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Consumer Protection Act, R.S.O. 1990, c. C.31

Versions

Revoked/spent regulations under this Act

	repealed on July 30, 2005
	January 1, 2003 – July 29, 2005

O. Reg. 175/01	DIRECT SALES CONTRACTS
R.R.O. 1990, Reg. 176	GENERAL

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Consumer Protection Act

R.S.O. 1990, CHAPTER C.31

Note: This Act was repealed on July 30, 2005. See: 2002, c. 30, Sched. E, ss. 3, 22.

Amended by: 1993, c. 27, Sched.; 1997, c. 35, s. 1; 1998, c. 15, Sched. E, s. 4; 1998, c. 18, Sched. E, ss. 54, 55; 1999, c. 12, Sched. F, ss. 11-20; 1999, c. 12, Sched. G, s. 19; 2001, c. 9, Sched. D, s. 4; 2002, c. 17, Sched. F, Table; 2002, c. 30, Sched. E, s. 3.

SKIP TABLE OF CONTENTS

CONTENTS


1.	Definitions
2.	Exception re sale of utility; gas charges
PART II EXECUTORY CONTRACTS
18.	Application of Part
19.	Form of executory contract
20.	Deposits in advance
21.	Cancellation of certain executory contracts within 10 days
22.	Lien on other goods not enforceable
23.	No repossession
PART II.1 DIRECT SALES CONTRACTS
23.1	Definitions
23.2	Contents of contract
23.3	Cancellation right
23.4	Notice of cancellation
23.5	Effect of cancellation
23.6	Obligations on cancellation
23.7	Title to goods under trade-in arrangement
PART III CREDIT TRANSACTIONS
24.	Disclosure of cost of borrowing
PART III CREDIT AGREEMENTS
General
24.	Application of Part
25.	Variable credit
25.	Agreement for credit card
26.	Manner of applying percentage rate
26.	Consequence of non-disclosure
27.	When costs of borrowing not recoverable
27.	Required insurance
28.	Prepayment
28.	Cancellation of optional services
29.	Advertising of cost of borrowing
29.	Deferral of payments
29.1	Default charges
29.2	Prepayment
Disclosure
29.3	Advertising
29.4	Credit broker’s statement
29.5	Initial disclosure statement
29.6	Subsequent disclosure: fixed credit
29.7	Subsequent disclosure: open credit
Assignment of Security for Credit
30.	Assignment of negotiable instrument
31.	Obligations of assignee of lender
32.	Order to pay indemnity
PART III.1 LEASES
32.1	Application of Part
32.2	Advertising
32.3	Initial disclosure statement
32.4	Residual obligation lease
PART IV GENERAL
33.	Agreements and waivers contrary to Act
33.1	Representation
33.2	Confidentiality
34.	Consumer sale
35.	Rights of buyer and borrower preserved
36.	Restrictions on actions
37.	Referral selling
38.	Order if false advertising
38.1	Service
39.	Offence
40.	Regulations

Definitions

1. In this Act,

“actually received” means the sum of money received by the borrower from the lender that can be used by the borrower without any restrictions on its use imposed by the lender; (“effectivement reçue”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “actually received” is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 11 (1). See: 1999, c. 12, Sched. F, ss. 11 (1), 45 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, section 1 is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 11 (4) by adding the following definitions:

“advance” means value received by the borrower under a credit agreement as determined by the regulations; (“avance”)

“APR” means the annual percentage rate in respect of a credit agreement or a lease that is determined in accordance with the regulations; (“TA”)

See: 1999, c. 12, Sched. F, ss. 11 (4), 45 (2).

“borrower” means a person who receives credit; (“emprunteur”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “borrower” is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 11 (6) and the following substituted:

“borrower” means the party to a credit agreement or prospective credit agreement who, respectively, receives or will receive credit from the other party but does not include a guarantor; (“emprunteur”)

See: 1999, c. 12, Sched. F, ss. 11 (6), 45 (2).

“brokerage fee” means an amount that a borrower pays or agrees to pay to a credit broker in consideration of the broker’s services in arranging or attempting to arrange a credit agreement, and includes an amount that the lender deducts from an advance and pays to the broker; (“frais de courtage”)

See: 1999, c. 12, Sched. F, ss. 11 (4), 45 (2).

“business premises” does not include a dwelling; (“locaux commerciaux”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “business premises” is repealed by the Statutes of Ontario, 1997, chapter 35, subsection 1 (1). See: 1997, c. 35, ss. 1 (1), 5 (2).

“buyer” means a person who purchases goods for consumption or services under an executory contract or a direct sales contract as defined in section 23.1 and includes his or her agent, but does not include a person who buys in the course of carrying on business or an association of individuals, a partnership or a corporation; (“acheteur”)

“cost of borrowing” means,

(a) in the case of credit other than variable credit, the amount by which,

(i) the total sum that the borrower is required to pay if the payments required are made as they become due, including all such sums regardless of the purpose or reason for the payment or the time of the payment,

exceeds,

(ii) the sum actually received in cash by the borrower or, where the lender is a seller, the amount of the cash price of the goods or services less the sums, if any, actually paid as a down payment or credited in respect of a trade-in or paid or credited for any other reason plus, in each case, insurance or official fees, if any, actually paid by the lender,

(b) in the case of variable credit, the charges made in respect of the extension of the variable credit; (“frais d’emprunt”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “cost of borrowing” is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 11 (6) and the following substituted:

“cost of borrowing” means all amounts that a borrower is required to pay under or as a condition of entering into a credit agreement other than,

(a) a payment or repayment of a portion of the principal under the agreement as prescribed by the regulations, and

(b) charges prescribed by the regulations; (“coût d’emprunt”)

See: 1999, c. 12, Sched. F, ss. 11 (6), 45 (2).

“credit” means credit for which the borrower incurs a cost of borrowing and,

(a) given under an agreement between a seller and a buyer to purchase goods or services by which all or part of the purchase price is payable after the agreement is entered into, or

(b) given by the advancement of money,

but does not include credit given on the security of a mortgage of real property; (“crédit”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “credit” is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 11 (2). See: 1999, c. 12, Sched. F, ss. 11 (2), 45 (2).

“credit agreement” means an agreement under which a lender extends credit to a borrower and includes a loan of money, a credit sale and an agreement under which a loan of money or credit sale may occur in the future but does not include an agreement under which a lender extends credit on the security of a mortgage of real property or agreements of a type prescribed by the regulations; (“convention de crédit”)

“credit broker” means a person who, for remuneration, matches potential borrowers with potential lenders; (“courtier en crédit”)

“credit card” means a card or device under which a borrower can obtain advances under a credit agreement for open credit; (“carte de crédit”)

“credit sale” means an agreement for the purchase of goods or services under which a vendor extends credit to a purchaser for the purchase; (“vente à crédit”)

“default charge” means a charge imposed on a borrower who does not make a payment as it comes due under a credit agreement or who does not comply with any other obligation under a credit agreement but does not include interest on an overdue payment; (“frais de défaut”)

See: 1999, c. 12, Sched. F, ss. 11 (4), 45 (2).

“Director” means the Director under the Ministry of Consumer and Business Services Act; (“directeur”)

“dwelling” means any premises or any part thereof occupied as living accommodation; (“logement”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “dwelling” is repealed by the Statutes of Ontario, 1997, chapter 35, subsection 1 (1). See: 1997, c. 35, ss. 1 (1), 5 (2).

“executory contract” means a contract between a buyer and a seller for the purchase and sale of goods or services in respect of which delivery of the goods or performance of the services or payment in full of the consideration is not made at the time the contract is entered into; (“contrat exécutoire”)

“fixed credit” means credit under a credit agreement that is not for open credit; (“crédit fixe”)

“floating rate” means a rate that bears a specified mathematical relationship to an index rate prescribed by the regulations; (“taux variable”)

See: 1999, c. 12, Sched. F, ss. 11 (4), 45 (2).

“goods” means personal property; (“marchandises”)

“itinerant seller” means a seller whose business includes soliciting, negotiating or arranging for the signing by a buyer, at a place other than the seller’s permanent place of business, of an executory contract for the sale of goods or services, whether personally or by an agent or employee; (“vendeur itinérant”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “itinerant seller” is repealed by the Statutes of Ontario, 1997, chapter 35, subsection 1 (2). See: 1997, c. 35, ss. 1 (2), 5 (2).

“lease” means an agreement for the lease of goods, other than an agreement for the lease of goods in connection with a residential tenancy agreement and “lessor” and “lessee” have a corresponding meaning; (“bail”, “bailleur”, “preneur”)

“lease term” means the period during which the lessee is entitled to retain possession of the leased goods under a lease; (“durée du bail”)

See: 1999, c. 12, Sched. F, ss. 11 (4), 45 (2).

“lender” means a person who extends credit; (“prêteur”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “lender” is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 11 (6) and the following substituted:

“lender” means the party to a credit agreement or prospective credit agreement who, respectively, extends or will extend credit to the borrower and includes a credit card issuer; (“prêteur”)

See: 1999, c. 12, Sched. F, ss. 11 (6), 45 (2).

“Minister” means the Minister of Consumer and Business Services; (“ministre”)

“Ministry” means the Ministry of Consumer and Business Services; (“ministère”)

“official fee” means a fee that is required to be paid by or under a statute of Ontario or Canada; (“droits officiels”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “official fee” is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 11 (3). See: 1999, c. 12, Sched. F, ss. 11 (3), 45 (2).

“open credit” means credit under a credit agreement that,

(a) anticipates multiple advances to be made as requested by the borrower in accordance with the agreement, and

(b) does not define the total amount to be advanced to the borrower under the agreement, although it may impose a credit limit; (“crédit en blanc”)

“optional service” means a service that is provided to a borrower in connection with a credit agreement and that the borrower does not have to accept in order to enter into the agreement; (“service facultatif”)

See: 1999, c. 12, Sched. F, ss. 11 (4), 45 (2).

“prescribed” means prescribed by this Act or the regulations; (“prescrit”)

“purchase price” means the total obligation payable by the buyer under an executory contract; (“prix d’achat”)

“registered” means registered under this Act; (“inscrit”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “registered” is repealed by the Statutes of Ontario, 1997, chapter 35, subsection 1 (2). See: 1997, c. 35, ss. 1 (2), 5 (2).

“Registrar” means the Registrar of the Consumer Protection Bureau; (“registrateur”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “Registrar” is repealed by the Statutes of Ontario, 1997, chapter 35, subsection 1 (2). See: 1997, c. 35, ss. 1 (2), 5 (2).

“regulations” means the regulations made under this Act; (“règlements”)

“residual obligation lease” means a lease under which the lessor may require the lessee at the end of the lease term to pay the lessor an amount based in whole or in part on the difference, if any, between,

(a) the lessor’s reasonable estimate of the wholesale value of the leased goods at the end of the lease term, and

(b) the realizable value of the leased goods at the end of the lease term; (“bail à obligation résiduelle”)

See: 1999, c. 12, Sched. F, ss. 11 (4), 45 (2).

“seller” means a person who is in the business of selling goods or services to buyers, and includes an agent of the seller; (“vendeur”)

“trade-in” means consideration given by a buyer in a form other than money or an obligation to pay money; (“objet donné en reprise”)

“Tribunal” means the Licence Appeal Tribunal; (“Tribunal”)

“variable credit” means credit made available under an agreement whereby the lender agrees to make credit available to be used from time to time, at the option of the borrower, for the purpose of the purchase from time to time of goods or services, and, without limiting the generality of the foregoing, includes credit arrangements commonly known as revolving credit accounts, budget accounts, cyclical accounts and other arrangements of a similar nature. (“crédit variable”) R.S.O. 1990, c. C.31, s. 1; 1998, c. 18, Sched. E, s. 54; 1999, c. 12, Sched. F, s. 11 (5); 1999, c. 12, Sched. G, s. 19 (1); 2001, c. 9, Sched. D, s. 4 (1).

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “variable credit” is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 11 (3). See: 1999, c. 12, Sched. F, ss. 11 (3), 45 (2).

Exception re sale of utility; gas charges

2. (1) This Act does not apply to the sale of a public utility or to any charge for the transmission, distribution or storage of gas as defined in the Ontario Energy Board Act, 1998 where such charge has been approved by the Ontario Energy Board. R.S.O. 1990, c. C.31, s. 2; 1998, c. 15, Sched. E, s. 4 (1); 2002, c. 17, Sched. F, Table.

Marketers of gas, retailers of electricity

(2) Despite subsection (1), this Act applies to a sale by,

(a) a gas marketer who is a seller and who sells to a buyer; and

(b) a retailer of electricity who is a seller and who sells to a buyer. 1998, c. 15, Sched. E, s. 4 (2).

Definitions

(3) In this section,

“gas marketer” means a gas marketer as defined in Part IV of the Ontario Energy Board Act, 1998; (“agent de commercialisation de gaz”)

“public utility” means water, artificial or natural gas, electrical power or energy, steam or hot water; (“service public”)

“retailer of electricity” means a retailer as defined in the Electricity Act, 1998. (“détaillant en électricité”) 1998, c. 15, Sched. E, s. 4 (2); 2002, c. 17, Sched. F, Table.

PART I (ss. 3-17) Repealed: 1997, c. 35, s. 1 (3).

Note: All registrations under the Act that were in force immediately before December 18, 1997 are terminated on December 18, 1997. Despite the repeal of Part I, subsection 16 (2) of the Act continues to apply to an action, proceeding or prosecution that was commenced or that could have been commenced before December 18, 1997. See: 1997, c. 35, s. 4.

PART II
EXECUTORY CONTRACTS

Application of Part

18. This Part applies to executory contracts for the sale of goods or services where the purchase price, excluding the cost of borrowing, exceeds a prescribed amount, but does not apply to executory contracts to which Part II.1 applies. 1999, c. 12, Sched. F, s. 12.

Form of executory contract

19. (1) Every executory contract, other than an executory contract under an agreement for variable credit, shall be in writing and shall contain,

Note: On a day to be named by proclamation of the Lieutenant Governor, subsection (1) is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 13 (1) by striking out the portion before clause (a) and substituting the following:

Form of executory contract

(1) Every executory contract, other than an executory contract under an agreement for open credit, shall be in writing and shall contain,

See: 1999, c. 12, Sched. F, ss. 13 (1), 45 (2).

(a) the name and address of the seller and the buyer;

(b) a description of the goods or services sufficient to identify them with certainty;

(d) where credit is extended, a statement of any security for payment under the contract, including the particulars of any negotiable instrument, conditional sale agreement, chattel mortgage or any other security;

(e) where credit is extended, the statement required to be furnished by section 24;

Note: On a day to be named by proclamation of the Lieutenant Governor, clause (e) is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 13 (2) and the following substituted:

(e) where credit is extended, the statements that Part III requires the lender to deliver to the borrower in respect of the credit agreement and the statements that Part III.1 requires the lessor to deliver to the lessee in respect of the lease;

See: 1999, c. 12, Sched. F, ss. 13 (2), 45 (2).

(f) any warranty or guarantee applying to the goods or services and, where there is no warranty or guarantee, a statement to this effect; and

(g) any other matter required by the regulations. R.S.O. 1990, c. C.31, s. 19 (1).

Validity

(2) An executory contract is not binding on the buyer unless the contract is made in accordance with this Part and the regulations and is signed by the parties, and a duplicate original copy thereof is in the possession of each of the parties thereto. R.S.O. 1990, c. C.31, s. 19 (2).

Allowance for trade-in subject to adjustment

(3) Where the amount to be paid by a buyer under an executory contract is determined after an allowance for a trade-in and is stated in the contract to be subject to adjustment after the existence or amount of liens against the trade-in is ascertained or confirmed, the statement of the terms of payment and the statement of the cost of credit shall be based upon the amount as determined upon the information provided by the buyer but, upon any subsequent adjustment, the percentage rate by which the cost of borrowing is expressed, the total number of instalments required to pay the total indebtedness or the price shown in the contract shall not be changed. R.S.O. 1990, c. C.31, s. 19 (3).

Note: On a day to be named by proclamation of the Lieutenant Governor, subsection (3) is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 13 (3) by striking out “an allowance for a trade-in” and substituting “a trade-in allowance as defined in section 23.1” and by striking out “des frais d’emprunt” in the French version and substituting “du coût d’emprunt”. See: 1999, c. 12, Sched. F, ss. 13 (3), 45 (2).

Deposits in advance

20. Where a trade-in is delivered or money is paid, whether by way of deposit or otherwise, on account of the proposed purchase of goods or services but no binding contract is entered into in respect of the goods and no delivery of the goods or any part thereof has been made to the buyer or no performance of the services has been made, the seller shall upon the request of the buyer return such trade-in or refund in full the money so paid, as the case may be. R.S.O. 1990, c. C.31, s. 20.

Cancellation of certain executory contracts within 10 days

21. (1) Where a seller solicits, negotiates or arranges for the signing by a buyer of an executory contract at a place other than the seller’s permanent place of business, the buyer may cancel the contract by delivering a notice of cancellation in writing to the seller within 10 days after the duplicate original copy of the contract first comes into the possession of the buyer, and the buyer is not liable for any damages in respect of such cancellation. R.S.O. 1990, c. C.31, s. 21 (1); 1999, c. 12, Sched. F, s. 14 (1, 2).

Duties upon cancellation

(2) Where a buyer cancels a contract under subsection (1),

(a) the buyer shall immediately return any goods received under the contract and the seller shall bear the expense of the return, not exceeding the expense of returning the goods from the place where the buyer received their delivery; and

(b) the seller shall return any money received or realized in respect of the contract, whether from the buyer or any other person, and shall return any trade-in received under the contract. R.S.O. 1990, c. C.31, s. 21 (2); 1999, c. 12, Sched. F, s. 14 (2).

Trade-ins

(3) Where part of the consideration for the sale of goods is a trade-in, the title to the trade-in does not pass to the seller until the 10-day period mentioned in subsection (1) has expired without cancellation of the contract. R.S.O. 1990, c. C.31, s. 21 (3); 1999, c. 12, Sched. F, s. 14 (2, 3).

Delivery of notice

(4) A notice of cancellation may be delivered personally or sent by registered mail addressed to the person to whom delivery is required to be made at the address shown in the contract, and delivery by registered mail shall be deemed to have been made at the time of mailing. R.S.O. 1990, c. C.31, s. 21 (4); 1999, c. 12, Sched. F, s. 14 (2).

Lien on other goods not enforceable

22. Any provision in any executory contract or in any security agreement incidental thereto under which the seller may acquire title to, possession of or any rights in any goods of the buyer, other than the goods passing to the buyer under the contract, is not enforceable. R.S.O. 1990, c. C.31, s. 22.

No repossession

23. (1) Where a buyer under an executory contract has paid two-thirds or more of the purchase price of the goods as fixed by the contract, any provision in the contract, or in any security agreement incidental thereto, under which the seller may retake possession of or resell the goods upon default in payment by the buyer is not enforceable except by leave of a judge of the Superior Court of Justice. R.S.O. 1990, c. C.31, s. 23 (1); 2001, c. 9, Sched. D, s. 4 (2).

Powers of judge

(2) Upon an application for leave under subsection (1), the judge may, in his or her absolute discretion, grant or refuse leave or grant leave upon such terms and conditions as he or she considers advisable. R.S.O. 1990, c. C.31, s. 23 (2).

PART II.1
DIRECT SALES CONTRACTS

Definitions

23.1 In this Part,

“direct sales contract” means a contract between a buyer and a seller for goods or services where,

(a) the purchase price exceeds a prescribed amount, and

(b) the contract is negotiated or concluded in person at a place other than the seller’s place of business or a market place, auction, trade fair, agricultural fair or exhibition; (“contrat de vente directe”)

“trade-in allowance” means the greater of,

(a) the price or value of the buyer’s goods as set out in a trade-in arrangement, and

(b) the market value of the buyer’s goods when taken in trade under a trade-in arrangement; (“valeur de reprise”)

“trade-in arrangement” means an agreement or arrangement, contained in a direct sales contract or forming the whole or part of a related agreement, under which the buyer sells or agrees to sell the buyer’s own goods to the seller and the seller accepts the goods as all or part of the consideration under the contract. (“accord de reprise”) 1999, c. 12, Sched. F, s. 15.

Contents of contract

23.2 (1) A direct sales contract must contain the information required by the regulations. 1999, c. 12, Sched. F, s. 15.

Written copy

(2) A seller who enters into a direct sales contract with a buyer shall deliver to the buyer a written copy of the contract that contains the information required by the regulations. 1999, c. 12, Sched. F, s. 15.

Cancellation right

23.3 (1) A buyer under a direct sales contract may, without any reason, cancel the contract at any time from the date of entering into the contract until 10 days after receiving the written copy of the contract mentioned in section 23.2. 1999, c. 12, Sched. F, s. 15.

Failure to meet requirements

(2) In addition to the right under subsection (1), a buyer under a direct sales contract may cancel the contract within one year of the date of entering into the contract if it does not contain all the information required by section 23.2. 1999, c. 12, Sched. F, s. 15.

Failure to supply

(3) In addition to the right under subsection (1), a buyer under a direct sales contract may cancel the contract within one year from the date of entering into the contract if the seller,

(a) does not deliver the goods required by the contract within 30 days of the delivery date specified in the contract or an amended delivery date agreed upon in writing by the buyer and the seller; or

(b) does not begin to provide the services required by the contract within 30 days of the commencement date specified in the contract or an amended commencement date agreed on in writing by the buyer and seller. 1999, c. 12, Sched. F, s. 15.

Forgiveness of failure

(4) If, after the period mentioned in subsection (3) has expired, the buyer accepts delivery of the goods or authorizes the services to begin, the buyer may not cancel the direct sales contract under subsection (3). 1999, c. 12, Sched. F, s. 15.

Notice of cancellation

23.4 (1) To cancel a direct sales contract, a buyer shall give a notice of cancellation in accordance with this section. 1999, c. 12, Sched. F, s. 15.

Effective time

(2) The cancellation takes effect when the buyer gives the notice of cancellation. 1999, c. 12, Sched. F, s. 15.

No required form

(3) The notice of cancellation may be expressed in any way, as long as it indicates the intention of the buyer to cancel the direct sales contract. 1999, c. 12, Sched. F, s. 15.

Means of delivery

(4) The notice of cancellation may be given by any means, including personal service, registered mail, courier or telecopier or any other method by which the buyer can provide evidence of the date of cancelling the direct sales contract. 1999, c. 12, Sched. F, s. 15.

When given

(5) Where the notice is given other than by personal service the notice of cancellation shall be deemed to have been given when sent. 1999, c. 12, Sched. F, s. 15.

Address

(6) The buyer may send or deliver the notice of cancellation to the seller at the address set out in the direct sales contract or, if the buyer did not receive a copy of the contract or the address of the seller was not set out in the contract, the buyer may send or deliver the notice,

(a) to any address of the seller on record with the Government of Ontario or the Government of Canada;

(b) to an address of the seller known by the buyer; or

Effect of cancellation

23.5 (1) A cancellation of a direct sales contract in accordance with this Part operates to cancel, as if they never existed,

(a) the contract;

(b) all sales related to the contract;

(d) all security given by the buyer or a guarantor in respect of money payable under the contract. 1999, c. 12, Sched. F, s. 15.

Credit contract

(2) If the seller extends or arranges credit for the direct sales contract, the credit contract is conditional on the direct sales contract, whether or not the credit contract is part of it or attached to it. 1999, c. 12, Sched. F, s. 15.

Effect on credit contract

(3) If the direct sales contract is cancelled, the cancellation operates to cancel the credit contract as if it had never existed. 1999, c. 12, Sched. F, s. 15.

Obligations on cancellation

23.6 (1) In this section,

“buyer’s address” means the place specified in the direct sales contract as the buyer’s address, or, if the address shown does not specifically identify the place by a municipal address, the place where the buyer actually resided at the time the direct sales contract was made. 1999, c. 12, Sched. F, s. 15.

Refund

(2) Within 15 days after the buyer cancels a direct sales contract, the seller shall,

(a) subject to the regulations, refund to the buyer all money paid by the buyer under the contract or a related sale or pre-existing contract; and

(b) return to the buyer’s address,

(i) in a condition substantially the same as when they were delivered, all the goods that the buyer delivered under a trade-in arrangement, or

(ii) an amount equal to the trade-in allowance for the goods that the buyer delivered under a trade-in arrangement. 1999, c. 12, Sched. F, s. 15.

Repossession of goods

(3) Upon cancelling a direct sales contract, the buyer shall allow the seller or a person described in subsection (4) a reasonable opportunity to repossess, at the buyer’s address, the goods that came into the buyer’s possession under the contract or a related sale or pre-existing contract if the seller gives the buyer a written request and has complied with subsection (2). 1999, c. 12, Sched. F, s. 15.

Other person

(4) The buyer may allow the opportunity to a person authorized by the seller or a person specified in the direct sales contract as a person to whom the buyer may give a notice of cancellation. 1999, c. 12, Sched. F, s. 15.

Return of goods

(5) Instead of complying with subsection (3), the buyer may return the goods to the seller or a person described in subsection (4) and in that case the seller or the person, as the case may be, shall be deemed to have consented to the return of the goods. 1999, c. 12, Sched. F, s. 15.

Discharge of obligation

(6) Compliance with subsection (3) or (5) discharges the buyer from all obligations relating to the goods. 1999, c. 12, Sched. F, s. 15.

Reasonable care

(7) The buyer is under an obligation to take reasonable care of the goods delivered to the buyer under a direct sales contract or a related sale or pre-existing contract until the earliest of,

(a) compliance by the buyer with subsection (3);

(b) the date that the buyer returns the goods under subsection (5); and

(c) the expiration of 21 days from the date of giving the notice of cancellation, if the buyer returns the goods under subsection (5). 1999, c. 12, Sched. F, s. 15.

To whom obligation owed

(8) The buyer owes the obligation described in subsection (7) to the person entitled to possession of the goods at the time in question. 1999, c. 12, Sched. F, s. 15.

No further obligation

(9) Except as provided by this section, the buyer is under no obligation, whether arising by contract or otherwise, to take care of the goods. 1999, c. 12, Sched. F, s. 15.

Title to goods under trade-in arrangement

23.7 If the buyer recovers an amount equal to the trade-in allowance under subsection 23.6 (2) and the title of the buyer to the goods delivered under the trade-in arrangement has not passed from the buyer, the title to the goods vests in the person entitled to the goods under the trade-in arrangement. 1999, c. 12, Sched. F, s. 15.

PART III
CREDIT TRANSACTIONS

Disclosure of cost of borrowing

24. Except as provided in section 25, every lender shall furnish to the borrower, before giving the credit, a clear statement in writing showing,

(a) the sum,

(i) expressed as one sum in dollars and cents, actually received in cash by the borrower, plus insurance or official fees, if any, actually paid by the lender, or

(ii) where the lender is a seller, being the amount of the cash price of the goods or services, including any insurance or official fees;

(b) where the lender is a seller, the sums, if any, actually paid as a down payment or credited in respect of a trade-in, or paid or credited for any other reason;

(c) where the lender is a seller, the amount by which the sum stated under subclause (a) (ii) exceeds the sum stated under clause (b);

(d) the cost of borrowing expressed as one sum in dollars and cents;

(e) the percentage that the cost of borrowing bears to the sum stated,

(i) under subclause (a) (i), where the lender is not a seller, or

(ii) under clause (c), where the lender is a seller,

expressed as an annual rate applied to the unpaid balance thereof from time to time, calculated and expressed in the manner prescribed by the regulations;

(f) the amount, if any, charged for insurance;

(g) the amount, if any, charged for official fees; and

(h) the basis upon which additional charges are to be made in the event of default. R.S.O. 1990, c. C.31, s. 24.

Note: On a day to be named by proclamation of the Lieutenant Governor, section 24 is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 and the following substituted:

PART III
CREDIT AGREEMENTS

General

Application of Part

24. (1) This Part does not apply to a credit agreement unless,

(a) the borrower is an individual who has entered into the agreement other than in the course of carrying on a business; and

(b) the agreement has been,

(i) made by a lender in the course of carrying on a business, or

(ii) arranged by a credit broker.

Non-application

(2) This Part does not apply to a credit sale that,

(a) requires the purchaser to make payment in full for the goods under the sale in a single payment within a certain period after the vendor delivers a written invoice or statement of account to the purchaser;

(b) is unconditionally interest-free during the period for payment described in clause (a);

(d) is unsecured apart from liens on the goods under the sale that may arise by operation of law; and

(e) the vendor cannot assign in the ordinary course of business other than as security.

Obligations of credit brokers

(3) If a credit broker arranges a credit agreement for a lender who does not enter into the agreement in the course of carrying on a business, the obligations that this Part imposes on the lender shall be deemed to be obligations of the credit broker and not the lender.

Transitional

(4) Sections 29.2, 29.4 and 29.5 do not apply to a credit agreement that the parties have entered into before section 16 of Schedule F to the Red Tape Reduction Act, 1999 comes into force and sections 24, 25 and 28, as they read immediately before that section comes into force, continue to apply to that agreement.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Variable credit

25. (1) In this section,

“period” means a period of time of not less than four weeks and not more than five weeks in duration. R.S.O. 1990, c. C.31, s. 25 (1).

Lender’s obligations

(2) A lender extending variable credit shall,

(a) before agreeing to extend variable credit, furnish the borrower with a clear statement in writing setting forth the cost of borrowing in respect of the unpaid balances from time to time,

(i) stated as an annual percentage, or scale of annual percentages, of such balance charged at the end of each period, subject to a minimum dollars-and-cents charge, if any, and

(ii) stated in dollars and cents in a schedule of fixed amounts of outstanding balances, and the corresponding charges for the cost of borrowing; and

(b) at the end of each period during the extension of credit, furnish the borrower with a clear statement in writing showing,

(i) the outstanding balance in the account of the borrower at the beginning of the period,

(ii) the amount and date of each extension of credit to the borrower during the period and the identity of the goods or services in respect of which the credit was extended,

(iii) the amount of each sum received or credited to the account of the borrower during the period, and the date and occasion thereof,

(iv) the cost of borrowing, expressed as one sum in dollars and cents, charged during the period,

(v) the outstanding balance in the account of the borrower at the end of the period, and

(vi) the statement referred to in clause (a). R.S.O. 1990, c. C.31, s. 25 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, section 25 is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 and the following substituted:

Agreement for credit card

25. (1) A person who applies for a credit card without signing an application form or who receives a credit card from a credit card issuer without applying for it shall be deemed to have entered into a credit agreement with the issuer with respect to the card on first using the card.

Liability

(2) A person described in subsection(1) is not liable to pay the lender any amount in respect of the credit card received in the circumstances described in that subsection until the person uses the card.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Manner of applying percentage rate

26. The percentage rate by which the cost of borrowing is expressed shall be applied in the manner prescribed by the regulations. R.S.O. 1990, c. C.31, s. 26.

Note: On a day to be named by proclamation of the Lieutenant Governor, section 26 is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 and the following substituted:

Consequence of non-disclosure

26. A borrower under a credit agreement is not liable to pay the lender as part of the cost of borrowing any amount in excess of the amounts specified in the statements that this Part requires the lender to deliver to the borrower in respect of the agreement.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

When costs of borrowing not recoverable

27. A borrower is not liable to pay a lender as the cost of borrowing any sum in excess of the sum shown in the statement required by section 24 or 25 in respect of the transaction. R.S.O. 1990, c. C.31, s. 27.

Note: On a day to be named by proclamation of the Lieutenant Governor, section 27 is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 and the following substituted:

Required insurance

27. (1) A borrower who is required under a credit agreement to purchase any insurance may purchase it from any insurer who may lawfully provide that type of insurance, except that the lender may reserve the right to disapprove, on reasonable grounds, an insurer selected by the borrower.

Disclosure by lender

(2) A lender who offers to provide or to arrange insurance required under a credit agreement shall at the same time clearly disclose to the borrower in writing that the borrower may purchase the insurance through an agent from an insurer of the borrower’s choice.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Prepayment

28. Where the sum remaining to be paid under an agreement for credit is paid in full before the term of the agreement has expired,

(a) the borrower is entitled to a proportionate credit in respect of the cost of borrowing; and

(b) the lender is entitled to a proportionate part of the cost of lending,

in an amount determined in the manner prescribed by the regulations. R.S.O. 1990, c. C.31, s. 28.

Note: On a day to be named by proclamation of the Lieutenant Governor, section 28 is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 and the following substituted:

Cancellation of optional services

28. (1) A borrower may cancel an optional service of a continuing nature provided by the lender on giving one month’s notice or the shorter period of notice that is specified in the agreement under which the service is provided.

Liability of borrower

(2) A borrower who cancels an optional service in accordance with subsection(1) is not liable for charges relating to any portion of the service that has not been provided at the time of cancellation and is entitled to a refund of amounts already paid for those charges.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Advertising of cost of borrowing

29. (1) Subject to the regulations, no lender shall represent, either orally or in print, or by radio or television broadcast, the lender’s charge for credit or cause such charge to be so represented unless the representation includes the full cost of borrowing and is expressed in the manner required by section 24 or 25. R.S.O. 1990, c. C.31, s. 29 (1).

Advertising of other terms of credit

(2) Subject to the regulations, where a lender represents or causes to be represented in a printing, broadcast or other publication any terms of the credit agreement other than that referred to in subsection (1), the lender shall also include or cause to be included all other relevant terms of the credit transaction, including,

(a) the sum to be actually received in cash by the borrower or the actual cash price of the goods;

(b) the amount of the down payment;

(d) the number of instalments required to repay the total indebtedness, including the cost of borrowing. R.S.O. 1990, c. C.31, s. 29 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, section 29 is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 and the following substituted:

Deferral of payments

29. (1) If the lender under a credit agreement invites the borrower to defer making a payment that would otherwise be due under the agreement, the invitation must clearly disclose whether or not interest will accrue on the unpaid amount during the period of the deferral.

Waiver of interest

(2) If the invitation does not disclose whether or not interest will accrue on the unpaid amount during the period of the deferral, the lender shall be deemed to have waived the interest that would otherwise accrue during the period.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, the Act is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 by adding the following section:

Default charges

29.1 A lender is not entitled to impose on a borrower under a credit agreement default charges other than,

(a) reasonable charges in respect of legal costs that the lender incurs in collecting or attempting to collect a required payment by the borrower under the agreement;

(b) reasonable charges in respect of costs, including legal costs, that the lender incurs in realizing a security interest or protecting the subject matter of a security interest after default under the agreement; or

(c) reasonable charges reflecting the costs that the lender incurs because a required payment by the borrower under the agreement has been dishonoured.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, the Act is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 by adding the following section:

Prepayment

29.2 (1) A borrower is entitled to pay the full balance of outstanding principal under a credit agreement at any time without any prepayment charge or penalty.

Credit to borrower

(2) If a borrower prepays the full balance of outstanding principal under a credit agreement for fixed credit, the lender shall refund to the borrower or credit the borrower with the amount determined in accordance with the regulations that is a portion of the charges, other than charges on account of interest, that the borrower was required to pay under the agreement or that were added to the principal under the agreement.

Partial prepayment

(3) A borrower is entitled to prepay a portion of the balance of outstanding principal under a credit agreement for fixed credit on any scheduled date of the borrower’s required payments under the agreement or once in any month without any prepayment charge or penalty.

No credit to borrower

(4) A borrower who makes a payment under subsection (3) is not entitled to a credit for the charges, other than charges on account of interest, that the borrower was required to pay under the agreement or that were added to the principal under the agreement.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, the Act is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 by adding the following section:

Disclosure

Advertising

29.3 (1) No lender shall make representations or cause representations to be made with respect to a credit agreement, whether orally, in writing or in any other form, unless the representations include the information prescribed by the regulations.

Credit cards

(2) No credit card issuer shall make information about a credit card available, whether in writing, orally or in any other form, unless it contains the information about the credit card that is prescribed by the regulations.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, the Act is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 by adding the following section:

Credit broker’s statement

29.4 If a credit broker takes an application from a borrower for a credit agreement and sends it to a lender who, in the course of carrying on a business, enters into the credit agreement with the borrower, the broker shall promptly deliver to the borrower a statement that,

(a) states the amount of the brokerage fee;

(b) indicates the effect that the brokerage fee will have on the APR under the agreement and the total amount, calculated in accordance with the regulations, of all payments that the borrower is required to make under the agreement, if applicable; and

(c) contains all the other information that the lender is required to disclose to the borrower in the initial disclosure statement.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, the Act is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 by adding the following section:

Initial disclosure statement

29.5 (1) Every lender shall deliver an initial disclosure statement for a credit agreement to the borrower before the earlier of,

(a) the time that the borrower enters into the agreement; and

(b) the time that the borrower makes any payment in connection with the agreement.

Form of statement

(2) The initial disclosure statement shall,

(a) be in writing or, if the borrower consents, in a form that allows the borrower to retain it; and

(b) express the information contained in it clearly, concisely and prominently.

Contents of statement, fixed credit

(3) The initial disclosure statement for a credit agreement for fixed credit shall state,

(a) the total, calculated in accordance with the regulations, of the value that the borrower will receive under the agreement;

(b) the total amount, calculated in accordance with the regulations, of all payments that the borrower is required to make under the agreement;

(d) the annual interest rate under the agreement and the particulars about the interest payable under the agreement that are prescribed by the regulations;

(e) the APR under the agreement if different from the annual interest rate;

(f) the particulars about the amount and timing of all payments under the agreement that are prescribed by the regulations; and

(g) all other information about the agreement that is prescribed by the regulations.

Contents of statement, open credit

(4) The initial disclosure statement for a credit agreement for open credit shall state,

(a) the credit limit under the agreement;

(b) the term of each period for which the lender is required to deliver a statement of account to the borrower under section 29.7;

(d) if the agreement is for a credit card and requires the borrower to pay the balance outstanding under the agreement in full on receiving each statement of account,

(i) the fact that the borrower has that obligation, and

(ii) the period after receiving a statement of account within which the borrower is required to pay the balance outstanding under the agreement in order to avoid being in default under the agreement;

(e) the interest rate under the agreement if it is fixed or the manner in which interest is calculated under the agreement if there is no fixed interest rate;

(f) the particulars about the interest payable under the agreement that are prescribed by the regulations;

(g) the APR under the agreement except in the case of a credit agreement for a credit card;

(h) if the agreement is for a credit card, the maximum liability of the borrower under the agreement in cases where the borrower has not authorized the use of the card; and

(i) all other information about the agreement that is prescribed by the regulations.

Brokerage fee

(5) If a credit broker arranges a credit agreement for the lender, the initial disclosure statement shall,

(a) state the amount of the brokerage fee that the borrower is required to pay if,

(i) the lender does not enter into the agreement in the course of carrying on a business, or

(ii) the lender enters into the agreement in the course of carrying on a business and the lender deducts the brokerage fee from advances payable under the agreement; and

(b) where the amount of the brokerage fee is required to be stated under clause (a), account for the brokerage fee in the APR under the agreement and the amount described in clause (3) (b), if applicable.

Adoption of other statement

(6) If a credit broker has delivered a statement to the borrower under section 29.4, the lender may adopt it as the initial disclosure statement that the lender is required to deliver under this section.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, the Act is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 by adding the following section:

Subsequent disclosure: fixed credit

29.6 (1) If the interest rate on a credit agreement for fixed credit is a floating rate, the lender shall, at least once every 12 months after entering into the agreement, deliver to the borrower a disclosure statement for the period covered by the statement stating,

(a) the annual interest rate at the beginning and end of the period;

(b) the balance of outstanding principal under the agreement at the beginning and end of the period;

(c) if the agreement contains a schedule of required payments by the borrower, the amount and timing of all remaining payments based on the annual interest rate at the end of the period covered by the statement; and

(d) all other information about the agreement that is prescribed by the regulations.

Increase in interest rate

(2) If the interest rate on a credit agreement for fixed credit is not a floating rate and the agreement allows the lender to change the interest rate, the lender shall, within 30 days after increasing the annual interest rate to a rate that is at least 1 per cent higher than the rate most recently disclosed to the borrower, deliver to the borrower a disclosure statement stating,

(a) the new annual interest rate;

(b) the date the new rate takes effect;

(d) all other information about the agreement that is prescribed by the regulations.

Insufficient scheduled payments

(3) If the principal under a credit agreement for fixed credit increases as a result of default charges or the failure of the borrower to make payments under the agreement to the point that the amount of the borrower’s scheduled payments under the agreement is no longer sufficient to cover accrued interest under the agreement, the lender shall give the borrower notice in writing to that effect within 30 days.

Amendments

(4) If information disclosed in a disclosure statement delivered under this section changes because of an amendment to a credit agreement, the lender shall deliver a supplementary disclosure statement to the borrower within 30 days after the amendment is made setting out the changed information, subject to subsection (5).

Exception

(5) If an amendment to a credit agreement consists only of a change in the schedule of required payments by the borrower, it is not necessary for the supplementary disclosure statement to disclose any change to the APR or any decrease in the total required payments by the borrower or the total cost of borrowing under the agreement.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, the Act is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 16 by adding the following section:

Subsequent disclosure: open credit

29.7 (1) Subject to subsection (2), the lender under a credit agreement for open credit shall deliver a statement of account to the borrower at least once monthly after entering into the agreement.

Exception

(2) The lender is not required to deliver a statement of account to the borrower if,

(a) during the period since the most recent statement of account, the borrower received no advances and made no payments under the agreement; and

(b) at the end of the period,

(i) the outstanding balance payable by the borrower under the agreement is zero, or

(ii) the borrower is in default under the agreement and the lender has notified the borrower that the lender has cancelled or suspended the right of the borrower to obtain advances under the agreement and has demanded payment of the outstanding balance payable by the borrower under the agreement.

Information about account

(3) The lender shall provide to the borrower a telephone number at which the borrower can make inquiries about the borrower’s account during the lender’s ordinary business hours without incurring any charges for the telephone call.

Contents of statement of account

(4) A statement of account for a credit agreement for open credit shall state, where applicable,

(a) the dates of the period since the most recent statement of account;

(b) the balance outstanding under the agreement at the beginning of the period;

(c) the amount, description and posting date of each transaction added to the balance outstanding under the agreement during the period;

(d) the amount and posting date of each payment or credit subtracted from the balance outstanding under the agreement during the period;

(e) the annual interest rate or rates in effect during the period;

(f) the amount of interest charged to the borrower during the period;

(g) the total amount of all advances and charges charged to the borrower during the period, including purchases made by the borrower and interest;

(h) the total amount of all payments made by the borrower during the period;

(i) the balance outstanding under the agreement at the end of the period;

(j) the credit limit of the borrower under the agreement;

(k) the minimum initial payment that the borrower is required to pay under the agreement for the period;

(l) the due date for the payment described in clause (k); and

(m) all other information about the period that is prescribed by the regulations.

Change in interest rate

(5) A lender under a credit agreement for open credit who changes the interest rate under the agreement shall notify the borrower of the change,

(a) in the next statement of account after the change, in the case of a credit agreement that is not for a credit card; and

(b) at least 30 days before the change, in the case of a credit agreement that is for a credit card where the interest rate is not a floating rate.

Other changes

(6) A lender under a credit agreement for open credit who, pursuant to the agreement, changes any of the matters mentioned in subsection 29.5 (4), other than the interest rate under the agreement, shall notify the borrower of the change,

(a) in the next statement of account after the change, if the change is not a material change as determined by the regulations; and

(b) at least 30 days before the change, if the change is a material change as determined by the regulations.

See: 1999, c. 12, Sched. F, ss. 16, 45 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, the Act is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 17 (1) by adding the following heading immediately preceding section 30:

Assignment of Security for Credit

See: 1999, c. 12, Sched. F, ss. 17 (1), 45 (2).

Assignment of negotiable instrument

30. (1) Where a lender assigns a negotiable instrument given to secure credit, the lender shall deliver to the assignee with the negotiable instrument a copy of the statement required by section 24 and, where the lender is a seller, a copy of the contract of sale. R.S.O. 1990, c. C.31, s. 30 (1).

Note: On a day to be named by proclamation of the Lieutenant Governor, subsection (1) is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 17 (2) by striking out “section 24” and substituting “section 29.5”. See: 1999, c. 12, Sched. F, ss. 17 (2), 45 (2).

Reassignment of negotiable instrument

(2) Every assignee of a negotiable instrument who reassigns the instrument shall deliver to his, her or its assignee the statement and contract of sale, if any, received by him, her or it in respect of the instrument. R.S.O. 1990, c. C.31, s. 30 (2).

Indemnity

(3) Where an assignee of a negotiable instrument to which subsection (2) applies is entitled to recover on the instrument from the maker, the maker is entitled to be indemnified therefor by any assignor of the instrument who has not complied with subsection (1) or (2), as the case may be. R.S.O. 1990, c. C.31, s. 30 (3).

Obligations of assignee of lender

31. (1) The assignee of any rights of a lender has no greater rights than and is subject to the same obligations, liabilities and duties as the assignor, and the provisions of this Act apply equally to such assignee. R.S.O. 1990, c. C.31, s. 31 (1).

Idem

(2) Despite subsection (1), a borrower shall not recover from, or be entitled to set off against, an assignee of the lender an amount greater than the balance owing on the contract at the time of the assignment, and, if there have been two or more assignments, the borrower shall not recover from an assignee who no longer holds the benefit of the contract an amount that exceeds the payments made by the borrower to that assignee. R.S.O. 1990, c. C.31, s. 31 (2).

Order to pay indemnity

32. (1) Where an assignor of a negotiable instrument is convicted of a contravention of section 30, the Ontario Court of Justice making the conviction may order that the person convicted is liable to indemnify the maker under subsection 30 (3). R.S.O. 1990, c. C.31, s. 32 (1); 2001, c. 9, Sched. D, s. 4 (3).

Filing indemnity order in court

(2) Where an indemnity order is made under subsection (1) in favour of a person who is or becomes liable under a judgment of a court to an assignee of the negotiable instrument in respect of which the indemnity order was made, the person entitled to the indemnity may file the indemnity order in the court office of the court in which the judgment was issued. R.S.O. 1990, c. C.31, s. 32 (2).

Default judgment

(3) Upon the filing of the indemnity order, the local registrar or clerk of the court shall issue a default judgment in favour of the person entitled to the indemnity and against the person required by the indemnity order to give the indemnity, and the amount of the default judgment shall be the amount of the judgment referred to in subsection (1) and costs together with the costs of issuing the default judgment, or such less amount as the person entitled to the indemnity by requisition requests. R.S.O. 1990, c. C.31, s. 32 (3).

Setting aside or variation of default judgment

(4) Upon application therefor, the court in which the default judgment is issued may set aside the default judgment or may determine the amount of the indemnity or make an order of reference for the purpose and may vary the amount of the default judgment. R.S.O. 1990, c. C.31, s. 32 (4).

Note: On a day to be named by proclamation of the Lieutenant Governor, the Act is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, section 18 by adding the following Part:

PART III.1
LEASES

Application of Part

32.1 This Part does not apply to a lease unless it is,

(a) a lease for a fixed term of four months or more;

(b) a lease for an indefinite term or that is renewed automatically until one of the parties takes positive steps to terminate it; or

Advertising

32.2 No lessor shall make representations or cause representations to be made about the cost of a lease of the lessor, whether orally, in writing or in any other form, unless the representations include the information prescribed by the regulations.

Initial disclosure statement

32.3 (1) Every lessor shall deliver an initial disclosure statement for a lease to the lessee before the earlier of,

(a) the time that the lessee enters into the lease; and

(b) the time that the lessee makes any payment in connection with the lease.

Form of statement

(2) The initial disclosure statement shall,

(a) be in writing or in a form to which the lessee consents; and

(b) express the information contained in it clearly, concisely and prominently.

Contents of statement

(3) The initial disclosure statement for a lease shall contain,

(a) a statement that the transaction is a lease;

(b) a description of the leased goods and their value determined in accordance with the regulations;

(d) the lessor’s reasonable estimate of the wholesale value of the leased goods at the end of the lease term;

(e) the total amount, calculated in accordance with the regulations, of all payments that the lessee is required to make under the lease;

(f) the particulars about the amount and timing of all payments under the lease as is prescribed by the regulations;

(g) the APR under the lease; and

(h) all other information about the lease that is prescribed by the regulations.

Residual obligation lease

32.4 The maximum liability of the lessee at the end of the term of a residual obligation lease after returning the leased goods to the lessor shall be the amount calculated in accordance with the regulations.

See: 1999, c. 12, Sched. F, ss. 18, 45 (2).

PART IV
GENERAL

Agreements and waivers contrary to Act

33. This Act applies despite any agreement or waiver to the contrary. R.S.O. 1990, c. C.31, s. 33.

Representation

33.1 No person shall publish or cause to be published in writing any representation that the person is registered under this Act. 1997, c. 35, s. 1 (4).

Confidentiality

33.2 (1) Each person employed in the administration of this Act shall preserve secrecy in respect of all information that comes to his or her knowledge in the course of his or her duties or employment and shall not communicate the information to any other person except if,

(a) it is required in connection with the administration of this Act and the regulations or any proceedings under this Act or the regulations;

(b) the person communicates the information to his or her counsel; or

Testimony

(2) No person to whom subsection (1) applies shall be required to give testimony in a civil suit or proceeding with regard to information obtained in the course of his or her duties or employment except in a proceeding under this Act or the regulations. 1997, c. 35, s. 1 (4).

Consumer sale

34. (1) In this section,

“consumer sale” means a contract for the sale of goods made in the ordinary course of business to a purchaser for the purchaser’s consumption or use, but does not include a sale,

(a) to a purchaser for resale,

(b) to a purchaser whose purchase is in the course of carrying on business,

(d) by a trustee in bankruptcy, a receiver, a liquidator or a person acting under the order of a court. R.S.O. 1990, c. C.31, s. 34 (1).

Implied warranties

(2) The implied conditions and warranties applying to the sale of goods by virtue of the Sale of Goods Act apply to goods sold by a consumer sale and any written term or acknowledgment, whether part of the contract of sale or not, that purports to negative or vary any of such implied conditions and warranties is void and, if a term of a contract, is severable therefrom, and such term or acknowledgment shall not be evidence of circumstances showing an intent that any of the implied conditions and warranties are not to apply. R.S.O. 1990, c. C.31, s. 34 (2).

Rights of buyer and borrower preserved

35. The rights of a buyer or borrower under this Act are in addition to any rights of the buyer or borrower under any other Act or by the operation of law, and nothing in this Act shall be construed to derogate from such rights. R.S.O. 1990, c. C.31, s. 35.

Restrictions on actions

36. (1) In this section,

“credit” means the advancing of money, goods or services to or on behalf of another for repayment at a later time, whether or not there is a cost of borrowing, and includes variable credit; (“crédit”)

Note: On a day to be named by proclamation of the Lieutenant Governor, the definition of “credit” is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 19 (1). See: 1999, c. 12, Sched. F, ss. 19 (1), 45 (2).

“unsolicited goods” means personal property furnished to a person who did not request it and a request shall not be inferred from inaction or the passing of time alone, but does not include,

(a) personal property that the recipient knows or ought to know is intended for another person, or

(b) personal property supplied under a contract in writing to which the recipient is a party that provides for the periodic supply of personal property to the recipient without further solicitation. (“marchandises non sollicitées”) R.S.O. 1990, c. C.31, s. 36 (1).

Credit arrangement

(2) No action shall be brought by which to charge any person upon any arrangement for the extension of credit evidenced by a credit card unless the person to whom credit is to be extended requested or accepted the credit arrangement and card in writing, and the obtaining of credit by the person named in the credit card shall be deemed to constitute such written acceptance by the person. R.S.O. 1990, c. C.31, s. 36 (2).

Note: On a day to be named by proclamation of the Lieutenant Governor, subsection (2) is repealed by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 19 (2). See: 1999, c. 12, Sched. F, ss. 19 (2), 45 (2).

Use of unsolicited goods

(3) No action shall be brought by which to charge any person for payment in respect of unsolicited goods notwithstanding their use, misuse, loss, damage or theft. R.S.O. 1990, c. C.31, s. 36 (3).

Relief from legal obligations

(4) Except as provided in this section, the recipient of unsolicited goods or of a credit card that has not been requested or accepted in accordance with subsection (2) has no legal obligation in respect of their use or disposal. R.S.O. 1990, c. C.31, s. 36 (4).

Note: On a day to be named by proclamation of the Lieutenant Governor, subsection (4) is amended by the Statutes of Ontario, 1999, chapter 12, Schedule F, subsection 19 (3) by striking out “or of a credit card that has not been requested or accepted in accordance with subsection (2)”. See: 1999, c. 12, Sched. F, ss. 19 (3), 45 (2).

Referral selling

37. (1) For the purposes of this section in addition to the meanings defined in section 1 for “buyer” and “seller”,

“buyer” includes a person who hires or leases goods for consumption where,

(a) the person has an option to purchase the goods, or

(b) upon compliance with agreed terms, the person will become the owner of the goods or will be entitled to keep them without further payment; (“acheteur”)

“seller” includes a person who is in the business of letting goods, by hire or lease, to buyers. (“vendeur”) R.S.O. 1990, c. C.31, s. 37 (1).

Prohibition

(2) No seller shall hold out to a buyer or prospective buyer any advantage, benefit or gain to the buyer or prospective buyer for doing anything that purports to assist the seller in finding or selling to another prospective buyer. R.S.O. 1990, c. C.31, s. 37 (2).

Contracts not binding on buyer

(3) Despite the provision for or imposition of a penalty under this Act, any contract entered into following the holding out referred to in subsection (2) is not binding on the buyer. R.S.O. 1990, c. C.31, s. 37 (3).

Order if false advertising

38. (1) If the Director believes on reasonable and probable grounds that a seller or lender is making false, misleading or deceptive statements in an advertisement, circular, pamphlet or similar material, the Director may make an order for the immediate cessation of the use of that material. 1997, c. 35, s. 1 (5).

Order effective

(2) The order takes effect immediately upon being made. 1997, c. 35, s. 1 (5).

Service

(3) The Director shall serve the order, together with written reasons for it, on the person named in it. 1997, c. 35, s. 1 (5).

Request for a hearing

(4) The order shall inform the person named in it that the person may request a hearing before the Tribunal by mailing or delivering a written notice of request for a hearing on the Director and the Tribunal within 15 days after service of the order. 1997, c. 35, s. 1 (5).

Hearing date

(5) If the person gives a notice of request for a hearing within the allowed time, the Tribunal shall schedule and hold the hearing. 1997, c. 35, s. 1 (5).

Stay of order

(6) The Tribunal may stay the order until it confirms or sets aside the order under subsection (8). 1997, c. 35, s. 1 (5).

Parties

(7) The Director, the person who requested the hearing and the persons whom the Tribunal specifies are parties to the hearing. 1997, c. 35, s. 1 (5).

Powers of Tribunal

(8) After holding the hearing, the Tribunal may,

(a) confirm the order with the amendments, if any, that the Tribunal considers proper to give effect to the purposes of the Act; or

(b) set aside the order. 1997, c. 35, s. 1 (5).

Same

(9) In confirming or setting aside the order, the Tribunal may substitute its opinion for that of the Director. 1997, c. 35, s. 1 (5).

Appeal

(10) Even if the person named in an order made under this section appeals it under section 11 of the Licence Appeal Tribunal Act, 1999, the order takes effect immediately but the Tribunal may grant a stay until the disposition of the appeal. 1999, c. 12, Sched. G, s. 19 (2).

Compliance with order

(11) Every person named in an order made under this section who knowingly fails to comply with it, except during the time that it is stayed, is guilty of an offence punishable under section 39. 1997, c. 35, s. 1 (5).

Service

38.1 (1) An order under section 38 is sufficiently served if delivered personally or sent by registered mail addressed to the person to whom service is required to be made at the person’s last known business address. 1997, c. 35, s. 1 (5).

Registered mail

(2) An order sent by registered mail shall be deemed to have been served on the third day after the day of mailing, unless the person being served establishes that the person did not, acting in good faith, through absence, accident, illness or other cause beyond the person’s control receive the order until a later date. 1997, c. 35, s. 1 (5).

Exception

(3) Despite subsection (1), the Tribunal may order any other method of service in respect of a matter before the Tribunal. 1997, c. 35, s. 1 (5).

Offence

39. (1) Every person who contravenes this Act or the regulations and every director or officer of a corporation who knowingly concurs in a contravention of this Act or the regulations is guilty of an offence and on conviction is liable to a fine of not more than $25,000 or to imprisonment for a term of not more than one year, or to both. R.S.O. 1990, c. C.31, s. 39 (1).

Corporations

(2) Where a corporation is convicted of an offence under subsection (1), the maximum penalty that may be imposed upon the corporation is $100,000 and not as provided therein. R.S.O. 1990, c. C.31, s. 39 (2).

Limitation

(3) No proceeding under this section shall be instituted more than three years after the time when the subject-matter of the proceeding arose. R.S.O. 1990, c. C.31, s. 39 (3); 1997, c. 35, s. 1 (6).

Deviations from forms

(4) For the purposes of this section, an error or omission in any form prescribed or information required to be given by this Act or the regulations shall not be deemed to be in contravention of this Act or the regulations where the person against whom the contravention is alleged proves that the error or omission was accidental or clerical or was beyond the person’s control. R.S.O. 1990, c. C.31, s. 39 (4).

Regulations

40. (1) The Lieutenant Governor in Council may make regulations,

(a) prescribing any matter mentioned in this Act as prescribed by the regulations;

(b) Repealed: 1997, c. 35, s. 1 (7).

(d) providing for the responsibility for payment of witness fees and expenses in connection with proceedings before the Tribunal and prescribing the amounts thereof;

(e) providing for the form and terms of bonds and collateral security with respect to persons who were registered as itinerant sellers under this Act or any class of them, and providing for the forfeiture of bonds and the disposition of the proceeds;

Note: On a day to be named by proclamation of the Lieutenant Governor, clause (e) is repealed by the Statutes of Ontario, 1997, chapter 35, subsection 1 (9). See: 1997, c. 35, ss. 1 (9), 5 (2).

(f) Repealed: 1997, c. 35, s. 1 (10).

(g) prescribing the form of statements of the cost of borrowing;

(h) prescribing amounts for the purposes of section 18 and the definition of “direct sales contract” in section 23.1;

(i) governing what information must be contained in a direct sales contract and the written copy of a direct sales contract;

(j) prescribing the circumstances in which a seller is not required to refund all money paid by a buyer under clause 23.6 (2) (a) and prescribing limits on the amount of money a seller is not required to refund in those circumstances;

(j.1) respecting the form in which a person is authorized to make representations or to make information available under section 29.3 or 32.2 or the form in which a person is required to make a statement under Part III or III.1;

(j.2) prescribing the maximum liability of a borrower under a credit agreement for a credit card in cases where the borrower has not authorized the use of the card;

(j.3) limiting the amount of compensation that a lessor may charge the lessee for termination of the lease before the end of the lease term;

(k) exempting any class of buyer, seller, lender or borrower from the application of this Act or any provision of it;

(l) prescribing forms for the purposes of this Act and providing for their use;

(m) requiring any information required to be furnished or contained in any form or return to be verified by affidavit;

(n) defining any expression used in Part II or Part III of this Act;

(o) Repealed: 1999, c. 12, Sched. F, s. 20 (4).

R.S.O. 1990, c. C.31, s. 40; 1997, c. 35, s. 1 (7, 8, 10, 11); 1998, c. 18, Sched. E, s. 55; 1999, c. 12, Sched. F, s. 20 (1-4).

Application of regulations

(2) A regulation may,

(a) be general or specific in nature;

(b) define classes of credit agreements or leases for the purpose of the regulations; and

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Consumer Protection Act, R.S.O. 1990, c. C.31

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