OMVIC Mandatory Disclosures and Consumer Protection Flashcards

A vehicle is sold with an outstanding loan (lien) that the dealer did not disclose, and the finance company later repossesses the vehicle from the consumer. Under OMVIC consumer protection provisions, the consumer:

Answer: Has grounds for a complaint to OMVIC and a potential Compensation Fund claim for the financial loss caused by the undisclosed lien

Selling a vehicle with an undisclosed lien that leads to repossession is fraudulent dealing; this type of loss is covered by OMVIC's Compensation Fund if the dealer was registered.

Under the MVDA, a registered motor vehicle dealer who wishes to operate from a new location must:

Answer: Obtain a new or amended registration from OMVIC for the new location before operating from it

Registration under the MVDA is location-specific; a dealer must obtain approval from OMVIC for any new location before conducting business from it.

A consumer who was defrauded by a dealer wants to file a Compensation Fund claim. What is the deadline for submitting a claim to the Fund?

Answer: Within two years of the date the consumer knew or ought to have known of the loss

Compensation Fund claims must generally be filed within the applicable limitation period, commonly aligned with the two-year limitation under Ontario's Limitations Act.

Under OMVIC's consumer protection framework, which of the following transactions requires registration as a motor vehicle dealer under the MVDA?

Answer: A person who regularly buys and resells used vehicles for profit, even if operating from their residence

The MVDA requires registration for anyone who trades in motor vehicles as a business; regularly buying and reselling vehicles for profit is considered 'trading' regardless of location.

A consumer has been offered a vehicle by an unregistered seller (curbsider) who claims to be a private party. If the consumer buys from an unregistered dealer, they:

Answer: Are not protected by the Compensation Fund since it only covers transactions with registered dealers

The Compensation Fund and OMVIC's consumer protections apply only to purchases from OMVIC-registered dealers; transactions with unregistered dealers (curbsiders) fall outside OMVIC's protection umbrella.

A used vehicle is being sold with a UVIP that shows two prior registrations. However, the salesperson tells the consumer it is a 'one-owner car.' What right does the consumer have?

Answer: The consumer may rely on the misrepresentation as grounds to rescind the agreement if it was material to their decision

A material verbal misrepresentation (such as false ownership history) that induces a consumer to purchase gives the consumer the right to rescind even if documentary evidence contradicted the claim.

Under OMVIC regulations, what is required for a dealer to sell a vehicle that has been designated with a 'lemon law buyback' brand in the United States?

Answer: The dealer must disclose the manufacturer buyback status to the buyer before any purchase agreement is signed

Manufacturer buyback status is a mandatory disclosure under MVDA regulations; the dealer must inform the buyer before signing, but is not prohibited from selling the vehicle.