Stephen Li v. Registrar, Motor Vehicle Dealers Act, 2002, 2021 CanLII 76762

Licence Appeal Tribunal

Date: 2021-07-22 Tribunal File Number: 13470/MVDA

Appeal from a Proposal of the Registrar under the Motor Vehicle Dealers Act, R.S.O. 2002, c. 30, Sch. B, to Refuse Registration

Between:

Stephen Li Appellant

and

Registrar, Motor Vehicle Dealers Act, 2002

Respondent

CONSENT ORDER

Order Made by: Ian Maedel, Vice Chair Date of Order: July 22, 2021

BACKGROUND

1This is an appeal from a Notice of Proposal issued by the Registrar under the Motor Vehicles Dealers Act, 2002 (“Act”), to revoke the registration of 2157437 Ontario Inc. o/a AADCO Auto Parts and Nimchand Seegobin (“the appellants”) as a motor vehicle dealer and salesperson pursuant to the Act. This appeal was processed under Tribunal File 13025/MVDA.

2The Registrar added an additional party to the Notice of Proposal and is hereby also proposing to refuse Stephen Li’s (“the added party”) registration as a motor vehicle salesperson pursuant to the Act. This appeal was processed under Tribunal File 13470/MVDA. However, the two appeals were never formally joined by the Tribunal.

3The parties have advised the Tribunal that they were able to agree upon a settlement of all outstanding issues in this matter and have requested that the terms of settlement be incorporated into a Consent Order disposing of this proceeding.

4In accordance with s. 4.1 of the Statutory Powers and Procedure Act, the parties do hereby waive the requirements of a hearing.

ORDER AND DIRECTION

5Accordingly, on the consent of the parties and upon having reviewed the agreement signed by the parties, the Tribunal, pursuant to Motor Vehicles Dealers Act, 2002 directs and orders that the appellants and the added party shall be bound by the terms of the consent agreement signed and executed by all of the parties.

6The signed agreement is appended as Schedule “A” to this Order.

7The joint case conference scheduled for July 21, 2021 is cancelled.

8These Tribunal file(s) shall be closed.

LICENCE APPEAL TRIBUNAL

_______________________ Ian Maedel, Vice Chair

Released: July 22, 2021

Schedule “A”

TO: Licence Appeal Tribunal Tribunals Ontario General Services 15 Grosvenor Street, Ground Floor Toronto, ON M7A 2G6

FROM: Registrar Motor Vehicle Dealers Act, 2002 Ontario Motor Vehicle Industry Council 65 Overlea Blvd., Suite 300 Toronto, ON M4H 1P1

FROM: 2157437 Ontario Inc. o/a Aadco Auto Parts 38 Hansen Road South Brampton, ON L6W 3H4

FROM: Nimchand Seegobin c/o 2157437 Ontario Inc. o/a Aadco Auto Parts 38 Hansen Road South Brampton, ON L6W 3H4

AND FROM: Stephen Li c/o 2157437 Ontario Inc. o/a Aadco Auto Parts 38 Hansen Road South Brampton, ON L6W 3H4

Pursuant to subsection 6(2) of the Motor Vehicle Dealers Act, 2002 (“MVDA”) 2157437 Ontario Inc. o/c Aadco Auto Parts, Nimchand Seegobin and Stephen Li (collectively the “Registrants”) and the Registrar, Motor Vehicle Dealers Act, 2002, (“Registrar”), in accordance with section 4.1 of the Statutory Powers Procedure Act, do hereby waive the requirements of a hearing.

2157437 Ontario Inc. o/c Aadco Auto Parts (“Aadco Auto Parts”) remains registered as a motor vehicle dealer and Nimchand Seegobin (“Seegobin”) remains registered as a motor vehicle salesperson and Stephen Li (“Li”) can be registered as a motor vehicle salesperson, respectively, under the MVDA. On consent, their registrations shall be subject to this Order of the Licence Appeal Tribunal (“Order”) based upon the following terms and conditions:

REGISTRATION

1. The Registrants shall comply with all requirements of the MVDA and Ontario Regulation 333/08, the Code of Ethics in Ontario Regulation 332/08, the Ontario Motor Vehicle Industry Council (“OMVIC”) Standards of Business Practice, 2010 and OMVIC Guidelines, as may be amended from time to time. The Registrants further agree to read all correspondence and bulletins from OMVIC as released.

2. The Registrants shall comply with the Consumer Protection Act and the Sale of Goods Act.

3. The Registrants shall provide the Registrar with notice in writing, within five days, of any substantive changes to their business plan or information provided in obtaining their registration, pursuant to section 31 of Ontario Regulation 333/08.

4. The Registrants shall ensure the Registrar is provided with notice in writing, within five days, of any change in the officers or directors of the corporation, pursuant to section 24 of the MVDA. The Registrants further agree to notify the Registrar of any change in partners or owner, person(s) in charge, and signing authority for the dealership. The Registrants further agree not to effect such changes without first obtaining the Registrar’s prior approval, in writing.

5. The Registrants acknowledge that "trade" refers to buying, selling, leasing, advertising or exchanging an interest in a motor vehicle or negotiating or inducing or attempting to induce the buying, selling, leasing or exchanging of an interest in a motor vehicle as defined in the MVDA and pursuant to section 36 through to and including section 51 of Ontario Regulation 333/08; and is not limited to the signing of contracts. The Registrants further acknowledge that this includes attendance at auction on behalf of the Registrant and positions commonly referred to as Sales Manager, Finance and Insurance Manager, Branch Manager, Business Manager, General Manager or any individual who has supervisory authority over salespersons.

6. The Registrants shall ensure that their registrations will not be used to trade in motor vehicles where the Registrants know, or ought to know, that trading motor vehicles will facilitate an illegal or unethical practice.

7. The Registrants shall ensure that all personnel, agents, assignees or anyone acting on behalf of the Registrants to trade in motor vehicles will be registered as a salesperson to the dealer, Aadco Auto Parts.

8. The Registrants shall not conduct business with any person acting as a motor vehicle dealer and trading in motor vehicles without first confirming that the person is registered as a motor vehicle dealer under the MVDA.

9. Aadco Auto Parts is registered under the wholesaler class. Aadco Auto Parts shall ensure that it, or any person acting on its behalf, shall not trade in any motor vehicles other than with registered dealers and wholesale auctions.

10. Seegobin and Li shall not act as a salesperson on behalf of any other dealer, or transfer their registrations to another dealer, without having obtained prior written approval from the Registrar, which will not be unreasonably withheld.

11. Seegobin and Li shall not engage in the trade of their personal vehicles (including family members) through Aadco Auto Parts.

PREMISES

12. The Registrants shall operate exclusively from its location approved by the Registrar and will not invite or facilitate the public or any customer to trade at a place other than the approved location, pursuant to section 28 of Ontario Regulation 333/08. This includes, but is not limited to, the signing of contracts related to the trade of a motor vehicle.

13. The Registrants shall not change the location approved by the Registrar without first obtaining the Registrar’s approval, in writing, pursuant to section 31 of Ontario Regulation 333/08. The Registrants shall then provide the Registrar with notice in writing, within five days, of any such change of the location.

BOOKS AND RECORDS

14. The Registrants shall maintain books and records, which accurately record the true nature of transactions involving the trade of a motor vehicle. The Registrants shall not be involved in the creation or furnishing of books, records, or any document, which are false or misleading as to the true nature of a transaction involving the trade of a motor vehicle.

15. The Registrants shall not falsify, assist in falsifying or induce or counsel another person to falsify or assist in falsifying any information or document, relating to a trade in motor vehicles – nor shall the Registrants furnish such information or document – pursuant to sections 26 and 27 of the MVDA.

16. The Registrants shall maintain all books and records at the Registrant's registered premises in accordance with the MVDA and pursuant to section 52 through to and including section 60 of Ontario Regulation 333/08.

17. The Registrants shall provide free access to books and records of the Registrant to an authorized representative of the Registrar in accordance with section 15 of the MVDA.

18. The Registrants shall not purchase a vehicle without first ensuring that the vehicle is registered to the seller, in the records of the Ontario Ministry of Transportation (MTO).

19. The Registrants shall ensure that all vehicles purchased will be registered within 6 days in accordance with section 11 of the Highway Traffic Act (“HTA”).

20. The Registrants shall undertake to ensure that all vehicles sold will be registered in the name of the purchaser, in the records of the MTO before releasing the vehicle to the purchaser.

21. The Registrants shall undertake that in the event their books and records are lost, stolen or destroyed in whole or in part, the Registrar will be advised, in writing, within 5 days of the event pursuant to section 55 of Ontario Regulation 333/08; and will include all relevant documentation. The documentation will include, but is not limited to, police reports, insurance claims and affidavits. The Registrants further agree to make all reasonable efforts to reconstitute the lost, stolen or damaged records.

22. The Registrants shall obtain a receipt prior to the removal of any records by a government or professional agency; or any other person or entity, from the registered premise. Such receipt will include the recipient's name, address, telephone number, description of records taken, the time of return and signature of recipient. The Registrant undertakes to provide the receipt to OMVIC when requested by the Registrar.

DISCLOSURE & ACCOUNTABILITY

23. The Registrants shall ensure that all trades in motor vehicles are completed in accordance with section 30 of the MVDA and pursuant to sections 39, 40, 41, 42 and 43 of Ontario Regulation 333/08 and sections 4 and 5 of Ontario Regulation 332/08, where applicable.

24. The Registrants shall disclose all material facts about the motor vehicles it trades. The Registrants further agrees that notwithstanding whether or not the Registrants consider a fact to be material, the Registrants shall comply with the disclosure obligation. The Registrants shall disclose all material facts on the Bill of Sale, in writing, in a clear, comprehensible and prominent manner. The Registrants shall ensure compliance with the disclosure obligation notwithstanding whether or not the vehicle has been branded through MTO. For greater certainty, a material fact is one that if disclosed could affect the decision of a reasonable person to purchase or lease the vehicle or affect the purchase price. In the case of damaged vehicles, the Registrants further agree to disclose as much detail as possible regarding the nature and severity of the damage. The Registrants undertake to research the history of all the motor vehicles under trade to ensure all material facts are disclosed.

25. The Registrants shall not represent any charges or fees on a Bill of Sale as being required by law where the charges or fees are not required by law. For greater clarity, this includes charges or fees such as tax, registration fee or certification.

26. The Registrants shall comply with all reasonable requests made by the Registrar in relation to any failure to comply with disclosure obligations. Further, where the Registrar reasonably considers any information to be a material fact, the Registrants shall provide compensation to a purchaser concerning a motor vehicle under trade.

27. The Registrants agree to accept full responsibility for the quality of any repairs or alterations to a motor vehicle completed by the Registrant’s personnel, agents, assignees, affiliated repair facilities or anyone acting on behalf of the Registrant.

28. The Registrants shall promptly respond to any correspondence made by a representative of the Registrar regarding any complaints and shall exercise best efforts to promptly resolve any complaints.

FINANCIAL RESPONSIBILITY

29. The Registrants agree not to receive any new sources of financing without the prior approval of the Registrar. This does not apply where the Registrant has applied on his own account and has obtained financing from a corporation registered under the Loan and Trust Corporations Act, The Bank Act or from a credit union or league to which the Credit Unions and Caisses Popularies Act, as may be amended from time to time.

30. The Registrants shall maintain bank accounts that are compliant with section 59 of Ontario Regulation 333/08. The Registrants shall ensure its business account is in the name of the dealer and that all amounts in connection with a trade of a motor vehicle are processed through the business account.

31. The Registrants shall ensure that bank account transactions relate exclusively to the operation or financing of the business. The Registrants agree to notify the Registrar of any change in any business banking accounts.

32. The Registrants shall comply with all federal, provincial and municipal tax obligations. The Registrant shall ensure all required filings are current and submitted with required payments. All taxes collected are deemed to be trust funds and will not be used for any other purpose other than remittances to the federal, provincial and municipal government.

33. The Registrants shall ensure that any claim made to the Motor Vehicle Dealers Compensation Fund (the “Fund”) in relation to the Registrants, and the Fund determines entitlement to compensation of the claim pursuant to section 42 of Ontario Regulation 338/08; that the Registrants shall reimburse the Fund for any monies paid in relation to the claim.

COURSE REQUIREMENT

34. Seegoin shall immediately enroll in the Ontario Motor Vehicle Industry Council's Automotive Certification Course (“Certification Course”) and be responsible for all fees in relation to enrolment. Seegoin shall successfully pass the Certification Course within 90 days of the date of this Order and shall forthwith provide proof of compliance to the Registrar.

COMPLIANCE

35. The Registrants shall ensure that all employees, personnel, agents, assignees or anyone acting on behalf of the Registrant are informed of the Terms and Conditions contained in this document to the extent necessary to ensure compliance with these Terms and Conditions.

36. These Terms and Conditions shall remain effective for a period of two years at which time, the Registrants may make a request, in writing, to the Registrar for the removal or amendment of said conditions.

ACKNOWLEDGMENT AND UNDERTAKING:

37. The Registrar is relying on the accuracy and completeness of all documents, statements or information provided by the Registrant in support of the Registrant’s application for registration.

38. The documents, information or statements provided to the Registrar are true to the best of the Registrants’ knowledge, and belief; and that full answer to all questions, inquiries and requests made by the Registrar.

39. The Registrar may take further administrative action, including a proposal to suspend or revoke registration, arising from any matters that have occurred or may occur related to honesty and integrity, financial responsibility or compliance with these terms and conditions.

40. Independent legal advice has been obtained or the Registrants have had the opportunity to obtain independent legal advice respecting consent to the Terms and Conditions contained in this document.

Signed in the City of this day of 2021.

Nimchand Seegobin (signature)

_

Nimchand Seegobin on behalf of 2157437 Ontario Inc. o/a Aadco Auto Parts (signature)

Signed in the City of this day of 2021.

Stephen Li (signature)

These Terms and Conditions are accepted by the Registrar, Motor Vehicle Dealers Act, 2002.