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Ontario car buyers have no cooling-off period after signing a contract, as shown by Sudhir Nagi who lost a $1,000 deposit on an electric vehicle despite changing his mind.
In Ontario, car buyers who sign a contract and leave a deposit have no legal right to cancel, unlike door-to-door sales which offer a 10-day cooling-off period. Sudhir Nagi of Scarborough experienced this when he and his wife signed paperwork for their first electric vehicle, put down a $1,000 deposit, and then changed their minds. When Nagi called the dealership to cancel, he was told the deal was final and his deposit would be kept.
No Cooling-Off Period for Car Sales
The Ontario Motor Vehicle Industry Council (OMVIC) recently ran an online ad campaign to warn consumers that there is no cooling-off period for car purchases in Ontario. OMVIC’s website states that to avoid problems, buyers must understand that sales are final unless the contract includes conditions allowing for cancellation. This means that once a contract is signed, the buyer is legally bound to complete the purchase.
Nagi and his wife had decided to trade in their Honda CRV and buy an electric vehicle. They signed the contract and left a $1,000 deposit. But after returning home, they began to worry about the number of kilometres they drive annually, the cost of insurance, and the expense of installing an electric charger. They concluded that an EV did not make financial sense for them.
Consumer Loses $1,000 Deposit After Cancellation
When Nagi contacted the dealership to cancel, he was shocked to learn that the deal was final and his deposit would not be refunded. He said he was not given a choice once he signed the contract. Nagi did not purchase the electric vehicle, but he lost his $1,000 deposit. He now wants that money back, especially since he is retired and does not have extra funds.
According to OMVIC, buyers should ensure all promises are documented in writing and understand the timing if a vehicle is not in stock or must be factory ordered. Contracts should be complete, including finance terms. Consumers should only sign a contract if they are certain they want to purchase the vehicle.
This case highlights the importance of understanding consumer rights when buying a car. Unlike other purchases, car sales in Ontario are binding once signed. Buyers are urged to carefully review all terms and conditions before committing. For Nagi, the lesson was costly, and he hopes to recover his deposit.
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