OMVIC Practice Test

Dealers are required to disclose all the information set out below (a - f); however, rescission is only granted automatically for failing to disclose three of them. Which are they?

1. The make, model and model year of the vehicle, The vehicle is missing airbags, The vehicle was previously a taxi or limo

2. The make, model and model year of the vehicle, The vehicle has been branded, The vehicle's manufacturer's warranty has been cancelled

3. The make, model and model year of the vehicle, The vehicle was previously a taxi or limo, The vehicle has been branded

4. The vehicle was previously a taxi or limo, The vehicle's manufacturer's warranty has been cancelled, The vehicle was involved in a collision

The correct answer is: The vehicle was previously a taxi or limo, The vehicle's manufacturer's warranty has been cancelled, The vehicle was involved in a collision

Rescission, which is the cancellation of a contract due to a significant misrepresentation or a failure to disclose important information, automatically occurs under specific circumstances outlined by regulations. In this case, the correct answer identifies crucial information that a dealer must disclose regarding the vehicle's history and condition which, if not disclosed, can lead to an automatic right for the buyer to rescind the purchase. The first piece of information, regarding the vehicle being previously used as a taxi or limo, is significant as such vehicles often undergo extensive, high-mileage use which can affect their reliability and overall condition. Buyers generally expect to be informed about this history to make an informed purchasing decision. The second point, concerning the manufacturer's warranty being cancelled, is critical because a cancellation can indicate potential issues with the vehicle's reliability or previous severe problems that were serious enough to warrant a voiding of the warranty. Buyers should be aware of this to assess their ongoing risk and cost implications. Lastly, knowing that the vehicle was involved in a collision informs the buyer about potential hidden damage and long-term effects that could arise from the past accident. Disclosures about prior accidents are fundamental in assessing a vehicle's safety and overall functionality. Together, these three elements represent serious risks and implications for prospective buyers