Mandatory Informal Dispute Settlement Procedure (BBB Auto Line) in NC

NC is one of the few states where consumers may be required to participate in a manufacturer’s informal dispute settlement procedure (typically BBB Auto Line) before filing court action. The requirement comes from N.C. Gen. Stat. § 20-351.7.

When BBB Auto Line is mandatory

If the manufacturer has established an informal dispute settlement procedure that:

• Meets the federal requirements of 16 C.F.R. Part 703; AND
• Is certified under N.C. Gen. Stat. § 20-351.7;

then the consumer must complete that procedure before pursuing Lemon Law remedies in court. Failure to comply bars the Lemon Law action.

How to verify a certified program exists

• Owner’s manual — manufacturers must disclose certified IDS programs.
• Warranty book.
• Manufacturer’s customer-relations line.
• BBB Auto Line’s participating-manufacturer list (bbb.org/auto-line).

If your manufacturer doesn’t have a certified program, you can go directly to court action.

How BBB Auto Line works in NC

1. Consumer files online or by mail with BBB Auto Line (free).
2. BBB collects records from consumer and manufacturer.
3. Scheduling typically within 40 days.
4. Hearing telephone or in-person, 1-3 hours.
5. Written decision typically within 40 days of the hearing.

Total timeline: typically 60-100 days.

Decisions can include

• Refund under N.C. Gen. Stat. § 20-351.3.
• Replacement vehicle.
• Additional repair attempts.
• Denial.

Decision is binding on the manufacturer if the consumer accepts. Not binding on the consumer — if the consumer rejects, they can pursue court action.

What BBB Auto Line does NOT provide

• Attorney fees — no fee shifting through arbitration.
• UDTPA mandatory treble damages — only available in civil court.
• § 20-351.8(3) treble damages — these require a court finding of “unreasonable refusal.”
• Magnuson-Moss claims.

For these remedies, court action is required after BBB Auto Line completes.

When BBB Auto Line is the right resolution

• Clean refund or replacement case.
• No significant misrepresentation facts (no UDTPA willfulness).
• Self-representing.
• Want fast, free resolution.
• Lower-value vehicle.

When to reject the BBB Auto Line decision and go to court

• The case has UDTPA willfulness exposure — exemplary damages potential.
• You want § 20-351.8(3) treble damages for unreasonable refusal.
• High-value vehicle.
• Manufacturer’s records suggest unfair or deceptive practices.

Procedurally — what to expect at the hearing

• Brief opening statements by both sides.
• Consumer presents the case — repair orders, certified-mail notice, photos/videos.
• Manufacturer responds — often with a technical witness from the regional service office.
• Panel questions both sides.
• Closing arguments.

No formal evidence code. The panel weighs documentation pragmatically.

After BBB Auto Line — what if you reject the decision

If you reject the arbitration decision:

• You can still pursue court action.
• The arbitration decision is not binding on the court (de novo review).
• However, prior arbitration positions can become discoverable.

The parallel UDTPA approach

UDTPA claims are not subject to the BBB Auto Line requirement — those go straight to court. Many NC attorneys file BBB Auto Line for the Lemon Law portion while simultaneously filing a UDTPA action in court for treble damages and fees.

Bottom line

BBB Auto Line is a mandatory procedural step in many NC cases — but its narrow remedies make it incomplete for cases with UDTPA exposure. For those cases, BBB Auto Line is a procedural box to check before court action with parallel UDTPA claims.

Get a free case review before deciding.

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