If you have a problem with a leased car, different solutions can be explored.
Warranties and recourse
If there is a problem, see whether your car is covered by warranties. If warranties do not apply, see the section How to settle a problem to learn more about other solutions that can be explored.
All merchants of motor vehicles (cars, motorcycles, snowmobiles, recreational vehicles, and so on) must be licensed. In order to obtain a license, a merchant must provide a deposit. This money can be used to compensate you if the merchant does not comply with their obligations.
You can contact the Office to check whether you are eligible to be compensated.
You can also consider the Canadian Motor Vehicle Arbitration Plan (CAMVAP). The CAMVAP is a "private court" that allows you to settle problems linked to manufacturing defects.
The car must have been manufactured in the current year or during the 4 previous years. For more details, see the Web site of the Canadian Motor Vehicle Arbitration Plan.
Unforeseeable and unavoidable event
If an unforeseeable and unavoidable event led to the loss or damage of your car, and you are not responsible for it, it is called an "act of God."
End of liabilities
An act of God frees both the merchant and the vehicle leaser of the liabilities included in the leasing contract. Examples of such situations include your car being stolen, burned, or damaged in unforeseeable and unavoidable circumstances.
If your insurance company requires a deductible, the merchant must pay it. The merchant must also refund the security deposit you provided when you signed the contract.
The merchant may also need to refund other charges to you. Indeed, the merchant should receive the lower of the two following amounts from the insurance company:
- the fair market value of the vehicle, used at the time of the events (unless the leasing contract includes a replacement value clause);
- the balance of your leasing contract, that is, the amount you would have had to pay if you had purchased the vehicle on the day of the incident.
If the merchant receives an amount that is more than either of these two amounts from the insurance company, it is likely that the overpayment will be paid to you.
Last update : May 3, 2021
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The information contained on this page is presented in simple terms to make it easier to understand. It does not replace the texts of the laws and regulations.
You can reach one of our customer service officers by telephone or in writing using our information request form.