Until April 15, 2001 there was no exemption amount for vehicles in the Province of Ontario. On that date, the provincial government changed the Execution Act so that vehicles with a value of $5,000 or less would be exempt from seizure.
Because of a glitch in the writing of the new exemption, a court case which is referred to as Fields gave a ruling that if the value of a vehicle was greater than $5,000, there could be no exemption amount claimed by the debtor.
On December 14, 2005, the exemption value for vehicles was changed from $5,000 to $5,650 but the value problem still remained.
The good news is that on June 22, 2006, the Government of Ontario passed the Good Government Act, 2005. In that Bill, a new section was added to the Execution Act such that if the value of a vehicle is greater than $5,650, the debtor is allowed the amount of $5,650 plus costs of the sale. In a consumer proposal or a personal bankruptcy this means that if a vehicle is valued at more than $5,650 after selling costs are calculated, the debtor could “purchase” the difference between the value and $5,650 from the trustee.
If you are experiencing financial difficulties and are worried about losing your vehicle, please contact our offices at 310-PLAN or local to London 519-435-1500 to set up an appointment to discuss your situation in detail.
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