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Court rules there is a limitation period for 407 ETR going after consumers

|Written By Jennifer Brown

An Ontario Superior Court judge has ruled a limitation period should apply for a user of the 407 ETR who failed to pay his bills totalling more than $13,000.

The court provided some clarity on limitation periods for going after those who don’t pay 407 tolls. (Photo: Raysonho/Wikimedia Commons)

In 407 ETR Concession Co. v. Ira J. Day,  Justice Mark Edwards was asked to decide whether a claim against Day for unpaid invoices was statute-barred because of an expired limitation period. The 407 ETR commenced an action against Day in June 2013 seeking to recover amounts owing from 2,914 trips on the Toronto-area toll road.

The 407 ETR argued if there should be no limitation period, it should be either the period set out in the Transponder Lease Agreement signed by Day for use with his Porsche 911 personal vehicle — 15 years, or two years from the date his licence plate went into licence plate denial.

The court ruled that for those who have an Ontario licence plate, the limitation period commences two years from the date the plate of the non-paying consumer is placed into licence plate denial by the Registrar of Motor Vehicles for the Province on Ontario. For out-of-province plates the limitation period should be two years from the date of invoice.

Day’s lawyer Ronald Manes, who argued the limitation period should be two years from the date of the invoice, says he has a mixed reaction to the decision, saying his client has “won the war but lost the battle.”

“In the consumer’s favour it is a big victory because the court found there is a limitation period and the transponder agreement he signed does not apply to a consumer as it’s protected by the Consumer Protection Act, but when the court went on to find the limitation period in his case starts on the date he was placed in plate denial, then the limitation period has not run,” he says.

“The result of the decision seems to be that it is in the 407’s discretion when to initiate the limitation period based on when they see fit to put somebody in plate denial.”

In Day’s case, plate denial happened after the 90-day period.

“The significance of the case is that if the court accepted the 407’s argument it would allow a company to determine when and how the limitation period applies to them which is the antithesis of what the limitation period was supposed to achieve,” says Manes.

“So while the judge rejects there is no limitation period, on the other hand he enables them to determine what their limitation period is via the date they submit plate denial.”

The court ruled that when Day leased the transponder, he did so as a consumer as defined by the Consumer Protection Act and not a business owner. As such, the 407 ETR can’t rely upon the 15-year limitation period set forth in the Transponder Lease Agreement, as the 407 ETR does not fall within the exception set forth in s. 22(5)(1) of the Limitations Act given that it only applies in respect of business agreements.

Lawyers for Day pointed out that if the 407 is entitled to rely on the limitation period of 15 years set forth in the Transponder Lease Agreement and not commence a claim for 15 years, Day would be liable to pay the 407 ETR $289,444.45 on a principal balance of $9,808, given the interest would be accumulating at the compounded rate of 26.82 per cent.

They also argued, by analogy if the 15-year limitation period applied to all outstanding invoices, the 407 ETR would stand to make between $1.5 billion and $4.1 billion as a result of accrued interest.

Manes argued the limitation period commences when an invoice is sent by the 407 ETR to a customer, and not two years after a customer’s licence plate is placed into denial.

Day was placed into licence plate denial on three occasions between August 2008 and November 2010. On each occasion Day paid the amounts owing to the 407 ETR.

He last paid his 407 ETR account in full on Dec. 21, 2010. Since then he has made no payments despite continuing to use the highway on a regular basis. The court heard he travelled on the 407 some 3,700 times since that last payment. The registrar subsequently placed a Mercedes owned by Day into plate denial in June 2012.

The matter is not over yet. Manes says the next step is that the court has to sign an order regarding its direction to the two parties.

At this point, the 407 and Day’s lawyers disagree on how to interpret Edward’s decision and references to “placed into plate denial” and the 407’s reference to being placed into plate denial (when plates actually expire.)

“We will also be taking instruction whether Mr. Day wishes to appeal the decision,” says Manes.

Counsel for the 407 could not be reached for comment before posting.

  • We hereby demand!!!

    Jeff English
    I have not used the 407 in well over 10 years and when I was they were double billing me (one with transponder, one without). I refused to pay the non-transponder fee and was told I had to pay it before they would even think of correcting it. I had owed them aprox $300.00 A couple of days ago I received a letter from a lawyer saying "We hereby demand payment in 10 days" to pay an outstanding balance of $25,171.37 What options do I have.
  • 407 rediculous interst and plate denial

    Greg Papich
    I recnetly went to get my plates renewed and found out that I could not as the 407 is holding my plates hostage. My original bill is $500.00. They said with interest is $1300.00. How is it that a hwy owned by a forgien country can hold my licence and charge interest rates that I thought were illegal. I am not going to pay and am not going to stop driving. I have had to pay a $150 fine for outdated plate. The officer told me that no points are involed but can anyone please help?
  • Illegal Government Move

    Brian Smith
    The 407 is another example of the back-door dealings of both the provincial and federal government in Canada. They build on the back of the tax-payer, claim spiraling costs and then sell the infrastructure for pennies on the dollar to off-shore corporations. The architecture of the 407 deal is even more sinister-do some research. The problem is that most Canadians have their heads up their ass. It wont change unless more people stand up and fight back.
  • Die with accident or pay 407

    Abdul Haider
    Hi recently got invoice 1st time as I used the 407 and was unaware that I will be invoice as I was not aware of this money game. My question is while I am using GPS at 100 Kms / Hours do I see all the boards around and hit someone and may die or I end up paying for these non-consent invoices I did not even know I have to pay. When I talked with 407 they waived 50% of they invoice because this was my 1st trip, but my open question is I am paying for something I had no idea I am using service of.
  • 407 ETR

    Gina forcillo
    Im a victim of being billed every month for an outstanding amount dateing 15 years ago with this toll highway pure robbery.cant get my plate sticker....how and who can I call to help me with this pure highway robbery bandits. 407 etr
  • Supreme Court judgement awaits

    Tracey Louise
    January 2015 stated 6 to 8 months to decide if 407 tolls and plate denial is included in consumer proposal or not....anyone hear of a eta on. When they will decide or a date specifically???
  • Reply to "Boss"

    Brent Miller
    I fully agree with you. The issue is that there are legitimate examples of the 407 wrongfully charging customers for trips not made on the 407. I am unsure as to the reasons for the errors. There are far too many examples to be ignored.

    I am just interested in the article as I do not believe a private institution should have the power to deny people services provided by a government, for example, plate sticker denial.

    If you were a shoveled driveways for a living and a person refused to pay for services rendered, you would not be able to put the person in plate denial. I am just curious as to why the Ontario Government allows it to happen.

    If the 407 wants to truly ensure they are paid, they could always put up toll booths as it happens in the United States.
  • Boss

    Robert st
    This is nonsense . You made a agreement with 407.
    The lawyers forgot to mention once your in default you are trespassing . That is another scenario you can read up at Osgoode Hall. You use it pay for it . I still hate the fact Mike Harris sold out on this . Just my opinion my free speech allowed on this site.
  • Consumer Purposal

    Don Moses
    Apparently the 407 is exempt from consumer purposal. Why is it that no other creditor, bank or collection agency is exempt except the 407. This makes no sense to me.
  • lay person

    Eitan owetch
    On December 29 2014 The 407ETR FINALLY mailed me proof of my $1675.95 debt. Proof came in form of 2 undated photographs with 2 dates 07/25/2004 and 05/11/2005.

    I have been harassed for some time now.
    I understand that there has been plate denial for several years.
    My credit is badly damaged as a result.

    I want to sue for damages.

    There was a case I believe of a Markham car dealer that sued and collected $50K in 2006.
    Does anybody have a comment?
  • So I am looking for clarification on the Plate Denial...

    Brent Miller
    So I am very intrigued by this. Too long has 407 been able to hold a person hostage. It is less a denial of plates and more a denial to own a motor vehicle in any other manner than an art piece. You can buy a car. You just cannot have it legitimized to use on the public roads.

    No other business could hold people hostage in this manner. If someone did not pay for a service, a business could not hold the same power over the person who owes.

    So here is my question. If the 407 places a plate in denial, after 2 years, they can no longer hold that person hostage by denying that person the ability to get a sticker for their plate?

    Example.

    Person in plate denial moves to another province. after 3 years, they move back. Would plate denial still apply to the person in this example?

    Just curious.

    Thank you.
  • 407 not special.

    Greg Leschynsky
    It would seem to me after reading the courts ruling that the 407 would have the judge believe they are have a special reason for not discovering their loss until plate denial.
    They indicate they do not know client is not going to pay until they receive notice from the registrar of the plate being denied.
    Hogwash....it is the 407 who must request that the registrar deny the persons plate because they have not paid.

    The 407 would have us believe that there are special circumstances that require them to have special powers.

    The supreme court has already ruled there are no longer any special circumstances when it comes to altering the timeline of the Limitation period.

    ie...Joseph V. Canada's Wonderland
    ruling.

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