IN THE PROVINCIAL COURT OF BRITISH COLUMBIA

[1]         The Claimant West Auto Sales Ltd. (“Kia West”) leased a Kia Optima to the Defendant Claire Day in 2019.  Three years into the lease, a dispute arose between Kia West and Ms. Day over her buying out the vehicle.  Ms. Day stopped making lease payments and has refused to return the vehicle, although the lease is now expired.

[2]         Kia West claims damages for the outstanding lease payments and the residual value of the vehicle at the end of the lease.

[3]         Ms. Day claims that she and Kia West had an oral agreement on buying out the vehicle.  She submits that Kia West breached the agreement by not honouring the agreed-upon price.  Ms. Day has refused to make any further payments under the lease, claiming that Kia West agreed to her suspending the lease payments.

[4]         Ms. Day counterclaims for damages related to the 2019 Kia, and also a 2017 Kia Optima that she had previously leased from Kia West.

[5]         The dispute begins with the Kia Optima that Ms. Day leased from Kia West in 2017 (the “2017 vehicle”).

[6]         Ms. Day testified that she had numerous problems with the 2017 vehicle after she took possession of it under a lease agreement.  The 2017 vehicle had a number of mechanical issues requiring repairs.  She was concerned that the vehicle was unsafe to drive because the battery died at a time when she was driving on the Coquihalla.  She was also concerned that there was a recall on the vehicle for a software update, although she acknowledged that the dealership performed the necessary update.  Ms. Day and her husband were not happy with the 2017 vehicle and wished to return it for a new Kia vehicle.

[7]         Ms. Day returned the 2017 vehicle to Kia West in June 2019 and leased a new 2019 Kia Optima (the “2019 vehicle”).  She signed a Motor Vehicle Purchase Agreement and a Lease Agreement for the 2019 vehicle on June 28, 2019 (the “Lease Agreement”).

[8]         Ms. Day was required to make payments on the lease totalling $960.73 a month, which included payments towards the principal, interest and taxes.

[9]         This Lease Agreement was an “open lease”, meaning that it included a term that Ms. Day could buy out the vehicle at any time for the balance owing on the vehicle.  An Amortization Schedule attached to the agreement set out the schedule of lease payments and the amount owing on the vehicle following each payment.  Ms. Day could choose to buy out the vehicle and terminate the lease at any time by paying the amount owing according to the Amortization Schedule.

[10]      Ms. Day advised Kia West in late 2021 that she wished to buy out the vehicle.  She stopped making lease payments in November 2021.  She says that a Kia West sales representative agreed that she could suspend the lease payments because she was going to buy out the vehicle.

[11]      Dick Crompton was Ms. Day’s sales representative at Kia West.  Mr. Crompton has since passed away.  Ms. Day says that Mr. Crompton agreed on behalf of Kia West that she could hold off making lease payments while they were negotiating the buyout amount.

[12]      Ms. Day’s mother passed away in January 2022 and the negotiations on buying out the vehicle were put off for several months.  However, Ms. Day did not resume making lease payments.

[13]      Ms. Day testified that at some point, she and Kia West agreed upon a price for the buyout.  She said that this was an oral agreement.  She does not recall when they reached an agreement, but the email records indicate that there were several discussions about buying out the vehicle in May and June 2022.

[14]      Ms. Day says that they agreed on a buyout price that was different than the amount owing on the Amortization Report.  However, she was unable to recall the amount that was agreed upon.  She believes that it was approximately $17,000.  She believes that she and Kia West had an oral agreement for the buyout of the vehicle at that price, and that Kia West breached the agreement by resiling from the agreed-upon price.

[15]      Ms. Day and her husband went to the bank on May 31, 2022 to obtain a bank draft for the buyout.  She called Kia West lease manager Robin Enns from the bank to confirm the price.  During that phone call, Mr. Enns told her that Kia West could not accept the price.

[16]      The negotiations about Ms. Day buying out the vehicle soon broke down.  Kia West sent a letter to Ms. Day on July 26, 2022 setting out her three options: 

[17]      Ms. Day did not accept any of these options.  She kept the vehicle but did not make any further lease payments.  The lease has now expired, but Ms. Day continues to retain the vehicle and has refused to return it to Kia West.

[18]      Before the negotiations on buying out the vehicle broke down, Ms. Day persuaded Kia West to remove the GPS device from the vehicle, on the basis that she was going to buy the vehicle.  A GPS device allows car dealerships to keep track of the location of their leased vehicles.  Because the GPS device was removed, Kia West has been unable to locate the 2019 vehicle held by Ms. Day.

[19]      Because she was in arrears on the lease payments, Kia West refused to consent to Ms. Day renewing the insurance when it came time to renew in the summer of 2022.  As the owner of the vehicle, the dealership’s consent was required to renew the insurance.  The vehicle has not been insured to drive since the summer of 2022.  According to Ms. Day, the vehicle has been sitting in storage.

[20]      Kia West submits that Ms. Day breached the Lease Agreement by failing to make payments on the vehicle.  Ms. Day has not made any payments since November 2021 and has wrongfully retained the vehicle after the lease expired.  Kia West seeks an order that Ms. Day pay all outstanding lease payments and the residual buyout amount owing at the end of the lease, as the lease has now expired.

[21]      Ms. Day submits that she had an oral agreement with Kia West to buy out the vehicle at a certain price, but that Kia West breached the agreement by refusing to accept the agreed-upon price.  She submits that after Kia West breached this agreement, she was no longer obligated to make any payments under the lease. 

[22]      Ms. Day says that she and Kia West agreed that she could suspend making lease payments while they negotiated the buyout of the 2019 vehicle.  She submits that because they have not yet reached an agreement on buying out the vehicle, she has been relieved of making any further lease payments.

[23]      Ms. Day further submits that that any amount owing for the 2019 vehicle should be reduced by $16,000, based on an insurance policy for the 2017 vehicle that she previously leased from Kia West.  She asserts that she was told by Kia West staff that the 2017 vehicle was a write-off and that she was entitled to receive $16,000 in insurance benefits that would be applied to the buyout of the 2019 vehicle. 

[24]      Ms. Day brings a counterclaim alleging various damages, including that Kia West fraudulently misrepresented the condition of the 2017 vehicle to induce her to return it and lease the 2019 vehicle; damages for the costs of renting other vehicles because she could not insure the 2019 vehicle; damages because Kia West cancelled the insurance policy on the 2017 vehicle without her consent; legal costs; and punitive damages.

[25]      The primary questions to be decided are whether Ms. Day should be ordered to pay the outstanding payments owing on the lease, or whether Kia West should be ordered to pay Ms. Day for fraudulent misrepresentation, damages related to the vehicles and punitive damages as set out in her counterclaim.

[26]      In my view, these questions turn on the following issues:

[27]      Ms. Day asserts that she had a valid oral agreement to buy out the 2019 vehicle at a certain price, which varied the terms of the written Lease Agreement and Motor Vehicle Purchase Agreement.

[28]      The Lease Agreement contains a standard clause that the written contract constitutes the entire agreement between the parties and may not be amended in any manner except in writing signed by both parties.

[29]      A written agreement stipulating that the agreement may not be amended except in writing may in some circumstances be amended by oral agreement despite the “no change” clause.  Where the evidence establishes a course of conduct demonstrating that the parties intended to vary the written agreement, the Court will not enforce the inconsistent terms of the written contract:  Premier Marketing Solutions Inc. v. NII Northern International Inc., 2012 BCSC 1478 at paras. 9-12.

[30]      As Ms. Day is asserting that there was an oral agreement varying the written agreement, Ms. Day has the onus of proof of establishing the oral agreement on a balance of probabilities:  Dutton v. Schwab, 2023 BCCA 161 at para. 8.

[31]      The interpretation of an oral agreement relies on the same legal principles that apply to written contracts. 

[32]      A contract is formed where there is an offer by one party accepted by the other with the intention of creating a legal relationship, and supported by consideration:  Ethiopian Orthodox Tewahedo Church of Canada St. Mary Cathedral v. Aga, 2021 SCC 22 at para. 35.

[33]      The requirements for a valid contract are:

[34]        Whether the requirements of a binding contract are met is determined from the perspective of an objective reasonable bystander, not the subjective intentions of the parties.  The determination is contextual and must take into account the communications between the parties and the conduct of the parties both before and after the agreement is made:  Oswald v. Start Up SRL, 2021 BCCA 352 at para. 34.

[35]      If an alleged agreement has not been reduced to writing, the conduct of the parties must be assessed objectively, including whether their conduct demonstrates an intention to form an agreement:  Le Soleil Hotel & Suites Ltd. v. Le Soleil Management Inc., 2009 BCSC 1303 at para. 328.  The credibility of the witnesses may be important in assessing conflicting versions of the events.

[36]      The issue of whether the parties intended to form an enforceable contract is often entangled with the issue of whether there is certainty in the essential terms.  An alleged contract cannot be enforced if the terms are unclear.  If the terms are vague, ambiguous, or incomplete, it cannot be said that the parties came to a meeting of the minds: Oswald v. Start Up SRL, at para. 139.

[37]      For the reasons that follow, I find that Ms. Day has not established that there was a valid oral agreement amending the buyout price set out in the written Lease Agreement.  In my view, the evidence does not establish the terms of any alleged oral agreement on buying out the vehicle with any degree of certainty.  Further, the email discussions between the parties at the time of the negotiations indicates that they did not reach a final agreement on the buyout price.

[38]      Ms. Day and Kia West staff agreed in their testimony that there were discussions about a buyout price that was different than the price that would have been owing based on the Amortization Report.  However, there is little evidence of the content of those discussions.  Ms. Day asserts that they reached an agreement on a price at some point but she did not recall when the alleged agreement was formed or the amount that was purportedly agreed upon, although she believes that it was approximately $17,000.

[39]      Although the Kia West Lease Manager Robin Enns agreed with Ms. Day’s suggestion that they had an “agreement” on a buyout price, his testimony was unclear as to the terms of any such agreement, including the agreed-upon buyout price.  Mr. Enns said that he realized after speaking to other staff that the amount offered by Ms. Day was incorrect and that Kia West could not accept Ms. Day’s offer.

[40]      Another Kia West staff member, Ray Relkie, testified that Ms. Day had made an offer, but it was ultimately rejected because they realized that Ms. Day was in arrears on lease payments.

[41]      A fundamental term of an agreement to terminate the lease and buy out the vehicle is the buyout price.  The evidence is deficient as to the amount that was purportedly agreed upon.  Ms. Day believed that it was approximately $17,000 but was not certain about this.  No other witness testified as to the amount that was apparently agreed upon.  

[42]      The $17,000 buyout price recalled by Ms. Day in her testimony is inconsistent with the contemporaneous e-mail discussions on buying out the vehicle.  Ms. Day sent an email to Kia West on May 31, 2022, attaching a “working paper” calculating the amount that she claimed was owing as the buyout price.  This document is difficult to decipher, but the calculations on the “working paper” appear to be significantly different than the $17,000 figure recalled by Ms. Day at trial.

[43]      Further, the wording of an email sent by Ms. Day on May 31, 2022 email suggests that they did not have a meeting of the minds on a buyout price.  In the email, Ms. Day said that she was on her way to the bank and would call the Lease Manager Mr. Enns for his “acceptance” prior to obtaining the bank draft.  She testified that she called Mr. Enns from the bank and that he told her that Kia West could not accept Ms. Day’s price.  This evidence suggests that the parties did not have a clear agreement on the buyout price.

[44]      The buyout transaction did not complete.  Ms. Day did not make any payment to Kia West for the buyout of the 2019 vehicle.

[45]      It is my view that a reasonable and objective observer would not conclude that the parties had an enforceable oral agreement.  I find that the evidence does not establish that there was an oral agreement on a buyout price that varied the written Lease Agreement.

[46]      Ms. Day refused to make any further lease payments once the buyout negotiations broke down.  She also refused to return the vehicle.

[47]      Even if it could be concluded that there was a valid oral agreement on a buyout price that Kia West breached by refusing to proceed with the transaction, Ms. Day would not be entitled to retain the vehicle without making any further payments.  She would likely be entitled to damages for the difference between the price in the oral agreement and the price set out in the written agreement.  However, she would not be entitled to keep the vehicle without paying anything for it. 

[48]      The next issue to be decided is whether the buyout price for the 2019 vehicle should be reduced based on issues related to the 2017 Kia vehicle that Ms. Day previously leased from Kia West.

[49]      Ms. Day submits that that the buyout price for the 2019 vehicle should be reduced to account for insurance benefits that she was entitled to receive for the 2017 vehicle that she previously leased from Kia West.

[50]      Ms. Day purchased a “Vehicle Loss Privilege Program” insurance policy for the 2017 vehicle.  This insurance policy was referred to during the trial as “LGM Insurance”, in reference to the name of the insurance company.

[51]      The LGM Insurance policy provided that if the vehicle was declared a total and permanent loss by the insurer, the insured would be entitled to financial assistance in purchasing a new vehicle.  The policy provided additional protection beyond what would be payable by a primary insurance package offered by ICBC.  In the event of a total loss, the primary insurance compensates the insured for the market value of the vehicle, which generally would be less than the purchase price of a new vehicle.  The purpose of the LGM Insurance is to assist the insured in paying the purchase price of a brand new vehicle.

[52]      Ms. Day believes that the 2017 vehicle was unfit to be driven and that she was entitled to benefits under the LGM Insurance.  She says that the now-deceased Kia West sales representative Mr. Crompton told her that the vehicle was a “write off”.  Ms. Day claims that she and Kia West agreed that the buyout price for the 2019 vehicle would be reduced by the insurance benefits for the 2017 vehicle.

[53]      Ms. Day says that she is entitled to insurance benefits in the amount of $16,000, which was the black book value of the 2017 Kia at the time of the trade-in.  She submits that $16,000 should have been deducted from the buyout price for the 2019 vehicle, and that any monies owing to Kia West should be reduced by this amount.

[54]      Kia West does not agree that Ms. Day was entitled to insurance benefits for the 2017 vehicle or that Kia West agreed that the purchase price for the 2019 vehicle would be reduced by insurance benefits for the 2017 vehicle.

[55]      I do not accept that the buyout price for the 2019 vehicle should be reduced by any amount for the insurance policy on the 2017 vehicle.

[56]      During her testimony, Ms. Day was referred to the LGM insurance policy and asked to identify which term of the policy would have entitled her to benefits for the 2017 vehicle.  She was unable to identify any provision that would have entitled her to benefits.  Based on her testimony, however, it seems that she is relying on the term of the policy that provided protection in the event of a “total and permanent loss”.

[57]      Ms. Day has not made any claim under the LGM Insurance policy.  The insurance policy required that any claim of “total loss” must be submitted to the insurer within 60 days of the occurrence.  Ms. Day did not make an insurance claim on the 2017 vehicle within 60 days of returning the vehicle or at any time in the four years since she returned the vehicle to Kia West.

[58]      Ms. Day submits that it was Kia West’s responsibility as “facilitator” of the insurance product to submit an insurance claim on her behalf.  I do not accept this submission.  While a car dealership could assist a customer with making an insurance claim, there was no duty on Kia West to make an insurance claim on her behalf.  If Ms. Day believed that she had a valid insurance claim, it was her responsibility to make the claim.

[59]      Apart from the absence of any insurance claim, the 2017 vehicle would not have qualified as a total loss as defined in the insurance policy.  A total loss is defined as occurring where the primary insurer (in this case, ICBC) declares the vehicle a total and permanent loss and indemnifies the insured for the loss of the vehicle.

[60]      This did not occur.  The 2017 vehicle was not a total loss.  The vehicle had not been in a collision.  Although there were mechanical issues that required servicing, the vehicle was sold to another customer after Ms. Day returned it to the dealership.  The vehicle was fit to be driven.

[61]      Apart from the absence of any legitimate insurance claim, I do not accept that there was an agreement between Ms. Day and Kia West that the buyout price for the 2019 vehicle would be reduced by insurance benefits for the 2017 vehicle.

[62]      Ms. Day asserted that that she was told by the sales representative Mr. Crompton that the buyout price for the 2019 vehicle would be reduced by the insurance benefits for the black book value of the 2017 vehicle.  She made this assertion for the first time in closing submissions.  This was not part of her testimony at trial.

[63]      Neither the Lease Agreement nor the Purchase Agreement for the 2019 vehicle contain any reference to a price reduction based on the 2017 vehicle, although Ms. Day signed those agreements after she claims to have been told that she would receive a credit based on the 2017 vehicle.  The Lease Agreement specifically states that Ms. Day could buy out the vehicle for the amount set out in the Amortization Report, which does not refer to any credit for the 2017 vehicle.

[64]      Ms. Day’s claim that there was an agreement that the buyout price for the 2019 vehicle was to be reduced by insurance benefits for the 2017 vehicle is inconsistent with her conduct when negotiating the buyout of the 2019 vehicle.  The amortized value of the 2019 vehicle at the time of the negotiations was $19,571.  Ms. Day testified that they agreed on a buyout price of approximately $17,000 and that she was prepared to pay that amount.  If Ms. Day genuinely believed that she was entitled to a $16,000 credit based on the 2017 vehicle, she would not have agreed to pay the amount that she was willing to pay.

[65]      In the May 31, 2022 email that Ms. Day sent to Kia West about buying out the 2019 vehicle, she provided handwritten calculations on the amount that she claimed was owing on the 2019 vehicle.  There was no mention of any credit for the 2017 vehicle.

[66]      There is no record of Ms. Day claiming any credit for the 2017 vehicle until the negotiations over buying out the 2019 vehicle were breaking down.  On June 16, 2022, she sent an email to Kia West in which she claimed that she was entitled to a credit of $24,862 based on the 2017 vehicle. 

[67]      Ms. Day’s claim that she and Kia West agreed that the buyout price for the 2019 vehicle would be reduced by insurance benefits payable for the 2017 vehicle is not credible.  She has not made any insurance claim although it has been four years since the vehicle was returned to the dealership.  There is no arguable claim to insurance benefits.  I do not accept that the amount owing on the 2019 vehicle should be reduced by any amount related to the 2017 vehicle.

[68]      Ms. Day submits that she was relieved of the obligation to make lease payments because Kia West agreed that she would not have to make any further payments once they began negotiations over her buying out the vehicle.  She testified that they agreed that the lease payments could be suspended while they were negotiating the buyout.  Because the negotiations broke down without completing the buyout, Ms. Day says that she was not obligated to make any further lease payments.

[69]      I accept that the sales representative Mr. Crompton agreed that Ms. Day could suspend making lease payments while negotiations on buying out the vehicle were ongoing.  The lease manager Mr. Enns acknowledged this in his testimony.  It is likely that Kia West staff agreed to Ms. Day suspending lease payments because they believed that the buyout would complete within a short time.  Further, Ms. Day’s mother passed away and it is possible that they did not want to pressure her to resume lease payments at that time.

[70]      I do not accept that any Kia West staff intended that if the buyout did not proceed, Ms. Day would be relieved of making any further payments on the vehicle at any time.  It is simply implausible that the dealership agreed to allow Ms. Day to keep the vehicle without paying for it if the buyout did not proceed.

[71]      When the negotiations broke down without Ms. Day buying out the vehicle, she was obligated to continue with the lease payments.  She was not entitled to retain the vehicle without making any further payments.

[72]      Ms. Day brings a counterclaim for $19,461 in damages relating to the leased Kia vehicles.  The damages include damages for fraudulent misrepresentation with respect to the 2017 vehicle; expenses that she incurred because she was unable to insure the 2019 vehicle; damages for Kia West cancelling insurance on the 2017 vehicle without her consent; legal costs; and punitive damages.

[73]      On the first day of trial, Ms. Day applied pursuant to Rule 7.1 of the Small Claims Rules to transfer the file to the Supreme Court of British Columbia.  Although the amount claimed in her counterclaim totals $19,461, she submitted on the first day of trial that her actual damages total $86,274.  She submitted that the file should be transferred to the Supreme Court because her damages exceed the $35,000 limit on damages in this Court.

[74]      The application was dismissed because there was no prospect that the Defendant’s damages could exceed the statutory limit for $35,000.

[75]      I will now address the damages claimed in Ms. Day’s reply and counterclaim.

[76]      In her Reply, Ms. Day alleges that Kia West misrepresented the condition of the 2017 vehicle to induce her to return the 2017 vehicle and purchase the 2019 vehicle.  Ms. Day says that she was told by sales representative Dick Crompton that the 2017 was a “write-off” in order to induce her to return the vehicle and lease a new vehicle.  She claims damages for fraudulent misrepresentation, including punitive damages. 

[77]      Ms. Day referred to this claim only briefly in submissions.  However, because it is included in her pleadings, I will consider whether Ms. Day has established that she is entitled to damages due to fraudulent misrepresentation by Kia West.

[78]      In order to establish fraudulent misrepresentation, Ms. Day must establish the following:

[79]      Kia West disputes that Mr. Compton or any other staff misrepresented that the vehicle would be written off as unfit to drive.  Kia West says that there was nothing wrong with the 2017 vehicle and that it was sold to another customer after it had been returned by Ms. Day.

[80]      During the trial, Ms. Day testified that Mr. Crompton made a number of representations which she says are binding on Kia West.  As Mr. Crompton is now deceased, there is no evidence from him confirming or disputing Ms. Day’s testimony, including whether he told Ms. Day that the 2017 vehicle was a “write-off”.

[81]      I find that the evidence does not establish that Mr. Crompton made a statement amounting to fraudulent misrepresentation.

[82]      Former Kia West employee Dane Endresen testified that Ms. Day’s husband was frustrated with the 2017 vehicle and wanted a new one.  Ms. Day agrees that she and her husband were unhappy with the 2017 vehicle, which she described as a “lemon”, and wanted to return it for a new vehicle. 

[83]      Ms. Day held strong views about returning the 2017 vehicle and getting a new Kia vehicle.  I accept that Mr. Crompton may have said something negative about the 2017 vehicle to affirm her views on returning that vehicle and leasing a new vehicle.  However, I do not accept that Mr. Crompton falsely misrepresented that the 2017 vehicle could not be repaired or that it would be written off by the dealership because it was unfit to drive.

[84]      Further, I do not accept that Mr. Crompton made a misrepresentation that caused Ms. Day to purchase a vehicle that she otherwise would not have purchased.  Ms. Day was clear in her testimony that she and her husband were not satisfied with the 2017 vehicle and were intent on returning it for a new Kia vehicle.  I do not accept that she was induced to return the 2017 vehicle by a false misrepresentation.

[85]      Kia West not only disputes that there was a fraudulent misrepresentation, but also submits that Ms. Day’s claim for alleged misrepresentation was not brought within the two year limitation period for bringing a claim as set out in the Limitation Act.

[86]      The alleged misrepresentation regarding the 2017 vehicle was made no later than June 2019, when Ms. Day purchased the new 2019 vehicle.  Shortly afterwards, Ms. Day received a refund on the LGM insurance and would have realized that there was no insurance claim, based on the vehicle being considered a “total loss” by the dealership.  She was also told by Kia West staff that the 2017 vehicle had been sold to another customer, although the evidence is not clear when this occurred.

[87]      The two year limitation period commenced when Ms. Day would have realized that the 2017 vehicle was not written off as unfit to drive.  The evidence is not certain as to when this occurred, but it seems that it occurred at some point in the summer of 2019.

[88]      The two year limitation period for bringing a claim was extended pursuant to the Emergency Program Act by one year due to the impact of the pandemic.  The time period for Ms. Day to bring a claim likely expired at some point in the summer of 2022.

[89]      Ms. Day first claimed fraudulent misrepresentation in her reply filed in September 2022.  This was close to but likely outside the two year time period for bringing a claim as set out in the Limitation Act.  However, because the evidence is uncertain as to when Ms. Day discovered that the vehicle had not been written off, I would not resolve the counterclaim on the basis of the Limitation Act. 

[90]      I find that Ms. Day has not established that there was a fraudulent misrepresentation by Kia West staff.

[91]      Ms. Day claims a number of costs related to renting other vehicles, as she has not been able to drive the 2019 Kia because Kia West refused to consent to it being insured.

[92]      Ms. Day says that she has incurred car rental costs of $21,000.  She also claims $900 as an estimate for the amount she has spent on gas beyond what she would have spent in driving the 2019 Kia, which is a hybrid vehicle.  She also claims storage and other costs in the amount of $4,234 for storing the 2019 vehicle during the time period that it could not be driven.

[93]      Although Ms. Day claimed car rental damages in her counterclaim, she did not present any evidence of car rental costs at trial.  Apart from the absence of evidence, however, she would not be entitled to damages for the costs of renting another vehicle.

[94]      Kia West is not responsible for the costs of Ms. Day choosing to rent another vehicle.  Kia West declined to consent to Ms. Day insuring the vehicle because she owed several thousand dollars in lease payments.  Kia West’s consent was required because Kia West is the owner of the vehicle.  Kia West was not obligated to consent to Ms. Day insuring the vehicle after Ms. Day defaulted on the lease.

[95]      Similarly, Kia West is not responsible for storage or other costs relating to Ms. Day retaining the 2019 vehicle.  Kia West sought the return of the vehicle.  Ms. Day refused to return it, although she had no proper legal basis to retain it after defaulting on the lease.  Kia West is not responsible for the costs that Ms. Day has incurred in storing and maintaining the Kia vehicle.

[96]      Ms. Day claims damages because Kia West staff cancelled the LGM insurance policy without her consent.  She says that Kia West should have made an insurance claim on her behalf, but instead cancelled the policy on the 2017 vehicle when she purchased the new 2019 vehicle.

[97]      I have already addressed the question of whether Kia West was obligated to make an insurance claim on her behalf.

[98]      In my view, Ms. Day is not entitled to damages because Kia West cancelled the LGM insurance policy on the 2017 vehicle.

[99]      The Kia West lease manager Mr. Enns agreed that he cancelled the LGM insurance after Ms. Day had purchased the 2019 vehicle, as she no longer required insurance for the 2017 vehicle.  There was no need for her to continue to make payments on the insurance when she no longer had the vehicle.  He agrees that he backdated the cancellation by a month so that she would get a refund on her premiums.  Ms. Day was subsequently provided with a small refund on her insurance premiums.

[100]   Ms. Day is not entitled to any damages, as she has not established that she has suffered any loss.

[101]   The cancellation of the insurance policy after Ms. Day returned the vehicle would not have precluded her from making an insurance claim on the vehicle for any legitimate loss that occurred while the policy was in force. 

[102]   If she believed that she had a valid insurance claim during the time that the insurance policy was in force, she could have submitted a claim.  She did not submit any insurance claim at any time in relation to this insurance policy and she was not denied coverage under the policy because of any act by Kia West or for any other reason.  There was no valid insurance claim in any event.

[103]   I find that the evidence does not establish that Ms. Day is entitled to damages for the cancellation of insurance.

[104]   Kia West submits that any claim for cancelling the insurance policy is barred by the Limitation Act.  These events occurred in the summer of 2019.  Ms. Day understood that the LGM insurance was cancelled at that time.  Former Kia West staff Mr. Dane Endresen testified that he advised Ms. Day that the LGM insurance was cancelled.  Ms. Day disputes that anyone told her that the insurance policy was cancelled.  However, regardless of whether Mr. Endresen told her that the insurance was cancelled, she received a small refund on the insurance premiums after returning the 2017 vehicle and would have understood at that time that the insurance policy was cancelled.  This likely occurred in the summer of 2019.

[105]   She had two years to bring a claim for damages pursuant to the Limitation Act.  Ms. Day did not file her counterclaim until September 2022.  Based on the suspension of the time period for bringing a claim due to the pandemic, the time period for bringing a claim likely expired in the summer of 2022.  However, I would not resolve this issue based on the application of the Limitation Act, because it is uncertain when Ms. Day discovered that the insurance was cancelled.

[106]   In my view, this claim in the counterclaim must be dismissed because the evidence does not establish that Ms. Day is entitled to any damages.

[107]   Ms. Day seeks damages for legal fees.  She was self-represented at trial, but consulted with law firms in defending against the claim.  Ms. Day has been unsuccessful in her counterclaim.  Legal fees are not recoverable as damages in any event: Voyer v. C.I.B.C., 1986 CanLII 1226 (BCSC).

[108]   Ms. Day seeks punitive damages in her counterclaim.  As she has been unsuccessful in defending the claim and in her counterclaim, there is no basis to award punitive damages.

[109]   I conclude that Ms. Day breached the Lease Agreement by not making the lease payments.  She has wrongfully retained the vehicle after the expiry of the lease.

[110]   Kia West is entitled to damages based on the payments that they were entitled to receive pursuant to the lease agreement.

[111]   Ms. Day owes Kia West for the outstanding lease payments.  There were 19 missed payments totalling $18,253.87.

[112]   Prior to trial, Kia West brought an application for the return of the vehicle before another judge of this Court.  The judge dismissed the application because the judge believed that there was no jurisdiction in this Court to order the return of the vehicle to the dealership.  The parties did not refer the judge to section 3 of the Small Claims Act, which provides authority for a Provincial Court judge to order the return of personal property and the specific performance of an agreement relating to personal property.

[113]   At trial, Kia West is not seeking the return of the vehicle but rather is requesting an order for the payment of the outstanding lease payments and the amount owing at the end of the lease.

[114]   As Ms. Day retained the vehicle despite Kia West’s efforts to have it returned, Ms. Day is also responsible for the buyout price of the vehicle at the end of the lease in the amount of $10,998.

[115]   The damages pursuant to the Lease Agreement are $29,251.87.

[116]   Kia West is also entitled to the filing and service fees, for a total of $29,437.87.

[117]   Because the vehicle is still owned by Kia West, it will be necessary for the dealership to transfer ownership to Ms. Day upon payment of the judgement in full.

[118]   Ms. Day must pay $29,437.87 to Kia West.  Kia West must transfer ownership of the 2019 Kia Optima to Ms. Day within five business days after payment of the judgement is received in full.

[119]   The parties agree that Kia West is in possession of four tires belonging to Ms. Day.  Kia West must also return the tires within five business days after receiving payment of this judgment in full.