VSA

Registrar's Decision

Registrar's Decision 19-12-001

File Number: 19-12-001

In the matter of Motor Dealer Act R.S.B.C. 1996 C.316
and Business Practices and Consumer Protection Act, S.B.C. 2004

Complainant: Dian Greene and The Vehicle Sales Authority of BC

Licensee/Unlicensed person:
Affordable Auto Sales and Services (#40114); Mr. Mohammed Nadir Ghani Zadeh (#201376)

Issues:

  • On March 13, 2020 the Registrar made findings that Affordable Auto Sales and Services Inc. (“Affordable Auto”) and Mr. Zadeh committed both deceptive acts and practices and unconscionable acts or practices, contravening the Business Practices and Consumer Protection Act (“BPCPA”), in relation to a consumer transaction involving Ms. Greene.
  • The main concern was that Affordable Auto and Mr. Zadeh misrepresented the 2006 Nissan Frontier (‘the Frontier) and failed to disclose that the vehicle had been purchased from Alberta as a salvage vehicle and was subsequently rebuilt for the purposes of resale. The amalgamation of the misrepresentations and in considering the transaction as a whole, the Registrar found the conduct clearly showed Affordable Auto and Mr. Zadeh undertook a deliberate course of action to try and sell the Frontier at little cost to itself to an unsuspecting consumer who was unable to protect their interests, Ms. Greene.
  • The issue for this decision was what, if any, compliance action should be taken against Affordable Auto and Mr. Zadeh.

Outcome:
Affordable Auto:

  • The Registrar added the following conditions to Affordable Auto’s motor dealer registration:
  • Affordable Auto has implemented policies and procedures to ensure similar conduct does not happen again. To protect the public, the Registrar will verify this statement and orders Affordable Auto to submit its policies and procedures for the Registrar’s review within 30 days of the date of this decision. Should the Registrar not find the policies and procedures adequate, they will be required to re-write and re-submit.
  • To mitigate the risk of Affordable Auto not advising a purchaser that the motor vehicle offered for sale is a rebuilt vehicle, the Registrar added a condition to Affordable Auto’s registration that they provide written disclosure to a consumer of the rebuilt status of any rebuilt vehicle offered for sale. Records of such disclosures must be signed by the consumer and a copy kept in the dealer records.
  • The Registrar imposed an Administrative Penalty of $5,000.
  • The Registrar found the Authority’s submissions and evidence for investigation costs to be reasonable and in line with cases of a similar nature. A Compliance Order will be issued requiring Affordable Auto pay the Authority’s investigation costs in the amount of $1, 311.64.

Mr. Zadeh:

  • Mr. Zadeh has not fully considered many concepts that are outlined in the salesperson licensing course in operating his dealership. Mr. Zadeh must be aware of his legal obligations if he is to continue operating a motor dealership. The Registrar added a condition to the salesperson licence of Mr. Zadeh that he retake, and successfully complete, the Salesperson Certification Course within 45 days of the date of this decision, at his own cost.

Discussion – Compliance Selection

  • The Registrar found that Affordable Auto was tardy in complying with the Registrar’s order made in March 2020. The Registrar noted that COVID-19 has negatively impacted commerce in the province. The fact that Affordable Auto took as long as it did to provide compensation to the consumer, can be understood given the then and now commercial climate in British Columbia for a small car dealer.
  • The Registrar found that this was a first-time transgression for Affordable Auto and Mr. Zadeh.
  • The Authority’s regulatory philosophy and enforcement principles speak of using progressive enforcement coupled with education to address non-compliance. Generally, a first-time transgression results in warnings, education and maybe conditions on a licence. Even so, the regulatory philosophy and enforcement principles reserve the right to “jump” to more stringent compliance options for a first-time transgression where necessary to protect the public interest.
  • The Registrar considered caselaw and previous decisions where a motor dealer’s registration had been cancelled, however those facts were not applicable to Affordable Auto or Mr. Zadeh. Considering Affordable Auto’s compliance history, coupled with the steps Affordable Auto is taking to ensure its future compliance, a “jump” to cancelling Affordable Auto’s motor dealer registration and/or Mr. Zadeh’s salesperson licence would not be proportionate to the transgression.
  • In considering the appropriate regulatory actions, the Registrar considered the required factors outlined in section 164(2) of the Business Practices and Consumer Protection Act. The Registrar also considered past cases, common law principles of specific and general deterrence, and that the penalty amount not be punitive in nature, but also not be considered the mere cost of doing business.

Legislation considered/referred to:

  • Business Practices and Consumer Protection Act, S.B.C. 2004, c. 2
  • Motor Dealer Act, R.S.B.C. 1996, c. 316
  • Motor Dealer Act Regulation, B.C. Reg. 447/78, sections 21, 23, 27, 32
  • Motor Vehicle Act, R.S.B.C. 1996, c. 318

Cases Cited:

  • Best Import Auto Ltd. v Motor Dealer Council of British Columbia, 2018 BCSC 834 (BC Supreme Court)
  • Best Import et al. (November 28, 2017, File 17-08-002, Registrar)
  • Brook v. Wheaton Pacific Pontiac Buick GMC Inc., 2000 BCCA 332 (BC Court of Appeal)
  • Crown Auto Body and
  • Auto Sales Ltd. v. Motor Vehicle Sales Authority of British Columbia, 2014 BCSC 894 (BC Supreme Court)
  • Cartaway Resources Corp. (Re), 2004 SCC 26, [2004] 1 S.C.R. 672 (Supreme Court of Canada)
  • Guindon v. Canada, 2015 SCC 41, [2015] 3 S.C.R. 3
  • Harris & Harris v. Windmill Auto Sales & Detailing Ltd. (April 10, 2013, File 12-030, Registrar)
  • Hogan v. British Columbia Securities Commission, 2005 BCCA 53 (Court of Appeal)
  • Knapp v. Crown Auto Body and Auto Sales Ltd. (September 21, 2009, File 08-70578, Registrar)
  • Motor Vehicle Sales Authority v. Barnes Wheaton (North Surrey) Chevrolet Buick GMC Ltd. et al (April 16, 2020, Hearing file 19-07-004, Registrar)
  • Scott v. Lake Country Motor Sports Ltd. et al. (August 10, 2018, File 18-01-004, Registrar)
  • Webster v. Pioneer Garage Limited dba Fraser Valley Pre-Owned et al (April 27, 2018, File 17-07-002, Registrar)
  • Windmill Auto Sales & Detailing Ltd. v. Registrar of Motor Dealers, 2014 BCSC 903 (BC Supreme Court)

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