The Motor Vehicle Dealers Act (MVDA) effective January 1, 2010

Update:

The Motor Vehicle Dealers Act or “MVDA” was initially to be implemented on April 1, 2009, but the Provincial government delayed implementation of the changes to January 1, 2010. In these troubling economic and austere times, consumers require more protection than ever and cannot afford to be ripped off by unscrupulous Motor Vehicle “Dealers”. Caveat emptor (Latin – “Let the buyer beware”) always applies to consumers, but the changes in the MVDA should remind those wheeler dealers that they must respect this act and the others, that affect their ability to sell or lease new or used motor vehicles to the general public. The recent changes to the MVDA enhances consumer protection (one example: the dealer will now be required to provide full disclosure with respect to the history of the motor vehicle that you are leasing, buying from him or her).

The changes in the MVDA will require that dealers provide alot more disclosure about the motor vehicle that is for sale.   Dealers will have to provide complete disclosure with respect to the following:

  • Reveal any material fact that may influence a consumer to lease or purchase a vehicle.
  • The prior use of the vehicle (was it a taxi/limo, was it a police/emergency vehicle, was it a
    daily rental or a  leased motor vehicle).
  • Whether the vehicle has sustained damage as a result of a water damage or a fire.
  • Reveal whether the vehicle was registered in another Province/Territory or another country.
  • The total cost of repairs for any specific incident that exceeded $ 3000.00, if they know.
  • Reveal that the vehicle had been declared a total loss by an insurance company.
  • Report the negative branding classification of a vehicle (Irreparable, Salvage or Rebuilt).
  • If the motor vehicle is equipped with an anti-lock braking system that is not operational,
    a statement to that effect; or
    If any of the motor vehicle’s airbags are missing or are not operational, a statement to that
    effect; or
    If the motor vehicle requires repair in any of the following, a statement to that effect
    a) the engine, transmission or power train,
    b) the subframe or suspension,
    c) computer equipment,
    d) the electrical system,
    e) the fuel operating system,
    f) the air conditioning.
  • Under the MVDA, the defintion of “Dealer” has been expanded to include:
    General Dealer (used and new motor vehicles), Captive Finance Companies, Brokers,Wholesalers, Exporters,
    Fleet Lessors, includes short-term lessors (daily motor vehicle rental companies).

    In the present economy, every consumer will be forced to stretch their dollar as far as it can go (especially considering the McGuinty’s Liberals decision to implement the HST by harmonizing the 8% GST and 5% PST sales tax, effective July 1, 2010 which will increase the price of numerous products & services, that were once PST exempt, such as fuel for motor vehicles ) and as such, should understand their consumer rights, under the Consumer Protection Act, before buying or selling a used motor vehicle in Ontario.

    Before purchasing a used motor vehicle, it pays to do alittle homework and research. If you want to buy or sell a used vehicle, access the Ontario’s Ministry of Transportation website for information, before you buy or sell.

    Update: January 12, 2010 – see Ontario Government’s website, which states the following:

    Improving Protection for Consumers Buying Cars

    January 12, 2010 10:30 AM

    McGuinty Government Strengthens Motor Vehicle Sales Sector

    Ontario is providing consumers with improved protections when they buy or lease new and used cars.

    The province’s new Motor Vehicle Dealers Act, 2002 (MVDA) that came into force on January 1, 2010, requires dealers to:

    • Disclose a vehicle’s true condition and history before consumers sign contracts.
    • Adopt “all-inclusive pricing” when advertising new and used vehicles, including freight, dealer preparation and other miscellaneous charges.

    Consumers will also be able to cancel a contract within 90 days if a dealer fails to disclose certain key items such as accurate odometer-readings, the correct year or model, and the previous use of the vehicle.

    Improved protection from the Motor Vehicle Dealers Compensation Fund, with an increase from $15,000 to $45,000 in coverage, will also allow consumers to recover deposits should a dealership goes out of business.

    The Motor Vehicle Dealers Act, 2002 is administered by the Ontario Motor Vehicle Industry Council (OMVIC) on behalf of the Ontario government.

    Quick Facts:
    • Sales of new motor vehicles have generally been increasing since the beginning of 2009, following a sharp decline at the end of 2008.
    • The number of new motor vehicles sold increased in eight provinces in October 2009 compared to September 2009.
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    10. Hi JA:
      This isn’t really my area, but you do have rights as a consumer in Ontario, if your being jerked around and asked to spend more than was originally negotiated. A scary term often used in these situations is caveat emptor (“let the buyer beware”).

      You should review the following website @ http://www.sse.gov.on.ca/mcs/en/Pages/What_Are_My_Rights.aspx . This will introduce you to the answers to your questions and the related acts (ie Consumer Protection Act – see http://www.e-laws.gov.on.ca/html/regs/english/elaws_regs_050017_e.htm).

      Here is a government page “What are my rights” see http://www.sse.gov.on.ca/mcs/en/Pages/Your_Consumer_Rights.aspx

      Remember you are entitled to a “cooling off period” of 10 days:
      Let’s say you make a purchase or sign a contract in your home (this may include a Chevy Impala) and then change your mind. If the deal is worth more than $50, you have the right to cancel within 10 days. It’s best to cancel by registered mail or fax to get your money back.

      You must act really quickly!

      Remember to http://fightyourtickets.ca

    11. I purchased a 2007 Chevy Impala on 28 October 2010. Took possession of the vehicle 30 October. Was advised that it was certified and that everything was working well. Later that day we found out that the window on the passenger seat was not working. Took the car back to the dealership on 01 November 2010 and was advised the window would need a new motor at a cost of $329.20. I have purchase a warranty but it does not cover this repair. After approaching the dealership I was informed on one hand that the dealership would charge me the factory cost for the part and on another hand that the dealership cannot do anything for me as the window was working before it left the lot. The salesman stated “I checked the window myself and it was working” What are my consumer’s rights in this instance?

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