A client had a vehicle delivered to them for repairs. However, after those repairs were complete, the owner never returned and essentially abandoned the vehicle which ended up being forgotten by our client for some time…oops!
They wanted to proceed with a Notice of Intention to Retain under the Repair and Storage Liens Act (“RSLA”) so they were able to sell the vehicle to recuperate storage fees for the time it had been sitting on their lot. The only problem: they didn’t provide notice to the owner of the storage fees.
Prior to July 1, 2016, the notice period for a Storer to notify interested parties in a vehicle that storage was being charged was sixty-days.
A “storer” is defined in the RSLA as “a person who receives an article for storage or storage and repair on the understanding that the person will be paid for the storage or storage and repair, as the case may be.”
This means that the Storer had up to sixty-days to notify the owner(s) and any interested parties, such as a finance company with a Personal Property Security Act (“PPSA”) registration on title that they had possession, and storage is being charged.
However, as of July 1, 2016, that notice period was reduced to just fifteen days. So, why the drastic change?
Prior to the change, it had been a problem in Ontario for some time that Storers waited until sixty-days to notify interested parties they were storing the vehicle, which allowed those fees to accumulate causing unnecessary expenses to the parties.
Finance companies and Insurers have raised concerns about the notice period and the financial impact of having to pay increased storage fees, which in many cases could have been lower, had the Storer provided notice sooner.
What happens if you fail to provide notice within fifteen days, but you have been storing a vehicle longer like our client? Failure to provide notice within fifteen days limits your storage fees to a maximum of sixty days and nothing more, despite how long you have been storing the vehicle for.
The above doesn’t apply if you provided the appropriate notice and no action is taken by the interested parties.
When you are provided a vehicle for storage, it is important to obtain information on the party delivering the vehicle for storage, so you know who to contact should you require to serve a notice.
It is also good practice to obtain a PPSA search to determine if you need to notify any other interested parties that you are charging storage on the vehicle to protect your rights as a storer.
Murray Brown, Licensed Paralegal