Are you a repairer whose customer has not paid you for your services and has left their vehicle at your business for a duration of time?
Are you now charging them storage fees for their vehicle until they pay? Well…not so fast!
A “storer” is defined in the Repair and Storage Liens Act 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”
So, what exactly does that mean?
If you took possession of the vehicle to only repair it, and the owner did not agree to pay you for storage, and you end up having to store their vehicle for a duration of time, you may be out of luck.
The Courts or somewhat divided on the issue of storage when there is no agreement to pay for same.
So, if there is an understanding that a customer will pay storage, how much can you charge?
The Small Claims Court has found that the reasonable amount to charge for storage per day is $60.00. The Divisional Court has upheld that amount. If you have a contract that has an amount higher than that, and its disputed, you may end up only getting $60.00 per day.
So, if you do not have an agreement for storage, and you are storing a vehicle because a customer won’t return to pay, what do you do?
Some Judges have found you’re entitled to charging the customer $60.00 per day, while others allow a repairer to recover the commercially reasonable expenses incurred in the custody, preservation and preparation for sale of a vehicle, but not allowing profit.
So if you anticipate ever having to charge for storage if a owner fails to pay for the repairs and take their vehicle, it would be good practice to have your quotes, contracts and authorizations disclosing a storage charge if they fail to return to pay for the repairs and you end up having to store it.
Murray Brown, Licensed Paralegal