Question

List two possible situations which could result in OMVIC applying to a court to appoint a receiver and manager to assume temporary control of a dealership

Answer 1

OMVIC may apply to a court to appoint a receiver and manager for temporary control of a dealership in situations like financial distress threatening consumer interests or legal and ethical misconduct harming public trust in the motor vehicle industry.

Step-by-step explanation:

The Ontario Motor Vehicle Industry Council (OMVIC), as the regulator of motor vehicle sales in Ontario, has the authority to intervene in the operations of dealerships under certain situations. Two possible situations which could lead to OMVIC applying to a court to appoint a receiver and manager for temporary control of a dealership are:

1. Financial distress that puts consumers at risk and potentially violates the Motor Vehicle Dealers Act (MVDA). This can occur if a dealership is unable to fulfill its financial obligations, such as failing to pay off liens on vehicles that it sells or failing to remit funds on consignment sales.
2. Legal or ethical misconduct that endangers the public interest or the integrity of the motor vehicle industry, such as consistent and severe breaches of the MVDA or evidence of fraudulent activities within the dealership.

Through the appointment of a receiver and manager, OMVIC aims to protect consumers and maintain trust in the motor vehicle industry by ensuring that dealerships operate within legal and ethical frameworks.