Skymark Finance Corporation v. Toraman
2020 CanLII 51091 (ON SCSM)
Court
Ontario Small Claims Court
Year
2020
Citation
2020 CanLII 51091 (ON SCSM)
Topic
Rescission of water-filter rental + finance company defeated under CPA s. 95
The facts
Immigrant homeowners with limited English were sold a 10-year water-filter rental at $59.99/month plus HST plus a 3.5% annual escalator — totalling over $8,100 over the term, against an approximate $1,200 retail value for a comparable filter. The finance assignee Skymark sued to recover over $8,600 in unpaid rentals.
The holding
The Deputy Judge found the door-to-door salesperson made both false/misleading representations and unconscionable representations under sections 14 and 15 of the CPA. The price grossly exceeded comparable prices and the deal was excessively one-sided. The Court rescinded the contract under Part III of the CPA and dismissed Skymark's claim — applying CPA section 95 (assignee takes subject to consumer's defences).
Why this matters for Ontario homeowners
Long-term water-filter and similar rentals at multiples of the equipment's value can be rescinded outright in Small Claims Court. The finance company's collection action fails because, under CPA section 95, an assignee inherits the consumer's defences against the original dealer.
Read the full reasons on CanLII: https://www.canlii.org/en/on/onscsm/doc/2020/2020canlii51091/2020canlii51091.html
This case summary is for general information only. It is not legal advice. Outcomes in your situation depend on the specific facts of your case.
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