Executive Summary: Key Legal and Evidentiary Issues

• Chartier sought $9,500 in damages from Hyundai Auto Canada Corp. for premature paint deterioration on her 2017 Elantra.
   
• Determining the appropriate remedy required the Tribunal to weigh monetary compensation against Hyundai's offer of performance in kind.
   
• Quantifying moral damages for stress and inconvenience formed a secondary issue before the court.
   
• Section 38 of the Consumer Protection Act's legal warranty of durability governed the underlying defect claim.
   
• Judicial discretion under section 272 of the Consumer Protection Act permitted the Tribunal to select among available remedies.
   
• Chartier's duty to mitigate damages ultimately limited her recovery for moral prejudice.
   

Facts of the case

Guylaine Chartier purchased a 2017 Hyundai Elantra, a glacier white floor model with 2,005 kilometres on the odometer, on August 3, 2017. In December 2020, Hyundai Auto Canada Corp. repainted the vehicle's hood under warranty, with its representative acknowledging the issue as a known defect affecting that specific paint colour. The paint subsequently continued to chip on the roof and fenders, and in 2022 Hyundai initially declined to cover the additional repairs, citing the expiry of the vehicle's 3-year or 60,000-kilometre basic warranty. Chartier filed her claim with the Small Claims Division on August 30, 2022, seeking $9,500: $7,500 for full repainting, $700 for a rental vehicle during repairs, and $1,300 for stress and inconvenience. During the proceedings, Hyundai revised its position, extending the paint warranty to 10 years and offering to repaint the affected sections, supply a replacement vehicle, and provide financial compensation. Chartier declined the in-kind offer, citing a loss of trust in the manufacturer given its initial refusals and what she described as a dismissive response to her repeated follow-ups.

Policy and legislative provisions at issue

The case turned on the legal warranty of durability under section 38 of the Consumer Protection Act (C.P.A.), which survives expiry of a manufacturer's conventional warranty and requires that a vehicle's paint have a reasonable lifespan relative to its price and normal use. Section 272 of the C.P.A. was also central, as it grants the Tribunal discretion to select among available remedies — performance of the obligation, reduction of the obligation, or damages — once a breach of warranty is established. The additional indemnity under article 1619 of the Civil Code of Québec applied to the monetary award ordered.

Reasoning and analysis

The Tribunal found that Hyundai had effectively admitted the paint defect through its extension of the paint warranty to 10 years. Citing Beaulieu v. FCA Canada and Marchildon v. Honda Canada, which in turn rely on Richard v. Time Inc., the Tribunal noted that while a consumer may choose among contractual repair, compensatory damages, punitive damages, or a combination of remedies, the presiding judge retains discretion to grant the remedy considered most appropriate. Drawing on scholarship by Myriam Brixi and Luc Thibaudeau, the Tribunal observed that a merchant may satisfy its legal warranty obligations through performance in kind, such as a correction program, provided the response is prompt and transparent. Although Chartier had lost confidence in the manufacturer, the Tribunal concluded that Hyundai's offer — full repainting at its own expense, a replacement vehicle, and an extended warranty — was reasonable and complete. It further reasoned that awarding $7,500 for a vehicle approaching 10 years old, without assurance the funds would be used for repairs, risked producing an unjust enrichment rather than remedying the defect. On the claim for moral damages, the Tribunal held that the time and effort Chartier spent pursuing her claim through the justice system did not itself constitute compensable trouble and inconvenience. It also found that, having declined Hyundai's April 2023 repair offer, Chartier could not claim compensation for the shame or frustration of continuing to drive a vehicle with visibly degraded paint, since that continued use stemmed from her own decision to await the litigation's outcome rather than accept the offered remedy.

Ruling and overall outcome

The Tribunal granted Chartier's claim in part. It ordered Hyundai Auto Canada Corp. to pay Chartier $600 for stress, trouble, and inconvenience, plus interest at the legal rate and the additional indemnity under article 1619 of the Civil Code of Québec from the thirtieth day following the judgment, along with court costs of $201. It dismissed Chartier's claim for monetary compensation related to the repainting work and vehicle rental, instead ordering Hyundai to comply with its offer of performance in kind: repainting all affected sections of the vehicle at its own expense, honouring the paint warranty extension until 2027, and providing a replacement vehicle free of charge for the duration of the repairs.