32nd Parliament, 3rd Session







The House resumed at 8 p.m.


Resuming the debate on the motion for second reading of Bill 29, An Act to amend the Estates Administration Act.

Mr. Renwick: Mr. Speaker, if anybody in the assembly wants to have a friendly fingerprint taken by the Metropolitan Toronto Police, he can go up to Sherway Plaza tonight. The police want to accustom us as best they can to the whole process. One can visit a bomb shelter or have a friendly fingerprint taken. They did not say anything about a friendly photograph. Apparently the police want to acclimatize us to having our fingerprints taken.

Mr. Breithaupt: It is not even 1984.

Mr. Renwick: Not yet.

I know the Attorney General (Mr. McMurtry) will want to put this bill into committee; so we will not have to request that it go into committee, but I am going to suggest that it does.

Unfortunately, this is one of the occasions on which I agree with the Attorney General and disagree with the critic for the official opposition, my good friend the member for Kitchener (Mr. Breithaupt) with respect to Bill 29.

Our caucus will support the bill. Our caucus has agreed that we will support the bill on second reading. We agree with the end which the bill attempts to achieve. But achieving that end is a lot more difficult than I think my friend the member for Kitchener will agree or, I am sure, the Attorney General has found in the length of time it has taken to get the bill in a position where he was prepared to proceed with it.

I am not certain. I do not have the connections with the community of concern that the member for Kitchener obviously has, but I want to say to the member for Kitchener that I would be extremely concerned if the Attorney General were to accept the extension of the bill, meritorious as it may appear for the purposes of the end, to the question of what will happen to those funds and to provide through the court some method by which a redirection of funds could take place.

I do not think one can fool around in an oblique way with the fundamental question with respect to the devolution of estates and the way in which property can be dealt with. If one is going to deal with it in a way different from the expressed, written intentions of a testator or the expressed statutory provisions of the province on the death of a person, then I think one has to have compelling reasons for doing so.

To ask the court to do so in the sense that it is to reinterpret the intention of the testator or in some way try to come to a conclusion about what a testator or a person dying intestate may have desired with respect to the disposition of his property is a course on which one should not embark lightly, at least in my view of the question.

We support the intention involved in the bill, but I have serious concerns about achieving the goal the bill is intended to achieve. In my view, that is reflected in the language of the bill. For that reason we would like to discuss the principles of the bill in committee.

One can be quite certain that if there is a significant number of dollars tied up in estates because of this bill, there will be any number of efforts made to divert those funds to persons other than a testator, or the laws of this province in the case of an intestacy, would have provided.

I recognize that I speak without the ambit of authority with which the member for Kitchener, who has been interested in this bill for some considerable time, speaks about it. Indeed, I think it is fair to say that the first I heard of this problem was from the former leader of the official opposition, and it was the first occasion I had to consider it. Therefore I would like to have the opportunity to explore in a give-and-take way exactly what this bill does say when it is in committee of the whole House.

We have no amendments to propose, but it is the kind of bill which, even though it has been drafted in a careful way, raises some questions in my mind about what we are asking the courts of the province to do with personal property that would otherwise go in one direction, which is to divert that money in another direction.

For example, I am particularly concerned where, on the application, the money does not go the way in which either the laws of the province on an intestacy or the laws of the province in the case of a testacy respecting the will of the testator would direct it to go.

Even in the low-key way in which it is expressed in the bill, I have a concern about the provisions of subsection 4 where it says: "Where, upon an application under subsection (2)" -- of course, the subsection should read "subsection (3)," not "(2)" as printed in the bill -- "the court is satisfied that a person other than a foreign beneficiary is entitled to the personal property, the court may by order direct its distribution to the person entitled."

I think that is an immensely onerous provision to impose on the courts. I do not pretend to know the answer, but I do think the record of the debate of this assembly on this rather extraordinary bill should show that we have considered the implications of it in supporting it, as we do in this party, because of the concerns I have expressed.

8:10 p.m.

I am not quite certain whether the member for Kitchener has discussed with his friend the member for Waterloo North (Mr. Epp) the implications of the proposal made by the member for Kitchener in the light of the resolution of the member for Waterloo North with respect to entrenching property in the constitution of Ontario.

Perhaps during the dinner hour the member for Kitchener has had an opportunity to talk with the member for Waterloo North and can enlighten us on the resolution of the apparent conflict which I see in the proposal he makes, which the Attorney General would say in a very soft, understated way was confiscation of property.

With those remarks on second reading, we would like the bill to go into committee of the whole House; but I understand the Attorney General will put it into committee because of the numerical errors in subsections 4 and 5.

Mr. Shymko: Mr. Speaker, I join the honour- able members from the opposition in speaking in support of this bill. I am very happy, as we all are, that there is obvious unanimity in support of the act to amend the Estates Administration Act, namely, Bill 29.

I do concur with the previous speaker that perhaps for the benefit of those who are not aware of the details of the implications and tragic consequences of some of the actions taken by legal representatives on behalf of relatives in the Soviet Union, this should be discussed in committee because of the educational nature of what we are trying to do.

I wish to point out that over the past number of years, as the member for Kitchener certainly knows, various delegations have approached both the governing parties and the parties of the opposition, not only here in the Legislative Assembly but also at the federal level, to take some action to stop the shameful exploitation of estates by certain governments, and more specifically the governments of Communist regimes in central and eastern Europe.

What is tragic is that more than $10 million a year, the figure I have seen, is ripped off from Canadians by these actions. This is a form of blackmail and often leads to fear. Hard currency is something these regimes are after. I do not have to remind the members that Canadians of Czech and Slovak origin are required to pay between $2,000 and $5,000 if they want to renounce their citizenship. This is a very interesting example of how these regimes are seeking hard currency.

The procedure for obtaining hard currency is outlined by the manner in which the regimes collect it. First of all, if there is a beneficiary in the Soviet Union, for example, they demand that the estate be delivered in hard currency, not in parcels, even if a will left by the deceased states the beneficiary should obtain the estate money in or through parcels rather than in hard currency.

Very often, as the member for Kitchener has indicated, the Iron Curtain representative -- and the prominent lawyer Gordon Price is a classic example -- has demanded that if an application is made to Ontario, these applications specify that Ontario courts, on behalf of the beneficiary, change the manner of payment from parcels to hard currency.

If they do not succeed in their court action, an unprecedented heavy tax or duty, often five times that normally paid on parcels going to the Soviet Union, is imposed on these parcels. So the first thing the Soviet representative has always demanded is that the payment be in cash.

I do not have to remind honourable members that the real rate of exchange is less than the official rate of exchange of one dollar to one rouble. Currently on the black market in the Soviet Union the exchange is 80 roubles per US dollar, a little less for the Canadian dollar -- from three to 12 times the official value of our currency.

It is interesting that in April 1983 in Radianska Ukraina, the largest-circulation daily of the Soviet Ukraine, there was an ad on behalf of the Soviet version of our Canadian Bar Association, an organization called In Jure Collegium. This ad called for people to come forward and indicate whether they had any relatives who had died in Canada, the United States or any of the countries outside the Soviet Union.

There is no doubt that great efforts are made to keep tabs on our senior citizens and to keep track of the obituaries in our dailies and in the ethnic press so that immediate action may be taken to proceed with an estate.

This collegium, or Soviet bar association, automatically collects 10 per cent of the estate before the case is even presented here in Canada. In addition to this, men such as Mr. Gordon Price, the well-known representative of the Soviet Union in this area of Ontario, collect a fee whose amount to this day we do not know.

There is also an estate tax, the figure of which we do not know, which is collected by the Soviet government; in addition, there is a local administration tax. So, as the member for Kitchener has pointed out, sometimes no more than 10 per cent of the original value of the estate finally ends up with the beneficiary.

I do not have to remind the members of the famous Toronto Star front-page announcement three years ago concerning the Ivan Franco senior citizen home in my constituency. All of a sudden a representative for Mr. Gordon Price appeared and said he would like to have details about Mr. So-and-So because of his estate. The man was still alive, and here they were ready to collect payment on a person who had not even been given a chance to leave this world. That is the type of urgency the Soviet Union has for hard currency.

I do not have to tell the members of cases of fraud or of forgeries. We have no control whatsoever today over the veracity of many of these beneficiaries.

I would like to point out that if a will has been drawn up, usually the Soviet government or its representatives are not as eager to contest it. But that challenge would be before the court. Many of these communities are seriously concerned and educating their members to draw up wills that will offer some protection to their estate when they are not around any more. That educative process is certainly recognized and is being stressed by various organizations, church groups and so on.

8:20 p.m.

I stress that the member for Kitchener is to be congratulated on the initiatives he has taken on the part of Her Majesty's loyal opposition to sensitize all of us to this terrible ripoff of Ontarians and Canadians. I certainly congratulate the Attorney General for the determination to have this bill presented and passed before this House adjourns.

There are those of us who may have had the impression or may have tried to give the impression that there was no willingness on the part of this government to reintroduce the bill, that it was a pure façade of concern with no genuine intention. As a member of the caucus and having spoken to the Attorney General, I point out that we were ready last year to proceed with this bill. I will not say the time consumed in the ringing of bells and other incidents was the greatest obstacle that stopped the Attorney General from proceeding, but rather the other priorities, perhaps exaggerated, of some opposition members.

I give total credit and recognition to the member for Kitchener for his sensitivity, his understanding and his willingness today to support the bill and not to play around with amendments and other things. He is to be congratulated.

I wish to point out that most of these people have relatives -- be they parents or their own children; and it is by force of tragic circumstances they are not with them today -- and they would like these benefits to return to them. I do not have to outline that, no matter how terrible the Communist regimes feel this capitalist system of free enterprise is, they are certainly trying to rip off as much as they can from our system and the land of opportunity these people where these people have lived and cherished our free democratic society and free enterprise system.

There is a desire that the beneficiaries receive maximum benefit from the estate. The intent of the Attorney General and this bill is to assess whether the property will be unduly depleted and to guarantee a maximum return for the beneficiaries.

Most important, what this legislation will do is to signal to the Soviet Union and to other regimes in central and eastern Europe that they will not be able to play this game of exploitation as blatantly as they have in the past. That is the importance of this legislation.

With time, perhaps we will see whether some of the aspects that are termed as confiscatory in the member for Kitchener's bill will need to be implemented. We will see whether further amendments are needed.

I certainly support the bill and, in doing so, I point out that it is one of those very few occasions in the House when there is unanimity among all members in understanding an area that is of acute need because of the tragedy involved.

Mr. Kolyn: Mr. Speaker, it is certainly a pleasure for me to make a few comments on Bill 29. I have been looking forward to the bill coming here and being passed.

I would like to thank the member for Kitchener for his support and dogged determination to keep the issue alive. The member for Riverdale (Mr. Renwick) indicated he supports the bill in principle. Last but not least, the Attorney General should be thanked for giving this all the consideration he has given it, because it is a rather complicated bill.

I am not a lawyer, nor do I profess to be, but I have been involved with this for the past couple of years. Mr. Roy Kostuk has been involved in this type of operation and has always pointed out the pitfalls he has had when it came to wills and estates that went back to Iron Curtain countries.

With that, on behalf of all the ethnic communities, I thank the Attorney General for bringing the bill forward. I hope we will see it passed very soon.

Mr. G. I. Miller: Mr. Speaker, I also want to take a few moments to pass on some comments. I think the bill has come about because of some urging from my riding of Haldimand-Norfolk. I know there were a couple of legal firms concerned. They dealt for many years with many foreign countries, such as the Soviet Union and Czechoslovakia. They had their families there.

It came to my attention that some changes should be made, which were passed along to my colleague the member for Kitchener and I think were passed on to the Attorney General.

I am certainly pleased some changes are going to be made to make sure that estate money earned here in Canada and Ontario will go to the proper people rather than to the state. Again I would like to congratulate my colleague and the Attorney General.

Hon. Mr. McMurtry: Mr. Speaker, this is an issue about which emotions can run deeply for understandable reasons. The thought of a Communist government ripping off estates, as has been expressed, is obviously a matter that has caused a great deal of concern within our Ontario community, a concern harboured by many of our citizens.

At the same time, it is important to keep in context the fact that governments do tax estates. In Ontario, we used to have something known as succession duty, and there used to be currency regulations of one kind or another; so the idea of governments benefiting as a result of a succession is not entirely a novel one.

This is legislation that is important and an issue about which we have been very concerned because fundamental to our concerns is that while, in the words of the legislation, we do not wish these estates to be "unduly depleted," on the other hand we do wish to respect the wishes of a testator and the fact that it is important the beneficiaries receive some degree of entitlement.

It is unfortunate that this legislation has not proceeded before. I attempted earlier to explain to colleagues the matter of not having sufficient House time. There were also concerns about the actual wording of the legislation. But it is quite clear that members from all parties are determined to get this legislation passed well before the end of the sittings. For this, I am very appreciative.

I appreciate that the member for Kitchener has made a thoughtful presentation in respect to his Bill 8. Without taking an undue period of time, I want to read into the record some of our concerns with his efforts, which were certainly well motivated and obviously the result of a good deal of care and effort on his part. These are several of our concerns:

"Firstly, since the purpose of the legislation is to ensure that beneficiaries will receive substantially the full value of any payments, it is unnecessary to extend the bill to real property. The beneficiary takes the property in specie, which is hardly ever done. The foreign government is powerless to seize a portion of it for itself. The land is converted to money before distribution. It then becomes personal property.

"In cases of intestacy and claims on estates by dependants, the intentions of the deceased are very difficult to determine and may well be irrelevant." As a matter of fact, they usually are irrelevant. Regardless of intention, the law of Ontario provides that certain people are entitled to inherit property on the death of a person domiciled in Ontario or to make a claim for support against the estate.

"To rewrite the law only for potential beneficiaries in eastern European countries seems to us to be extremely unfair.

8:30 p.m.

"The private member's bill of the member for Kitchener, in our respectful view, goes beyond its stated intention, which is to ensure that payments are not made to foreign beneficiaries who are unlikely to receive substantially the full value of any payment. Even if a court decides that a beneficiary is entitled to the property and is likely to receive substantially the full value of the payment, the court can still refuse to direct any payment where it feels it would not be just and equitable, having regard to the intentions of the deceased person to do so.

"I should also like to state that a principle of the government legislation is that it is a custodial statute and is procedural in nature. It offers no threat to an heir's right to inherit, but his right to possession is held in abeyance until certain conditions have been satisfied. The estate is held in trust until the court is satisfied that the property will not be unduly depleted before it is received by the beneficiary.

"The private member's bill, in our respectful view," as I stated when I introduced the bill again, "is confiscatory in nature. Unless the court is satisfied that a beneficiary will receive the substantial benefit of the payment and that it is just and equitable, having regard to the intentions of the deceased, the beneficiary can be forever excluded from the estate. If there are no other heirs, the estate would cede to the crown. In our view, there simply is no justification for this approach."

I have read these comments into the record not to engage in an unnecessary or prolonged debate with my respected colleague the member for Kitchener, but to indicate to him that my advisers looked at his bill very carefully and they respected the effort that had gone into its preparation. I did not want him to think we were just dismissing it out of hand because it was a private member's bill, I am still mindful of the fact that he is the same private member who introduced the first amendment to our historic family law legislation, which was accepted and passed. That is an indication of our respect on this side of the House for the member for Kitchener.

I just wanted to indicate to him that we had looked at his bill very carefully. We respected the motives that prompted it, and I wanted to let him know that some thought had gone into our rejection of this approach. It is obvious whatever legislation is passed is going to have to be monitored. I should say in conclusion there is no doubt that much of the problem can probably not be alleviated totally satisfactorily by any legislation. It simply requires a significant educational effort and educational initiatives in the community that is concerned about this problem, so that wills may be properly drafted. I think they can be drafted in such a way as to avoid to a considerable extent some of the problems that arise, for example, in the sery nature of the bequest.

As an illustration, if the testator wishes the beneficiary to benefit, it has been suggested that where we are talking about hard currency, instead of "hard currency," there could be "monthly packages of clothing" and other matter such as that. That is one approach that has been suggested. Quite apart from any legislative initiatives, which are important, there is no question that the educational value of a campaign to ensure that people, for example, do not die intestate and that their wills are properly drawn, probably in the long run will be more effective than any legislation.

I certainly would like to thank as well my distinguished colleagues, the member for High Park-Swansea (Mr. Shymko) and the member for Lakeshore (Mr. Kolyn) for their encouragement and their participation in the drafting of this legislation. I assume, Mr. Speaker, that this legislation is going to go to committee of the whole House and there will be an opportunity there to discuss further some of the issues that have been raised, particularly those issues raised by the member for Riverdale.

Motion agreed to.

Bill ordered for committee of the whole House.

House in committee of the whole.


Consideration of Bill 32, An Act to amend the Landlord and Tenant Act.

On section 1:

Mr. Chairman: Mr. Philip moves that section 1 of the bill be amended by deleting the word "six" in line 2 of clause (c) of subsection 7 of the amended section 107 of the Landlord and Tenant Act and substituting therefor the word "four."

Mr. Philip: In moving this amendment I might indicate to the House that I have noted that at the same time I drafted this amendment, the Liberal Party drafted a similar one. They are both equal, and therefore it matters little which of us moves the amendment because we both had the same idea at the same time independently.

I wonder, Mr. Chairman, since my next amendment is a complementary amendment -- it deals with section 2 of the bill and in effect deals with the same issue -- if we might consider them both together and allow me to move my amendment to section 2. I think that will speed up the process somewhat.

Mr. Chairman: I would be willing to do that, except your first amendment deals with clause 107(7)(c) as set out in section 1 of the bill, does it not?

Mr. Philip: Yes, essentially though they deal with the same problem. What we are trying to do is to make this bill apply to all buildings which have four or more units, rather than six or more units. That is the essential thrust of both of these amendments. I would suggest that we will save some time if we debate that issue by moving the two amendments.

Mr. Chairman: I am in complete sympathy but I think that we do have a procedural problem of trying to deal with two amendments on the floor at the same time. I think we will just have to stick to the one.

8:40 p.m.

Mr. Philip: The purpose of this amendment, Mr. Chairman, is very simple. What we are dealing with is the fact that a great number of buildings will be exempt if the bill is passed in its present form. I am suggesting that the area that has been most affected, namely the community of Lakeshore, has a great number of six-plexes. A six-plex is not the kind of building normally bought by families.

While I can understand that the minister in bringing in his bill, Bill 32, would want to exempt small family buildings, I suggest that six units is high. It will simply mean that the very people we are trying to stop from evicting tenants -- those merchandisers of that process of selling a building as a percentage interest with an allocation of an apartment and evicting the tenants in that process -- will simply start merchandising smaller buildings using the same method and evicting the same kind of tenants.

In areas such as Lakeshore, where we have had some 800 tenants affected by the present end run around the Condominium Act, and the Attorney General has seen fit to respond to tenants and the opposition by introducing Bill 32, those same people will simply go and merchandise smaller buildings. That is the reason both the New Democratic Party and the Liberals saw this problem. We have moved that we simply reduce the size to four.

That will still allow families to buy a building and have provision for apartments for the grandparents and the sons and daughters. We think that four is a reasonable substitute.

Hon. Mr. McMurtry: Mr. Chairman, about whether it is the figure "four" or "six," as I said earlier, it is something about which reasonable people can disagree. Both the member for Etobicoke (Mr. Philip) and the government caucus are attempting to accomplish the same thing by maintaining some degree of flexibility for families or people who have a close association.

With the greatest respect, on this issue of four or six to accommodate what we thought was a legitimate concern for families or people of close association, we thought we should leave it at six. This was the result of a debate. Whether the number "four" would be better as time goes on, only our experience will be the appropriate guide.

I urge the member for Etobicoke to consider that we have moved this legislation ahead, certainly in part as a result of his urging and that of other members of the Legislature. If it turns out that the figure "six" is a problem from the standpoint of people marketing this type of unit, then it is something we can look at again. But I am afraid I do not have any authorization at this point to take the figure "six" and substitute for it the figure "four."

I would like to give the member for Etobicoke my assurance that if this turns out to be something that is being abused and people are being evicted as a result of individuals who do not have any particular relationship entering into occupancy agreements, this is something we can consider down the line.

Mr. Chairman: Mr. Philip has moved an amendment to section 1.

All those in favour will please say "aye."

All those opposed will please say "nay."

In my opinion the nays have it.

Vote stacked.

Mr. Philip: Mr. Chairman, I have some questions to the minister on section 1 since we are in committee of the whole. It is on the principle of the bill that one may ask a fairly wide range of questions.

I have been raising this problem over a number of years as different lawyers come up with different ways of getting around the condominium conversion bylaws. The minister indicated he would be meeting with the Minister of Municipal Affairs and Housing (Mr. Bennett) and the Minister of Consumer and Commercial Relations (Mr. Elgie) to discuss this problem and would be bringing forth legislation within 10 days. He almost made his deadline and I congratulate him on that.

Can the minister give us any indication whether there is any legislation forthcoming from those three ministries, particularly the Ministry of Municipal Affairs and Housing, that would stop this problem once and for all? I am sure the minister understands this is a stopgap measure; it will prevent some 30 families from being evicted when they have their court hearings on May 30, but it really does not deal with --


Mr. Philip: There are 30 that I know of. There may be even more. None the less, we do know there are at least 30 that are scheduled for court hearings on one day alone this month. Some estimates indicate there are as many as 3,000 who may be affected by this bill.

Can the minister give us any indication of the results of those conversations with those ministers and of whether some substantial legislation to stop this practice once and for all, such as an amendment to the Planning Act, might be forthcoming?

Hon. Mr. McMurtry: Is this vote going to be stacked until 10:15 p.m.?

Mr. Chairman: No, he is just talking generally now.

Hon. Mr. McMurtry: I just wondered about --

Mr. Chairman: That is what I understood from members of the opposition. It is going to be stacked until the committee rises, which could be soon.

Hon. Mr. McMurtry: The Ministry of Consumer and Commercial Relations is considering other legislation. I am sorry I cannot give the member for Etobicoke (Mr. Philip) any time frame.

I think the member is being quite fair. I do not want to be quarrelsome about it, but this 10 days was not the time frame for introducing the legislation; it was the time frame within which I would state the intention of the government. It is true I was just outside the time frame, but we did introduce the legislation on the same day.

The Ministry of Consumer and Commercial Relations is considering other legislation. I cannot give a commitment on behalf of that ministry that they will be introducing legislation prior to the report of the Thom commission. It is quite conceivable they will. I do not know of any intention on the part of the Minister of Municipal Affairs and Housing (Mr. Bennett) to introduce legislation in this area in the foreseeable future, but that is a question that could be directed to the minister during question period.

On section 2:

Mr. Chairman: Mr. Philip moves that section 2 of the bill he amended by deleting the word "six" in line 2 of clause (a) of the new subsection 4 of the amended section 110 of the Landlord and Tenant Act and substituting therefor the word "four."

Mr. Philip: The arguments are the same, Mr. Chairman.

8:50 p.m.

Mr. Chairman: Mr. Philip has moved an amendment to section 2.

All those in favour will please say "aye."

All those opposed will please say "nay."

In my opinion the nays have it.

Vote stacked.

Sections 3 and 4 agreed to.

Mr. Chairman: We cannot do section 5. We will stand the bill down.


Consideration of Bill 28, An Act to amend the Small Claims Courts Act.

On section 1:

Mr. Renwick: Mr. Chairman, when we were speaking on second reading this afternoon in connection with section 1 of the bill to amend the Small Claims Courts Act, Bill 28, which is before us. I raised the question of the tenure of officers of the courts. We were speaking about the clerks, bailiffs and referees of the small claims court. The Attorney General very properly and appropriately, because of what the statute provides, simply said, "That is the way it is in all the courts." That is exactly the issue I want to raise with him.

I am quite aware that under section 83 of the Judicature Act provision is made with respect to the Supreme Court as follows: "There shall be such officers of the Supreme Court as are considered necessary by the Lieutenant Governor in Council for the due dispatch of the business of the court, and such officers, subject to section" so and so, which is not applicable in this case, "shall be appointed by the Lieutenant Governor in Council."

I am also aware that the Interpretation Act specifically provides that authority to the Lieutenant Governor to make an appointment to an office shall be deemed authority to appoint during pleasure. Not being particularly knowledgeable about these matters, I had assumed the tenure of the officers of the Supreme Court was somewhat more secure than the provisions relating to the clerks, bailiffs and referees of the small claims court. That did not turn out to be the case and I was surprised. I had never had occasion to look at that.

I suppose the two contrasting poles are appointment during pleasure on the one hand and appointment during good behaviour on the other hand, illustrated by the present status of the clerks of the small claims court, for example, who have the least secure tenure and the judges of the Supreme Court of Canada, for example, who have the most secure tenure, because they are removable only upon the address of both Houses of Parliament.

I had a sensation that in the area in between it was about time we looked at the question of tenure with respect to the principal officers of those courts where the great bulk of the citizenry come in touch with the system, which are the small claims courts. In due course when occasion arises, when the bill the Attorney General has referred to -- I think he refers to it as the administration of the courts act?

Hon. Mr. McMurtry: The Courts of Justice Act.

Mr. Renwick: The Courts of Justice Act: when that comes before the assembly we may have a more extended opportunity to look into this question.

It did seem appropriate to raise the point of the nature of tenure of the court officers in the little time that was available to do it. I did notice that in the Judicature Act there are significant provisions for protecting the Masters of the Supreme Court; it is set out in some detail in section 96 of the Judicature Act.

It was with that in mind that I simply adapted those provisions for the purpose of the amendment which I would like to propose to section 1 of this bill, so that we could have both the proposed amendment on the record in the interests of furthering a discussion of this kind of question, have a brief discussion about it and then let the matter lay at this point where it would fall with the suggestion.

Basically, my position is, I would be very concerned if the principal officials of all of the courts, the provincial courts and the Supreme Court, did not have some clarity with respect to the process by which they could be removed from office.

Mr. Chairman: Mr. Renwick moves that section 20 of the Small Claims Courts Act, set out in section 1 of Bill 28, be amended to read as follows:

"(1) There shall be a clerk and one or more bailiffs for every small claims court who shall be appointed by the Lieutenant Governor in Council on the recommendation of the Attorney General.

"(2) The Lieutenant Governor in Council may appoint a referee for each small claims court, on the recommendation of the Attorney General.

"(3) A clerk, bailiff, or referee may be removed from office before attaining retirement age only for misbehavior or for inability to perform his duties properly, and only if,

"(a) the circumstances respecting the misbehavior or inability are first inquired into; and

"(b) the clerk, bailiff or referee is given reasonable notice of the time and place for the enquiry and is afforded an opportunity by himself or his counsel of being heard and of cross-examining the witnesses and producing evidence on his own behalf.

"(4) For the purpose of making an enquiry the Lieutenant Governor in Council may appoint a judge of the county court who shall make the enquiry and report therein and a judge so appointed has for that purpose the powers of the commission under part II of the Public Enquiries Act, which part applies to such enquiry if it were an enquiry under that act.

"(5) An order removing a clerk, bailiff or referee from office under this section may be made by the Lieutenant Governor in Council and the order and report of the enquiry shall be laid before the Legislative Assembly if it is in session or, if not, within 15 days after the commencement of the next ensuing session.

"(6) Every clerk, bailiff or referee shall retire upon attaining the age of 65 years.

"(7) Upon attaining an age for retirement under subsection 6 a clerk, bailiff or referee may be reappointed to hold office during any period but shall not hold office after attaining the age of 70 years.

"(8) A clerk, bailiff or referee may at any time resign his office in writing signed by him and delivered to the Attorney General."

Mr. Renwick: In speaking, if I may, to that amendment, I believe it is self-explanatory. It may appear somewhat unduly elaborate with respect to the provisions of the due process involved, and for the terms of the tenure which are provided, but I do commend it, at least the thought contained in it, to the consideration of the Attorney General. I think it would be a wise move for us to make, when one considers that officers of the court, as distinct perhaps from other employees, have a split authority with respect to their appointment, and I refer particularly to the comments made by the Chief Justice of Ontario at the opening of the court when he was commenting on the committee that reported on the Deschênes report on the independent judicial administration of the courts. It makes this distinction.

9 p.m.

Among the matters that must be -- I emphasize must be -- within control of the judges is that of the activity of court personnel but not their salaries or the general terms of their employment. In that particular unusual division of the authority with respect to those officers I do believe they should be entitled to some higher degree of protection than merely to hold their office during pleasure, which, so far as I know, is the most insecure form of tenure known to the English law.

I would submit that this amendment deserves consideration. I would appreciate a brief comment from the Attorney General about it.

Hon. Mr. McMurtry: Mr. Chairman, as I said earlier, this proposal is very interesting. It is certainly without precedent, considering the nature of the employment of these clerks and registrars in the court system outside the small claims court.

I indicated earlier that I would be unable to accept the amendment, but I would like to express my appreciation to the member for Riverdale in so far as putting forward the amendment is concerned because, as he suggested, it will form the basis for further discussion. It is a useful document to have for that purpose, certainly, at the very least.

This would be a very substantial, very significant and very far-reaching amendment. In my view it would be unwise to accept it without a lot of careful thought and consideration. However, as the member has stated, it is on the record. It will be the subject matter of further discussion, and certainly if we were to make such an amendment we would have great difficulty in making such an important amendment separate and apart from our new courts of justice legislation.

I accept this very significant and far-reaching amendment proposal on the basis that it will be the subject for further discussion in relation to this very important and comprehensive legislation, which will involve all of the courts under the title of the Courts of Justice Act.

Mr. Renwick: Mr. Chairman, I appreciate that the Attorney General has accepted it pretty much in the spirit in which I proposed it, and I think the germ of the idea reflected in this brief consideration of it is well worth exploring.

Mr. Chairman: All those in favour of Mr. Renwick's amendment will please say "aye."

All those opposed will please say "nay."

In my opinion the nays have it.

Motion negatived.

Sections 1 to 3, inclusive, agreed to.

On section 4:

Mr. Renwick: Mr. Chairman, I simply want to refer to what the compendium says that was provided with the bill. Section 4 provides for interest to run on small claims court judgements at the same rate as in Supreme Court, county court and district court judgements. Previously, interest could run on a judgement only where it was enforced by seizure and sale of goods. Since few judgements are enforced by seizure and sale, the previous law was very inequitable to judgement creditors.

Section 5 was complementary to section 4. I have no problem with section 5, because it was for practical purposes to remove the particular provision and provide it in this more omnibus one.

My comments this afternoon were quite simple and direct. There is nothing I know other than a spurious logic that would tell us at this point in the history of the small claims courts in Ontario that we should provide for an interest on judgement. We have never had it before; that we should have it at this point simply in order that it would accord with the same interest as in the Supreme Court and the county and district courts is not to my mind a reason.

I suppose it can be reduced, as the Attorney General likes to reduce these things, to a philosophic difference. It is a practical philosophic difference in the judicial system because it runs entirely contrary to everything I have ever read about the nature of the small claims courts, the purposes for which they were instituted and the expeditious way in which they were to be operated. There is nothing that indicates to me that the provision of this kind of interest on judgements in the small claims courts will do anything either to speed up, delay or alter the settlement of judgements by judgement debtors to their creditors. I rest my case at that.

We will never be able to persuade this government that the small claims court is not some kind of miniature Supreme Court but a qualitatively different court with a different concept and a different purpose, designed to ensure the speedy settlement of monetary disputes between citizens of the province in a way that is inimical to the lengthy processes reserved for the wealthier citizens of the province in the county courts and in the Supreme Court. All the jurisprudence, all the writings about the small claims court appear to have made no impression on the government of this province, because it now tends entirely to try simply to make the small claims court into some other kind of adjunct of the superior courts.

Anything that has been written in the last 30 years with respect to the need to reform the small claims court flies in the teeth of the proposed amendment. A spurious logic tells us that on this day of our Lord, May 17, 1983, this assembly should now agree that interest should run on judgements in the small claims court. Why, I do not know. I would have thought any kind of jurisprudential evidence would have been submitted to this assembly rather than a false and spurious Aristotelian logic in connection with it. It is for this reason that our party feels quite strongly about this view of those courts.

Of course, the constituents of most of the members sitting on the government benches deal only in the higher courts, so they are not faced with the problem. If you are in my riding, you go out to the small claims court in Scarborough. You have to get from Riverdale to the small claims court in Scarborough when somebody sues you for your account at Eaton's, for example, on the question of whether or not the equipment you received was any good. If you fail to pay and they sue you in that court, just imagine the amount of time you spend in public transportation getting to and from that court, without Eaton's having the luxury of a penalty provision with respect to interest imposed on the judgement, which the people in the Riverdale area have enough difficulty paying. They have enough difficulty competing against the persons who make these claims against them.

I take off my hat to nobody in connection with the obligation of people to settle their debts. But these courts are settling disputed debts when the settlement is made by the arbitrary judgement of the court, and the Attorney General does not provide any information whatsoever except from the 18th floor, or whatever floor it is, at 18 King Street East, where they have decided it must accord with what is done in the county courts and the Supreme Court. I find that kind of approach to jurisprudence as it affects the people in the riding of Riverdale utterly without merit.

9:10 p.m.

Hon. Mr. McMurtry: Mr. Chairman, I think the member for Riverdale has somehow forgotten -- and it is not usual for him -- that in the small claims court there has been prejudgement interest since 1977. Given his logical bent of mind, I would have thought that if we in this Legislature approved pre-judgement interest back in 1977, he would have seen some modest degree of logic in extending it to postjudgement interest.

I say with great respect to him that there is not a member of this Legislature who does not have a lot of ordinary people appearing in the small claims courts of this province. Certainly the majority of citizens who are likely to find themselves in civil court in the great riding of Eglinton are more likely to find themselves in a small claims court than in the other courts.

There is a further consideration. In cases where judgement creditors are going to the small claims court or would be persuaded to go to small claims court, in our view if interest is allowed, they are not going to be more likely to take it to a higher court if their claim can fall within that jurisdiction.

I think the very fact that we put the small claims court on the same basis as the other courts may encourage some litigants who might technically have a case that can be proven in the county court to restrict their claim to the small claims court jurisdiction with a saving of costs all around.

Sections 4 and 5 agreed to.

On section 6:

Mr. Renwick: Mr. Chairman, my point is again quite simple. Section 6 is going to provide for what is referred to in the compendium of information provided to us with the bill as some minor changes and so on. They are not particularly minor; they are going to grant to the collection agencies the authority to file executions against the land of a judgement debtor.

Assuming for the moment that judgement debtors in the small claims court have land, one will find in most of the cases -- and I can state this just as categorically because there is no other evidence available to contradict it -- that it will be the home of the person. I do not happen to believe in this day and age that the collection of this kind of debt awarded in the small claims court should be at the expense of levying against the land of the person when in most cases it is his private home.

I do not know whether the Attorney General has any idea of the trauma most people feel if they find out they have an execution levied against their home. It certainly is very traumatic for elderly people and it is very traumatic for people who are not aware of all the ins and outs of the law.

The method of collecting debts through the bailiffs and through the courts is adequate without judgement creditors having the benefit of this ancient and time-worn method of levying against real property. In the bill the Attorney General said, "All right, if they do levy it, what does it really matter, because what we are going to do is make certain that once you have paid your bill, it will be the responsibility of the person who placed the execution on the property to take it off the property."

One can imagine how convenient that will be when one reads the provision that is going to be added to carry it out:

"Where an execution against lands has been filed with the sheriff and the judgement is fully satisfied, the judgement creditor or his agent shall cause the execution to be withdrawn promptly and shall be liable to the judgement debtor for any reasonably foreseeable loss resulting from failure to do so."

Again, if my friend the Chairman were able to speak and participate in this debate, as a practising solicitor he would well know how fraught with nonsense that kind of provision is with respect to the irritation and the frustration that can be caused by a judgement debtor, who, having had this iniquitous execution levied against his land, pays up his account, which he intended to do in any event, and then finds some time later, of course, that there is still the execution levied against his land, because the collection agency or the client of the collection agency has not quite gotten around to lifting it.

The day he turns around to sell his house, of course, his solicitor says to him, "What about this execution against your land?" "Oh," he says, "I paid that." "Well, we will have to get rid of it. Who put it on?" "Well, so-and-so, but so-and-so is out of business now. How do we get it removed?" "Oh, you can make an application to the court." "Will that cost anything?" "Of course it will cost -- you know, a few dollars." That is how it will go.

We find that every time the encroachment is made upon ordinary people by the judicial system we have a little bit given on the other hand as though that evens the balance. I simply say to the Attorney General with all the force I can, and in the parliamentary way in which I want to say it, that the provision under the Small Claims Courts Act for executions to be levied against the land of judgement debtors, is iniquitous and it is contrary to the philosophy and the concept of the small claims court. It is a step backwards, I would like to think, only to the 18th century; it is probably a step backward to the feudal system in England in the 14th century. I and my caucus are quite opposed to this attitude that the Attorney General has towards small claims courts.

Hon. Mr. McMurtry: Mr. Chairman, I would like the member for Riverdale to tell the tens of thousands of ordinary small judgement creditors that he believes in having a small claims court system in which one can obtain judgements but one cannot enforce them. If that is what he wants, I do not think it would be acceptable to most of the ordinary folk in this province.

Mr. Renwick: Mr, Chairman, let me just briefly respond. I am not against the enforcement of judgements. People should pay their debts; people should meet judgements made by the courts. But we do not need to give one party in the game an overwhelmingly strong position as against the other. The Attorney General knows that justice is generally known as a balance. There is an ancient statue of a blind person with two scales. It is a balance and it is an evenhanded proposition, and this is not evenhanded. Of course, it will have to await the incoming of a New Democratic Party government to deal properly with the Small Claims Courts Act, and I leave the matter at that point.

Sections 6 to 10, inclusive, agreed to.

Bill ordered to be reported.


Consideration of Bill 29, An Act to amend the Estates Administration Act.

Hon. Mr. McMurtry: Mr, Chairman, I wonder if in opening I should say that I am grateful to the member for Riverdale for pointing out, first of all, some typographical errors in the bill as printed, and we will be introducing the appropriate amendments.

9:20 p.m.

I would also like to say I was interested in the comments of the member for Riverdale on subsection 19a(4) of the act as set out in subsection 1(1) of the bill in relation to foreign beneficiaries. As I understood his brief comments and as I directed my attention to that subsection, it was my view that there was some confusion on the basis of whether a person is or is not a beneficiary. I would like to say in opening that it is our intention to amend subsection 19a(4) by striking out the words "foreign beneficiary" and substituting therefor the words "person resident in a country designated by regulation under this section."

I wanted to make an opening statement in regard to the direction in which we were going, because I think the member for Riverdale made a very valid observation in relation to this section and the confusion. What we are trying to do in that subsection is to provide for a situation where, if the purported foreign next of kin turns out to the satisfaction of the court not to be the next of kin, the court could make the appropriate substitution. I think the member for Riverdale is quite right, as I understood his comments, that either one is a beneficiary or one is not a beneficiary, and he naturally expressed some interest in the basis on which a court would be satisfied that a person other than a foreign beneficiary would be entitled to the personal property.

I am grateful to him for bringing this to my attention, as well as these other issues that will be the subject matter of amendments. I thought it would be helpful if I just made these brief observations in opening with respect to the legislation being in committee of the whole House.

Mr. Breithaupt: Mr. Chairman, we have a further change to subsection 19a(4). I assume the Attorney General is going to place that as well, or shall we proceed to deal with those amendments, since they are all within the first section of the bill? If they can be agreed to, perhaps we can handle all three seriatim.

Mr. Chairman: I think we should deal with one at a time.

Mr. Renwick: Mr. Chairman, my colleague the member for Lake Nipigon (Mr. Stokes) asked me whether Latin was an accepted language under the rules of the House, and I assured him it was.

I do not have any problems with the amendments. Indeed, I appreciate the Attorney General responding to that concern of mine. My concern, strangely enough, was that somehow or other the concept that the member for Kitchener, with the best of intentions in the world, was trying to introduce -- which I, with great respect, disagreed with -- gave some latitude in the court to pick and choose who was going to get the money. I was a little bit worried about that. I think that was why the anomaly of the term "foreign beneficiary" appeared when I read the bill.

What I really wanted to have a brief exchange about in committee of the whole House was the vast difference between the very low-keyed statement the Attorney General has always made and the statements made by the member for Kitchener, not by way of exaggeration but in dimensions of the problem, and echoed by the member for High Park-Swansea (Mr. Shymko), about the number of dollars involved, the number of estates involved and the number of countries involved.

We get a compendium of information provided by the Attorney General that simply says, "Within the past few years, members of Toronto's Ukrainian community, particularly lawyers of Ukrainian ancestry, have brought to the attention of the Attorney General certain problems they have encountered in attempting to deal with the estates of persons dying in Ontario who leave beneficiaries in the Soviet Union."

I would like to know whether the rhetoric is correct: that it is also a problem with a number of countries lying behind the Iron Curtain. In so far as the information the Attorney General has is concerned, is it limited to the Soviet Union in relation to the encroachment on the value of legacies and bequests going to persons in the Soviet Union? Which countries does he intend to designate? Is it restricted to members of the Ukrainian community, or have there been a number of other cases?

I think the member for Kitchener referred to a lawyer having 400 files and said that the number of dollars was in the millions; the member for High Park-Swansea referred to it in the same rhetorical terms. What is the dimension of the problem we are dealing with? Is it the limited problem the Attorney General refers to related to the Soviet Union and to members of the Ukrainian community -- I am not diminishing the seriousness of the problem -- or is this a much broader problem related to a number of countries behind the Iron Curtain?

I would appreciate it if the Attorney General, who must have the information, could put it into some kind of perspective for us.

Hon. Mr. McMurtry: Mr. Chairman, it is a little difficult to measure the extent of the problem, because no one has been able to monitor the actual amount of money involved. It is believed to involve a large amount; the term "millions of dollars" is frequently mentioned.

I do not know of any system we could implement that would monitor the actual amount of money involved. Certainly it is a strongly held view that a number of these estates not only in the Soviet Union but in the Soviet-bloc countries are being, in the words of the legislation, "unduly depleted." The beneficiaries, whether they are named or those under an intestacy, often receive a small fraction of the amount of the bequest.

There is another issue that has caused some concern. It is an issue that is not directly dealt with in this legislation, because it is really an evidentiary matter. This is the concern that when some of the beneficiaries come forward as a result of an intestacy in the Soviet Union and other countries -- Czechoslovakia, the Ukraine, Hungary, etc. -- there is some doubt as to the legitimacy of these beneficiaries. To put it in very blunt terms, are they the people they purport to be? This is not dealt with in this legislation, but it does help to increase the level of concern with respect to this issue.

When it comes to measuring the extent of the problem, I am afraid I cannot be of much assistance other than to say that on a number of occasions I have met with lawyers of eastern European origin who have acted on a number of estates. They have provided me and my colleagues within the ministry with a fairly convincing case that there is a significant problem, but the actual extent of the problem is very difficult to measure.

9:30 p.m.

Again, we have made it clear to them that our legislative approach is not going to eliminate the problem. We hope it will help to persuade the officials in the countries involved that if they are going to be unreasonable with respect to the various costs that are applied, legal or otherwise, a court in Ontario may come to the conclusion that the estate has been unduly depleted and simply hold the money in trust, as opposed to any escheat to the crown, until it is satisfied that the estate has not been unduly depleted.

Obviously this criterion as to what is an undue depletion is a relatively general one and the courts will have to deal with each case on its own particular factual situation.

Mr. Renwick: I appreciate those comments as well because the question of some form of fraudulent impersonation of who is entitled to it is a problem every court must be alert to regardless of the origin. I can appreciate the problems might well be compounded and I thank the Attorney General for the clear statement that this bill does not deal with that problem in any way. I think I have some sense of it.

I do not want to pursue this too far. Is the Attorney General in a position to tell us now which countries he intends to designate by regulation? My clear understanding now is that this does not grant any extra jurisdiction to the courts. Is that correct? Their obligation is simply to find out who the beneficiary is and, having found out who the beneficiary is, in the one case, if they are satisfied that it will not be unduly depleted, to pay over the money; if they find out it will be something called "unduly depleted," to hold it or to require the personal representative to hold it. That is the way I read this bill.

The obvious question is how long do they hold it? What is the open-ended nature of this trust which is created? Is that something we leave for some other legislators in this assembly at the turn of the century? I will probably be the only one still here when that comes around.

I am not criticizing. I believe this is the correct way to do it, but I think the record should clearly show that these funds are held either by the court if it is money, or by the personal representative if it is personal property other than money, and they are held indefinitely for the person who is determined to be the beneficiary. It is a very open-ended requirement.

I do not know the answer, but I would simply ask the Attorney General to let me know whether my understanding is correct on those two points, that is, the designated countries and the indefinite nature of these trusts.

Is the purpose of subsections 6 and 7 in obtaining these reports which are to be prescribed by regulations simply for the purpose of trying to monitor what is happening and provide information? What other purpose do they serve?

Hon. Mr. McMurtry: I can answer most of this fairly briefly by saying that all the observations that have been made by the member for Riverdale reflect my understanding of the legislation, with the exception of the designated countries about which he has asked me a specific question that was not dealt with directly. I expect the countries that will be designated -- outside of the USSR -- will be Poland, Hungary, Czechoslovakia, Latvia, Estonia and Lithuania. If there are any additional suggestions, we will consider them. But fundamentally those are the nations we expect to have designated.

On section 1:

Mr. Chairman: Hon. Mr. McMurtry moves that subsection 19a(4) of the act as set out in subsection 1(1) of the bill be amended by striking out "(2)" in the first line thereof and inserting in lieu thereof "(3)."

Hon. Mr. McMurtry: There is a further amendment to that same subsection.

Mr. Chairman: Is there? Let us deal with the first one.

Motion agreed to.

Mr. Chairman: Hon. Mr. McMurtry further moves that subsection 19a(4) of the act as set out in subsection 1(1) of the bill be amended by striking out the words "foreign beneficiary" in the second line and inserting in lieu thereof the words "person resident in a country designated by regulation under this section."

Mr. Breithaupt: It is interesting to see that change. As I read it at least, the minister almost repeats the terms of his definition in subsection 19a(1) rather than leave the phrase "foreign beneficiary." Is there some difference in not having the word "beneficiary" involved but instead the word "person"? Is there a reason for that? If there is, it has escaped me.

Hon. Mr. McMurtry: The member for Riverdale drew this to my attention. He wondered under what circumstances the court would be satisfied that a person other than a foreign beneficiary would be entitled to the personal property. The court may by order direct its distribution to the person entitled.

When he raised that issue, in looking at it, what occurred to me was that either one is a foreign beneficiary or one is not a beneficiary. What the legislation appeared to be stating was that, notwithstanding the fact that one is in law a beneficiary under an estate, the court would still have the authority to designate somebody else to receive the property in one's stead. That, to me, was not the intention of the legislation.

The intention of that subsection was, where, during the course of the application it became clear that the person resident in the foreign jurisdiction, the purported beneficiary, was not in fact the legal beneficiary, the court would have, in the course of the proceedings, the right simply to substitute, where it could be ascertained on an application. If there was an issue about this the court would have to direct a trial of the issue. The confusion I saw as a result of having this pointed out by the member for Riverdale was that either one is or is not a beneficiary in law.

I repeat that the purpose of this section was, where, during the course of the application it became clear that the purported foreign beneficiary was not the legal beneficiary, in other words, if the person on whose behalf the claim was made was not a legal beneficiary, the court on the proper evidence could substitute the "person entitled" in the words of that subsection.

Mr. Breithaupt: I suppose the minister could follow through on the theme that the law defines the term "beneficiary," except that in this section there is a clear definition of the phrase "foreign beneficiary." What he is doing in his amendment is replacing the term "foreign beneficiary" with what he has defined a foreign beneficiary to be. I am not quite certain why that is happening.

We see, and I have a note here, that if another person is entitled, then the foreign beneficiary -- that is, the person upon whose account this application is being made -- is not a beneficiary at all. Therefore the change is made to avoid using the word "beneficiary" at all in that subsection. That explanation makes somewhat more sense, but I presume that is because the counsel wrote it, and neither I nor the Attorney General attempted to define it.

9:40 p.m.

Hon. Mr. McMurtry: The foreign beneficiary, as defined in 1981, means a beneficiary as opposed to a person who is resident. That is the distinction. After it was directed to my attention by the member for Riverdale, it seemed to me there was some confusion. I relied upon our expert draftsmen to remove that confusion.

Motion agreed to.

Mr. Chairman: Hon. Mr. McMurtry moves that subsection 19a(5) of the act as contained in subsection 1(1) of the bill be amended by striking out "(2)" in the first line and inserting in lieu thereof "(3)."

Motion agreed to.

Section 1, as amended, agreed to.

Sections 2 to 4, inclusive, agreed to.

Bill, as amended, ordered to be reported.


Consideration of Bill 3, An Act to amend the Motor Vehicle Dealers Act.

Section 1 agreed to.

On section 2:

Mr. Chairman: Mr. Philip moves that section 2 of Bill 3 be amended by adding the following clause (s):

"Providing for the payment of claims by purchasers of a new motor vehicle to permit the replacement of such a vehicle which, before the first anniversary of its delivery to the purchaser, or before the vehicle has been driven 20,000 kilometres, has been the subject of four attempts to repair a defect by the manufacturer, the motor vehicle dealer or an agent thereof, has been out of service for an aggregate period of 30 days or more in the course of attempted repairs by the manufacturer, the motor vehicle dealer or an agent thereof, and whose defect remains substantially uncorrected."

I am wondering, if it is all the same to the member for Etobicoke, if there is any discussion on clauses (o), (p), (q) or (r). No discussion? Carried.

The member for Etobicoke on his amendment.

Mr. Philip: Mr. Chairman, essentially this is a copy of Bill 20, which I introduced, known as the Lemon-Aid Act, or An Act to protect the Purchasers of New Motor Vehicles.

With the trend towards lower interest rates, there are some preliminary indications that with the upturn of new car sales we will once again face a proliferation of complaints by new car owners about the fact they have bought cars that are lemons, that have had large numbers of days in the repair shop for substantially the same faults and that the warranty is not working.

We know the difficulty of class action suits in this province, and in this country. My colleague the member for Welland-Thorold (Mr. Swart) has spoken on that topic on numerous occasions and indeed has introduced a private member's bill.

In the absence of such legislation it seems to us fairly clear that we need some protection for the consumer who happens to purchase a lemon. This is not an innovative idea on my part; in fact, it is a fairly close copy of the state of Connecticut's automobile warranty, or lemon law, which I have put into the Ontario statutes.

Those who have reviewed the literature on Connecticut and on two or three other states that have introduced similar legislation, know that this does provide some protection to the consumer.

I have a thick file on one case alone, which I have sent to the Minister of Consumer and Commercial Relations (Mr. Elgie), where a person who came to see me has shown that he has gone back time and again -- over 25 times -- for essentially the same complaint.

A couple of years ago I had the situation of a constituent who came to me with a car that was warped. The dealer could do nothing about it. Because of the way in which the frame was bent, he got an unwanted shower every time it rained. We never did resolve that problem.

When one called the Ministry of Consumer and Commercial Relations they simply said: "All we can do is act as a mediator." Well, they act as a mediator and what invariably happens is that the dealer says it is not his problem, it is the company's problem, and the company says, "Go and see your dealer."

The Minister of Consumer and Commercial Relations has indicated in a recent article in the Star that he would consider action in the way of protecting new car owners. I am facilitating that by moving an addition to this act of what essentially he and the Attorney General have expressed some interest in in my Bill 20. It will make it a lot easier if we pass this right at the moment rather than wait for my private member's bill to come up, at which time no doubt the government would rush to pass it.

Mr. Swart: It would steal it.

9:50 p.m.

Mr. Philip: I do not use the word "steal" because that is unparliamentary and the Attorney General (Mr. McMurtry) and I have now resolved our differences on that bill, It has been taken care of.

I urge all members of the Liberal Party carefully to consider our proposal. We hope the Liberals will vote for it and we hope the government will similarly support the amendment.

Mr. Boudria: Mr. Chairman, briefly, as the member for Etobicoke knows, he introduced this bill only a few minutes after I had informed him I had a similar bill ready on the very same day that I was going to introduce, and we discussed that. I believe it was also on that very same day I flew in from Ottawa with the member for Carleton (Mr. Mitchell) on board the same flight and I informed him I intended to introduce a bill regarding "lemon" automobiles, if that is a proper word to use.

There are a couple of things that particularly concern me. One is the practice of automobile dealers repairing brand new cars and selling them without notifying the purchasers of such cars that those automobiles were damaged and subsequently repaired. As the member for Etobicoke clearly stated, the case of a bent chassis or undercarriage of an automobile is certainly an example of that.

Where an automobile may have been in a major accident in the process of transit from the manufacturing plant to the dealer, it would subsequently have been repaired by that same dealer under no obligation ever to report such damage to the new customer.

The dealer could repair that automobile using such products as putty, plastic and other kinds of body-filling material, and repaint it, never notifying the purchaser of the automobile and never breaking any law by doing so. Thus, the customer could be sold an automobile which would undoubtedly not last as long as one which had never been damaged, thereby causing on a long-term basis -- maybe in some cases on a short-term basis -- a very difficult situation for the owner of that automobile.

That only takes into account matters such as problems with the body of the automobile itself. Even more fundamental are issues such as truly mechanical problems, motor problems, transmission problems, drive train problems and so forth. The same situation occurs. Theoretically, a dealer could remove an automobile from the truck that delivers it, rev the engine and the engine could be defective; it could blow a piston or something like that. The dealer could repair that vehicle, never inform the customer and sell it as a new automobile because if it has not been previously owned it is still a new automobile.

A customer for such an automobile deserves to be afforded better protection. One of the methods of arriving at such protection, in the first year at least, is to have a bill such as Bill 20, proposed by the member for Etobicoke and also as proposed in this amendment which is similar if not exactly the same as Bill 20.

The owners of automobiles in other jurisdictions have such protection, as the member for Etobicoke has said. He has named the state of Connecticut. I believe California also has similar legislation. Massachusetts is contemplating or working on similar legislation right at this moment, as are several other jurisdictions in North America.

This amendment certainly warrants the support of each and every one of us, and it is our hope the member for Carleton, in his capacity as parliamentary assistant to the Minister of Consumer and Commercial Relations, will see the value of such legislation and the great benefit it could have for the consumers of this province. I know he is a very concerned person and, as one who wants to protect the consumers of this province, will undoubtedly be in favour of such a bill.

Mr. Martel: He got his marching orders.

Mr. Boudria: As the member for Sudbury East (Mr. Martel) has stated, he may have received orders to the contrary and been told not to support this very important amendment, but we as a party would like to support it. As I said earlier, we had a very similar bill that I had myself proposed. It is our hope that the government is revealing a new philosophy that it has undoubtedly had since the recent trust companies incident, that it now has to take an active interest in the protection of consumers. We all know it will endeavour to do this.

Perhaps the member for Carleton will say that such a bill will be more effective if it was at the federal level. Undoubtedly that point will come up because it has been said in the past by others. Although we agree that other legislatures could do their share as well for the protection of consumers, I believe that certainly it is our duty and incumbent upon us as legislators to support this amendment to help the consumers of Ontario in purchasing new automobiles, either domestic or imported.

Mr. Swart: Mr. Chairman, when Bill 3 was before us there was unanimous support for the principle of this bill which gave some additional protection to purchasers of new vehicles against default on the part of the dealer. I would rather hope that this same sense of political ecumenism would apply to this amendment which has been put forward by my colleague from Etobicoke. It certainly adds to the bill; it provides a very needed additional measure of protection to purchasers of automobiles.

Of course I have an interest in it apart from the fact that I have had some part in consumer matters. Since I have been a member I can recall offhand at least three or four occasions when people had bought new cars which were lemons and they could not get the problems corrected. That had a substantial adverse effect on them, not only financially but psychologically.

One person had bought a car that turned out to be one of the purest lemons ever purchased by a consumer. It was a foreign car and that is another reason there is need for this legislation. In our Canadian-made and American-made cars, we do have some avenues of appeal -- not a certain measure of getting redress -- directly to the manufacturers. When one gets into the purchase of a foreign car, one cannot follow that same route to the top. Therefore, it is more difficult --

Mr. Boudria: It is a little hard for the people with Ladas, for instance.

Mr. Swart: Particularly the people with Ladas, but even the Japanese cars; with all of the foreign makes it is much more difficult to get redress. Therefore this kind of bill becomes more essential.

The woman I referred to had bought this foreign made car from a dealer in the St. Catharines area and found it totally unsatisfactory. It was breaking down all of the time. She took it back and never did get satisfaction. Eventually, she wrote a book about it, which was published. I want to tell members that it had a long-term effect on her psychologically.

10 p.m.

On another occasion, a purchaser paid a substantial amount for a truck. After he purchased this truck, he found out the chassis had been altered from the specifications of the truck he thought he had purchased. I guess it was a special order that had been made. He had trouble with the transmission and with the drive shaft, and that continued. He lost literally thousands and thousands of dollars on that truck.

I suspect that if we had had this kind of legislation -- and it may have had to be broadened somewhat -- that it could have dealt with the issue of the Chevmobile. People bought Oldsmobiles thinking they were getting a car with an Oldsmobile engine and later found out it had only a Chevrolet engine in it.

The Minister of Consumer and Commercial Relations at the time, the member for Scarborough Centre (Mr. Drea), blustered about that and said he would make these companies come to heel. He would not settle for the 200, as they had done in lots of other jurisdictions. The end result was the people got nothing. They were out entirely the difference in value between that Oldsmobile motor and the Chev motor.

More recently, there has been -- and I have had some occasion to bring this to the attention of the current Minister of Consumer and Commercial Relations (Mr. Elgie) -- trouble with a light transmission being put in some cars. I have forgotten what make it was right now, but inadequate and light transmissions have been put in cars which, by all specifications, should have had heavier transmissions.

As I say, it may be the legislation would have to be broadened to deal with all of these particular problems. The amendment by my colleague the member for Etobicoke might not quite cover all of these, but I suggest to the parliamentary assistant that even if it does not, it is a good start.

Although the member has intimated -- and I take his word for it and perhaps he is going to make a further commitment when he gets on his feet -- that there is in the works some consumer protection legislation with regard to lemons and these other problems, I would suggest the best way to prove good faith that they are going to bring this in is to accept this amendment at the present time.

If they bring in a bill to further amend the present Motor Vehicle Dealers Act to incorporate more consumer protection measures, they can always amend and delete this amendment by my colleague the member for Etobicoke. But if we accept it at this time -- because this is a measure that is needed certainly as much as any other -- then it does show a degree of good faith. On that basis, I would ask the parliamentary assistant to consider support of this amendment and to incorporate it in the legislation we have before us.

During the years I have been in this Legislature, we have had a great many commitments made on that side of the House about legislation they intended to table in order to correct problems. Time after time we have had both opposition parties move amendments to legislation brought before this House to incorporate those further provisions. The government has always seemed to turn them down on the excuse, "We are going to bring in more comprehensive legislation and, therefore, we do not want to touch this at the present time."

In many instances, I do not doubt the good intentions of the members of the government in doing this, but in practice the majority of those amendments have never been brought to this Legislature for a variety of reasons. Whether there is no time to deal with them, whether there have been changes in the ministries, or whether the ministers themselves have moved from one ministry to another, they have not come before this House. Therefore, more and more, regardless of good intentions, I am inclined to feel we must use every opportunity when we have amending legislation brought in by the government to tag on our amendments that we think will improve the situation.

I think this is one amendment that even the government would feel there could be no harm in passing, that it would only improve the situation as it wants to improve it. Although it may not be as comprehensive as it would hope it could be by bringing in its own legislation in the future, it would certainly show good faith on its part. The big thing is we would have it in place now.

I am sure the Liberal Party is going to support this amendment. If we could now have concurrence from the government side of the House tonight, we could make this improvement people have been waiting for for years.

In conclusion, I say to the parliamentary assistant, who talked to me about this privately, perhaps he can rise up now and say, "Yes, we are going to bring in legislation on our own, but because this is part of any legislation we bring in we will support it right now."

Mr. J. M. Johnson: Mr. Chairman, I am sorry to disappoint the member for Welland-Thorold, but the member for Carleton (Mr. Mitchell) is not going to rise up now in answer to his question because I want to make a few comments. Those members seem to feel they have the right to speak whenever they want, but I think some of the government members should have the right to express themselves.


Mr. J. M. Johnson: All right; calm down. I would like to go on record as saying I fully support the concept of the motor vehicle dealers compensation fund, but I have a bit of a problem with it. Perhaps it can be resolved with the ministry.

Mr. Martel: We hope you will support the bill then.

Mr. Charlton: It's your amendment.

Mr. J. M. Johnson: Just cool it. My father was in the car business all his life, 40 some years. I think I know a little bit about car sales and the background to that. I have 25 to 30 dealers in my riding. They are small dealers selling 20, 30 or 40 cars in a year.

I find a discrepancy in Addison on Bay Ltd. paying $150 a year and my small, individual dealers are supposed to pay the same amount to create a fund of $1 million. I think it should be related more to the policy in the travel business where the fee is based on volume.

Mr. Swart: Turn around and talk to the guy behind you.


Mr. J. M. Johnson: I do not see anything in here about lemons. I thought the member was talking about lemons.

I will be brief. The parliamentary assistant is getting quite agitated. He wants me to quiet down so I will only take a couple of minutes. All I am saying is I understand that when this bill is brought in there will be consultation with the car dealers. I hope they will take into consideration the fact that there should be some equity in the charges levied against the dealers based on the volume of the franchise. I hope that is reasonable. It does not seem to me to be out of the way. I would hope the members across the floor could support that type of proposition.

10:10 p.m.

Mr. Martel: Mr. Chairman, while I chat my colleague is drafting an amendment that I might be prepared to move which would incorporate that very idea being presented, unless the parliamentary assistant is prepared to do it. I would take my place if he is prepared to move that amendment.

I am sure those of us on this side of the House are all prepared to accept an amendment that would protect the small dealers. I understand what my colleague says. If the parliamentary assistant wants to move the amendment so that it does not come from the opposition, I am prepared to take my place. If he is not, then I --

Mr. Mitchell: There is no fee structure, in fact.

Mr. Martel: Let me make two points as a member who once had a lemon and over a two and half year period had 14 sets of brake shoes put on that car. When I finally got rid of it, it was still not working. I remember driving down Highway 400 going home one weekend in July and it let go in the middle of a holiday weekend. I was in the middle lane and the brakes let go again. I had 14 sets of brake shoes put on that one car. It was frightening.

They could not get to the basis of the problem nor would they take the car back. I was stuck with a car on which the brakes went on 14 different occasions, and there was no recourse for me. My dealer tried everything under the sun to find out what was wrong. He brought in the experts but they could not find it; yet there was no way they would replace it.

There I was out on the highway driving a car which was a hazard to me, my family and every other person who came remotely close to my vehicle. It was an eerie experience. I was absolutely delighted, in one sense, to get rid of it, but I knew that some other poor fish was going to have that car; and I had bought it new.

Mr. Treleaven: Why did the member not junk it?

Mr. Martel: Unlike some of those legal people, those of us in the Legislature in those days could not afford it. Not being in the cabinet, I did not have a chauffeur-driven limousine like my friend the government House leader, so I had to put up with this ruddy car which was a hazard to everyone on the highway.

Let me make my second point. I totally agree with my friend the member for Wellington-Dufferin-Peel (Mr. J. M. Johnson) that it would be unfair to charge everyone the same amount.

Has he got that written out? I will move it.

Mr. Chairman: We have an amendment to the amendment?

Mr. Martel: Yes. Does the member for Wellington-Dufferin-Peel want to second this? Where is he? He is a man of integrity and principle, and I know he would want to second this motion. Therefore, I move that clause 2(b) of the bill be amended by adding the following after the word thereof, "proportional to their sales."

Mr. Chairman: We have already passed clause (p).

Mr. Martel: No, no.

Mr. Chairman: Yes, we have already passed clause (p).

Mr. Martel: It is clause (b) of section 2 of the bill.

Mr. Chairman: I do not see a (b).

Mr. Martel: Pardon me, (p). The writing is so bad. I would fail him in school. He could never get a grade with me.

Mr. Chairman: I see clauses (o), (p), (q), (r). We are dealing with clause (s) in a proposed amendment. Where does this come in? We have passed (p).

Mr. Martel: That section 2 of the bill be amended.

Mr. Chairman: It is out of order.

Mr. Swart: Mr. Chairman, on a point of order. If we get unanimous consent of the House, we could revert to that section after we deal with the section we are on at the present time.

Mr. Chairman: We will need unanimous consent because we did pass clause (p).

Mr. Swart: I am sure the members on that side would not cross up their own member.

Mr. Chairman: Let us get going with the other amendment, clause (s). One amendment at a time. Let us get this show going.

Mr. Mitchell: Mr. Chairman, perhaps I can address the whole question of fees in my wrapup. There are no fees set as yet; there have been fees talked about in a specific area with the industry, but the regulation is yet to be drawn. The fees have not been finalized; in fact, there will be further meetings with the associations representing the dealers before the fees are struck.

They have talked in the area of $150 on a two-year basis because they are currently paying $75 to $100 for a bond. Once the fund reaches $1 million, they will get a holiday. Nothing has been finalized and that is quite clear. There will be a meeting with the industry prior to the regulations being formulated.

Mr. Chairman: Speaking to the proposed amendment from the member for Etobicoke on clause (s).

Mr. Martel: Is it the government's intention to deal with what my friend the member for Wellington-Dufferin-Peel is proposing? Is it the government's intention to bring in an amount based on sales or volume? It will not simply be one levy across the board, is that right?

Mr. Mitchell: All I can say is that it is something to be considered. The industry will have to be met with after the passage of this bill. They support this bill. The fees have not been established as a final figure.

Mr. Philip: I would like some clarification.

We were dealing with an amendment to section 2 of the bill. That amendment was a new section, clause (s). But we have not passed section 2 as amended and therefore it is in order to --

Mr. Chairman: Make it clause (t) then. We have already passed clauses (o), (p), (q) and (r) and we are dealing with clause (s). Make your second amendment as clause (t).

Mr. Philip: We have not passed section 2 as amended.

Mr. Chairman: That is right. I agree with that.

Mr. Philip: Therefore it is surely possible to amend clause (p).

Mr. Chairman: No, I am going to rule that out of order. We passed that; everyone was present at the time. I said, "Since your proposed amendment is clause (s), can we deal with clauses (o), (p), (q) and (r)?" Everyone agreed. They are all passed.

Mr. Philip: Since this is obviously our attempt to accommodate a Conservative member, I am sure we could get unanimous consent.

Mr. Chairman: All right. Do we have unanimous consent?

Some hon. members: No.

Mr. Martel: If we were to follow what the member is saying, we could simply make that clause (s).

Mr. Chairman: No, clause (t). We have an amendment for clause (s) already. Let us deal with (s). One amendment is on the floor already, from the member for Etobicoke.

Mr. Martel: Would you read that for me, Mr. Chairman? I want to hear the amendment.

Mr. Chairman: "Providing for the payment of claims by purchasers of a new motor vehicle to permit the replacement of such a vehicle which, before the first anniversary of its delivery to the purchaser, or before the vehicle has been driven 20,000 kilometres, has been the subject of four attempts to repair a defect by the manufacturer, the motor vehicle dealer or an agent thereof, has been out of service for an aggregate period of 30 days or more, in the course of attempted repairs by the manufacturer, the motor vehicle dealer or an agent thereof, and whose defect remains substantially uncorrected."

That is the proposed amendment by the member for Etobicoke to be added as clause 2(s) to Bill 3, An Act to amend the Motor Vehicle Dealers Act.

10:20 p.m.

Mr. Martel: I would ask for clarification: why is it not possible to add to an amendment that is at present before you?

Mr. Chairman: Fine. Do you want to amend the amendment?

Mr. Martel: Yes, that would be the simplest way. Could we add those words then. Is that fine with you?

Mr. Chairman: That is fine with me.

Mr. Martel: I can then say, Mr. Chairman, that clause 2(s) be further amended to add the words "proportional to their sales." Is that quite acceptable to the Chairman?

Mr. Chairman: Do you have only one copy? I should have written it down. What does it say? Read it nice and clear so everyone can hear.

Mr. Martel: An amendment to that amendment by simply adding the words "proportional to their sales."

Mr. Nixon: Will the member get his act together over there?

Mr. Martel: I am doing this on behalf of the member for Wellington-Dufferin-Peel. I am simply trying to incorporate what he wants in the bill.

Mr. Chairman: Okay, thank you. "Proportional to their sales." I am obliged to follow through with the standing orders. I would like to put the amendment.

Mr. Philip: I have an amendment to the amendment.

Mr. Chairman: We can only have one amendment to the amendment. I would like to ask one question. Are we going to continue with this or can we put the vote?

We have all heard the amendment. Is it the pleasure of the House that the amendment carry?

All those in favour will please say "aye."

All those opposed will please say "nay."

In my opinion the nays have it.

Motion negatived.

Is section 2 carried?

Mr. Philip: I have a new amendment.

Mr. Chairman: Well, I will have to call you out of order.

Under the standing orders we have to go to the vote.

Mr. Nixon: We'lI finish the bill another day.

Mr. Chairman: Call in the members.

10:32 p.m.


The committee divided on Mr. Philip's amendment to section 1, which was negatived on the following vote:

Ayes 28; nays 39.

Section 1 agreed to.

The committee divided on Mr. Philip's amendment to section 2, which was negatived on the same vote.

Section 2 agreed to.

Section 5 agreed to.

Bill ordered to be reported.

On motion by Hon. Mr. Wells, the committee of the whole House reported one bill with certain amendments, two bills without amendment and progress on one bill.

Motion agreed to.

The House adjourned at 10:36 p.m.