The Rural Voice, 1991-09, Page 24THE FARM IMPLEMENTS ACT -A QUICK FIX
The Ontario Farm Implements Act,
passed in 1988, provides a formal
process for the resolution of problems
that farmers encounter when dealing
with the farm machinery industry.
The main features of the "Act" are
the registration of distributors and
dealers; implied warranties with each
farm implement; the availability of
emergency and regular order repair
parts; a specified procedure for the
return or replacement of defective
equipment; a repurchase system of
dealers' unused inventory of farm
equipment by a distributor on the ter-
mination of a distributor dealer agree-
ment; and the creation of a mediation
system for resolving disputes.
The Act applies to any farm imple-
ment, which is defined as any equip-
ment or macflfnery designed and used
for agricultural or organic purposes,
and includes repair parts for the
machinery. The Act covers relation-
ships between a farmer and any
dealers and distributors with whom
the farmer does business. A dealer is
a person who, in the ordinary course
of business, offers farm implements or
parts to a dealer. The Act does not
apply to farm implements with a man-
ufacturer's list price of $3,500 or less;
motor vehicles that are not farm vehi-
cles; tractors that develop 20 horse-
power or less; lawn and garden equip-
ment; and tires.
A dealer or distributor who sells, or
offers for sale, farm implements and
who is unregistered under the Act is
liable to prosecution. Registration is
required annually and is subject to cer-
tain conditions, including the payment
of license fees.
When a farm implement is sold, a
sale agreement between a purchaser
and the dealer must be made. The
agreement is to be in writing and must
contain information describing the
farm implement and any trade-in; the
purchase price and any trade-in
allowance; the date of delivery; the
name and address of the purchaser,
dealer, and distributor. Further, the
agreement must include the nature
and duration of any warranties.
Perhaps the most important feature
of the Act is that a farm implement is
warranted to develop the power stated
in the sale agreement. In addition, on
the sale of any new farm implement,
there is a warranty that the implement
is properly constructed and will per-
form to the manufacturer's specifica-
tions. Warranties as to power and
quality will be the lesser of one year
or 1,000 hours of operation for trac-
tors; the lesser of one year or 500
hours of operation for combines; and
one year for any other farm imple-
ment.
On the sale of a new farm imple-
ment, there is an implied warranty that
repair parts will be available for 10
years and will be free from defects.
The distributor is liable to honour the
implement power and quality warran-
ty. The dealer and distributor are
jointly liable to honour the parts
supply warranty. A distributor or a
dealer may, of course, give warranties
that offer broader protection for the
consumer than those created by the
Act.
Under the repair parts warrranty,
when a dealer and distributor are noti-
fied that a farm implement requires
emergency repair parts, those parts
must be made available within three
working days unless there are condi-
tions beyond the distributor's control
which prevent delivery. The repair
parts cannot cost more than the manu-
facturer's suggest list price, but a
service charge may be added to the
price. If the dealer and distributor are
unable to supply repair parts, the
distributor must provide a satisfactory
substitute farm implement or pay one
half of the normal rental rate for a
similar implement to the consumer.
If the implement is shown to be
defective and fails to perform to the
manufacturer's specifications within
12 months following delivery during
the first 10 days or 100 hours of actual
use, the dealer or distributor must at-
tempt, within four working days of ob-
taining notice, to make the implement
perform, or provide a substitute. If,
after two weeks, the implement still
does not meet the manufacturer's spe-
cifications, the distributor must re-
place the implement or the dealer must
refund the purchaser. Any trade-in
will be returned or fair market value
for the trade-in will be given to the
consumer.
Under the Act, the Ontario Farm
Implements Board can enquire into
and resolve disputes with respect to
any matter arising under the Act. The
Board can investigate claims regard-
ing charges by dealers for repairs and
can make orders to ensure that there is
compliance with any of its decisions.
Further, the Board can, on the request
of any party, appoint a mediator to
resolve a dispute. The Board has the
power to ensure compliance with
prescribed safety standards for farm
implement performance and that any
safety information be given to pur-
chasers. In addition, the Board has the
power to conduct research related to
farm implement design, construction,
performance, and safety, and to work
with manufacturers to encourage
standardization and improvement in
farm implements in Ontario.°
Agrilaw is a syndicated column
produced by a full service London law
firm. Marlene McGrath, an associate
lawyer, specializes in corporate and
commercial law, wills, and estate
planning. Agrilaw is intended to
provide information to farmers on
subjects of interest and importance.
The opinions expressed are not
intended as legal advice. Before
acting on any information contained
in Agrilaw, readers should obtain
legal advice with respect to their own
particular circumstances.
20 THE RURAL VOICE