P-40.1 - Consumer Protection Act

Section 260.14 Disposition versions

1989-08-03

260.14. The sums collected by a merchant to be deposited in trust in his reserve account pursuant to section 260.8 are deemed to be held in trust for the consumers by the merchant so long as they have not been applied to the discharge of a claim arising from a contract of additional warranty or to the refund of sums due to a consumer following the dissolution or cancellation of a contract of additional warranty or so long as the residual value of the contracts has not been refunded to the consumers, and an amount equal to the aggregate of the sums deemed to be held in trust shall be regarded as a separate fund not forming part of the merchant’s property, whether or not the amount has been kept separate and apart from the merchant’s own funds or the mass of his property.

The residual value of the contracts must be calculated according to recognized actuarial hypotheses and methods as it stands on the date of a winding-up order in respect of the merchant, on the date of an assignment, seizure or taking of possession of his property, on the date of a receiving order against him or on the date fixed by a provisional administrator appointed under section 260.16.

1988, c. 45, s. 2.