Law Talk

Before You Ride Off Into the Sunset: Motor Vehicles Dealers Act


Law Talk

September, 2013

Before You Ride Off Into the Sunset

Did you know that Ontario residents purchase 1.4 million vehicles a year? Almost everyone buys a vehicle at least once, so it is important to know your rights before making this expensive decision. 

How are Motor Vehicle Sales Regulated?

Ontario’s Motor Vehicle Dealers Act (MVDA) applies to sales of new and used vehicles (automobiles, trucks, and motorcycles) by anyone who is in the trade of selling motor vehicles. Dealers must register with the Ontario Motor Vehicle Industry Council (OMVIC), the regulator of Ontario’s motor vehicle sales industry. Buyers need to know that the MVDA does not apply to private sales, that is, buying from someone who is not a registered motor vehicle dealer (often called “curbsiders”). Buyers need to be especially cautious about buying from curbsiders because they will not have the protections of the MVDA. You can look for the yellow-and-blue OMVIC decal on a dealer’s door or window, or check online at www.omvic.on.ca to see if a dealer is registered.

What Disclosures does the MVDA Require?

Under the MVDA, dealers must disclose specific information about the motor vehicle. Required disclosures include information about: the vehicle’s mileage and odometer functioning;  whether the vehicle was ever leased daily, or used as a police, emergency services, or taxi  vehicle; the extent of any damage suffered by the vehicle, and specifically if it suffered more than $3,000 damage in a single accident; if the antilock brakes and airbags are working properly; the vehicle’s make, model, and model year; whether it was ever declared a total loss by an insurer; and any other fact about the structural or performance quality that would have an influence on your decision whether or not to buy the vehicle.  If you are not mechanically savvy yourself, it may be a good idea to have an independent mechanic do an inspection before making your decision.

What Must the Sale Contract Include?

The MVDA requires the sale contract to include information about: the buyer’s name and address, and the registered name, registration number, and business address of the dealer; the registered name and registration number of the salesperson; the dates of the sale and of the delivery of the vehicle, along with the vehicle’s colour, VIN, and body type; the total cost of the vehicle, any down payment made, and the balance due; any inducements the dealer agreed to provide at no charge; and any other charges (like taxes) that must be paid in connection with the purchase.  

What if You Change Your Mind?

You should be certain about your decision before signing a motor vehicle purchase agreement.  In general, you cannot simply change your mind and cancel a signed purchase contract—there is no “cooling off” period for motor vehicle purchases.  If certain information was not disclosed to you, you may have the right to cancel within 90 days of receiving the vehicle. This applies if you were not told: the total distance travelled (vehicle mileage); that it was once a daily rental, police, emergency services, taxi or limousine vehicle; the correct information about the make/model and year; or, that the vehicle was once branded as irreparable, salvage or rebuilt. You may also cancel the contract if you are the victim of an unfair practice as defined by the Consumer Protection Act, 2002 (CPA). This can be done up to one year after entering the contract by sending a letter to the dealership informing them of your intention to cancel the agreement. Sample cancellation letters are available on the Ministry of Consumer Services website.

What if You are Dissatisfied with the Purchase or the Vehicle?

If the dealer is still in business, your first step should be to try to resolve the matter directly with the dealer.  Put your concerns in writing, send it to the dealer, and keep a copy for yourself.  Have an independent mechanic inspect the vehicle, get a Used Vehicle Information Package from the Ministry of Transportation, and try to reach the previous owner(s) of the vehicle. If you still cannot resolve the matter with the dealer, you should contact OMVIC for assistance in filing and processing a complaint. As a last resort, you can also file suit in Small Claims Court if the amount of the dispute is less than $25,000.  The Ministry of the Attorney General has Small Claims Court resource guides on its website at http://www.attorneygeneral.jus.gov.on.ca/english/courts/scc/default.asp.

Knowing your own rights and the obligations of dealers will help steer you towards your dream car. You are in the driver’s seat now.

For more information and to contact the Ministry of Consumer Services, call 1-800-889-9768 or visit their website at http://www.sse.gov.on.ca/mcs/en/pages/defaults.aspx OMVIC information can be found at www.omvic.on.ca. In addition, you can find more information about consumer protection topics at any time in a series of Community Law School webinars archived online at www.yourlegalrights.on.ca/training-topic/consumer-law. Be empowered, and stay tuned.

This column is brought to you by Community Law School (Sarnia-Lambton) Inc., and Community Legal Services and Pro Bono Students Canada at Western University, with financial assistance from the Law Foundation of Canada. It provides legal information only.  The information is accurate as of the date of publication. Laws change frequently so we caution readers from relying on this information if some time has passed since publication. If you need specific legal advice please contact a lawyer, your community legal clinic, Justice Net at 1-866-919-3219 or the Law Society Referral Service at 1-800-268-8326.

 

This column provides legal information only and is produced by the students of Community Legal Services and Pro Bono Students Canada (UWO). The information in this article is accurate as of the date of publication. If you need legal advice please contact a lawyer, community legal clinic or the Lawyer Referral Service at 1-900-565-4LRS.

Last edited: Tuesday, September 17, 2013 @ 7:34 PM