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CONSUMER PROTECTION ACT

[RSBC 1996] CHAPTER 69

Contents

Section

 

1

Definitions

 

2

No derogation

 

3

Assignee's obligations

 

4

Guarantor has same rights as buyer

 

5

Goods for resale

 

6

Land

Part 1 — Executory Contracts

 

7

Seller

 

8

Salesperson's representations

 

9

Referral selling

 

10

Disclosure requirements

 

11

Buyer's right of cancellation

 

12

Buyer's right to cancel time share contract

 

13

When must a contract be in writing?

 

14

What must be in a written contract?

 

15

Trust accounts

 

16

Return of goods on cancellation

 

17

Retention of goods after cancellation

 

18

Refund on cancellation of contract for future services

 

19

Refunds recoverable

 

20

Maximum term and payment

 

21

Contracts expressed in hours

Part 2 — Direct Seller Licensing

 

22

Application of this Part

 

23

Definition

 

24

Who must be licensed?

 

25

Who does not have to be licensed?

 

26

How to apply for a licence

 

27

Licence may have conditions

 

28

Refusal, suspension or cancellation of a licence

 

29

Change of address

 

30

What information can the registrar require?

 

31

Inspection of records

 

32

Licence not transferable

 

33

What name must a licensee use?

 

34

Production and surrender of licence by licensee

 

35

Salesperson's identification card

 

36

Production or surrender of identification card

 

37

Change in firm requires prior approval

 

38

Designation of registrar

 

39

Designation of acting registrar

 

40

Register

Part 3 — Credit Transactions

 

41

Disclosure of cost of borrowing

 

42

Requirements when extending variable credit

 

43

Increase of cost of borrowing: variable credit

 

44

Prepayment

 

45

Advertising terms of credit

 

46

Lost or stolen credit cards

 

47

Credit cards

 

48

Notice requirements

 

49

Crediting payments

 

50

Improper disclosure

 

51

Cash discounts

 

52

Income tax refund discounts

Part 4 — Food Plan Contracts, Negative Option Offers and Disclosure Notices

 

53

Food plan contracts

 

54

Negative option schemes

 

55

Negative option offers for selling services

 

56

Disclosure notice

Part 5 — Mortgage Transactions Relief

 

57

Definition

 

58

Scope of Part

 

59

Lender to justify transaction

 

60

Indications of unconscionability

 

61

Powers of court

 

62

Effect of Part

Part 6 — General

 

63

Request for information

 

64

Investigation

 

65

Authorization to search

 

66

Removal of records

 

67

Report to minister

 

68

Investigation by order of minister

 

69

Suspension or revocation of registration or licence

 

70

Restraining orders

 

71

Order to refrain from dealing with assets

 

72

Confidentiality

 

73

Matters confidential

 

74

Protection of officials

 

75

Offence and penalty

 

76

Defences

 

77

Power to make regulations

Definitions

1 In this Act:

"borrower" means an individual who receives credit;

"buyer" means an individual who leases or purchases goods or services under an executory contract, and includes the individual's agent;

"cash" includes cheques, bills of exchange, money orders and sums credited to an account on which a borrower has an unrestricted power of drawing;

"contract for dance lessons" means a contract for future services that provides for instruction in any type of dancing, and includes lessons and other services, rights or privileges whether provided to persons individually or in groups;

"contract for future services" means

(a) an executory contract that includes a provision for services of a prescribed type or class to be rendered in the future on a continuing basis, or

(b) a contract for dance lessons or a contract for health studio services under which the consideration, excluding the cost of borrowing, is greater than an amount set by regulation;

"contract for health studio services" means a contract for future services that provides

(a) for instruction, training or assistance in physical culture, body building, exercising, reducing, figure development or self defence, or

(b) for the use by a person of the facilities of a health studio, gymnasium or other facility used for any of the purposes referred to in paragraph (a);

"cost of borrowing" means

(a) in relation to variable credit, the charges that a borrower or buyer is required to pay on the unpaid balance from time to time, or

(b) in relation to a form of credit other than variable credit, the amount by which the total sum that a borrower is required to pay, if the payments required are made as they become due, exceeds the principal sum;

"credit" means credit

(a) for which a borrower incurs a cost of borrowing, and

(b) given under an executory contract or by the advancement of money;

"credit card" means a card, document or similar instrument, or a replacement or renewal of any of them, by which on a continuing basis and from time to time goods or services or credit may be obtained on deferred payment, or by means of which cash may be obtained, whether or not there is any cost of borrowing or default charge for the credit or cash;

"creditor" includes a lender and an assignee of a claim or security given in respect of a credit transaction and includes his or her agent, personal representative, successors or assignees;

"debtor" includes a borrower, buyer or guarantor;

"direct sale" means a contract for the sale of goods or services, or both, made by a seller

(a) in the ordinary course of business,

(b) at a place other than the seller's permanent place of business, and

(c) either

(i) without the purchaser having requested the seller to attend at the place where the contract is made, or

(ii) in response to the purchaser's request that the seller attend at the place where the contract is made, if that request is solicited by or on behalf of the seller by means of a representation that does not plainly disclose that the seller is selling the type of goods or services that are the subject of the solicitation or contract,

but does not include a contract where the sale, offering for sale or soliciting of orders is made by telephone, mail, fax or any other method that does not involve face to face contact with the intended purchaser;

"direct seller" means a seller whose business includes making direct sales, soliciting orders for direct sales, or both, whether personally or through a salesperson;

"director" means the member of the public service appointed by the minister to perform all the duties and to exercise all or any of the powers assigned to the director under this Act, and includes a person authorized to act on the director's behalf;

"executory contract" means a contract between a buyer and a seller for the purchase and sale or the lease of goods or services, or of goods and services, for which delivery of the goods or performance of the services or payment in full of the consideration is not made at the time the contract is made, including a contract that is partly executed, but does not include an executory contract for the sale or the lease of goods or services, or for goods and services, by and under which the consideration, excluding the cost of borrowing, is less than an amount set by regulation in respect of any particular class of seller;

"goods" means personal property;

"guarantor" includes a guarantor, surety, indemnitor and endorser, or other individual liable for the payment or repayment of the money owing or on an agreement or collateral or other security given in respect of it, but does not include a person who at the time he or she agreed to act in any of those capacities knew or ought to have known that the money or the credit would be used for commercial or business purposes;

"individual" means a natural person and includes his or her agent, personal representative and assigns, but does not include a natural person with respect to buying or borrowing in the course of carrying on a business;

"lease" includes the hourly, daily, weekly, monthly, annual or other periodic rental of goods or services;

"lender" means a person, including a seller, who in the course of business extends credit, and includes his or her personal representative, successors or assignees;

"official fees" means search, filing or registration fees to be paid by or under an Act of British Columbia or of Canada in connection with the search, filing or registration of an instrument relating to a credit transaction;

"principal sum" means the aggregate of

(a) the cash price of the goods or services or both,

(b) any sum received in cash by the borrower,

(c) any sum paid to a third party on behalf of, and at the request of, the borrower,

(d) any sum remaining unpaid from a previous extension of credit that is consolidated by agreement with the proposed extension of credit,

(e) any sum actually paid by the lender on account of official fees, and

(f) any sum actually to be paid on account of the cost of insurance effected at the express request of the borrower,

less any sum credited as a down payment or in respect of a trade-in or any other matter;

"purchase financing transaction" means the extension of credit to a borrower by a creditor where the creditor knows or ought to know that the credit proceeds will be used by the borrower to purchase goods or services from a seller;

"registrar" means the registrar of direct sellers designated under section 38;

"salesperson", in relation to a contract, means a person other than a seller who, for or in expectation of a fee, gain or reward,

(a) solicits, negotiates or arranges for the signing of the contract by the buyer, or

(b) in any way participates in soliciting, negotiating or arranging for the signing of the contract by the buyer;

"seller" means a person

(a) who is in the business of leasing or selling goods or services, or both, or

(b) who, in relation to a contract entered into in the course of business,

(i) is the seller or lessor of goods or services, or both, under the contract, or

(ii) is obligated to perform services or cause services to be performed,

and includes his or her agent, personal representative, successors or assignees;

"time share contract" means a contract, that is not covered by the provisions regarding time share plans in the Real Estate Act, by which an individual acquires the right to use property, whether or not the property is located in British Columbia,

(a) for a period of time each year, or other interval, and

(b) as part of a plan that provides for the use of the property to circulate, in any year, among persons participating in the plan;

"trade-in" means consideration given by a buyer in a form other than money or an obligation to pay money;

"trade-in allowance" means

(a) the sum that, under a trade-in arrangement, is agreed to be allowed in payment or in part payment for goods or services, or both, sold or to be sold under an executory contract, or

(b) if the sum referred to in paragraph (a) is not agreed on, an amount that would, in all the circumstances, have been reasonable to allow in payment or in part payment for the goods or services if notice of cancellation had not been given;

"trade-in arrangement" means an agreement or arrangement, whether contained in an executory contract or not, whereby the buyer sells or agrees to sell goods to the seller or any other person and the goods are or will be accepted as all or part of the consideration under an executory contract;

"variable credit" means credit made available in advance by a lender to a borrower who may draw on it, from time to time, up to the specified limit, in accordance with the terms and conditions of the credit transaction, and includes credit cards, credit accounts, budget accounts, cyclical accounts and any other similar arrangements, but does not include an arrangement for overdrawing an account with a savings institution or an arrangement where the amount owing must be repaid immediately on demand of the creditor.

No derogation

2 The provisions of this Act and the regulations apply despite any waiver or agreement to the contrary, and do not restrict, limit or derogate from any other rights of a debtor under any other law.

Assignee's obligations

3 (1) Subject to subsection (2), an assignee of a right of a lender or seller in a transaction to which this Act applies has no greater right than, and is subject to the same obligations, liabilities and duties as, the assignor respecting the credit given to the debtor.

(2) A debtor must not receive from, and is not entitled to set off against, an assignee of the lender or seller an amount greater than the balance owing on the contract at the time of the assignment.

Guarantor has same rights as buyer

4 A guarantor may rely on a defence that is available to a buyer or borrower in an action commenced by a seller or lender against the guarantor, whether or not the buyer or borrower is a party to the action, but a guarantor must not use the infancy or bankruptcy of the buyer or borrower as a defence.

Goods for resale

5 This Act does not apply to a transaction in which a person purchases or leases goods for the purpose of reselling, leasing or subleasing them or for the purpose of using them in a business.

Land

6 Except for Part 5, this Act does not apply to a sale, lease, sublease, mortgage or charge of land or a chattel real.

Part 1 — Executory Contracts

Seller

7 If a seller is not specified in an executory contract at the time it is signed by the buyer or guarantor, then a person by whom or on whose behalf the executory contract is signed at a later time and who is then specified in the executory contract as the seller is deemed to be and at all material times to have been the seller under that executory contract.

Salesperson's representations

8 An oral or written representation, statement or undertaking,

(a) whether constituting a condition or warranty or not, and

(b) made to a buyer by a salesperson with respect to goods covered by an executory contract,

is deemed to have been made by the salesperson as agent of the seller, but nothing in this section exonerates a person from liability to which he or she would be subject apart from this section.

Referral selling

9 An executory contract is unenforceable by the seller if

(a) the seller gives, or offers to give, a rebate, discount or other value to the buyer or guarantor in consideration of the buyer or guarantor giving to the seller the names of prospective purchasers, or otherwise aiding the seller in making a sale to another person, and

(b) the earning of the rebate, discount or other value is contingent on the occurrence of an event after the time the buyer agrees to buy.

Disclosure requirements

10 (1) An executory contract must contain in the prescribed manner and form the information and particulars required by the regulations.

(2) A contract for future services or an executory contract that a direct seller, other than one referred to in section 11 (3), solicits, negotiates or concludes at a place other than his or her business address, is not binding on the buyer, unless

(a) the contract is made in accordance with this section and the regulations,

(b) it is signed by the buyer, and the guarantor if applicable, and

(c) within 7 days after the day it was signed by the buyer, and the guarantor if applicable, a copy of it has been received by the buyer, or both of them, as the case may be.

(3) Money paid by the debtor to the seller pursuant to an executory contract that is, by virtue of subsection (2), not binding may be recovered by the debtor as a simple contract debt.

(4) The burden of proving that this section has been complied with is on the seller.

(5) For the purposes of this section, if, except for a lender's failure of the type described in section 50 (1) (a) or (b), an executory contract under which credit is extended conforms to the requirements set out in subsection (2) (a) to (c) of this section, the contract must be treated as if it conforms to those requirements in all respects.

Buyer's right of cancellation

11 (1) In this section, "permanent" means for the remainder of the executory contract period or for the remainder of the time stated by the seller under section 21.

(2) If a direct seller solicits, negotiates or concludes a contract at a place other than his or her business address, the buyer may cancel the contract

(a) if it is an executory contract, by giving notice of cancellation not later than

(i) 7 days after the date on which the copy of the contract was received by the buyer,

(ii) one year after the date on which the copy of the contract was received by the buyer if

(A) all the goods to be supplied under the contract are not supplied within 30 days after the delivery date specified in the contract, and

(B) the buyer has not accepted delivery of the goods, or

(iii) 130 days after the date of the contract if

(A) a delivery date is not specified in the contract,

(B) all the goods to be supplied under the contract are not supplied within 120 days after the date of the contract, and

(C) the buyer has not accepted delivery of the goods,

(b) if it is not an executory contract, by giving notice of cancellation not later than 7 days after the date the contract was made, or

(c) whether or not the contract is executory, if the direct seller is not licensed as required by Part 2, by giving notice of cancellation not later than one year after the date the contract was made.

(3) If a seller only occasionally carries on his or her business outside of his or her permanent place of business, subsection (2) does not apply to a contract that the seller or his or her agent or employee solicits, negotiates or concludes at a place other than the seller's permanent place of business.

(4) In a dispute over the application of subsection (2), the onus of proving that a seller carries on his or her business only occasionally outside of his or her permanent place of business is on the seller.

(5) A direct seller under a contract to which subsection (2) (b) applies must at the time of making the contract notify the buyer, in the prescribed form and manner, of the buyer's right of cancellation under that subsection.

(6) For the purposes of subsection (2) (a) (ii) and (iii), the Sale of Goods Act determines whether the buyer has accepted delivery of the goods.

(7) Unless otherwise provided by regulation, a buyer may cancel a contract for future services by giving notice of cancellation not later than 7 days after the date on which the copy of the contract was received by the buyer.

(8) A buyer or his or her personal representative may, at any time, cancel a contract for future services if

(a) there has been a material change in the circumstances of the buyer, by giving notice of cancellation to the seller, or

(b) there has been a material change in the services provided by the seller, by giving notice of cancellation to the seller.

(9) For the purposes of

(a) subsection (8) (a), a material change in the circumstances of the buyer includes, without limitation,

(i) the buyer's death,

(ii) permanent physical, medical or mental disability of the buyer, to be substantiated by the provision of a certificate of a medical practitioner showing that the buyer's continued participation is unreasonable, having regard to the buyer's condition, or is likely to endanger the buyer's health, or

(iii) permanent relocation of the buyer so that the buyer and the seller are located more than 30 km further distant from each other than they were when the executory contract was entered into, if the seller does not provide reasonably comparable alternative facilities for the use of the buyer not more than 30 km from the buyer's new location, and

(b) subsection (8) (b), a material change in the services provided by the seller is deemed to occur

(i) when, for reasons that are wholly or partly the fault of the seller, the services are not completed or at any time appear unable to be reasonably completed within the period of time stated by the seller under section 21,

(ii) when the services are no longer available or substantially available as provided in the contract because of the seller's discontinuance of operation or substantial change in operation, or

(iii) when the seller relocates his or her facility so that the seller and buyer are located more than 30 km further distant from each other than they were when the contract was entered into, and the seller does not provide reasonably comparable alternative facilities for the use of the buyer, not more than 30 km from the buyer's location.

(10) A notice of cancellation under this section is sufficient if, however expressed, it indicates the intention of the buyer to cancel the contract and, in the case of cancellation under subsection (8) (a) or (b), it states the reason for cancellation.

(11) A notice of cancellation under this section may be given by delivering it in person or mailing it by registered mail

(a) to the seller or to the address shown in the executory contract for the person named in it as a person to whom notice of cancellation may be given, or

(b) if the address of the seller or other person is not shown in the contract, to any salesperson or to any address of the seller known to the buyer.

(12) For the purposes of this section, a notice of cancellation by mail is deemed to be given at the time it is mailed.

Buyer's right to cancel time share contract

12 (1) A buyer of a time share contract may cancel the contract by giving notice of cancellation not later than 7 days after the date on which the buyer received a copy of the contract.

(2) A notice of cancellation may be given by any method that a reasonable person would think is sufficient to give notice, including

(a) delivering it in person, and

(b) sending it by registered mail, ordinary mail, electronic mail or fax, to

(i) the seller, or

(ii) the address, electronic mail number or fax number shown in the contract for the person named in the contract as a person to whom notice of cancellation may be given.

(3) A written notice of cancellation is sufficient if it indicates, in any way, the intention of the buyer to cancel the contract.

(4) A copy of the time share contract must be provided to the buyer at the time of signing, and must contain

(a) a notice, in prescribed form, in bold and in at least 12 point type, of the buyer's right to cancel the time share contract within 7 days of receiving a copy of the contract, and

(b) the name and mailing address of the seller or persons to whom notice of cancellation may be given.

(5) A buyer may cancel a time share contract at any time if the time share contract does not comply with subsection (4).

(6) If a written notice of cancellation is given by mail, electronic mail or fax, it is considered to be given at the time it is mailed or sent.

When must a contract be in writing?

13 A direct seller must use a written contract for a direct sale if the buyer's purchase price, excluding the cost of borrowing, but including any taxes, equals or exceeds the amount set by regulation.

What must be in a written contract?

14 A direct seller who enters into a written contract with a buyer for a direct sale must ensure that the contract contains

(a) a notice of the buyer's right of cancellation,

(b) a detailed statement of the terms of payment including interest, and

(c) any other matter required by regulation.

Trust accounts

15 (1) The registrar may at any time require a direct seller

(a) to hold in trust money that is paid under a direct sale by a buyer to the direct seller in full or partial compensation for goods or services that are to be delivered, wholly or partly, after the payment, and

(b) to keep the trust money with a financial institution or class of financial institutions approved by the registrar

and the direct seller must comply with the requirement.

(2) When requested by the registrar, the direct seller must provide to the registrar, in the manner and form requested, information or records respecting the trust or the money required to be held in trust.

Return of goods on cancellation

16 (1) If a buyer cancels a contract under section 11 (2) or 12 (1),

(a) the buyer must, subject to section 17, return any goods received under the contract by delivering the goods

(i) to a person authorized to receive them in a written request signed or purporting to be signed by the seller, or

(ii) to the seller or to a person named in the contract as a person to whom notice of cancellation may be given, and

(b) despite section 3 (2), the seller must, within 15 days after the notice of cancellation has been given,

(i) refund to the buyer, without deduction, all money received or realized in respect of the contract, whether from the buyer or any other person, and

(ii) return to the buyer any trade-in received under a trade-in arrangement, or a sum equal to the trade-in allowance.

(2) Subject to subsection (3), return of the goods by the buyer under subsection (1) discharges the buyer from any obligation or liability in respect of the goods arising under the contract.

(3) If goods are returned by a buyer under subsection (1), the buyer is liable to the seller for any damage to the goods caused by the failure of the buyer to take reasonable care of the goods.

Retention of goods after cancellation

17 If a buyer cancels a contract under section 11 (2), the buyer is entitled to retain possession of the goods delivered to the buyer under the contract

(a) until all money paid by the buyer is refunded, and

(b) in the case of a trade-in arrangement, until either

(i) the goods delivered by the buyer under the trade-in arrangement are returned to the buyer in condition substantially the same as they were when delivered by the buyer, or

(ii) a sum equal to the trade-in allowance is paid to the buyer.

Refund on cancellation of contract for future services

18 (1) If a buyer cancels a contract under section 11 (7), the seller must, within 15 days after the notice of cancellation has been given, refund to the buyer without any deduction all money received or realized in respect of the contract.

(2) If a buyer or his or her personal representative cancels a contract under section 11 (8), the seller must, within 15 days after the notice of cancellation has been given, refund to the buyer or his or her personal representative

(a) in the case of a cancellation under section 11 (8) (a), the portion determined in the prescribed manner of all cash payments made under the contract, less a prescribed amount on account of the seller's costs, or

(b) in the case of a cancellation under section 11 (8) (b), the portion determined in the prescribed manner of all cash payments made under the contract.

(3) If a contract has been cancelled under section 11 (8) (a) or (b), the seller must, within 30 days after the notice of cancellation has been given, return to the buyer every negotiable instrument executed by the buyer in connection with the contract.

Refunds recoverable

19 (1) A refund that is required to be made by a seller to a buyer under section 16 or 18, or by a seller to an individual under section 55, is recoverable as a simple contract debt.

(2) If a trade-in is not returned to a buyer as required under section 16, the buyer may recover from the seller as a simple contract debt an amount equal to the trade-in allowance for the trade-in.

(3) When a buyer receives an amount equal to the trade-in allowance, the title of the buyer in respect of the goods delivered by the buyer under the trade-in arrangement, if it had not already passed from the buyer, vests in the person entitled to them under the trade-in arrangement.

(4) In an action by the buyer against the seller where the seller fails to comply with section 16 (1) (b) or 18, or in an action by an individual against a seller under section 55 for a refund, judgment must be entered against the seller for the greatest of the following:

(a) 3 times the amount of any refund not paid within the time limited by that section;

(b) if there are actual damages, 3 times the amount at which those damages, inclusive of any refund, are assessed;

(c) the sum of $100.

(5) A seller has a defence to an action under subsection (1) of this section for a refund referred to in section 55, and has a defence to an action under subsection (4) of this section in relation to that refund, if the seller proves to the court that

(a) the negative option offer was made before January 26, 1995, and

(b) at the time of the offer, the seller did not know that the contract for the unsolicited service sold by the seller by means of the negative option offer might be made unenforceable by legislation.

(6) A seller has a defence to an action under subsection (4) of this section for a failure to comply with the 30 day time limit for making a refund or giving a credit under section 55 (12), if the seller proves to the court that

(a) the seller made a reasonable attempt to comply with the 30 day time limit, or

(b) the seller had a reasonable belief that section 55 did not apply to the seller.

Maximum term and payment

20 (1) A contract for future services must not be for an amount in excess of the prescribed amount, exclusive of the cost of borrowing, or be for a term or period of time longer than 2 years after the date the contract was signed by the buyer.

(2) For the purpose of subsection (1), all contracts for future services that are in effect between the same seller and the same buyer at one and the same time, whether or not services are being supplied concurrently under 2 or more of them, are deemed to be one contract.

(3) If a contract does not comply with subsection (1), the buyer may recover all money paid under the contract as a simple contract debt.

Contracts expressed in hours

21 If a contract for future services provides that services are to be supplied by the seller by reference to a number of hours or a number of sessions, the seller must state in the contract the period of time in months over which the buyer can reasonably expect to receive the services.

Part 2 — Direct Seller Licensing

Application of this Part

22 This Part applies to a direct seller who solicits orders for, or sells or offers for sale, goods or services if

(a) the purchase price, excluding the cost of borrowing, but including any taxes, equals or exceeds the amount set by regulation,

(b) the soliciting, sale or offering for sale is made to an individual, and

(c) the direct seller solicits, negotiates or concludes the contract at a place other than the direct seller's permanent place of business.

Definition

23 In this Part, "commission" means the Commercial Appeals Commission continued under the Commercial Appeals Commission Act.

Who must be licensed?

24 (1) A person must not carry on business as a direct seller unless licensed by the registrar or exempted under section 25 or by regulation.

(2) A person may not sell on behalf of a direct seller if the direct seller does not have a licence required by this section.

Who does not have to be licensed?

25 (1) A licence is not required under this Act for

(a) the direct sale of newspapers published at intervals of 7 days or less,

(b) the direct sale of fuel,

(c) the direct sale of

(i) food for human consumption, or

(ii) a commodity that will become food for human consumption

if the food or commodity is unfrozen and perishable at the time of delivery,

(d) the direct sale of a class of goods exempted by regulation, or

(e) the direct sale by a class of direct sellers that is exempted by regulation.

(2) A salesperson or class of salespersons may be required by regulation to be licensed, but in the absence of such a regulation a salesperson is not required to be licensed.

How to apply for a licence

26 (1) A person may apply to the registrar for a licence using a form required by regulation.

(2) An application for a licence or renewal of a licence must be accompanied by

(a) the fee required by regulation,

(b) security, or proof of security, that is satisfactory to the registrar including, if the registrar requires it, an irrevocable letter of credit, and

(c) any information that the registrar reasonably requires to determine whether to issue the licence or renewal.

Licence may have conditions

27 (1) The registrar may decide

(a) to issue or renew a licence with conditions including a condition that restricts the goods or services that may be sold under the licence, or

(b) to alter, add to or impose conditions on a licence at any time.

(2) A licensee may appeal the decision to the commission.

Refusal, suspension or cancellation of a licence

28 (1) For the purposes of subsection (2), "associate" means a salesperson or a person, including an officer and a director, who performs services related to the management of the business of a direct seller.

(2) The registrar may refuse to issue a licence to a person and may suspend, cancel or refuse to renew the licence of a person if there are reasonable grounds to believe that

(a) the person's finances are not adequate to carry on the business of a direct seller,

(b) the past conduct of the person or an associate of the person is such that it is contrary to the public interest for the person to carry on the business of a direct seller,

(c) the person or an associate of the person has contravened this Act, the regulations or a condition of a licence, or

(d) the security in respect of the licence has ceased to be effective for the purpose for which it was given and has not been replaced with security that is the equivalent of the original security.

(3) The registrar must not refuse an application for a licence or renewal, or suspend or cancel a licence, without first giving the applicant or licensee an opportunity to be heard.

(4) A person whose application for a licence or renewal has been refused or whose licence has been suspended or cancelled may appeal the decision to the commission.

(5) Despite section 12 of the Commercial Appeals Commission Act, a decision of the registrar under this section is not stayed pending an appeal to the commission.

Change of address

29 A licensee must notify the registrar in writing of a change in the address of the licensee's place of business within 2 weeks of the change.

What information can the registrar require?

30 (1) The registrar or a person authorized in writing by the registrar may by written order require a licensee, within the time specified in the order, to provide information or produce records that are

(a) related to the direct sales business of the licensee, and

(b) specified or otherwise described in the order.

(2) The registrar may require a licensee or an officer or director of a licensee to state by affidavit his or her knowledge or belief respecting information or a record supplied under this section.

(3) A licensee, officer or director, as the case may be, must provide the information, records and affidavits required by the registrar under subsection (1) or (2).

Inspection of records

31 (1) The registrar or a person authorized in writing by the registrar may inspect the records and inventory of a licensee.

(2) A licensee must facilitate an inspection under this section.

(3) Section 66 applies to the removal of records and inventory inspected under this section as if the person conducting the inspection under this section were an investigator.

(4) The registrar must ensure that any record or inventory removed under subsection (3) is kept safe and secure until its return and must establish procedures for achieving that safety and security.

Licence not transferable

32 A licence under this Part is not transferable.

What name must a licensee use?

33 A licensee must not advertise, contract or otherwise carry on business in a name other than the licensee's name as it appears in the licence.

Production and surrender of licence by licensee

34 (1) A licensee must produce the licence

(a) to a person to whom the licensee is making or attempting to make a direct sale, and

(b) on request, to a police officer, the registrar or any person authorized in writing by the registrar.

(2) A person who ceases to hold a licence must surrender it to the registrar on the registrar's request.

Salesperson's identification card

35 (1) A licensee must give an identification card to a salesperson who makes or attempts to make direct sales on behalf of the licensee.

(2) The identification card must contain the salesperson's name and picture, the name and business address of the licensee and the signature of the licensee or, if the licensee is a corporation, of an officer of the licensee and any other information required by regulation.

Production or surrender of identification card

36 (1) A salesperson who has received an identification card under section 35 must produce it

(a) to a person to whom the salesperson is making or attempting to make a direct sale, and

(b) on request, to a police officer, the registrar or any person authorized in writing by the registrar.

(2) A person who has received an identification card who is no longer authorized to make direct sales on behalf of a licensee must surrender the card

(a) to the licensee, or

(b) if the person that held the licence no longer does so, to the registrar.

Change in firm requires prior approval

37 (1) A licensee must obtain the registrar's prior approval,

(a) if the licensee is a partnership, to a change in partners, or

(b) if the licensee is a corporation, to a change in the directors or officers

if the proposed partner, director or officer would be an associate as defined in section 28 (1).

(2) The registrar has no more than 14 days after receiving a request for an approval under subsection (1) to approve or refuse a change if the proposed partner, director or officer has continuously been a resident of British Columbia during the 12 months preceding the registrar's receipt of the request.

(3) The registrar may refuse approval under subsection (1) for the same reasons for which the registrar may refuse a licence under section 28.

(4) A licensee who has been refused approval may appeal the refusal to the commission.

(5) Despite section 12 of the Commercial Appeals Commission Act, a decision of the registrar under this section is not stayed pending an appeal to the commission.

Designation of registrar

38 The minister may designate an individual as the registrar of direct sellers.

Designation of acting registrar

39 The registrar may designate a person who may, in the absence of the registrar, exercise the powers and perform the duties of the registrar.

Register

40 (1) The registrar must maintain a register of persons

(a) who are licensed,

(b) who have been refused a licence, and

(c) whose licences have been suspended or cancelled,

and must supply information from the register to any person who asks.

(2) A written statement concerning information in the register is admissible in court as proof of the information contained in the register if the written statement purports to be signed by the registrar.

Part 3 — Credit Transactions

Disclosure of cost of borrowing

41 (1) Except as provided in section 42, every lender must furnish to the debtor before extending credit a statement, in the prescribed manner and form, disclosing information pertaining to the following:

(a) the principal sum;

(b) the charges;

(c) the cost of borrowing;

(d) the calculation;

(e) any other particulars required by the regulations with respect to the credit transaction.

(2) This section does not apply to an arrangement between a savings institution and a borrower respecting the overdrawing of the borrower's account.

(3) If a lender extends credit, other than variable credit, at a rate of interest that is subject to variation during the extension of credit, the lender must, in the prescribed manner and form and at prescribed times, furnish to the debtor particulars required by the regulations of any variation in the rate of interest or of another matter related to the credit transaction.

Requirements when extending variable credit

42 A lender who makes variable credit available must,

(a) before making it available, disclose to the debtor, in the prescribed manner and form,

(i) the cost of borrowing, and

(ii) any other information required by the regulations, and

(b) during the extension of credit, disclose to the borrower with respect to the borrower's account, in the prescribed manner and form and at prescribed times,

(i) the cost of borrowing,

(ii) the total amount credited,

(iii) the outstanding balance,

(iv) the amount of credit extended, and

(v) any other information as required by the regulations.

Increase of cost of borrowing: variable credit

43 A lender who makes variable credit available may increase the cost of borrowing, but the increase must not take effect before the expiration of at least 30 days after the lender has given the debtor notice in writing of the lender's intention to increase the cost of borrowing and has set out the new cost of borrowing in accordance with section 42.

Prepayment

44 (1) Under an agreement extending credit, where

(a) the cost of borrowing is calculated in advance and is added to the principal sum, a debtor may, at any time, without notice or penalty

(i) extinguish the entire credit obligation by prepaying the outstanding principal sum and by paying the earned cost of borrowing and any accrued default charges, or

(ii) reduce the outstanding principal sum and the cost of borrowing calculated in advance on it, by prepaying at least the amount or percentage of the outstanding principal sum that is prescribed, or

(b) the cost of borrowing is calculated periodically and not in advance, a debtor may, at any time, without notice or penalty prepay any or all of the outstanding balance of a credit obligation.

(2) For the purposes of subsection (1), the earned cost of borrowing is the amount that has been incurred to the date of prepayment as determined by regulation.

(3) If a lender does not accept a prepayment tendered in accordance with this section and the regulations, the lender is not entitled to the future cost of borrowing with respect to the amount tendered.

Advertising terms of credit

45 A person must not publish an advertisement relating to

(a) the cost of borrowing in a credit transaction, or

(b) the terms of a lease or lease to purchase transaction,

that is contrary to the regulations.

Lost or stolen credit cards

46 (1) In this section:

"holder" means the person to whom a credit card is issued;

"issuer" means the person who issues the credit card.

(2) Despite anything contained in an agreement entered into before or after October 15, 1981, if

(a) a holder has lost a credit card, or

(b) a credit card has been stolen,

the holder is not liable for any debt incurred through its use after the holder has, in person or by registered mail, notified the issuer that the card is lost or stolen and is no longer in the holder's possession or control.

(3) For the purposes of subsection (2), notification by registered mail is deemed to be given at the time the notice is mailed.

(4) A holder is not liable for any debt in excess of the lesser of

(a) $50, or

(b) the maximum amount of credit that is available to the holder under a written agreement with the issuer,

if the debt is incurred by the use of the credit card by an unauthorized person before the date on which the holder gave notice to the issuer under subsection (2).

(5) If a dispute arises between a holder and an issuer under this section, the burden of proof rests with the issuer to show that the debt was incurred by the holder or a person authorized by the holder to use the card.

Credit cards

47 (1) In this section:

"unsolicited credit card" means a credit card, except a credit card in the hands of the recipient before April 6, 1970, that has not been requested in writing by the person named on it;

"unsolicited goods" means personal property, except personal property in the hands of the recipient before April 6, 1970, that has not been requested by the recipient, but does not include personal property delivered to the recipient that the recipient knew or ought to have known was intended for delivery to another person.

(2) If an unsolicited credit card or unsolicited goods are received,

(a) in the case of a credit card, the person named on it, or

(b) in the case of goods, the recipient

has no legal obligation

(c) in respect of it, and

(d) in the case of an unsolicited credit card, in respect of any transaction made under it,

unless and until the person referred to in paragraph (a) or (b) expressly acknowledges to the sender in writing his or her intention to accept the unsolicited credit card or the unsolicited goods.

(3) Unless the acknowledgment referred to in subsection (2) has been given, the sender does not have a cause of action for any loss, use, misuse, possession, damage or misappropriation in respect of the unsolicited credit card, the unsolicited goods or the value obtained by the use of either.

(4) A credit card that renews or replaces another credit card, except an unsolicited credit card, is not an unsolicited credit card within the meaning of this section.

Notice requirements

48 (1) In this section:

"last statement of account" means the latest statement of account received, or deemed to have been received, by the debtor at least 10 days before the date on which payment must be made in order to reduce or avoid the cost of borrowing on an account;

"new balance" means credit extended and cost of borrowing accrued, after the date of the last statement of account;

"previous balance" means the amount owed by the debtor to the creditor as at the date of the last statement of account;

"statement of account" means a written statement of the amount owing by the debtor to the creditor that includes the following:

(a) the amount stated on the previous statement of account to be owing;

(b) a record of each extension of credit since the previous statement of account;

(c) the amount credited to the account since the previous statement of account;

(d) the cost of borrowing accrued since the previous statement of account.

(2) A creditor must not impose a cost of borrowing in respect of a previous balance if the debtor is unable to make payment by reason of such circumstances as may be prescribed.

(3) A creditor extending variable credit must not impose a cost of borrowing in respect of a new balance in any account

(a) for which the relevant statement of account was not received or not deemed to have been received by the borrower a least 10 days before the date on which payment must be made on the account in order to reduce or avoid the cost of borrowing, or

(b) if the debtor is unable to make payment by reason of such circumstances as may be prescribed.

(4) Subject to subsection (5), for the purposes of subsection (3), a statement of account is deemed to have been received by the borrower

(a) on the date of delivery, if delivered personally to the borrower's last known address, or

(b) on the fifth day after it was posted, if posted in Canada by first class mail to the borrower's last known mailing address.

(5) For the purposes of subsection (4), if the mail service is disrupted by an act of God, war, civil disorder, natural disaster or labour dispute during the period referred to in subsection (4) (a) or (b), a statement that is mailed to the buyer's last known address is deemed to have been received by the buyer on the day that follows the period of disruption of the mail service plus the number of days remaining in the period referred to in subsection (4) (a) or (b), as the case may be.

(6) A debtor may recover as a simple contract debt, set off or counterclaim any cost of borrowing imposed contrary to subsection (2) or (3) and paid by the debtor.

Crediting payments

49 (1) A payment made by a debtor is deemed to have been made on the earlier of

(a) the date the payment is received by the creditor, and

(b) the date the payment is received by a person who is authorized to receive the payment on behalf of the creditor.

(2) Unless otherwise agreed by a creditor and debtor, the creditor must apply every payment made by the debtor

(a) first, to the payment of the accrued cost of borrowing,

(b) second, to the payments of penalties or charges, and

(c) third, to the reduction of the principal sum.

(3) If, in a variable credit transaction, the principal sum is comprised of 2 or more extensions of credit secured by charge or encumbrance against goods or chattels of the debtor, the reduction of the principal sum accrues in the same chronological order that the extensions of credit represented by that principal sum were made, unless otherwise directed by the debtor.

(4) If a creditor contravenes subsection (2) and, as a result of that contravention a debtor pays a greater cost of borrowing than the debtor otherwise would have, the debtor may recover the excess as a simple contract debt.

Improper disclosure

50 (1) A lender who

(a) fails to provide the debtor with a disclosure statement in accordance with sections 41 and 42 and the regulations, or

(b) fails to give the debtor a completed copy of the prescribed lending transaction documents on or before the date on which a cost of borrowing starts to accrue

is not entitled to collect any cost of borrowing.

(2) A lender is deemed to have complied with the regulations on disclosure described in subsection (1), despite any error, omission, or incorrect or insufficient description in the disclosure, if a court is satisfied that the error, omission, or incorrect or insufficient description is not of a nature to mislead or deceive the debtor to the debtor's prejudice or disadvantage.

(3) The burden of proof that the error, omission, or incorrect or insufficient description is not of a nature to mislead or deceive the debtor to the debtor's prejudice or disadvantage is on the lender.

Cash discounts

51 (1) In this section, "cash discount" means a reduction in the price of goods or services, or both, allowed by a seller if the buyer pays in cash.

(2) Except as may be permitted by regulation, a person who is engaged in the business of producing or supplying goods or services, or who extends credit by way of credit cards or otherwise, or who is engaged in a business that relates to credit cards must not, directly or indirectly,

(a) by agreement, threat, promise or any other means, attempt to influence, prohibit or discourage the granting of cash discounts by any person who supplies, offers to supply or advertises goods or services, or

(b) refuse to supply goods or services or otherwise discriminate against any person because of the cash discount policy of that other person.

Income tax refund discounts

52 (1) In this section:

"discounter" means a person including an agent or broker who, acting in the course of business, acquires from a taxpayer the taxpayer's right to a refund that is due or will become due to the taxpayer;

"refund" means the amount that an individual is entitled

(a) to receive as an overpayment of the income tax paid by the individual or on the individual's behalf under the Income Tax Act or the Income Tax Act (Canada) and interest on the overpayment,

(b) to receive as an overpayment of unemployment insurance premiums paid by the individual or on the individual's behalf under the Unemployment Insurance Act (Canada),

(c) to receive as an overpayment of Canada Pension Plan contributions paid by the individual or on the individual's behalf under the Canada Pension Plan, or

(d) to claim as a grant or refund under a Provincial or federal Act;

"taxpayer" means an individual, other than a discounter, who has the right to receive a refund.

(2) Before a discounter may acquire from a taxpayer the right to receive a refund that is due or will become due to the taxpayer, the discounter must specify in writing to the taxpayer the terms of the acquisition including the following information:

(a) the amount of the refund that the taxpayer believes is due or will become due to the taxpayer;

(b) the amount to be paid by the discounter for the refund that is due or will become due after deducting the amount charged for any service related to the acquisition of the refund or the right to the refund;

(c) the difference between the amounts referred to in paragraphs (a) and (b), which is the amount that the taxpayer will forego as a result of the discounting agreement.

(3) A discounter must not acquire a right to receive a refund on behalf of a taxpayer from the government of Canada until the discounter has paid not less than 85% of the refund to the taxpayer.

(4) If a discounter receives an amount that exceeds the amount referred to in subsection (2) (a), the discounter must promptly remit the excess amount to the taxpayer.

(5) The taxpayer may recover from the discounter as a simple contract debt

(a) the difference between the minimum amount required to be paid under subsection (3) and the amount actually paid by the discounter to the taxpayer, or

(b) an excess amount required to be paid under subsection (4) that has not been paid by the discounter to the taxpayer.

(6) A discounter must, by July 31 of each year, file with the director in the prescribed form

(a) the name and address of each taxpayer whose refund was acquired,

(b) the amount of the refund,

(c) the amount that was paid to the taxpayer, and

(d) the amount actually received by the discounter pursuant to the refund acquired

for the year ending June 30.

(7) In a proceeding under this Act, a certificate of the director that contains a statement based on the records kept by the director pertaining to subsection (6) is, without proof of the signature or official position of a person giving the certificate, evidence of the matters stated in the certificate.

Part 4 — Food Plan Contracts, Negative Option Offers and Disclosure Notices

Food plan contracts

53 (1) In this section:

"down payment" means a cash payment or a legal obligation for payment in advance of receiving delivery of the food that relates to any matter arising from or related to a food plan contract;

"food plan contract" means a contract between a buyer and a seller for the purchase and sale of food in amounts in excess of 25 kg, in respect of which delivery of the food is not made at the time the contract is made and includes a membership scheme or plan or other service or matter arising from or related to the purchase and sale of food.

(2) A food plan contract must not require a down payment in excess of $100.

(3) A food plan contract is not binding on the buyer and an action against the buyer in respect of the contract may not be commenced unless,

(a) if it is a contract that provides for the sale of food in bulk, it contains the unit price for each item of food covered by the contract,

(b) if the contract allows for the substitution of one type of food for another type within the total food order, it contains a clear statement of the manner in which substitutions will be permitted, and

(c) a copy of the food plan contract is delivered to the buyer at the time it is signed by the buyer.

Negative option schemes

54 (1) In this section:

"contract complete buyer" means a person who has purchased the minimum quantity of goods required by the terms of the negative option scheme;

"goods", despite section 1, means tangible personal property and does not include services as defined in section 55;

"negative option scheme" means an arrangement between a buyer and a seller under which the seller will, from time to time,

(a) on notice to the buyer, supply the buyer with goods described in the notice, unless the buyer notifies the seller that the buyer does not want to be supplied with the goods described in the notice, or

(b) supply the buyer with certain goods and the buyer will be deemed to have accepted the goods, unless the buyer returns the goods to the seller.

(2) If a seller delivers goods to a buyer under a negative option scheme, the buyer has no legal obligation to the seller with respect to the goods, unless the buyer has received or is deemed to have received the notice or the goods at least 15 days before the date on which the buyer must

(a) notify the seller of the buyer's decision not to receive the goods, or

(b) return the goods.

(3) Subject to subsection (4), for the purposes of subsection (2), a statement that is mailed to the buyer's last known mailing address is deemed to have been received by the buyer if mailed in Canada,

(a) on the 5th day after it was mailed if it was sent by first class mail, or

(b) on the 20th day after it was mailed, if it was mailed other than by first class mail.

(4) For the purposes of subsection (3), if the mail service is disrupted by an act of God, war, civil disorder, natural disaster or labour dispute during the period referred to in subsection (3) (a) or (b), a statement that is mailed to the buyer's last known address is deemed to have been received by the buyer on the day that follows the period of disruption of the mail service plus the number of days remaining in the period referred to in subsection (3) (a) or (b), as the case may be.

(5) A negative option scheme is not enforceable by the seller against the buyer unless

(a) the promotional material clearly and conspicuously disclosed the material terms of the plan, including

(i) that aspect of the plan under which the buyer must notify the seller, in the manner provided for by the seller, or return the goods if the buyer does not wish to purchase the goods,

(ii) any obligation assumed by the buyer to purchase a minimum quantity of goods,

(iii) the right of a contract complete buyer to cancel the arrangement at any time,

(iv) whether billing charges will include an amount for postage and handling,

(v) a disclosure indicating that the buyer will be provided with at least 15 days in which to notify the seller of the buyer's decision not to receive the goods or to return the goods,

(vi) a disclosure that the seller will credit the return of any goods sent to the buyer and guarantee to the postal service or the buyer postage to return the goods to the seller when the announcement and form or goods are not received by the buyer in time to afford the buyer at least 15 days in which to give notification of the buyer's decision to refuse to accept the goods or to return the goods to the seller, and

(vii) the frequency with which the announcements, forms or goods will be sent to the buyer and the maximum number of announcements, forms or goods that will be sent to the buyer during a 12 month period,

(b) before sending any goods, under a negative option scheme described in paragraph (a) of the definition of "negative option scheme", the seller mails to the buyer, within the time specified by subsection (2),

(i) an announcement identifying the goods, and

(ii) a form, contained in or accompanying the announcement, clearly and conspicuously disclosing that the buyer will receive the goods identified in the announcement unless the buyer instructs the seller that the buyer does not want the goods, designating a procedure by which the form may be used to enable the buyer to instruct the seller and specifying the return date, and

(c) on every anniversary date of the negative option scheme, the seller discloses, in the prescribed manner and form, the right of the buyer to cancel the contract arrangement.

(6) For the purpose of this section, if a buyer, by mail

(a) notifies the seller of the buyer's decision not to receive the goods, or

(b) returns the goods,

the notification or return is deemed to have been made at the time of mailing.

Negative option offers for selling services

55 (1) In this section and section 56:

"negative option offer" means an offer to sell an unsolicited service to an individual by which the seller gives the individual notice to the effect that the seller will charge the individual, on or after January 26, 1995, for the service unless the individual instructs the seller not to provide the service;

"service" means the benefit to an individual of work done by a person and, without limiting that meaning, it includes

(a) the delivery of, or provision of access to, electricity, gas, water, cable television and other telecommunications, and

(b) a prescribed activity,

but it does not include the delivery of, or provision of access to, books, magazines, newspapers or petroleum products;

"unsolicited service" means a service provided to an individual who did not request that specific service.

(2) A contract for an unsolicited service sold by means of a negative option offer is not enforceable by the seller against an individual.

(3) For the purposes of this section and section 56, a contract is not sold by means of a negative option offer if the individual instructs the seller, orally or in writing, that the individual consents to the purchase of the service.

(4) Consent under subsection (3) cannot be given before the individual receives notice of

(a) a description of the specific service that is the subject of the negative option offer, and

(b) the price of that service.

(5) Consent under subsection (3) cannot be inferred from the individual's

(a) inaction,

(b) use of the service,

(c) consent to purchase another similar service, or

(d) payment for the service.

(6) Subsection (2) applies to a change to an individual's existing service only if

(a) the change is made pursuant to a negative option offer, and

(b) without the consent of the individual, the change

(i) provides a new, unsolicited service for which an extra charge is made, or

(ii) reduces an existing service without reducing the price proportionately.

(7) Subsection (2) does not apply to

(a) a change to the price of an existing service, or

(b) a renewal of an existing service

if the service is not otherwise changed.

(8) An individual who pays for an unsolicited service under a contract that is unenforceable because of subsection (2) may demand that the seller refund the payment.

(9) An individual's right to demand a refund ends 2 years after the individual

(a) received the disclosure notice referred to in section 56, or

(b) first received the service, if no disclosure notice is received during the 2 years after the service is received.

(10) A demand for a refund made by an individual to a seller under subsection (8)

(a) must be given in writing to the seller, and

(b) is sufficient, however it is expressed, if it indicates the intention of the individual to demand a refund of a payment made for a service that was sold by means of a negative option offer.

(11) If an individual sues a seller under section 19 (1) or (4) in respect of a refund referred to in subsection (8) of this section, the seller has a defence to the action if the seller can prove to the court that, at the time the individual paid for the service, the individual

(a) knew that he or she was receiving the service pursuant to a negative option offer, and

(b) was receiving a benefit from the service.

(12) If a seller receives a demand for a refund from an individual under this section, the seller must, within 30 days after receiving the demand,

(a) mail or deliver a refund of any payment received from the individual for the unsolicited service that was sold by means of the negative option offer, or

(b) with the individual's consent, give the individual a full credit towards subsequent services purchased from the seller.

(13) This section does not apply to a service or class of services or a seller or class of sellers that is exempted by regulation.

Disclosure notice

56 (1) Within 60 days of providing an unsolicited service to an individual, sold by means of a negative option offer, the seller must provide a disclosure notice to the individual setting out the following:

(a) a description of the service;

(b) the price of the service;

(c) the timing of payments for the service;

(d) the date the service starts;

(e) how to cancel the service, including an address to which a letter of cancellation may be sent;

(f) a statement that, under section 55 of the Consumer Protection Act, an individual

(i) is not required to pay for this service unless the individual has explicitly consented to receiving it, and

(ii) may have a right, for 2 years, to make a written demand for a refund.

(2) A seller must ensure that any disclosure notice provided by the seller meets the following requirements:

(a) it must be written in at least 12 point type;

(b) it must be visually clear and written in a manner that is readily understandable by a reasonable consumer of the service;

(c) it must not contain, or be mailed with, promotional materials.

Part 5 — Mortgage Transactions Relief

Definition

57 In this Part, "mortgage transaction" means the extension of credit on the security of

(a) a duplicate indefeasible title to land that has been deposited with the lender, or

(b) a mortgage, or an agreement for sale, of real estate or leasehold property,

but does not include a transaction involving real estate or leasehold property if credit is to be used for investment, business or commercial purposes.

Scope of Part

58 This Part applies to mortgage transactions.

Lender to justify transaction

59 If it is alleged that a mortgage transaction was unconscionable on the day the transaction was entered into, the burden of proof that it was not unconscionable on that day is on the lender.

Indications of unconscionability

60 In determining whether a mortgage transaction is unconscionable, a court must consider all of the surrounding circumstances that the lender knew or ought to have known, including, without limitation,

(a) that the debtor was subjected to undue pressure by the lender or the lender's agent to enter into the mortgage transaction,

(b) that the debtor was taken advantage of by the debtor's inability or incapacity to reasonably protect his or her own interest by reason of the debtor's physical or mental infirmity, ignorance, illiteracy, age or inability to understand the character, nature or language of the mortgage transaction, or any other matter related to the mortgage transaction,

(c) that, at the time the mortgage transaction was entered into, the cost of borrowing grossly exceeded the cost of borrowing that was available to similar debtors,

(d) that, at the time the mortgage transaction was entered into, there was no reasonable probability of full payment of the monthly or other periodic payments of the principal and interest,

(e) that, at the prevailing rate of interest at the time the mortgage transaction was entered into, there was no reasonable probability of refinancing any unpaid balance of principal at the end of the term,

(f) that the terms or conditions on, or subject to, which the mortgage transaction was entered into by the debtor are so harsh or adverse to the debtor as to be inequitable,

(g) that, at the time the mortgage transaction was entered into, the cost of borrowing was excessive in relation to the degree of risk assumed by the lender, having regard to the nature and value of any security provided, and

(h) other circumstances as may be prescribed by the regulations.

Powers of court

61 If the court determines that the mortgage transaction was unconscionable on the day the transaction was entered into, the court may

(a) reopen the mortgage transaction and take an account between the lender and the debtor,

(b) despite any statement or settlement of account or any agreement purporting to close previous dealings and create a new obligation, reopen any account already taken and relieve the debtor from any obligation to pay the cost of borrowing at a rate in excess of the prime rate, as defined by regulation, on the day the mortgage transaction was entered into,

(c) order the lender to repay any such excess that has been paid or allowed by the debtor,

(d) set aside all or part of, or alter, any agreement made or security given in respect of the mortgage transaction and, if the lender has parted with the security, order the lender to indemnify the debtor, and

(e) suspend the rights and obligations of the parties to the mortgage transaction.

Effect of Part

62 (1) This Part applies even though the time for payment or repayment of any sum or sums pursuant to the mortgage transaction has not arrived.

(2) Nothing in this Part derogates from the existing powers or jurisdiction of a court.

Part 6 — General

Request for information

63 (1) If, by the director's own inquiries, or as a result of complaints, the director has reason to believe that a person has contravened, is contravening or is about to contravene a provision of this Act or the regulations or an order made under this Act, the director may investigate the matter and may request that the person furnish to the director information respecting the matter.

(2) A request under subsection (1) must indicate the nature of the inquiry or complaint.

Investigation

64 (1) If the director believes on reasonable and probable grounds that a person has contravened, is contravening or is about to contravene this Act or the regulations or an order made under this Act, the director may order a full investigation of the matter by the director or by a person or persons appointed by the director as investigators to investigate the matter.

(2) Reasonable particulars of the matter to be investigated under subsection (1) must be set out in the order referred to in that subsection.

(3) If an investigator is appointed by the director, the investigator must make a full investigation of the matter and report the results of his or her investigation to the director.

(4) For purposes of an investigation under this section, the director or an investigator may inquire into and examine the business and affairs of the person in respect of whom the investigation is being carried out, and may,

(a) on production of his or her appointment, enter at any reasonable time the business premises of that person and examine any record and thing that the director or investigator believes is relevant to a contravention of this Act and, subject to section 66 (2), retain anything that may be required for evidence, and

(b) inquire into negotiations, transactions, loans, borrowings made by, or on behalf of, or in relation to, that person, and into property, assets or things owned, acquired or alienated in whole or in part by that person, or any other person acting on that person's behalf, that are relevant to the subject matter of the investigation.

(5) For the purpose of the inquiry under subsection (4), the person making the investigation has the power, privileges and protection of a commissioner under sections 12, 15 and 16 of the Inquiry Act.

(6) A person must not obstruct or impede the director or an investigator or withhold from the director or an investigator, or conceal or destroy, any record or thing relevant to the subject matter of the investigation.

(7) If, for the purposes of this Act, a trust account is required to be maintained by a seller, the director may, at any reasonable time, inspect the business records of the seller and audit the seller's accounts to ensure there has been compliance with this Act and the regulations with respect to trust accounts.

Authorization to search

65 (1) If a justice is satisfied, on an application by the director or an investigator made without notice to any other person, that

(a) the investigation has been authorized under section 64 and that the director or the investigator is authorized or appointed to make it, and

(b) there is reasonable ground for believing there is, in a building, dwelling house, receptacle or place, a record or thing relating to the person whose affairs are being investigated and to the subject matter of the investigation,

the justice may, whether or not an inspection has been made or attempted under section 64 (4) (a), make an order authorizing an investigator, together with those peace officers that the investigator calls upon to assist the investigator, to enter, if necessary by force, and search the building, dwelling house, receptacle or place described in the order for the record or thing, and to examine them.

(2) Every entry and search under subsection (1) must be made between 8 a.m. and 8 p.m., unless a justice otherwise orders.

Removal of records

66 (1) An investigator may, on giving or leaving a receipt for it, remove a record or thing examined under section 64 (4) (a) or 65 (1) to examine or make copies or tests of it.

(2) A record or thing removed under subsection (1) must be promptly returned to the person whose affairs are being investigated, unless required for evidence in a proceeding under this Act.

(3) If a record or thing removed under subsection (1) is required for evidence in a proceeding under this Act, the director must, on request and without charge, furnish to the person whose affairs are being investigated copies of the record retained for that purpose.

(4) A copy made under subsection (1) and certified to be a true copy by an investigator is admissible in evidence in a proceeding as proof of the original record and of its contents, without proof of the signature or appointment of the person certifying it.

(5) The minister or director may appoint an expert to examine or test a record or thing removed under subsection (1).

Report to minister

67 If, on the report of an investigation made under section 64 (1), it appears to the director that a person may have contravened this Act or the regulations, the director must

(a) send a full and complete report of the investigation, including the report made to the director, to the minister, and

(b) take whatever steps or proceedings are required or permitted by this Act or the regulations.

Investigation by order of minister

68 (1) The minister may, by order, appoint one or more persons to make an inquiry into any matter to which this Act applies as may be specified in the order.

(2) A person appointed under subsection (1) must report the results of his or her inquiry to the minister.

(3) For the purposes of the inquiry, the person making it has the power, privileges and protection of a commissioner under sections 12, 15 and 16 of the Inquiry Act.

Suspension or revocation of registration or licence

69 If a person who is registered or licensed under an Act to carry on a profession, occupation, business, trade or any other activity contravenes this Act or the regulations in the course of carrying on that profession, occupation, business, trade or other activity, the contravention may be a ground for suspension, revocation or cancellation of the registration or licence.

Restraining orders

70 (1) If a person has not complied or is not complying with this Act, the regulations or an order under this Act, then despite

(a) any other right or remedy available to the director in respect of the noncompliance, or

(b) the imposition of a penalty on that person in respect of the noncompliance,

the Supreme Court, on the application of the director, may make an order directing that person to comply with this Act, the regulations or an order under this Act, or may make any other order as it thinks fit.

(2) An appeal lies to the Court of Appeal, with leave of a justice of that court, from an order made under subsection (1).

Order to refrain from dealing with assets

71 (1) If the director has ordered an investigation of a person under this Act and the director believes that it is necessary to protect individuals dealing with that person, the director may, in writing or by telegram,

(a) order

(i) a person having on deposit, or under his or her control or for safekeeping, assets, trust funds or other property of the person being investigated, or

(ii) a debtor of the person being investigated,

to hold the assets, trust funds or other property of, or money owing to, that person, in trust for a receiver, liquidator or trustee to be appointed under this Act or any other Act or law, or

(b) order the person being investigated to refrain from withdrawing assets, trust funds or other property that are on deposit with, or under the control of, or in the safekeeping of another person, unless the director consents in writing to the release of all or part of them.

(2) The director may revoke in writing an order made under this section.

(3) Instead of making an order under this section, the director may accept from the person being investigated

(a) a personal bond, together with collateral security,

(b) a bond of a guarantee company approved by the director, or

(c) a bond of a guarantor, other than a guarantee company, together with collateral security,

in the form and with the terms that the director determines under the Bonding Act.

(4) A person who receives an order from the director under this section may,

(a) if in doubt as to the application of the order to assets, trust funds or other property on deposit with the person or under his or her control or in his or her safekeeping, or

(b) if a person not named in the order claims a right, title or interest in the assets, trust funds or other property,

pay or deliver those assets, trust funds or other property into a court and, on doing that, is discharged from liability to the extent of that payment or delivery.

Confidentiality

72 The director must not publicly disclose the name of a person investigated under this Act unless the person's name is a matter of public record in respect of the matter investigated, or unless that person consents to the disclosure.

Matters confidential

73 (1) Every person employed in the administration of this Act, including a person making an inquiry, inspection, examination, test or investigation under sections 64 to 66, must preserve secrecy in respect of all matters that come to the person's knowledge in the course of his or her duties, employment, inquiry, inspection, examination, test or investigation, and must not communicate those matters to any other person except

(a) as may be required or permitted in connection with the administration of this Act or the regulations or any proceedings under this Act or the regulations,

(b) to his or her counsel or to the court in any proceeding under this Act or the regulations,

(c) to any department or agency of any government engaged in the administration of statutes, measures or rulings similar to this Act, or an Act for the general protection of consumers,

(d) with the consent of the person to whom the information relates, or

(e) in connection with an investigation under sections 64 to 66.

(2) Except in respect of a proceeding under this Act or the regulations, a person to whom subsection (1) applies must not, in any civil proceeding, be compelled to give evidence respecting information obtained by the person in the course of his or her duties, employment, inquiry, inspection, examination, test or investigation.

Protection of officials

74 (1) The minister, the director, the registrar, their agents, officers, employees, representatives and persons acting on their behalf are not liable in their personal or official capacities for any loss or damage suffered by a person by reason of anything done or omitted to be done in good faith in the exercise or purported exercise of any powers given by or under this Act or the regulations.

(2) Despite any other law, subsection (1) does not relieve the government from any liability it may have at law for loss or damage suffered by any person in respect of an act or omission of a person referred to in that subsection.

Offence and penalty

75 (1) A person who

(a) contravenes section 10 (1), 13 to 15, 18 (3), 20 (1), 21.2 (1) (b), 21.3 (1) (b), 21.4 (2), 21.5 (1) or (3), [for sections 21.2 to 21.5, supplement], 24, 29, 31 (2), 33, 34, 35, 36, 37, 41, 42, 45, 48 (2) or (3), 49 (2), 51 (2), 52 (3), (4) or (6), 56 (1) or (2) or 64 (6) or an order of the director or minister under this Act or the regulations,

(b) refuses or fails to furnish information as required under this Act or the regulations,

(c) furnishes false information to a person acting under this Act or the regulations,

(d) fails to comply with an order of a court under this Act or the regulations, or

(e) fails to provide the notice required by regulation,

commits an offence and is liable to a fine not exceeding $10 000 or to imprisonment for a term of not more than one year, or to both.

(2) If a corporation is convicted of an offence under subsection (1), the maximum penalty that may be imposed on the corporation is $100 000.

(3) If a corporation is guilty of an offence under subsection (1),

(a) every director or officer, and

(b) every other person

who authorized, permitted or acquiesced in the offence is guilty of the offence personally and is liable to the penalties set out in subsection (1), but this does not affect the prosecution of the corporation for the same offence.

(4) A proceeding under this section must not be instituted more than 2 years after the date on which the subject matter of the proceeding arose.

Defences

76 (1) In proceedings for an offence under section 75 it is, subject to subsection (2), a defence for the person charged to prove that

(a) the commission of the offence was due to a mistake, or to reliance on information supplied to the person charged, or to the act or default of another person, or to an accident or some other cause beyond the control of the person charged, and

(b) the person charged took all reasonable precautions and exercised all due diligence to avoid the commission of the offence by the person charged or any person under his or her control.

(2) If the defence provided by subsection (1) involves the allegation that the commission of the offence was due to

(a) the act or default of another person, or

(b) reliance on information supplied by another person,

the person charged is not entitled, without leave of the court, to rely on that defence unless he or she served on the prosecutor, within a period ending 7 clear days before the trial, a notice in writing, giving information that was then in his or her possession identifying or assisting in the identification of that other person.

Power to make regulations

77 (1) The Lieutenant Governor in Council may make regulations as follows:

(a) requiring direct sellers and their employees to provide security under the Bonding Act;

(b) prescribing the form of executory contract and statement of the cost of borrowing and the size, type and colour of lettering used in any provision of them;

(c) requiring and governing the maintenance of trust accounts by sellers or any class of sellers, and prescribing the money that must be held in trust and the terms and conditions of the trust;

(d) prescribing the manner in which the cost of borrowing is to be disclosed and the manner in which the cost of borrowing stated as a percentage must be calculated, expressed and applied;

(e) prescribing the manner of determining the apportionment of the cost of borrowing for the purposes of section 44;

(f) prescribing information to be included in advertisements relating to the cost of borrowing in a credit transaction, and the form and manner of providing that information;

(g) exempting any class of transaction, buyer, seller, direct seller, lender or debtor from the application of this Act or the regulations or any provision of them;

(h) prescribing forms and providing for their use, and requiring the information in any form to be verified by statutory declaration;

(i) for the inclusion of credit

(i) extended on the security of a mortgage of real property, or

(ii) in respect of the sale of goods intended for resale,

or both, in the definition of "credit" to the extent prescribed;

(j) respecting the modification of the definitions of this Act and the application of the provisions of Part 3 in respect of the extension of credit on the security of land;

(k) prescribing any additional matter to be contained in an executory contract;

(l) prescribing types or classes of services for the purposes of paragraph (a) of the definition of "contract for future services";

(m) respecting any matter necessary or advisable to carry out effectively the intent and purpose of this Act;

(n) prescribing anything that by this Act is to be prescribed.

(2) The Lieutenant Governor in Council may make regulations as follows:

(a) providing that a person who commits an offence under the regulations is liable to the penalties provided in section 75;

(b) respecting the licensing of salespersons or classes of salespersons who sell on behalf of a direct seller;

(c) respecting the licensing of direct sellers or classes of direct sellers, including providing that a licence is not required for a direct sale of a class of goods or for a direct sale by a class of direct sellers;

(d) respecting application forms and licensing fees for direct sellers and classes of direct sellers and salespersons and classes of salespersons;

(e) respecting the term of a licence or class of licences;

(f) setting the amount of the purchase price referred to in section 13;

(g) setting the amount of the purchase price referred to in section 22;

(h) respecting wording that a direct seller must include, or not include, in a written direct sales contract or class of contracts, and respecting the form of the wording and the manner of its inclusion;

(i) respecting wording that is conclusively deemed to be in a direct seller's written direct sales contract or class of contracts;

(j) requiring direct sellers or classes of direct sellers to obtain the registrar's approval of the form and content of

(i) the direct seller's sales contract or class of contracts, or

(ii) any other document or class of documents intended to be used by a direct seller in the course of making a sale to a purchaser

before the contract or document is used;

(k) respecting information that a licensee is required to include in a salesperson's identification card;

(l) prescribing a service or class of services or a seller or class of sellers to which section 55 does not apply;

(m) prescribing an activity that is a service for the purposes of the definition of "service" in section 55 (1).

(3) A regulation under subsection (1) (l) expires with the prorogation of an adjourned session or of the next ensuing session of the Legislative Assembly, as the case may be.

(4) A regulation made under subsection (1) (g) may provide that the exemption does not apply to section 55, and the provision that the exemption does not apply to section 55 may be made retroactive to January 26, 1995.

(5) A regulation made under subsection (2) (l) or (m) may be made retroactive to January 26, 1995.