Under the Québec Consumer Protection Act (Act), a “consumer” is defined as “a natural person, except a merchant who obtains goods or services for purposes of business.” In the 1997 Québec Court of Appeal decision in Bérubé c. Tracto Inc., the court interpreted this definition to include individuals who are “independent craftsmen.” The court held a lumberjack who had purchased a chainsaw-like tool to be an independent craftsman and, thus, a “consumer” under the Act.
The court has recently provided further guidance on what constitutes an independent craftsman, and thus a “consumer” under the Act. In Multiple Business Systems M.B.S. Ltd. v. Randhawa, the respondent cancelled a lease agreement for two allegedly defective photocopiers used in his photocopy business. The appellant repossessed the machines and the respondent refused to pay the full rental amount due under the agreement. The respondent cited section 138 of the Act, which states that if a consumer is in default of his obligations, the merchant may choose to either exact immediate payment or retake possession of the goods sold. Since the appellant had repossessed the photocopiers, the respondent claimed that he did not owe rent from the time of repossession.
Findings of Trial and Appeal Courts
The trial judge determined that the respondent could rely on section 138 of the Act because he was a sole operator, artisan or craftsman and thus a “consumer” under the Act. The respondent was held to not owe rent from the time the machines were repossessed.
The Québec Court of Appeal reversed the trial judge’s decision, finding that the respondent was not a consumer under the Act as he ran a small commercial enterprise rather than a craft shop. The court also noted that the respondent had failed to establish that the photocopiers were defective.
Moreover, the court found that the trial judge had failed to consider relevant information concerning the photocopy operation, including the presence of any employees and what equipment was used. The court also noted that the trial judge had failed to give weight to the fact that the respondent had admitted he was carrying on a “business.”
Further, the court stated that the trial judge, in determining whether the respondent was a “consumer” under the Act, failed to consider:
- whether the enterprise was registered as a commercial business;
- whether the individual was engaged in the operation for profit;
- whether the individual had experience in the particular business;
- whether the operation lacks skill, expertise, craftsmanship and training;
- whether the business was operated at a specific place of business that was open to the public and where clients were received;
- the volume of services furnished; and
- the permanency of the business.
Based on these factors, the court held that the respondent was an entrepreneur who had leased the photocopiers for the purpose of his business (rather than his craft).