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Lecture 11

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Law and Business
LAW 525
Gil Lan

Law 525 Lecture 11 Non-Court Based Business-Consumer Redress (NCBCR) Why would businesses create NCBCR systems? • Maintain good customer relations and customer base • Reduce uncertainty associated with redress • Reduce costs Why would consumers use NCBCR? • Quicker • Less costly • Less intimidating • But is it as fair as courts? Cdn Motor Vehicle Arbitration Plan (CAMVAP) • Created in 1994 • Free for consumers, paid by participating auto manufacturers • Started first in Ontario, with encouragement from Ontario government • Consumer does not commit to CAMVAP at time of purchase. Consumer has option of going to court (related to Ontario consumer protection act) • Once CAMVAP chosen, consumer gives up right to use court and recognizes arbitrator’s decision as final CAMVAP Procedure • Consumer must first bring complaint to manufacturer and authorized dealer • Consumer completes claim form, manufacturer has 10 days to respond and to file documents it will use at the hearing • Consumer given choice of three arbitrators (trained, impartial, not judges) • Results binding on both parties • Legal counsel optional • CAA inspection of car at no cost is possible CAMVAP Results • Arbitration can lead to: buyback, repairs, reimbursement of out of pocket expenses, or no liability • Buybacks: 11 percent • Repairs: 36 percent • Out of pocket expenses: 3 percent • Settlements outside of arbitration: 21 percent • No liability: 29 percent • Takes approximately 70 days • Results no longer confidential Better Business Bureau (BBB) • Not a government office • To be eligible, members must be in business for six months, meet all legal requirements for business such as bonding and licensing, respond to all complaints forwarded by Bureau, and be free from governmental action concerning marketplace conduct and its customers that demonstrate a significant failure of the company to support the BBB principles • Members must pay BBB membership fee • 30,000 members in mid-west and Central Ontario • Local BBB will provide info and handle complaints • Consumers may ask the BBB for a reliability report on a local company, whether company is BBB member or not • “front end” BBB assistance with complaints is usually free for consumers • First step: conciliation (informal) • Second: mediation (BBB plays a role in resolution: confidential: sometimes there is a fee charged to consumers) • Third: arbitration (BBB representative makes decision: fee for consumers) • BBB uses Conciliation in which a BBB member contacts the company to see if wheter the firm can reach a satisfactory agreement • If the company is a BBB member that it requires the company to deal with complaint in good faith but if it is not no requirement exists (an unsatisfactory mark may be placed on company file) • Conciliation is the only level common to all local BBB • Local BBB offer both mediation and arbitration dispute resolution services • BBB mediator does not make a decision while the arbitrator does Advertising Standards Canada (ASC) • ASC function: to receive and review complaints from public regarding advertising and to pre-clear certain kinds of advertising for advertisers • ASC members comply with Cdn Code of Advertising Standards • Code addresses 14 issues, most relating to honesty in marketing cla
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