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Consumer Protection through Professional Regulation Looking Ahead: Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 © CLEAR.

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Presentation on theme: "Consumer Protection through Professional Regulation Looking Ahead: Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 © CLEAR."— Presentation transcript:

1 Consumer Protection through Professional Regulation Looking Ahead: Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 © CLEAR 2010 Ontarios Consumer Protection Act, Jacob Bakan Legal Services Branch Ministry of Consumer Services

2 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Consumer Protection Act, 2002 Consumer Protection Act, 2002 (CPA) is law of general application. Applies to consumer transactions with consumers. Consumer transaction defined as any act or instance of conducting business or other dealings with a consumer. Consumer defined as an individual acting for personal, family or household purposes and does not include a person who is acting for business purposes. Business to business transactions not covered.

3 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Excluded Transactions Several categories of transactions excluded from the CPA. Some examples include: –real property –residential tenancies –securities –most financial products and services –gas marketers and energy retailers (currently covered, but unproclaimed provision will exclude) –professional services listed in regulation

4 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Excluded Professional Services Professional services provided by a person governed by, or subject to any of the following Acts: –1. The Architects Act. –2. The Certified General Accountants Association of Ontario Act, –3. The Chartered Accountants Act, –4. The Drugless Practitioners Act. –5. The Law Society Act. –6. The Ontario College of Teachers Act, –7. The Professional Engineers Act.

5 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Excluded Professional Services Cont. –8. The Professional Foresters Act, –9. The Professional Geoscientists Act, –10. The Public Accountancy Act. –11. The Regulated Health Professions Act, 1991 and any Act named in Schedule 1 to the Regulated Health Professions Act, –12. The Social Work and Social Service Work Act, –13. The Society of Management Accountants of Ontario Act, –14. The Surveyors Act. –15. The Veterinarians Act.

6 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Excluded Professional Services Cont. Professional services provided at any of the following facilities are exempt: –1. An institution under the Mental Hospitals Act. –2. A hospital under the Public Hospitals Act. –3. A pharmacy under Part VI of the Drug and Pharmacies Regulation Act. Services provided at an independent health facility pursuant to licence under Independent Health Facilities Act are exempt.

7 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 General Consumer Contract Rules (examples) Consumer cannot waive protections in CPA. Consumer cannot waive right to participate in class proceeding. Limitation on mandatory arbitration clauses. Supplier cannot charge more than 10% of estimate given in an agreement. Ambiguities in agreement to be interpreted in favour of consumer. Supplier cannot demand payment for unsolicited goods. Most ongoing contracts cannot be amended, renewed or extended without meeting specified criteria.

8 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Prohibition on Unfair Practices Offence to commit unfair practice. Types of unfair practices –False, Misleading and Deceptive Representations. –Unconscionable representations. –Holding consumers goods in custody to renegotiate a price.

9 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 False, Misleading and Deceptive Representations. Prohibition of false, misleading and deceptive representations eliminates ability for business to deny responsibility for pre-contractual inducements including verbal inducements. Language of provision similar to language found in most consumer protection law in U.S. and Canada.

10 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Unconscionable Representations No definition of unconscionable representation given. Factors that can be considered in determining if representation is unconscionable include such things as: –Consumer is not reasonably able to protect his or her interests because of disability, ignorance, inability to understand the language of agreement or similar factors. –Transaction is excessively one-sided. –Undue pressure to enter a transaction.

11 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Minimum Contract Requirements Contracts with future obligations for $50 or more must meet certain basic requirements including such things as: Consumers name Suppliers name and contact information Fair and accurate description of goods and services. Prices & terms of payment. Delivery or commencement dates and places.

12 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Sector Specific Requirements Special rules for certain areas such as: –Direct agreements (which includes door to door sales) –Remote agreements (which includes telephone sales) –Internet sales –Time Share agreements –Personal development agreements (which includes gym memberships). –Motor vehicle repairs –Leases –Credit agreements –Loan brokering –Credit repair Where special rules exist, CPA requires them to be disclosed.

13 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Consequences for Non-compliance Breach of provisions create quasi-criminal and civil consequences. Provincial offence to breach several provisions. –Investigations typically commenced after attempts at consumer-supplier mediation have failed. –Ministry of Consumer Services investigators lay charges and Ministry of the Attorney General lawyers prosecute before Ontario Court of Justice. –Court has power on conviction to order fines, incarceration, restitution or compensation.

14 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Civil consequences for non-compliance Agreement not binding on consumer unless made in accordance with CPA. (Court has limited discretion to bind consumer where it would be inequitable not to do so.) If agreement does not meet CPA disclosure requirements, consumer has extended period to cancel, typically one year. If consumer cancels agreement, supplier typically has obligation to repay all amounts under agreement.

15 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Civil Consequences for Non-compliance Consumer has one year to rescind any agreement if business has engaged in unfair practice. If full rescission not possible, consumer entitled to recover amount by which the consumers payment exceeds value of goods or services to the consumer. Court has power to award damages.

16 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Administrative Enforcement. Misleading Representations. If Director believes person is making false, misleading or deceptive representation, she can: –Order person to stop publication of representation. –Order person to retract the representation and publish correction. Subject of order has right to a hearing.

17 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Administrative Enforcement. Compliance Orders. Director has power to issue compliance orders requiring person to comply with any provision the CPA. Violation of compliance order an offence. Subject of compliance order has right to a hearing.

18 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Administrative Enforcement. Voluntary Compliance Orders. Person may enter into undertaking of voluntary compliance with the Director. Has all the force of an order from the Director. Undertaking may provide for: –Provision of compensation to consumer. –Payment of investigation and legal costs. –Other actions the Director considers appropriate. Director may require undertaking to be secured by bond.

19 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Administrative Enforcement. Freeze Orders. Director may order asset freeze. Order applies to supplier and any person holding suppliers assets or trust funds. Freeze order can be issued where there is search warrant, compliance order, or undertaking of voluntary compliance. Person has right to a hearing.

20 Council on Licensure, Enforcement and Regulation Toronto Symposium June 15, 2010 Speaker Contact Information Jacob Bakan Ministry of the Attorney General Legal Services Branch of the Ministry of Consumer Services. 6 th Floor, Ferguson Block 77 Wellesley Street, Toronto, ON M7A 1N


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