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CONSUMER LAW

Sector-Specific Consumer Law
(01 July 2013)

Personal Development Services
(Gym Memberships and Similar)

  1. Overview
  2. Content and Disclosure Requirements
    (a) Overview
    (b) Disclosure Where Facilities Currently Available, or Where Unavailable and No Alternate Facilities Provided For
    . Overview
    . Disclosure Requirements
    (c) Disclosure Where Facilities Not Yet Available, but Where Alternative Facilities Provided For
    . Overview
    . Disclosure Requirements
  3. Early Consumer Cancellation
  4. Term, Renewal, Extension and Supplier Modification of Personal Development Services Consumer Agreements
    (a) Overview
    (b) One Year Maximum Term
    (c) Renewals, Extensions and Supplier Modifications
    (d) Termination by Consumer
    (e) Exception for Monthly Renewals
  5. Extra (Initiation) Fees Where Year-Long Term
  6. Instalment Payment Options Mandatory
  7. Payments in Trust Where Services or Facilities Unavailable
    (a) Trust Payments Where Services Unavailable
    (b) Where Facility Late Trust Payments Refundable
    (c) Trust Refund on Consumer Cancellation
  8. Remedies
    (a) Overview
    (b) General CPA Civil Remedies
    . Overview
    . Rescission
    . Restitution
    . Right of Civil Action
    . Special Credit Card Remedies
    . Common Law Right of Action Preserved
    (c) Sector-Specific Remedies
    . Overview
    . Where Consumer Agreement Non-Compliant No Monies Payable
    . Trust Corporation Must Pay Supplier Debts re Personal
    Development Services
    (d) Unfair Practices
  9. Exemptions

      ________________________________________

      CAUTION

      This chapter involves law from the Ontario Consumer Protection Act (CPA). Anyone considering using the CPA should first carefully sort out which of its rules apply to their situation. DO NOT ASSUME THAT BECAUSE YOU FOUND THE CHAPTER DEALING WITH THE RELEVANT ECONOMIC SECTOR THAT YOU HAVE ALL THE RIGHT RULES. The steps to do this properly are explained at this link:

      Identifying Which CPA Rules Apply to Your Situation


      1. Overview

      The Consumer Protection Act (CPA) regulates prepaid consumer agreements (both before and after execution) respecting a range of exercise, sport and other body-related services, IF the total cost exceeds $50 (excluding costs of borrowing) [CPA 29(1), Reg 27]. These services are called "personal development services".

      "Personal development services" include services, instruction, facilities for the same and related incidental goods for the following [CPA 20]:

      • health, fitness, diet or matters of a similar nature,

      • modelling and talent, including photo shoots relating to modelling and talent, or matters of a similar nature, and

      • martial arts, sports, dance or similar activities.

      The CPA contains provisions for other activities to be included in this list by Regulation, but to date this authority has not been used. Perhaps the most common "personal development service" is a gym membership.


      2. Content and Disclosure Requirements

      (a) Overview

      CPA rules set the content and disclosure requirements for personal development service consumer agreements. The CPA divides these into two types, the first where there are no alternative facilities contractually available, and the second where there are. This CPA distinction is confusing and counter-intuitive, as the natural distinction is betweeen facilities already available and those not yet ready, but follow along as fits your situation and it should become clear.

      Consumer agreements for personal development services must be in writing, must be signed by both the consumer and the supplier, and must be delivered to the consumer [CPA 30(1)]. As well, such consumer agreements must meet the disclosure requirements listed below in (b) and (c), as applicable [CPA 30(1); CP Reg 28(2), 29(2)].

      General requirements for disclosure are explained at this link:

      General Disclosure Requirements

      Where the consumer agreement fails to meet the requirements set out in this section ["Content and Disclosure Requirements for Personal Development Service Consumer Agreements"] then the supplier is prohibited from either requiring or accepting payment for the personal development services [CPA 30(2)]. That remedy, along with other than might apply for disclosure non-compliance, are discussed further in s.8 below ["Remedies"].

      (b) Disclosure Where Facilities Currently Available, or Where Unavailable and No Alternate Facilities Provided For

      . Overview

      The below disclosure and signature requirements apply to a consumer agreement for personal development services Where, at the time of it's commencement, either: 1. the required facilities are available, or 2. they are unavailable AND lacking any contractually-provided alternative temporary facilities [CP Reg 28(1)]. As noted above, placing these two different situations under the same set of rules seems counter-intuitive, but follow along as fits your situation and you should get to the right
      rules.

      . Disclosure Requirements

      In these situations, the consumer agreement must disclose the following [CP Reg 28(2)]:

      • Consumer Name

      • Supplier Name

        If a person, partnership or corporation then their correct name, and as well any business names used.

      • Contact Information of Supplier

        The telephone number and business address of the supplier, and information respecting other ways, if any, in which the supplier can be contacted by the consumer, such as the fax number and e-mail address of the supplier.

      • Names of Supplier Agents

        The names (if any) of persons who solicited and/or negotiated, and the name of the person who concluded, the consumer agreement with the consumer.

      • The Facility Address

      • Services Listed

        An itemized list of the personal development services that the supplier is to make available to the consumer, that fairly and accurately describes each service.

      • Dates Services Available

        For each personal development service contracted for, the date on or as of which it will be available to the consumer.

      • Discount Where Service Not Available When Promised

        The reduction, if any, in the price payable by the consumer if a personal development service is not available on the date specified above.

      • Trust Payment Where Service Not Available at Payment Date

        Where a personal development service is not available on the date that the consumer is scheduled to make a payment for it, the consumer agreement shall contain a statment that the consumer shall make the payment to a trust corporation, which shall be identified by name and address.

        Note that this trust payment scheme operates anytime that a payment is to be made when a service is not yet available, EVEN IF the date that the service was promised has not passed yet (ie. even if it is not late yet).

      • Trade-In Details

        If the agreement includes a trade-in arrangement, a description of the trade-in arrangement and the amount of the trade-in allowance.

      • Payment Amounts and Terms

        The total amount payable by the consumer and the terms and methods of payment.

      • Currency of Transaction

        The currency in which amounts are expressed, if not Canadian.

      • Date of Execution of Consumer Agreement

      • Dates of Commencenent and Expiry of Consumer Agreement

      • Renewal or Extension Details

        With respect to renewal or extension (if provided for in the consumer agreement), the following:

        - requirements for renewal or extension

        - supplier notice requirments

        The manner in which the supplier shall deliver a notice about renewal and extension to the consumer. The consumer agreement may either require or permit the supplier to use one or more of: mail or personal delivery, email, fax or some other manner to an address, number or other communication means as specified by the consumer in the agreement.

        - notice of non-renewal of non-extension

        That the agreement shall be deemed not to be renewed or extended if the consumer notifies the supplier, before the time for renewal or extension, that the consumer does not want to renew or extend.

      • Consumer Information Statement [CP Reg 28(3,4)]

        The following statement:

        - "which shall be in at least 10 point type, except for the heading which shall be in at least 12 point bold type', and

        - "which shall appear on the first page of the agreement, unless there is a notice on the first page of the agreement in at least 12 point bold type indicating where in the agreement the statement appears":

        -------------------------------------------------------------
        Your Rights under the Consumer Protection Act, 2002

        You may cancel this agreement at any time during the period that ends ten (10) days after the later of the day you receive a written copy of the agreement and the day all the services are available. You do not need to give the supplier a reason for cancelling during this 10-day period.

        In addition, there are grounds that allow you to cancel this agreement. You may also have other rights, duties and remedies at law. For more information, you may contact the Ministry of Consumer and Business Services.

        To cancel this agreement, you must give notice of cancellation to the supplier, at the address set out in the agreement, by any means that allows you to prove the date on which you gave notice. If no address is set out in the agreement, use any address of the supplier that is on record with the Government of Ontario or the Government of Canada or is known by you.

        If you cancel this agreement, the supplier has fifteen (15) days to refund any payment you have made and return to you all goods delivered under a trade-in arrangement (or refund an amount equal to the trade-in allowance).
        -------------------------------------------------------------

      • Additional Consumer Information Statement if Consumer Entitlement to Goods

        -------------------------------------------------------------
        If the supplier requests in writing repossession of any goods that came into your possession under the agreement, you must return the goods to the supplier's address or allow one of the following persons to repossess the goods at your address:

        The supplier. A person designated in writing by the supplier.

        If you cancel this agreement, you must take reasonable care of any goods that came into your possession under the agreement until one of the following happens:

        The supplier repossesses the goods. The supplier has been given a reasonable opportunity to repossess the goods and twenty-one (21) days have passed since the agreement was cancelled. You return the goods.

        The supplier directs you in writing to destroy the goods and you do so in accordance with the supplier?s instructions.
        -------------------------------------------------------------

      (c) Disclosure Where Facilities Not Yet Available, but Where Alternative Facilities Provided For

      . Overview

      The below disclosure and signature requirements apply to a consumer agreement for personal development services Where, at the time of it's commencement, the required facilities are not yet available, and where the consumer agreement provides for alternative temporary facilities [CP Reg 29(1)].

      . Disclosure Requirements

      The consumer agreement shall disclose the following [CP Reg 29(2)]:

      • Consumer Name

      • Supplier Name

        If a person, partnership or corporation their correct name, and as well any business names used.

      • Contact Information of Supplier

        The telephone number and business address of the supplier, and information respecting other ways, if any, in which the supplier can be contacted by the consumer, such as the fax number and e-mail address of the supplier.

      • Names of Supplier Agents

        The names (if any) of persons who solicited and/or negotiated, and the name of the person who concluded, the consumer agreement with the consumer.

      • The Facility and the Alternate Facility Addresses

      • Alternate Services and Monthly Prices Listed

        An itemized list of the personal development services that the supplier is to make available to the consumer at the alternate facility, that fairly and accurately describes each service and that sets out the price payable for the services on a monthly basis.

      • Primary Services Listed

        An itemized list of the personal development services that the supplier is to make available to the consumer at the primary facility, that fairly and accurately describes each service.

      • Dates Services Available both Primary and Alternate

        For each personal development service to be made available at both the primary and the alternate facility, the dates on which it will be available to the consumer.

      • Discount Where Service Not Available When Promised

        The reduction, if any, in the price payable by the consumer if a personal development service is not available on the date specified above.

      • Trade-In Details

        If the agreement includes a trade-in arrangement, a description of the trade-in arrangement and the amount of the trade-in allowance.

      • Payment Amounts and Terms

        The total amount payable by the consumer and the terms and methods of payment.

      • Currency of Transaction

        The currency in which amounts are expressed, if not Canadian.

      • Date of Execution of Consumer Agreement

      • Dates of Commencenent and Expiry of Consumer Agreement

      • Renewal or Extension Details

        With respect to renewal or extension (if provided for in the consumer agreement), the following:

        - requirements for renewal or extension

        - supplier notice requirments

        The manner in which the supplier shall deliver a notice about renewal and extension to the consumer. The consumer agreement may either require or permit the supplier to use one or more of: mail or personal delivery, email, fax or some other manner to an address, number or other communication means as specified by the consumer in the agreement.

        - notice of non-renewal or non-extension

        That the agreement shall be deemed not to be renewed or extended if the consumer notifies the supplier, before the time for renewal or extension, that the consumer does not want to renew or extend.

      • Consumer Information Statement [CP Reg 28(3,4)]

        The following statement:

        - "which shall be in at least 10 point type, except for the heading which shall be in at least 12 point bold type', and

        - "which shall appear on the first page of the agreement, unless there is a notice on the first page of the agreement in at least 12 point bold type indicating where in the agreement the statement appears":

        -------------------------------------------------------------
        Your Rights under the Consumer Protection Act, 2002

        You may cancel this agreement at any time during the period that ends ten (10) days after the later of the day you receive a written copy of the agreement and the day all the services are available. You do not need to give the supplier a reason for cancelling during this 10-day period.

        In addition, there are grounds that allow you to cancel this agreement. You may also have other rights, duties and remedies at law. For more information, you may contact the Ministry of Consumer and Business Services.

        To cancel this agreement, you must give notice of cancellation to the supplier, at the address set out in the agreement, by any means that allows you to prove the date on which you gave notice. If no address is set out in the agreement, use any address of the supplier that is on record with the Government of Ontario or the Government of Canada or is known by you.

        If you cancel this agreement, the supplier has fifteen (15) days to refund any payment you have made and return to you all goods delivered under a trade-in arrangement (or refund an amount equal to the trade-in allowance).
        -------------------------------------------------------------

      • Additional Consumer Information Statement if Consumer Entitlement to Goods

        -------------------------------------------------------------
        If the supplier requests in writing repossession of any goods that came into your possession under the agreement, you must return the goods to the supplier?s address or allow one of the following persons to repossess the goods at your address:

        The supplier. A person designated in writing by the supplier.

        If you cancel this agreement, you must take reasonable care of any goods that came into your possession under the agreement until one of the following happens:

        The supplier repossesses the goods. The supplier has been given a reasonable opportunity to repossess the goods and twenty-one (21) days have passed since the agreement was cancelled. You return the goods.

        The supplier directs you in writing to destroy the goods and you do so in accordance with the supplier?s instructions.
        -------------------------------------------------------------


      3. Early Consumer Cancellation

      On the occurence of the date when both the consumer has received a written copy of the consumer agreement AND the facilities are fully ready for use, the consumer has the right (without any reason) to cancel the consumer agreement within 10 days on notice to the supplier [CPA 35(1)].

      Further, where the consumer has not yet received a copy of the consumer agreement that complies with the content and disclosure requirements set out in s.2 above, they have the right to cancel the consumer agreement within one year from it's execution on notice to the supplier [CPA 35(2)].

      Consumer-issued notice procedures are discussed in Part C, Ch.7, s.7: "CPA Civil Remedies: Consumer-Issued Notice Procedures".


      4. Term, Renewal, Extension and Supplier Modification of Personal Development Services Consumer Agreements

      (a) Overview

      The CPA attempts to limit excessive term lengths for contracts, an area which had been problematic before when suppliers tried to lock consumers into unrealistically long-term contracts with excessive penalties for termination.

      Similarly, the CPA requires suppliers to make clear at the time of renewal or extension any modifications made to the consumer agreement, and for that reason both deems renewal or extension to constitute a new consumer agreement, and requires disclosure of such changes (if any) and of the consumer's right to terminate the arrangement on notice. However, suppliers are relieved from these duties where after expiry of a term contract the renewal is monthly only, with a right to terminate on a
      month's notice.

      (b) One Year Maximum Term

      Accomodating consumer agreements where services are not immediately available, the CPA provides that the maximum term length may not exceed one year "after the day that all the services are made available to the consumer" [CPA 31(1)].

      (c) Renewals, Extensions and Supplier Modifications

      Any provision for renewal or extension within the consumer agreement shall be deemed to create a separate agreement for each renewal or extension, and the term of such renewal or extension may not exceed one year [CPA 31(2)].

      Such renewal or extension is only valid if at least 30 days (but not more than 90 days) before the term expires, the supplier delivers to the consumer "a copy of the agreement that clearly notes all changes that the supplier has made to the agreement" (if any) AND a written notice specifying [CPA 31(3), CP Reg 30(1,2)]:

      • the date of the proposed renewal or extension of the agreement,

      • that under the Consumer Protection Act, 2002, the supplier is required to deliver the notice to the consumer, in the manner specified in the agreement, at least 30 days but not more than 90 days before the agreement expires,

      • the address of the premises from which the supplier conducts business and information respecting other ways, if any, in which the supplier can be contacted by the consumer, such as the fax number and e-mail address of the supplier, and

      • that the agreement will not be renewed or extended if, before the date set out above, the consumer notifies the supplier, at the address set out above, or by contacting the supplier in some other way as set out immediately above that the consumer does not want to renew or extend the agreement.

      The consumer agreement copy and notice set out above shall be delivered to the consumer in the manner set out in the consumer agreement disclosure set out in ss.2(b) and (c) above, which may either require or permit the supplier to use one or more of: mail or personal delivery, email, fax or some other manner to an address, number or other communication means as specified by the consumer in the agreement. Where registered mail is used it shall be deemed to be delivered the third day after mailing [CP Reg 30(3)].

      Replacing an existing consumer agreement other than as set out above respecting renewals and extensions is prohibited "unless the new agreement is for personal development services that are distinctly different from the services provided under the existing agreement" [CPA 32]. For these purposes, "a different term or a different commencement date does not constitute a distinct difference". Presumably the CPA goal here is to prevent a supplier circumventing the protections on renewal and extension by simply embodying what they want in an entirely new contract.

      (d) Termination by Consumer

      The consumer may, before the date set for renewal or extension in the notice set out in (c) above, advise the supplier that they do not wish to renew or extend the consumer agreement [CPA 31(4)].

      Consumer-issued notice procedures are discussed in Part C, Ch.7, s.7: "CPA Civil Remedies: Consumer-Issued Notice Procedures".

      (e) Exception for Monthly Renewals

      Suppliers are freed from the duties set out in (c) above if the consumer agreement provides for monthly renewal with a consumer right to terminate on one month's notice (or less) [CPA 31(5)].


      5. Extra (Initiation) Fees Where Year-Long Term

      'Initiation fees', despite the term, are ANY fees charged in addition to an annual membership fee [CPA s.1] for a year term consumer agreement. While they are typically charged by a supplier at the commencement of a consumer agreement, that is not an aspect of their legal definition.

      Initiation fees may only be charged once against any consumer, and may not be greater in amount than twice the annual membership fee [CPA 33].

      To be clear, the supplier's right to charge an initiation fee does not recur on renewal, extension or even complete replacement of a consumer agreement. Indeed, it seems that a supplier is prohibited from charging a past customer a new initiation fee even on return after extended absence (ie. extended period where no consumer agreement existed between the parties) [CPA s.33].

      It seems that by definition, consumer agreements of terms less than one year in length (they cannot be more), are not subject to these rules, because - lacking an annual membership fee - they cannot impose any charge "in addition" to an annual membership fee (this is the definition of an 'initiation fee').


      6. Instalment Payment Options Mandatory

      Suppliers must offer at least one payment plan that provide for equal monthly payments of initiation fees (if any) and membership fees over the term of the consumer agreement. The total amount payable under such a payment plan may not exceed 25% of the one-time payment amount of the charges [CPA 34].


      7. Payments in Trust Where Services or Facilities Unavailable

      (a) Trust Payments Where Services Unavailable

      As was noted in s.2(b) above, whenever services are unavailable - even if they are not 'late' yet (as is commonly the case where memberships are sold but facilities are not ready yet) - monies due to be paid by the consumer for such services must be paid to a trust corporation registered under the Loan and Trust Corporation (typically a 'trust company') [CPA 36(1)]. Upon receiving any payment from a consumer, such trustee shall give the consumer a written receipt receipt of the payment and of the fact that the payment will be dealt with in accordance with CPA law respecting personal development services (as covered in this chapter).

      Only when the services become available to the consumer may the trust corporation release funds to the supplier [CPA 36(7)].

      This trust payment requirement is excepted where the unavailable service is use of a primary facility and the consumer agreement provides for an alternative facility to be used pending availability of the primary facility [CPA 36(2)]. The law does not to reinstate the trust payment requirement when the alternative facility is also unavailable, so consumers will have to deal with that as a breach of contract situation [see s.8: "Remedies", below].

      (b) Where Facility Late Trust Payments Refundable

      Where trust payments have been made and the availability of a facility (either primary or alternate) is late (ie. past the date contracted for) then the trustee shall refund to the consumer all monies paid to it in respect of the facility, except where the consumer consents that it keep them [CPA 36(3)]. Such consent expires every 90 days but may be renewed [CPA 36(4)].

      Where the trust corporation holds money sufficient to do so, it shall also pay the supplier's debts as they relate to personal development service consumer agreements [CPA 36(5)].

      (c) Trust Refund on Consumer Cancellation

      Where trust payments have been made and the consumer properly terminates a consumer agreement for personal development services, the trustee shall refund to the consumer funds held respecting that consumer agreement [CPA 36(8)]. Any notice given by the consumer to the trust corporation shall be deemed to be notice to the supplier [CPA 36(5)].

      Consumer agreements for personal development services may be cancelled in several ways:

      • "Early Consumer Cancellation of Consumer Agreement" (see s.3 above);

      • 'Termination by Consumer' (on receiving notice of renewal or extension) [see s.4(d) above]; and

      • "General Rescission and Cancellation Remedies" on supplier non-compliance with the CPA (see s.8 below).

      All of the above terminations require that the consumer deliver proper Notice to the supplier. Consumer-issued notice procedures are discussed in Part C, Ch.7, s.7: "CPA Civil Remedies: Consumer-Issued Notice Procedures".

      Where the trust corporation holds money sufficient to do so, it shall also pay the supplier's debts as they relate to personal development service consumer agreements [CPA 36(5)].


      8. Remedies

      (a) Overview

      In addition to the common law law remedies of tort, contract and restitution [discussed in Part A], CPA civil court remedies fall into three categories: 'general', 'sector-specific' (ie. those specific to the "personal development services" sector), and 'unfair practices'.

      Non-compliance with any of the general consumer rights [see Part C, Ch.5: "General Consumer Rights"] or with most of the sector-specific rights set out in this chapter can usually be addressed using the general remedies explained in Part C, Ch.7 ["CPA General Civil Remedies"]. These are summarized in (b) below.

      However some sector-specific rights have their own remedial procedures [discussed in (c) below].

      Any 'unfair practice' provisions (which deal primarily with 'false, misleading or deceptive' and unconscionable representations) which may have specific relevance to personal development services are set out in (d) below.

      As for non-civil court remedies, the CPA provides for a range of administrative Orders [see Part C, Ch.8: "Administrative Enforcement"] and regulatory prosecutions [see Part C, Ch.9: Prosecutions], neither of which are aggressively pursued by the Ministry of Consumer Services or the Director of the Consumer Protection Branch.

      (b) General CPA Civil Remedies

      . Overview

      This is a summary of the general civil remedies available to consumers under the CPA. The full version of this discussion is at Part C, Ch.7: "General Civil Remedies".

      These remedial provisions apply to violations of general CPA consumer rights such as illegal charges and prohibitions against negative-option contract formation [see Part C, Ch.5: "General Consumer Rights"] - and as well to non-compliance with the sector-specific rights discussed in this chapter, particularly disclosure.

      . Rescission

      Typically, supplier non-compliance with any CPA right allows the consumer to cancel the consumer agreement at their election, on the delivery of a Notice of Cancellation to the supplier.

      Consumer-issued notice procedures are discussed in Part C, Ch.7, s.7: "CPA Civil Remedies: Consumer-Issued Notice Procedures".

      However the type of cancellation (properly: 'rescission') used in the CPA does not just end the consumer's duties under the consumer agreement from the date of cancellation and then forward into the future. Rather the cancellation or rescission is 'ab initio' ('from the beginning' of the consumer agreement).

      . Restitution

      This form of 'ab initio' cancellation necessitates that both parties - consumer and supplier alike - engage in post-cancellation restitution to each other respecting all that has passed between them since the consumer agreement commenced. Typically this involves the return of goods by the consumer and the return of monies paid by the supplier. In the case of past services performed or perishable goods typically a value compensation provision is imposed on the consumer.

      Consumer restitution duties are sometimes complex, so readers should be sure to review carefully both sections 5 and 6 in Part C, Ch.7 "General Civil Remedies".

      From the point that Notice of Cancellation is delivered, both parties are under specific timelines to complete their specific restitution duties.

      . Right of Civil Action

      Failure of a party to fulfil their restitution duties in the time required then automatically triggers a right of civil action in the aggrieved parties (the original Notice of Cancellation doubling as a de facto 'demand' notice). Practically most such claims will be suited to the Small Claims Court with its newly-raised $25,000 monetary jurisdiction, and parallel jurisdiction over the return of chattel property to the same dollar value.

      Civil action is also a possibility in some cases where the consumer has not rescinded the consumer agreement fully, for example with the case of illegal charges. In that case there is still a 'Notice' requirement, but after the failure of the supplier to refund the monies the consumer can sue.

      . Special Credit Card Remedies

      Further, where consumer payments which are now subject to restitution were originally made by credit card, the consumer has a 'back up' right to demand, and then proceed in court, against the credit card issuer should the supplier remain in default of their restitution duties.

      . Common Law Right of Action Preserved

      The CPA rights of action do not prohibit use of common law remedies in tort, contract and restitution and claims may (and when called for, should) be advanced both under the CPA and common law causes of action.

      (c) Sector-Specific Remedies

      . Overview

      The CPA rules discussed in this chapter add the following sector-specific remedies.

      . Where Consumer Agreement Non-Compliant No Monies Payable

      Where the consumer agreement fails to meet the requirements set out in s.2 above ["Content and Disclosure Requirements for Personal Development Service Consumer Agreements"] then the supplier is prohibited from either requiring or accepting payment for the personal development services [CPA 30(2)].

      . Trust Corporation Must Pay Supplier Debts re Personal Development Services

      Where the trust corporation holds money sufficient to do so, it shall pay the supplier's debts as they relate to personal development service consumer agreements [CPA 36(5)].

      (d) Unfair Practices

      'Unfair practices' are discussed at length in Part C, Ch.6. They primarily address 'false, misleading or deceptive' and unconscionable representations.

      Specific 'unfair practices' which may relate to the personal development services section include:

      • Deceptive or Negligent Representation Re Availability of Goods or Services

        "A representation that the goods or services or any part of them are available or can be delivered or performed when the person making the representation knows or ought to know they are not available or cannot be delivered or performed'"

        This addresses situations where people try to sell goods or services that are not available in order to get a sale now, and then come up with delaying excuses later. In light of the next-following example, this one must refer to the COMPLETE unavailability (that even waiting won't fix) of the goods or services.

      • False or Misleading Representation Re Timing of Availability

        "A representation that the goods or services or any part of them will be available or can be delivered or performed by a specified time when the person making the representation knows or ought to know they will not be available or cannot be delivered or performed by the specified time."

        Like the above example, this one requires either deception ('knows'), or 'negligence' (ie. 'ought to know'), to be satisfied. A mistaken representation made both innocently and without negligent would not invoke this example.

      • False or Misleading Representation Re Material Facts

        "A representation using exaggeration, innuendo or ambiguity as to a material fact or failing to state a material fact if such use or failure deceives or tends to deceive."

        A 'material fact' is one which is pivotal to your decision to make a purchase. For instance, if you require an electrical appliance compatible with a particular foreign country's electrical system, but you get one only compatible with North American systems - that issue is 'material' to your purchase decision. The item is simply useless for your purpose, and you would not have purchased it had you known.


      9. Exemptions

      While still technically falling within the definition of "personal development services", the following are exempt from the application of the provisions discussed in this chapter [CPA 29(2)]:

      • Non-Profits and Co-ops

        Non-profit corporations, co-operative corporations - and as well similarly-focussed unincorporated entities or individuals.

      • Charitable, Municipal or Ontario Funded or Operated

        A supplier funded or run by a charitable or municipal organization or by the Province of Ontario or any of its agencies.

      • Private Clubs

        Private clubs primarily owned by their members.

      • Golf Clubs

      • Incidental Services

        Suppliers incidentally as a part of other primary goods or services. An examples might be services which are part of a larger overall therapeutic programs such as drug or alcohol rehabilitation.

      • Payday Loans [CP Reg 9(3)]

        I can't imagine a "personal service agreement" could also fall under the definition of a "payday loan", but they are listed as exempt from the provisions discussed in this chapter.

        I plan to do a separate Legal Guide for payday loans, which will be included in Part B of this Isthatlegal.ca Consumer Law Guide. In the meantime, readers should consult the Payday Loans Act directly.

        Payday Loans Act


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