Summary of Changes to British Columbia’s Trade Privilege Legislation (CLA vs. RLA & Common Law)
This document outlines the meaningful changes brought about by the Commercial Law Act (CLA) in British Columbia, modernizing the legal framework governing trade privileges previously governed by the Repairers’ Lien Act (RLA) and Common Law. The CLA aims to increase efficiency in the service sector by providing greater flexibility for service providers while enhancing openness and uniformity for owners.
Here’s a breakdown of the key changes:
1. repairers’ Privileges:
RLA Limitations: The RLA required physical possession of goods for a privilege to be valid, prioritized the first recorded privilege, and didn’t allow for privilege transfer.
CLA Improvements:
expanded Privileges: The CLA introduces a new type of privilege recordable in the Personal Property Registry, covering goods without serial numbers and all commercial privileges with financing declarations (including authorization or commitment to pay).
Automatic creation & No Possession Requirement: A privilege is now automatically created when the service begins, eliminating the need for the repairer to maintain possession of the goods. This benefits mobile service providers and those working on large, immobile equipment.
Priority & Transferability: The CLA prioritizes later-recorded privileges, reflecting the practical realities of repair work, and allows privileges to be sold, aligning with modern commercial practices.
2. Transporters’ Privileges:
Common Law limitations: Previously, transporters’ privileges under Common Law were limited to the price of service, excluded storage/maintenance costs, prohibited sale of goods, and didn’t apply to private carriers.
CLA Improvements:
Standardized Amount: The CLA clarifies the guaranteed amount as either the agreed price or the market value of the service.
Expanded Coverage: The CLA extends privilege rights to all service providers offering targeted services, not just public carriers.
Increased Protection of Goods: The CLA imposes new responsibilities on privilege holders to maintain the goods in their possession, preserving their value and providing greater certainty for both holders and owners.Overall CLA Objectives:
Consolidation: Replaces obsolete laws with a single, unified framework.
Abolishment of Common Law Privileges: Eliminates existing Common Law privileges for repairers and transporters.
Integration with PPSA: Includes trade privileges under the Personal Property Security Act (PPSA).
Enhanced Flexibility & Transparency: Provides service providers with greater security in receiving payment while offering owners a more predictable and transparent system for managing privileges.
In essence, the CLA represents a significant modernization of British Columbia’s trade privilege legislation, designed to better serve the needs of both service providers and their customers in a contemporary commercial habitat.
