The Not-So Inspiring Tale of A Senior's 'Contract' Moment

Everyone who has grandchildren will understand the warm, fuzzy feeling surrounding that special relationship. That is why, one suspects, Alexandre Lavigne allowed himself, in March of 2008, to be drawn into a discussion with his 18 year-old grandson Colton about the purchase of a motor vehicle.

Not that Colton didn't already have a motor vehicle; he did. Colton's plan was to trade in his very cool used Chrysler on a very hot used 2002 Acura RSX.

So, this was the deal. Colton would trade in his Chrysler and the dealer, Bathurst Honda, would give him a credit for the full amount still owing on the Chrysler. That meant the Chrysler debt would be paid in full and Colton would then only have to finance the purchase of his hot 2002 Acura RSX.

"Sayonara Grandpa!"

You can see where this is going. Enter...the discussion with Grandpa Alexandre...followed by Colton's trip to the car dealership with Grandpa Alexandre in tow.

At the dealership, grandson Colton and Grandpa Alexandre were met with the usual financing documents to review. The business manager at Bathurst Honda went over the necessary documents with Colton and Alexandre including the Conditional Sales Contract Agreement that had to be signed to secure the loan with the financing company, Caisse Populaire de Shippagan Ltée.

The loan was structured so that the party borrowing the money from the finance company was Grandpa Alexandre, not Colton. According to the evidence at trial the business manager went over all of the documents with Grandpa Alexandre...which was a good thing because Alexandre Lavigne was illiterate and he would obviously have had to rely on the information provided to him by the business manager.

And so it was that Alexandre, not Colton, signed all the necessary financing papers. Grandpa Alexandre and Colton agreed that, since Colton was to make all the car payments, they would give young Colton's banking information for the monthly automatic withdrawal payment - not Alexandre Lavigne's.

It was a great day after the paperwork had been completed. Eighteen year old Colton took delivery of his RSX and Grandpa Alexandre walked away with Colton's word that Colton would make all the monthly payments directly from Colton's bank account, until the loan was paid off.

2002 Acura RSX

What could possibly go wrong with that plan?


Needless to say Colton never did make a car payment. The car was ultimately seized and Alexandre Lavigne was sued by the financing company for money still owed to it after the seized car was sold.

Does this seem right...going after a man for signing documents he couldn't read and who got absolutely no benefit out of the loan?

At trial, Alexandre told the Court it was unclear to him what he was signing, that the documents were not properly explained to him, and that Bathurst Honda had agree to take the payments out of Colton's bank account, not his. In short, Alexandre argued - he should not be bound to the agreement when he clearly did not appreciate the nature of the documents at the time of signing.

So, here is the Judge's dilemma. Someone is going to have to take the hit for the unpaid loan of $29,443.97.

Should it be the big, financially sound financing company? Or should it be the little, illiterate grandfather, who received absolutely no benefit from the loan and who, after all was said and done, was only trying to help out his grandson?

Here's what the Judge said:

"I do not accept the defendant's assertion that he was unaware of the nature of the documents he was signing. The defendant clearly stated in his testimony that he signed the documents because Colton was going to make the payments. Unfortunately, the defendant's grandson has left him in a precarious position, and that will be an issue for the two of them to resolve. However, at all times the defendant understood he was signing the documents for the purchase of a vehicle. The defendant further believed his grandson would make the payments and based on this agreement he signed the necessary documents to purchase the vehicle. Despite the defendant's limited education, I have no reservation that he understood the nature of the transaction he entered into...."

The Judge reminded the parties that simple justice required the grandfather to bare the loss since he was in the position to take reasonable care to avoid the loss that resulted, when the only other alternative would have been to place the loss upon the financing company, who after all was the innocent party.

In the end, it cost Grandfather Alexandre Lavigne $29,443.97, plus $100.00 in disbursements and $2,025.00 costs for a grand total of $31,568.97. Ouch! We'll bet Colton was not on Grandpa's Christmas shopping list, not at least in 2008.

Lesson to be learned:

1. Unless you totally understand documents you are asked to sign (especially those contracts that have all that very, very fine print), it is best to consult a lawyer who understands contract law. That one appointment with a lawyer could save you thousands of dollars.

2. If someone asks you for a favour involving money, ask yourself whether you can afford the potential loss without spoiling the relationship.

If you have had a similar experience, or just want to comment on this case, or the law, we'd like to hear from you.

You can reach us at: wewanttohearfromyou@rossfirm.com

At The Ross Firm, we have lawyers whose practice focus is Civil Litigation and Contractual matters.

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