Script 252 gives information only, not legal advice. If you have a legal problem or need legal advice, you should speak to a lawyer. For the name of a lawyer to consult, call Lawyer Referral at 604.687.3221 in the lower mainland or 1.800.663.1919 elsewhere in British Columbia.

If you’re in debt and have fallen behind in your payments, you may have received phone calls or letters demanding payment. If you’re far enough behind, you may even have been threatened with court action, or the seizure of your car or furnishings. If so, you’ll want to know what your rights are.

There are laws to protect debtors
Not many years ago, debt collection practices weren’t regulated by any laws. Not surprisingly, this state of affairs led to abuses, including midnight phone calls demanding payment, complaints to a debtor's employer about the debt, and threats of terrible consequences. Now there are laws to protect debtors.

In BC, the Business Practices & Consumer Protection Act protects debtors
The provincial government passed this law to ensure the collection of debts is done in a reasonable manner. The Act has two important aims:

• first, to license debt collection businesses, and
• second, to regulate the conduct of creditors and debt collection businesses.

The Act recognizes that creditors have a right to collect monies owing to them, but at the same time, it recognizes that debtors should be protected from harassment.

How do debt collectors operate?
A debt collector is someone who carries on the business of collecting debts for others for a fee. If you bought a suit from a local store and haven't made the payments, the store owner may eventually give up on you and hire a debt collection business to recover the money from you. Normally the debt collection business charges the creditor (in this example, the store owner) a fee in proportion to the amount they actually recover from you. If the debt collector recovers nothing, they get no fee, so they have the reputation of being more aggressive in their collection tactics than creditors who are doing their own collecting.

Harassment is forbidden
The general rule is that anyone collecting a debt – either a creditor or a debt collection business – cannot communicate or attempt to communicate with a debtor or their family, acquaintances or employer in a manner or with a frequency that it constitutes harassment. Harassment is defined in the Business Practices and Consumer Protection Act to include the use of threatening or intimidating language, exerting excessive or unreasonable pressure, and publishing or threatening to publish the debtor’s failure to pay what they owe to the creditor. The following are some common examples of these types of harassment.

First, creditors and debt collectors cannot intimidate you
They’re not allowed to contact you, your family, or your employer in such a way that it may cause alarm, distress or humiliation. For example, they cannot phone your home every ten minutes all day long demanding payment, if that tactic distresses your family members. Similarly, they aren’t allowed to stand on your front lawn with a megaphone, demanding payment, for all your neighbours to hear. Those are extreme examples, but many more subtle techniques are forbidden as well.

Second, creditors and debt collectors must be careful when contacting your employer
They can only contact your employer to confirm your employment. So, they can’t harass your boss, or prejudice your reputation by suggesting that you ought to be fired because of your debts. But a creditor or debt collector can make one attempt to collect a debt from you while you’re at your place of work, if they’re unable to reach you at home, or if you won’t respond.

Third, creditors and debt collectors aren’t allowed to mislead you
They can’t use forms or documents where the appearance or language would cause you to think that they come from a court or government office. For example, they can’t mail you a letter demanding payment, produced in the form of a “Court Summons,” because you might be misled into thinking that it was an official court document.

Fourth, they can only collect the appropriate amount from the right person
Debt collectors cannot collect or try to collect money from someone who doesn’t owe the money, or attempt to collect more money than is owed to the creditor.

There’s another special rule for debt collection businesses
They have to submit to the Business Practices & Consumer Protection Authority a copy of every document or form of letter they plan to send to a debtor. This is to ensure that the documents aren’t misleading in appearance or unreasonable in content. A debt collector isn’t allowed to use forms that haven’t been approved by the Business Practices & Consumer Protection Authority.

What if you’re a victim of harassment or unreasonable collection practices?
If you think you’re a victim, you have three options to consider.

Your first choice is to complain
If you complain to the Business Practices & Consumer Protection Authority, the Authority will investigate and can take steps against the debt collector or creditor. To make a complaint, call 1.888.564.9963 (toll-free).

Your second choice is to only accept written communications.
If the nature or frequency of the collection telephone calls is upsetting you and the calls won’t stop, you have the right to demand in writing that all future communication be in writing only. It’s an offence if a debt collector doesn’t follow your request.

Your third choice is to ask the creditor to sue you
If the debt is disputed, you have the right to notify the creditor and the collection agency in writing that you want the creditor to take the matter to court. Upon written notification, all other types of collection must stop.

Remember, if you’re in debt, you have a legal obligation to repay the money
But the Business Practices & Consumer Protection Act regulates the practices that debt collectors may use in recovering their money.

Where can you get help or find more information?

• See the consumer information section published by the Business Practices & Consumer Protection Authority on their website at www.bpcpa.ca, or call 1.888.564.9963 (toll-free).
• If you’re in financial difficulty or having trouble paying your bills, refer to script 253 on “When You Can’t Pay Your Debts.”
• See the brochure on “Consumer Law and Credit/Debt Law,” published by the Legal Services Society of BC and available on their website at www.lss.bc.ca. To find it, click on “Publications,” then search under the subject of “Consumer Law.”

[updated April 2007]

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