OMVIC warns recalls bring disclosure obligations

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Over the past two years, the number of vehicle recalls for serious safety issues has attracted immense media and public attention.

The recent Canadian recall of 1.2 million vehicles and the NHTSA expanded recall of 34 million vehicles with defective Takata airbags in late May are the latest.

These defective airbags can deploy with too much force, showering debris on vehicle occupants. More than 100 injuries and six deaths have been attributed to the faulty airbags in the U.S.

Dealers are required to disclose in writing any material fact about a vehicle’s use, history or condition to a purchaser or lessee, says OMVIC.

“Outstanding recalls related to serious issues of vehicle safety meet this test and where possible should be disclosed in writing on the bill of sale,” says the regulator in a release.

Dealers may sell a vehicle with an outstanding recall, but the regulator warns dealers cannot sell vehicles to which a “stop sale” or “stop driving” order applies.

Who decides if a recall is material?

While the answer to this question could ultimately rest with the courts, OMVIC’s position is that if the manufacturer deems the problem serious enough to issue a safety recall, that problem is likely to be a material fact to a consumer.

Dealers should visit the vehicle manufacturer’s website. Many, though not all, make VIN specific recall searches available (partial list here ).

Some manufacturers’ recall searches may not include Canadian vehicles or searches must be performed on the U.S. version of the manufacturer’s website.

Dealers may also phone the manufacturer to determine the existence of outstanding recalls. A list of phone numbers is provided by Transport Canada here.

While it doesn’t allow for VIN-specific searches (only by make/model/year), Transport Canada provides its online Road Safety Database.

Recalls for the same vehicle model can vary from jurisdiction to jurisdiction. NHTSA also has a searchable database of US issued recalls.

Dealers may sell vehicles with outstanding recalls.Dealers must use due diligence to identify outstanding safety recalls using readily available resources.

Outstanding recalls for serious safety issues are material facts that, where possible, should be disclosed in writing on the bill of sale or lease contract.

Dealers should recommend in writing on the bill of sale that the customer register their vehicle with the manufacturer as soon as possible after the purchase to ensure outstanding recalls, and future ones, will be brought to their attention.

For more information, contact OMVIC’s Complaints and Inquiries Team at 1-800-943-6002×5105.