THE Supreme Court has ruled that buyers of defective brand-new motor vehicles may choose to enforce their rights not only under Republic Act 10642 or the Philippine Lemon Law but under any available law.
In a 15-page ruling dated October 11, 2023 but only made public yesterday, the SC’s Second Division held that aside from RA 10642, a consumer may enforce his or her rights under Republic Act 7394 or the Consumer Act or any other available law.
RA 10642, or the Act Strengthening Consumer Protection in the Purchase of Brand-New Motor Vehicles, covers brand-new motor vehicles purchased in the country reported by a consumer to be defective within 12 months from the date of original delivery or up to 20,000 kilometers of operation, whichever comes first.
Under RA 7394, consumers have the option to request either a replacement unit or an immediate refund if a defect cannot be corrected within 30 days.
The SC ruling penned by Associate Justice Antonio Kho Jr. said the Lemon Law is not an exclusive remedy to such a predicament. Concurring with the ruling were Senior Associate Justice Marvic Leonen and Associate Justices Mario Lopez and Jhosep Lopez.
“There is nothing that prevents a consumer from availing of the remedies under RA 7394 or any other law for that matter even if the subject of the complaint is a brand-new vehicle. RA 10642 is an alternative remedy granted to the consumer and the consumer is free to choose to enforce his or her rights under RA 7394 or any other law,” the SC ruling said in the petition filed by the Department of Industry on behalf of Marilou Tan, who bought a Toyota Fortuner from Toyota Balintawak, Inc. on May 17, 2016 for P1.47 million.
The High Court stressed there is no “irreconcilable conflict” between the two laws since their provisions are “clear and unambiguous.”
Court records showed that while Tan was driving home after the purchase, her husband noticed a jerky movement whenever the transmission changed gears.
After a mechanical inspection, Toyota Balintawak informed her that the transmission assembly needed to be replaced and/or the Engine Control Unit reprogrammed at no extra cost.
But she refused, demanding instead that the vehicle be replaced, or she be refunded.
Toyota, however, argued that RA 10642 allowed it to make up to four repair attempts before replacing the vehicle.
This prompted Tan to file a complaint with the DTI, citing RA 7394. Under this law, consumers can request a replacement unit or an immediate refund if a defect cannot be corrected within 30 days.
During the pendency of the proceedings, Tan voluntarily brought the vehicle to Toyota for ECU reprogramming, which addressed the shift shock problem.
The DTI later ruled in favor of Tan and ordered Toyota to either replace the vehicle or reimburse the amount paid.
The company sought to nullify the DTI rulings by going to the Court of Appeals.
The appellate court ruled in favor of Toyota, explaining that RA 10642 and 7394 are conflicting because the first law gives the supplier 30 days to correct the defect, while the second law allows the manufacturer, distributor, or dealer at least four separate repair attempts.
Since the case involved a brand-new motor vehicle, the CA ruled that the Lemon Law is the applicable law.
Without Tan’s participation, the DTI elevated the CA ruling to the SC.
While acknowledging that the case had been resolved due to the repair of the vehicle, the High Court took the opportunity to settle the issue to guide future disputes, stressing that the Lemon Law is not the only remedy.
However, the High Court dismissed the petition because the DTI secretary was not the proper party to file the case.
