer never actually paid that amount.