Appeal from a Notice of Proposal to Revoke Registrations by the Registrar pursuant to the Motor Vehicle Dealers Act, 2002, S.O. 2002, c. 30, Sch. B
Between:
Donald Rezoski, D.S. Turnaround Leasing Inc., 1037166 Ontario Inc. o/a Best Rate Auto Sales
-and-
Roderick Gagne
Appellants
-and-
Registrar, Motor Vehicle Dealers Act, 2002
Respondent
CONSENT ORDER
Adjudicator: Colin Osterberg
CONSENT ORDER
1The appellants and the Registrar under the Motor Vehicle Dealers Act, 2002 (the “Registrar”) apply under section 4.1 of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22 for an order of the Tribunal to dispose of this matter without a hearing.
2I have reviewed the consent agreements, which are signed by the appellants and Maureen Harquail, Registrar, and which are attached to this Consent Order as “Schedule A” and “Schedule B”.
3On consent of the parties, I order that the proceedings in this matter are concluded and disposed of without a hearing based on the terms set out in the attached Schedule A and Schedule B, which are incorporated into and made part of this Consent Order.
LICENCE APPEAL TRIBUNAL
____________________________
Colin Osterberg, Member
Released: November 15, 2022
“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 300 – 65 Overlea Boulevard Toronto, ON M4H 1P1
AND FROM: 1037166 Ontario Inc. o/a Best Rate Auto Sales 6045 Tecumseh Road East Windsor, ON N8T 1E5
AND FROM: Donald Rezoski c/o 1037166 Ontario Inc. o/a Best Rate Auto Sales 6045 Tecumseh Road East Windsor, ON N8T 1E5
AND FROM: DS Turnaround Leasing Inc. 6045 Tecumseh Road East Windsor, ON N8T 1E5
In accordance with subsection 6(2) of the Motor Vehicle Dealers Act, 2002 (the “MVDA”), 1037166 Ontario Inc. o/a Best Rate Auto Sales (“Best Rate”) and Donald Rezoski (“Rezoski”) and DS Turnaround Leasing Inc. (“DS Leasing”) and the Registrar, Motor Vehicle Dealers Act, 2002, (“the Registrar”), in accordance with section 4.1 of the Statutory Powers Procedure Act, do hereby waive the requirements of a hearing and consent to an Order of the Licence Appeal Tribunal (the “Tribunal”) based upon the terms and conditions specified herein
Background
- The Registrar issued a Notice of Proposal dated October 13, 2021 and a Notice of Further and Other Particulars dated September 15, 2022 (collectively the “Proposal”) to revoke the registrations of Best Rate and DS Leasing as motor vehicle dealers and of Rezoski as a motor vehicle salesperson, under the MVDA (as well as another salesperson who is not entering into these terms and conditions).
1037166 ONTARIO INC. o/a BEST RATE AUTO SALES
The Registrar’s Proposal shall be carried out in respect of Best Rate and its registration as a motor vehicle dealer shall be revoked, as of the date of the Tribunal’s order.
Best Rate shall not apply for registration as a motor vehicle dealer for a period of four (4) years from the date of the revocation of its registration pursuant to paragraph 2.
DONALD REZOSKI
The Registrar’s Proposal shall be carried out in respect of Rezoski and his registration as a motor vehicle salesperson shall be revoked, as of the date of the Tribunal’s order.
Rezoski shall not apply for registration as a motor vehicle salesperson or a dealer for a period of four (4) years from the date of the revocation of his registration pursuant to paragraph 4.
DS TURNAROUND LEASING INC.
COMPLIANCE
The Registrar’s Proposal shall not be carried out in respect of DS Leasing. DS Leasing may remain registered as a motor vehicle dealer under the MVDA.
DS Leasing shall comply with all requirements of the MVDA, Ontario Regulation 333/08, the Code of Ethics contained within Ontario Regulation 332/08, and the Ontario Motor Vehicle Industry Council (“OMVIC”) Standards of Business Practice, 2010, as may be amended from time to time.
All of its officers and directors, persons-in-charge, salespersons, employees, personnel, agents, assignees or anyone acting on behalf of DS Leasing shall be informed of the conditions contained in this document to the extent necessary to ensure compliance with them.
DS Leasing acknowledges 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. DS Leasing further acknowledges that this includes attendance at auction on its behalf 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.
RESTRICTION REGARDING INTERESTED AND ASSOCIATED PERSONS
As a condition of DS Leasing’s registration as a motor vehicle dealer, Donald Rezoski shall not be an officer or director of it. DS Leasing shall facilitate his removal from its board of directors within 30 days.
DS Leasing shall not trade in motor vehicles with Donald Rezoski, nor shall it permit him to be an “interested person” (as defined in section 6(4) of the MVDA) in respect of it, nor an “associated person” (as defined in section 1(2) of the MVDA) in respect of it.
DS Leasing shall not permit Donald Rezoski to trade in motor vehicles on its behalf, act as its person-in-charge, exercise any direct or indirect control or management of its operations, be employed or retained by it, provide any financing to it, have any signing authority, or act as its agent in any capacity.
DS Leasing shall not permit Donald Rezoski to be involved, directly or indirectly, with the business operations of DS Leasing.
DS Leasing confirms that Donald Rezoski will not be financing the dealership, either directly or indirectly. DS Leasing will make reasonable efforts to determine the source of financing received to ensure compliance with these Terms and Conditions.
Notwithstanding the above, Beth Rezoski (currently the spouse of Donald Rezoski) may remain as one of DL Leasing’s officers and/or directors.
DL Leasing shall not permit Beth Rezoski to act as a motor vehicle salesperson on its behalf.
DL Leasing shall ensure that Beth Rezoski does not engage in the trade of motor vehicles on its behalf.
DS Leasing shall provide the Registrar with notice in writing, within five days, of any substantive changes to its business plan or information provided in obtaining and/or renewing its registration, pursuant to section 31 of Ontario Regulation 333/08.
BOARD OF DIRECTORS
- Except as specified above, DS Leasing shall not otherwise change the members of its corporate board of directors, or its officers, without first obtaining the written consent of the Registrar. The Registrar shall not withhold her consent unreasonably.
FINANCIAL POSITION
DS Leasing shall obtain and provide to the Motor Vehicle Dealers Compensation Fund, within 180 days from the date that these conditions come into effect and in a form acceptable to the Registrar, an irrevocable letter of credit in the amount of $15,000.
DS Leasing shall not receive any new sources of financing without first obtaining the written consent of the Registrar, including financing in the form of short-term revolving lines of credit (colloquially known as “floor-plans”). The Registrar shall not withhold her consent unreasonably. This restriction does not apply to 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 applies, although DS Leasing shall inform the Registrar in writing within 14 days of receiving such financing.
DS Leasing shall, at all times, conduct its business in a financially responsible way and shall ensure that it does not become overleveraged and that it is able to pay off its debts as required by its lenders and creditors.
DS Leasing shall promptly reimburse, or enter into an agreement to reimburse, the Motor Vehicle Dealers Compensation Fund for any monies it may owe in relation to a claim paid out pursuant to section 42(8) of the MVDA.
LIENS
DS Leasing shall ensure that if it agrees to pay any outstanding loan, repair or storage fees in relation to a vehicle being traded-in to it, a statement to this effect is included in writing, on the contact, as required pursuant to section 43(4) of Ontario Regulation 333/08 and section 9(5) of the Code of Ethics Regulation 332/08. DS Leasing shall fulfil these obligations by immediately paying off the loan and ensuring that any related liens are discharged.
DS Leasing shall ensure that prior to selling or leasing a motor vehicle to a customer, the vehicle is free of any liens or encumbrances, in accordance with section 13 of the Sale of Goods Act and section 9 of the Consumer Protection Act.
ADVERTISING
DS Leasing shall ensure that all advertisements placed by or on its behalf comply with section 36 of Ontario Regulation 333/08 as well as the Code of Ethics in Ontario Regulation 332/08, OMVIC Standards of Business Practice, 2010, as may be amended from time to time.
DS Leasing shall ensure that if it advertises a price for a motor vehicle, that the price is all-inclusive (e.g. includes any “admin fees”) and represents the total amount that a customer would be required to pay for the vehicle. The advertised price may set out in a clear, comprehensible and prominent manner that the price is inclusive or exclusive of taxes and/or licensing.
DISCLOSURE
DS Leasing 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.
DS Leasing shall disclose all material facts about the motor vehicles for purchase or lease to its customers. DS Leasing shall disclose all material facts on the contract (e.g. bill of sale), in writing. DS Leasing 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, DS Leasing further agrees to disclose as much detail as reasonably possible regarding the nature and severity of the damage. DS Leasing undertakes to conduct a reasonable amount of research into the history of all the motor vehicles under trade to ensure all material facts are disclosed. DS Leasing shall ensure it discloses in a clear, comprehensible and prominent manner the dollar amount of any costs of repairs.
Subject to any legal defenses, DS Leasing shall accept full responsibility for the quality of any repairs or alterations to a motor vehicle completed by DS Leasing’s personnel, agents, assignees, affiliated repair facilities or anyone acting on behalf of DS Leasing.
BOOKS AND RECORDS
DS Leasing shall maintain all books and records at its registered premises in accordance with the MVDA and pursuant to section 52 through to and including section 60 of Ontario Regulation 333/08.
DS Leasing shall maintain books and records, which accurately records the true nature of transactions involving the trade of a motor vehicle. DS Leasing shall not be involved in the creation of books and records, which are false or misleading as to the true nature of a transaction involving the trade of a motor vehicle.
FALSE INFORMATION
DS Leasing shall ensure that it, as well as any individual acting on its behalf (e.g. officers, directors, persons-in-charge, salespersons, employees, agents, etc.) do not make, provide or furnish, false or misleading (including by omission) statements, information or records to the Registrar or to any of his/her representatives. This includes, but is not limited to, during the registration process and/or during inspections.
DS Leasing shall ensure that it, as well as any individual acting on its behalf (e.g. salespersons), do not falsify, assist in falsifying or induce or counsel another person to falsify or assist in falsifying any information or document relating to a motor vehicle trade and shall ensure that it acts in accordance with section 26 of the MVDA.
DS Leasing shall ensure that it, as well as any individual acting of its behalf (e.g. salespersons), do not furnish, assist in furnishing or induce or counsel another person to furnish or assist in furnishing any false or deceptive information or document relating to a motor vehicle trade and shall ensure that it acts in accordance with section 27 of the MVDA.
EXPIRY OF CONDITIONS
- The conditions contained in this document shall be in force for a period of two (2) years commencing from the date of the Tribunal’s order, except for conditions 3 and 5 above which shall be in place for a period of four (4) years.
ACKNOWLEDGMENTS AND UNDERTAKINGS
The Registrar is relying on the accuracy, truthfulness and completeness of all documents, statements or information provided to her by DS Leasing, Best Rate and Rezoski.
DS Leasing, Best Rate and Rezoski, acknowledge that the Registrar may take further administrative action, including a proposal to suspend or revoke registration, or to impose conditions, arising from any matters that have occurred or may occur related to past conduct, honesty and integrity, financial responsibility or compliance with these conditions.
Independent legal advice has been obtained, or DS Leasing, Best Rate and Rezoski, 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 _________________ 20_____.
_________________________________
Signature of Donald Rezoski
I confirm that I have read and understood the terms and conditions above and agree to have them applied to my registration under the MVDA.
Signed in the City of ____________________ this ____day of _________________ 20_____.
_________________________________
Print Name of individual authorized on behalf of 1037166 Ontario Inc. o/a Best Rate Auto Sales
_________________________________
Signature of individual authorized on behalf of 1037166 Ontario Inc. o/a Best Rate Auto Sales
I confirm that I have authority to bind the corporation and agree to have the conditions above applied to 1037166 Ontario Inc. o/a Best Rate Auto Sales’ registration under the MVDA.
Signed in the City of ____________________ this ____day of _________________ 20_____.
_________________________________
Print Name of first individual authorized on behalf of DS Turnaround Leasing Inc.
_________________________________
Signature of first individual authorized on behalf of DS Turnaround Leasing Inc.
I confirm that I have authority to bind the corporation and agree to have the conditions above applied to DS Turnaround Leasing Inc.’s registration under the MVDA.
Signed in the City of ____________________ this ____day of _________________ 20_____.
_________________________________
Print Name of second individual authorized on behalf of DS Turnaround Leasing Inc.
_________________________________
Signature of second individual authorized on behalf of DS Turnaround Leasing Inc.
I confirm that I have authority to bind the corporation and agree to have the conditions above applied to DS Turnaround Leasing Inc.’s registration under the MVDA.
These Terms and Conditions are accepted by the Registrar, Motor Vehicle Dealers Act, 2002.
Date:
_________________________________
Maureen Harquail
“SCHEDULE B”
TO: Licence Appeal Tribunal Tribunals Ontario General Services 15 Grosvenor Street, Ground Floor Toronto, ON M7A 2G6
FROM: The Registrar Motor Vehicle Dealers Act, 2002 Ontario Motor Vehicle Industry Council 65 Overlea Blvd., Suite 300 Toronto, ON M4H 1P1
AND FROM: Roderick Leonard Gagne c/o 1037166 Ontario Inc. o/a Best Rate Auto Sales 6045 Tecumseh Road East Windsor, ON N8T 1E5
Pursuant to subsection 6(2) of the Motor Vehicle Dealers Act, 2002 (“MVDA”) Roderick Leonard Gagne (the “Registrant”) and the Registrar, Motor Vehicle Dealers Act, 2002, (the “Registrar”), in accordance with section 4.1 of the Statutory Powers Procedure Act, do hereby waive the requirements of a hearing and consent to an Order of the Licence Appeal Tribunal based upon the following terms and conditions:
COMPLIANCE:
These terms and conditions shall remain effective for a period of four (4) years from the date of this Order.
The Registrant shall ensure that any dealer and individuals are informed of the terms and conditions contained in this document to the extent necessary to ensure compliance with these terms and conditions.
The Registrant 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 Registrant further agrees to read all correspondence and bulletins from OMVIC as released.
The Registrant acknowledges 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 Registrant further acknowledges that this includes attendance at auctions on behalf of a dealer 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.
REGISTRATION:
The Registrant shall not act as a salesperson on behalf of any dealer other than the Registrant’s sponsoring dealer (e.g. registered as a salesperson to that dealer).
The Registrant shall not be a partner, shareholder, officer, director, owner, person-in-charge, bank signing authority, or controlling mind of any dealer. The Registrant shall not provide funds, or financing, or act as an investor in relation to any dealer. The Registrant shall not act as a final signatory on a contract related to the trade of a motor vehicle – including financing documents – on behalf of any dealer.
The Registrant agrees to be registered as a salesperson and shall not apply to be a dealer for a period of four (4) years.
The Registrant shall not transfer his registration as a salesperson to another dealer without having first obtained prior written consent of the Registrar, which will not be unreasonably withheld.
The Registrant shall provide the Registrar with notice in writing, within five days, of any substantive changes to his role with his sponsoring dealer or information provided in obtaining his registration, pursuant to section 31 of Ontario Regulation 333/08.
The Registrant shall forthwith comply with any reasonable requests for information, made on behalf of the Registrar.
The Registrant 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.
THE TRADE OF MOTOR VEHICLES:
The Registrant shall ensure that his registration will not be used to trade in motor vehicles where the Registrant knows, or ought to know, that it will facilitate an illegal or unethical practice.
The Registrant shall not be involved in the creation of books and records, which are false or misleading as to the true nature of a transaction involving the trade of a motor vehicle.
The Registrant 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 motor vehicle trade, pursuant to section 26 of the MVDA.
The Registrant shall not furnish, assist in furnishing or induce or counsel another person to furnish or assist in furnishing any false or deceptive information or document relating to a motor vehicle trade, pursuant to section 27 of the MVDA.
The Registrant shall not do or omit to do anything – in his capacity as a salesperson – that causes the registered motor vehicle dealer who employs or retains him to contravene any applicable law with respect to trading in motor vehicles, pursuant to section 6(2) of Regulation 332/08.
The Registrant understands and acknowledges that dealers shall ensure that all trades in motor vehicles are to be 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.
The Registrant shall disclose on the contract (e.g. bill of sale), in writing, all material facts about the motor vehicles for purchase or lease to customers. 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 Registrant further agrees to disclose as much detail as reasonably possible, including the dollar amount of costs to fix any damage.
The Registrant shall not to represent any charges or fees on the contract (e.g. bill of sale) as being required by law where the charges or fees are not required by law. The Registrant also understands and acknowledges that a dealer’s advertised price for a motor vehicle must be all-inclusive, pursuant to section 36 of Ont. Regulation 333/08. Thereby, for example, the Registrant shall not add an “admin fee” on the contract which is in addition to the advertised price.
CHARGES:
The Registrant shall provide any sponsoring dealer with notice, in writing, of any charges, findings of guilt, convictions (including absolute or conditional discharges), within five (5) days. The Registrant shall provide a copy of the notification acknowledged by the signature of the sponsoring dealer, to the Registrar, forthwith.
The Registrant shall advise the Registrar of any disposition of any charge, under any law, within five (5) days of same and that the Registrant shall comply with any and all recognizances, penalties, dispositions and/or probation orders.
The Registrant confirms that the particulars and circumstances of any findings of guilt, convictions and pending charges are substantially as disclosed to the Registrar.
OTHER:
- The Registrant shall provide the Registrar with full and complete disclosure in all future correspondence and on all future applications, regardless of whether or not disclosure has been made previously to the Registrar.
CERTIFICATION COURSE:
- The Registrant shall successfully complete the Automotive Certification course (offered by Georgian College) within 120 days of signing these conditions.
ACKNOWLEDGMENT AND UNDERTAKING:
The Registrar is relying on the accuracy and completeness of all documents, statements and information provided by the Registrant in support of the Registrant’s application for registration.
The documents, information or statements provided to the Registrar are true to the best of the Registrant's knowledge, and belief; and that full answer to all questions, inquiries and requests made by the Registrar in connection with the Registrant’s application have been given.
The Registrar may take further administrative action, including a proposal to suspend or revoke registration, or impose further conditions, arising from any matters that have occurred or may occur related to past conduct, honesty and integrity, financial responsibility or compliance with these terms and conditions.
Independent legal advice has been obtained or the Registrant has 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 2022.
Roderick Leonard Gagne (signature)
These Terms and Conditions are accepted by the Registrar, Motor Vehicle Dealers Act, 2002.
Date:
Maureen Harquail