(NOTE: Following a unanimous decision of the Ontario Divisional Court on November 7, 2005, the Ontario Registrar of Motor Vehicles has started to deny the renewal of existing and issuance of new plates of individuals who refuse to pay their 407 ETR bills.)
Most 407 ETR customers pay their bills on a regular basis and will not be affected by plate denial. Unfortunately, some people use the highway and refuse to pay. That’s unfair to paying customers and the company.
407 ETR is an all-electronic, open-access toll highway without booths or barriers. This design was chosen by the Ontario Government to improve traffic flow and to reduce congestion. Because there are no barriers, however, 407 ETR cannot stop someone from using the highway – even if they are significantly in debt.
While other companies refuse service, cancel credit or turn off utilities to those who refuse to pay, plate denial is the only effective means to collect payment from those few individuals who take advantage of the open-access highway. That’s why plate denial was used even before the highway was sold in 1999 and was a key part of the sale.
How Does Plate Denial Work?
Under the Highway 407 Act (the “Act”), 407 ETR follows a very thorough legislated process in order for the Registrar to deny someone the renewal of an existing license plate or issuance of a new license plate.
"Notice of Failure To Pay"
As outlined in the Act, if a 407 ETR bill is outstanding for 35 days, a Notice of Failure to Pay can be sent to the customer. 407 ETR must send a Notice of Failure to Pay to the customer’s address listed in the Ministry of Transportation (MTO) database. Upon receipt of a Notice of Failure to Pay, a customer may pay their bill and/or send a Notice of Dispute within 30 days listing one or more of the permitted grounds for dispute set out in the Act.
Opportunity to Dispute:
If the customer sends a Notice of Dispute, 407 ETR has 30 days to respond. If 407 ETR fails to respond, the disputed amount cannot be sent to plate denial.
If 407 ETR does not agree with any or all of the disputed items in the customer’s Notice of Dispute, the customer has the right to appeal 407 ETR’s decision to an independent dispute arbitrator that has been appointed by the Ontario Government. Please note that the plate denial process continues while the matter is appealed to the independent arbitrator.
If the arbitrator finds in favour of the customer and the customer has already paid while they were in plate denial or otherwise, the disputed amount plus interest is returned to the customer.
If a customer sends a Notice of Dispute to 407 ETR, 407 ETR will not use a collection agency or seek court enforcement to collect the amounts until the final disposition of the customer’s dispute.
“Notice of Plate Denial”
A minimum of ninety (90) days must elapse between the issuance of the Notice of Failure to Pay and the referral of amounts owed to the Registrar. Upon referral to the Registrar, the customer is sent a Notice of Plate Denial by registered mail or bonded courier to their address listed in the MTO database.
The Registrar places the customer in plate denial at the same time the Notice of Plate Denial is sent to the customer. This means that customers will be unable to renew their licence plate or obtain a new licence plate until all tolls, fees and interest referred to the Registrar have been paid in full. An Enforcement Fee is charged if your account is referred to the Registrar of Motor Vehicles for Licence Plate Denial.
If you have received a Notice of Failure to Pay or Notice of Plate Denial, have used the highway and never paid, or would simply like to learn more about plate denial, please click here to review a list of frequently asked questions.
Plate Denial and Bankruptcy
407 ETR is an all-electronic, open-access toll highway without booths or barriers that collects tolls, fees and, as applicable, interest (together, "407 Charges") from its customers subsequent to their use of the highway. The design and system of payment of 407 Charges were purposely chosen by the Ontario Government to improve traffic flow and to reduce congestion, land use and pollution.
Unlike other service providers, 407 ETR does not have the opportunity or ability to screen or examine the credit-worthiness of its customers until after they have used the highway. While most 407 ETR customers pay their bills on time, some do not, and 407 ETR uses traditional collection methods, similar to those used by other companies, to collect payment from these individuals. In addition, 407 ETR can require the Registrar of Motor Vehicles to deny the renewal of existing licence plates or the issuance of new plates to Customers who fail to pay their 407 Charges in certain express circumstances. However, unlike other companies that can refuse to provide service, cancel credit or turn off utilities to those who fail to pay, plate denial is the only effective remedy available to 407 ETR.
407 ETR is governed, among other things, under the Highway 407 Act (the “407 Act”). The 407 Act expressly allows for plate denial, which is modelled after other provincially-mandated licence suspension processes. 407 ETR plate denial is the process whereby the Ontario Registrar of Motor Vehicles must deny the renewal of existing, or the issuance of new, vehicle licence plates for Customers who have failed to pay their 407 Charges. 407 ETR’s right to plate denial was endorsed in a unanimous decision of the Ontario Divisional Court on November 7, 2005.
The courts have confirmed that provincially mandated licence suspension can be enforced against an individual despite his/her status as a bankrupt, and despite the broad stay of proceedings or “freeze” on the actions of creditors against the bankrupt and his/her assets found in the Bankruptcy and Insolvency Act . The courts have also confirmed that such rights can be enforced against discharged bankrupts.
Notwithstanding the broad stay of proceedings, the Bankruptcy and Insolvency Act allows creditors to take action against individual bankrupts in certain circumstances. There is extensive Canadian case law where the courts have upheld the enforceability of licence plate suspensions issued by provincial motor vehicle authorities against individual bankrupts. The courts focused on the fact that permits and licences are “privileges” afforded by provinces to drivers as opposed to ordinary property and that provinces are within their right to enforce such suspensions as a matter of public policy.
Given the express provisions of the 407 Act and the current jurisprudence, 407 ETR will continue to use plate denial for those Customers that fail to pay their 407 Charges, including bankrupts and individuals discharged from bankruptcy in accordance with the 407 Act.
407 ETR recognizes that there are instances whereby customers may have extenuating circumstances that are not financial in nature and require the use of their vehicle. The ‘Exceptional Hardship Plan’ is designed to assist customers who may fall into this category. For details regarding the ‘Exceptional Hardship Plan’ process, click here.
