Canceling a Future Performance Agreement

Caselaw.Ninja, Riverview Group Publishing 2021 ©
Date Retrieved:	2024-11-27
CLNP Page ID:	2159
Page Categories:	[Section 23 - Consumer Protection Act]
Citation:	Canceling a Future Performance Agreement, CLNP 2159, <https://rvt.link/4i>, retrieved on 2024-11-27
Editor:	Sharvey
Last Updated:	2023/02/24

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Consumer Protection Act, 2002, S.O. 2002, c. 30, Sched. A

1 In this Act,

...

“consumer agreement” means an agreement between a supplier and a consumer in which,

(a) the supplier agrees to supply goods or services for payment, or

(b) the supplier agrees to provide rewards points to the consumer, on the supplier’s own behalf or on behalf of another supplier, when the consumer purchases goods or services or otherwise acts in a manner specified in the agreement; (“convention de consommation”)

...

“future performance agreement” means a consumer agreement in respect of which delivery, performance or payment in full is not made when the parties enter the agreement; (“convention à exécution différée”)

...

22 Every future performance agreement shall be in writing, shall be delivered to the consumer and shall be made in accordance with the prescribed requirements. 2002, c. 30, Sched. A, s. 22.

23 A consumer may cancel a future performance agreement within one year after the date of entering into the agreement if the consumer does not receive a copy of the agreement that meets the requirements required by section 22. 2002, c. 30, Sched. A, s. 23.

O. Reg. 17/05: GENERAL

24. For the purpose of section 22 of the Act, a future performance agreement that is not a gift card agreement to which sections 25.2 to 25.5 apply shall set out the following information:

1. The name of the consumer.

2. The name of the supplier and, if different, the name under which the supplier carries on business.

3. The telephone number of the supplier, 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.

4. A fair and accurate description of the goods and services to be supplied to the consumer, including the technical requirements, if any, related to the use of the goods or services.

5. An itemized list of the prices at which the goods and services are to be supplied to the consumer, including taxes and shipping charges.

6. A description of each additional charge that applies or may apply, such as customs duties or brokerage fees, and the amount of the charge if the supplier can reasonably determine it.

7. The total amount that the supplier knows is payable by the consumer under the agreement, including amounts that are required to be disclosed under paragraph 6, or, if the goods and services are to be supplied during an indefinite period, the amount and frequency of periodic payments.

8. The terms and methods of payment.

9. As applicable, the date or dates on which delivery, commencement of performance, ongoing performance and completion of performance are to occur.

10. For goods and services that are to be delivered,

i. the place to which they are to be delivered, and

ii. if the supplier holds out a specific manner of delivery and will charge the consumer for delivery, the manner in which the goods and services are to be delivered, including the name of the carrier, if any, and including the method of transportation to be used.

11. For services that are to be performed, the place where they are to be performed, the person for whom they are to be performed, the supplier’s method of performing them and, if the supplier holds out that a specific person other than the supplier will perform any of the services on the supplier’s behalf, the name of that person.

12. The rights, if any, that the supplier agrees the consumer will have in addition to the rights under the Act and the obligations, if any, by which the supplier agrees to be bound in addition to the obligations under the Act, in relation to cancellations, returns, exchanges and refunds.

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

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

15. Any other restrictions, limitations and conditions that are imposed by the supplier.

16. The date on which the agreement is entered into. O. Reg. 17/05, s. 24; O. Reg. 187/07, s. 2.

25. In the case of a future performance agreement to which sections 22 to 26 of the Act apply, the supplier shall provide the consumer with an express opportunity to accept or decline the agreement and to correct errors immediately before entering into it. O. Reg. 17/05, s. 25.

Sawh v Par-Tek Construction Services Inc., 2017 CanLII 53634 (ON SCSM)

[5] The plaintiffs Mala Sawh (“Mala”) and Daniel Sawh (“Daniel”) are husband and wife. They are the owners of the Property where the Addition was to take place.

[6] The defendant Par-Tek is an Ontario corporation that was to carry out on a design-build basis the Addition for the plaintiffs at the Property.

[7] The defendant Andrew Parker (“Andrew”) is the director and officer of Par-Tek.

[8] The plaintiffs and Andrew on behalf of Par-Tek entered into a written contract on February 18, 2015 (the “Contract”) for a design-built Addition to the Property by Par-Tek.

[9] The plaintiffs paid $15,000 to Par-Tek on February 18, 2015 pursuant to the Contract.

[10] The plaintiffs testified that their only source of income is from a restaurant that they own and operate and without it they would have been unable to pay for the Addition at their home Property.

[11] By email dated March 11, 2015 (“Termination Date”), the plaintiffs notified the defendants that they “will be unable to continue with the planning process of our addition/renovation” and wished to terminate the Contract due to “unforeseen circumstances” related to the security of their restaurant lease which the plaintiffs were somehow informed that it may not have been renewed. The plaintiffs requested the return of the $15,000 less “appropriate deductions” for the “work [that] has been performed” by Par-Tek (the “Termination Notice”).

...

[26] Most importantly, I find that the Contract did not meet the requirements of the CPA – in particular the requirements for what a “future performance agreement” must contain as set forth in section 24 of the Regulation.

[27] It goes without saying that the CPA is a comprehensive Code which is intended to protect consumers in various ways and to give remedies to consumers where suppliers of goods or services do not comply with its provisions, including the provisions related to the contents of contracts of various kinds.

[28] As a consequence of the Contract not complying with the prescribed requirements under the Regulation, pursuant to section 23 of the CPA the plaintiffs had the right to cancel the Contract up to one year after entering into it – that is up until February 18, 2016.

...

[34] Following the Termination Notice given by the plaintiffs, which effectively cancelled the Contract, Par-Tek was required to return the initial payment of $15,000 to the plaintiffs without any deductions.

[35] This follows from section 96 (1) of the CPA which provides as follows:

(1) Obligations on cancellation – If a consumer cancels a consumer agreement, the supplier shall, in accordance with the prescribed regulations,

(a) refund to the consumer any payment made under the agreement or any related agreement; [emphasis added]

[36] Section 95 of the CPA is also relevant. It provides:

95 Effect of Cancellation – The cancellation of a consumer agreement in accordance with this Act operates to cancel, as if they never existed,

(a) the consumer agreement; [emphasis added]

[37] Sections 95 and 96 of the CPA clearly imposed an obligation on Par-Tek to return to the plaintiffs the $15,000 paid to it under the Contract and to do so without any deduction that might otherwise be stipulated in the Contract. It does not matter whether the $15,000 was deemed to be an initial payment, part-payment or a deposit under the Contract. Section 96 is abundantly clear – any payment made under the Contract is to be refunded to the plaintiffs.