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The Consumer Protection Amendment Act (3)

S.M. 1989-90, c. 53

Bill 63, 2nd Session, 34th Legislature

The Consumer Protection Amendment Act (3)

(Assented to March 15, 1990)

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:

C.C.S.M. c. C200

1           The Consumer Protection Act is amended in the manner set forth in this Act.

Subsection 1(1) amended

2           The definition of "retail hire-purchase" in subsection 1(1) is amended by adding "and" at the end of clause (g) and by striking out clauses (h) and (i) and substituting the following clause:

(h) a hire-purchase of goods by a hirer who himself intends to use them or uses them for the primary purpose of carrying on a business, unless the goods are intended for resale or re-let in a manner to which Part VII applies; («location-vente au détail»)

Subsection 1(1) amended

3           The definition of "retail sale" in subsection 1(1) is amended by adding "and" at the end of clause (d) and by striking out clauses (e) and (f) and substituting the following clause:

(e) any contract of sale of goods or services intended to be used or used by the purchaser for the primary purpose of carrying on a business, unless the goods or services are intended for resale or re-let in a manner to which Part VII applies; («vente au détail»)

Subsection 1(1) amended

4           The definition of "variable rate agreement" in subsection 1(1) is struck out and the following definition is substituted:

"variable rate agreement" means an agreement that is subject to variations in the true annual percentage rate of the cost of borrowing, and includes all agreements evidencing loans of money, retail sales on credit or retail hire purchases wherein the true annual percentage rate of the cost of borrowing either at, or from time to time subsequent to, the time of signing the agreement is made subject to variations; («convention assujettie à un taux variable»)

Subsection 1(2) repealed

5           Subsection 1(2) is repealed.

Subsection 2(1) rep. and sub.

6           Subsection 2(1) is repealed and the following subsection is substituted:

Rules to determine cost of borrowing and price

2(1)        For the purpose of determining

(a) whether the cost of borrowing in a sale or hire-purchase exceeds $10.; or

(b) the amount of the cash price of goods or services or both comprised in a sale or hire-purchase;

the following rules apply:

(c)The cost of borrowing in all sales and hire-purchases which are part of the same transaction shall be added together.

(d)The cash price of goods and services comprised in all sales and hire-purchases which are part of the same transaction shall be added together.

(e)Unless the contrary is proved, all sales and hire-purchases made between the same seller and the same buyer on the same day shall be presumed to be part of the same transaction.

Subsection 4(4) amended

7           Subsection 4(4) is amended by adding "and" at the end of clause (b) and by striking out clauses (c), (d), (e) and (f) and substituting the following clause:

(c) the amount of the periodic payment.

Subsection 5(4) amended

8           Subsection 5(4) is amended by adding "and" at the end of clause (b) and by striking out clauses (c), (d), (e) and (f) and substituting the following clause:

(c) the amount of the periodic payment.

Subsection 13(1) rep. and sub.

9           Subsection 13(1) is repealed and the following subsection is substituted:

Application of section

13(1)       Subject to section 3, this section applies to every loan of money made by a money lender except

(a) a loan secured exclusively on real property;

(b) a loan to a corporation;

(c) a loan made by an insurance company to a policyholder pursuant to a provision of the policy; and

(d) a loan in which the cost of borrowing does not exceed $10.

Subsection 13(4) amended

10          Subsection 13(4) is amended by adding "and" at the end of clause (b) and by striking out clauses (c), (d), (e) and (f) and substituting the following clause:

(c) the amount of the periodic payment.

Section 58.2 rep. and sub.

11          Section 58.2 is repealed and the following section is substituted:

Warranty contract liability

58.2(1)     Notwithstanding any provision in a contract to service or repair goods including an extended warranty contract, and subject to subsection (2), the seller of the contract is liable to the buyer for the performance of all obligations under the contract to service or repair the goods, whether or not the seller is a party to the contract and whether or not the seller received a fee, commission or other remuneration for selling the contract.

Sales person not liable

58.2(2)     Subsection (1) does not render an employee or sales person of a seller personally liable for the performance of all or any of the obligations under a contract to which that subsection applies, notwithstanding that the actual sale of the contract is effected or arranged by the employee or sales person.

Sections 61 and 62 amended

12          The Act is amended by striking out "four" where it appears

(a) in subsection 61(1);

(b) in subsection 62(1);

(c) in clause 62(4)(b); and

(d) in subsection 62(8);

and, in each case, substituting "seven".

Subsection 62(1) amended

13          Subsection 62(1) is amended by striking out "or certified".

Subsection 76(2) rep. and sub.

14          Subsection 76(2) is repealed and the following subsection is substituted:

Employees of collection agents

76(2)       A person who is employed by a licensed collection agent as a collector does not require a licence to transact business on behalf of the employer but is subject to the registration requirements of section 105.

Subsection 81(1.1) added

15          Section 81 is amended by adding the following subsection:

Registration not assignable

81(1.1)     The registration of a person as a collector under this Act is not assignable.

Subsection 90(6) amended

16          Subsection 90(6) is amended by striking out clause (c) and substituting the following clause:

(c) to such persons as may be deemed to be entitled thereto

(i) by reason of a sale to which Part VII applies, made by or on behalf of the person named in the bond, or

(ii) by reason of any offer, solicitation, proposal or approach made by or on behalf of the person named in the bond and intended to result in a sale to which Part VII applies.

Subsection 94(1) rep. and sub.

17          Subsection 94(1) is repealed and the following subsection is substituted:

Offence and penalty

94(1)       Except where otherwise specifically provided, any person who contravenes, or fails or neglects to comply with, a provision of this Act or the regulations is guilty of an offence and liable, on summary conviction,

(a) if an individual, to a fine of not more than $3,000. for a first offence and to a fine of not more than $10,000. or imprisonment for a term of not more than three years for any subsequent offence; and

(b) if a corporation, to a fine of not more than $10,000. for a first offence and to a fine of not more than $25,000. for any subsequent offence.

Section 97 amended

18          Section 97 is amended by striking out clause (a) and substituting the following clause:

(a) prescribing the form and contents of applications for the granting or renewal of a licence or for registration as a collector;.

Section 97 amended

19          Section 97 is further amended by striking out clause (h) and substituting the following clause:

(h) respecting the manner in which the cash price of goods or services or both, shall be disclosed to a purchaser in a cash sale, a sale on credit or a hire-purchase;.

Section 97 amended

20          Section 97 is further amended by renumbering clause (j) as clause (k) and by adding the following clause after clause (i):

(j) prescribing services to which Part XV applies, in addition to the services set out in the definition of "services" in section 121;.

Section 105 amended

21          Section 105 is amended by striking out all the words after clause (e) and substituting "and, upon payment of the prescribed fee, the consent shall be granted in accordance with the regulations in the first instance for one year only, and shall be required annually thereafter".

Section 106.1 added

22          The Act is amended by adding the following section:

Restriction on use of name by collector

106.1       No collector shall, for or on behalf of a collection agent, collect or attempt to collect money, or seize or attempt to seize goods, using a name that differs from that under which the collector is registered under section 105.

Part XV added

23          The Act is further amended by adding the following Part:

PART XV

PREPAID SERVICES

Definitions

121         In this Part,

"buyer" means a person who

(a) enters into a contract with a seller, or

(b) who is discussing a contract with a seller with a view to entering into the contract; («acheteur»)

"contract" means a contract for any services to which this Part applies; («contrat»)

"fee" means all amounts payable by a buyer for services, and includes payments for initiation or membership or both, and all costs associated with the purchase of services from a seller; («frais»)

"seller" means a person who is in the business of selling, or providing or offering to provide, services; («vendeur»)

"services" means services of any kind whatsoever, and facilities of any kind whatsoever whether or not provided in conjunction with services, relating to

(a) health, fitness, exercise, body building or conditioning, modelling, talent development, dieting, martial arts, sports or dance activities or other activities of a similar nature, or

(b) dating or introduction clubs, or

(c) such other activities, clubs or matters as may be prescribed by regulation,

and may include instructional services. («services»)

Application

122(1)      This Part applies to services for which payment in advance is required.

Exception

122(2)      This Part does not apply to services that are provided

(a) by a non-profit organization; or

(b) by a corporation without share capital; or

(c) by a cooperative within the meaning of The Cooperatives Act; or

(d) by a seller whose services require registration under The Private Vocational Schools Act; or

(e) by a university established under The Universities Establishment Act; or

(f) by a school district or school division established under The Public Schools Act; or

(g) by golf, curling or racquet clubs or other clubs of a similar nature; or

(h) as incidental to the main business of the operator; or

(i) by a class of sellers specified in the regulations.

Existing contracts

122(3)      This Part does not apply to a contract in force at the time this Part comes into force.

Written contract

123(1)      No seller shall receive advance payment for services from a buyer with whom the seller does not have a written contract setting out

(a) the names and addresses of the seller and buyer;

(b) a description of the services to be provided under the contract;

(c) the total fee for the services to be provided under the contract;

(d) the date that the services will be made available, if the services or any part of the services are not available at the time of entering into the contract;

(e) a statement that complies with subsection 123(3); and

(f) a schedule of payments that complies with section 125.

Cancellation within 7 days

123(2)      Any contract to which this Part applies may be cancelled by notice in writing within 7 days after the day on which the buyer enters into the contract or the services are available, whichever is the later, by serving the notice by registered mail or personal delivery on the seller at the seller's usual place of business; and the notice is good and effective if, however expressed, it indicates the intention of the buyer to withdraw from the transaction.

Statement required in contract

123(3)      Every contract to which this Part applies shall be accompanied by a written notice which shall have printed or typed at the top of the first page, in type not less than 10 point in size, the following words or such other words as may in the view of the director provide the same information to the buyer:

"You may cancel this contract by notice in writing within 7 days after you sign it. If you do not cancel this contract within the 7 days, you may not be able to cancel it afterwards. You may send your notice by registered mail to (name of seller and address of seller's usual place of business shall be inserted here) or you may deliver it there yourself. You must mail it or deliver it before the end of the 7 days. If you cancel the contract, any moneys you paid will be returned to you."

Effect of cancellation

123(4)      Upon the written cancellation of a contract under subsection (2),

(a) subject to subsection (6), every liability or obligation of the buyer under the contract is extinguished; and

(b) on the buyer's demand, the seller shall repay to the buyer immediately all amounts already paid by or on behalf of the buyer in respect of the contract, whether paid for or on account of the contract price or for or on account of any fee, cost of borrowing or other amount paid under or pursuant to or as incidental to the contract, and whether paid to the seller or another person, but the seller may retain any portion of the amounts so paid by the buyer for which services have been provided, and the portion to be so retained by the seller shall be calculated as that proportion of the amounts so paid by the buyer which bears the same mathematical relationship to the total of the amounts so paid as the period of the contract ending on the date of the cancellation bears to the total period of the contract.

Negotiation of new contract

123(5)      Upon receiving written notice of cancellation of a contract under subsection (2), the seller shall fulfil the seller's obligations under subsection (4) before attempting to renegotiate the contract or to negotiate another contract with the buyer.

Rights of cancellation

123(6)      The right of the buyer to cancel a contract under this Part is not affected by

(a) the partial consumption of the services by the buyer; or

(b) the partial performance of any services by the seller.

Reckoning of Time

123(7)      In reckoning the time for giving notice under this Part, Sundays and holidays shall be excluded.

Refund

123(8)      A seller who receives payments on a contract that does not meet the requirements of subsection (1) shall, on demand by the buyer, refund to the buyer all payments for services that have not been performed, and the contract is void thereafter.

Prohibition

124(1)      No contract may be made between two parties to an existing contract unless the subsequent contract is for services that are distinctly different from the services to be provided under the existing contract, and a different term or a different commencement date does not constitute, for the purposes of this subsection, a distinct difference in the services to be provided.

Repayment

124(2)      A seller shall repay to the buyer, on demand, every amount paid on a new contract for services that are already included in an existing contract.

Maximum term

125(1)      No contract shall be made for a term longer than 12 months.

Instalments

125(2)      A seller shall not collect payment of the fee under any contract except by approximately equal instalments, no fewer than two in number and payable in approximately equal payment periods the length of each of which shall be the number of months obtained by dividing the number of months in the contract by the number of instalments payable thereunder.

Refund

125(3)      A seller who receives payments in contravention of subsection (2) shall refund those payments to the buyer on demand.

No provision for renewal

126         No contract to which this Part applies shall include any provision for the renewal of that contract prior to or upon the date of its expiry.

Coming into force

24          This Act comes into force on a day fixed by proclamation.