Quebec auto dealers lose class action over hidden fees, buyers entitled to credits

Almost half-a-million Quebecers could be eligible for a credit after a class action lawsuit settlement was approved by a Quebec judge over car dealerships that charged hidden fees.

In the suit, 220 Quebec new and used car dealers were accused of charging their customers nearly $300 million in hidden fees.

A settlement agreement involving 150 of those dealerships was approved by the Superior Court of Quebec on Oct. 8.

"They had bought vehicles, and they ended up paying more than had been announced to them prior to purchasing the vehicles in question," said lawyer Philippe Brault of Lambert Avocats.

The Automobile Protection Association's George Iny said the hidden costs were bogus.

"Definitely illegal retailing practices," he said. "[You] can call it a scam. It's definitely illegal retailing practices that should be punished. And it got out of hand. The regulators really weren't able to do it. And it created this opportunity for a law firm to take a suit."

Brault said the law firm was contacted by several buyers who were hit with sticker shock when they bought a car.

"At the end of the transaction they actually ended up paying hundreds or thousands more for the vehicle than what was announced previously," he said.

Brault added that some dealerships named in the suit claim they charged the fees because their competitors did, but Lambert Avocats argue that that doesn't make it legal.

The law firm's website has the long list of car dealers to see if you might be eligible for a $75 credit.

Iny said that the credit per client isn't much, but the dealerships also have to pay legal fees and he estimates that to total around $5 million.

"They probably each have anywhere from $10,000 to $50,000," said Iny.

Brault estimates that up to 500,000 Quebecers may be eligible for a credit.

There is also the condition in the settlement that hidden fees are eliminated.

"Every dealership that's part of this agrees to stop charging such fees without exposing them to people before," said Brault.

Those looking to find out if they are entitled to a credit can visit the law firm's website.