WHAT IS THE COMPENSATION FUND?

The Motor Dealer Customer Compensation Fund was established by legislation in 1995 to reimburse consumers for eligible losses in relation to vehicle purchase, lease and consignment sales in BC.

The Fund is financed by contributions made by all licensed motor dealers in the province.  Its independent Board is separate from the Motor Vehicle Sales Authority of BC (“VSA”), the regulatory body that licenses motor dealers.

The Board, which consists of industry and public representatives, is an independent administrative tribunal that decides eligible consumer claims made to the Fund resulting from alleged failures to perform by licensed motor dealers.

WHAT IS COVERED?

Compensation may be available for eligible financial losses related to the purchase, lease or consignment sale of a motor vehicle or an extended warranty or service plan through a licensed motor dealer. Financial loss must be documented and compensation is limited to a maximum of $20,000.

HOW DO I MAKE A CLAIM?

Step 1.  Demand Letter

If the motor dealer is in business, send a Demand Letter to the dealer.  A dealer has 30 days from the date of your Demand Letter to rectify a problem.  If after 30 days your dispute remains unresolved, proceed to Step 2.

If the motor dealer is not in business, proceed to Step 2.

Step 2. Claim Application Complete all sections of Compensation Fund Claim Form, attach supporting documents as required and mail your claim application to VSA.  Complete Cash Payment Affidavit of you paid for the vehicle in cash.

THE PROCESS

1. Intake and Assessment

• We will review your claim application to make sure it is complete and will assess eligibility of your claim.
• We will forward a copy of your claim application to the motor dealer affected by it and will request a response within 10 days.  We will forward a copy of the dealer’s response to you for your reference.

2. Pre-adjudication

The duration of this phase varies depending on the nature of a claim and need for further investigation.

If the motor dealer is in business, we will use other options available for resolution of your dispute with the motor dealer prior to processing your Compensation Fund claim:

• Facilitation of dispute resolution by a VSA Consumer Services Officer.
• Investigation by a VSA Compliance Officer to obtain additional evidence.  The investigation may result in a compliance hearing before the Registrar that both parties may need to attend.
• If the dispute remains unresolved after a hearing before the Registrar and if dispute resolution fails, eligible claims will be adjudicated by the Compensation Fund Board.

If the motor dealer is not in business, we will involve a VSA Compliance Officer to obtain additional evidence, if needed.  Eligible claims will be adjudicated by the Compensation Fund Board.

3. Adjudication

• The parties will be notified in advance of the date of a Board meeting.  Most often, claims are adjudicated based on the written submissions of the parties.  If needed, a hearing before the Board may be required.
• The Compensation Fund Board meets every 2-3 months.  The Board’s decision is communicated to the parties within 30 days of the Board meeting.

IMPORTANT NOTES

A claimant may not be eligible for compensation if:

• 50% or more of use or intended use of a vehicle is for business purposes;
• The claim relates to a dispute about cost, value or quality of the vehicle contracted for, such as its mechanical condition; or

The claim is made more than 2 years after the refusal or failure of the dealer to pay.

SUMMARY

You may be eligible for compensation if you suffered a financial loss related to

• purchase or lease of a new or used vehicle;
• purchase of an extended warranty or service plan; or
• sale of a vehicle on consignment.

The loss must be caused by the failure to perform by a licensed BC motor dealer and must be documented. The compensation limit is $20,000.

Eligible losses may include unlawful failure by the dealer to

• deliver the vehicle contracted for;
• provide clear title to the vehicle;
• return a  deposit; or
• remit extended warranty contract and payment to the warranty company.

ALTERNATIVES

• The Compensation Fund may not necessarily be the best option for you.  If the motor dealer is in business, we recommend that you first contact VSA to see if there are alternative solutions available to resolve your dispute.
• You may have other legal options available to you, such as the courts, and we suggest you contact a lawyer and obtain legal advice regarding your dispute.

CONTACT INFORMATION

For more information on applying to the Motor Dealer Customer Compensation Fund, please contact the Vehicle Sales Authority at:

Suite 208 - 5455 152nd Street
Surrey, BC V3S 5A5

E-mail: compensationfund@mvsabc.com        

Tel:                  604.575.6161
Toll Free:         1.866.400.3529
Fax:                 604.574.5886

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