In a consignment, what role does the dealer play?
BC VSA Salesperson overview
BC VSA Salesperson: Consignment sales
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Study reference: Official-source editorial checking, no licensed review — Consignment sales
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In a consignment, what role does the dealer play?
- It rents the vehicle to the public
- It sells the owner's vehicle as the owner's agent
- It buys the vehicle outright at a wholesale price
- It lends the owner money on the vehicle
Show answer and explanation
Correct answer: It sells the owner's vehicle as the owner's agent
A consignment is an arrangement where a vehicle is entrusted to a dealer for sale, under a conditional sale for resale, or for display for sale. The dealer acts as agent for the owner (consignor).
Based on: Motor Dealer Consignment Sales Regulation s. 1; official source checked 2026-10-24
Official reference ↗When a consignment is negotiated, when must the dealer give the consignor a copy of the prepared consignment agreement?
- Only after the vehicle sells
- Within 90 days after payment
- Only if the consignor pays a document fee
- At the time the consignor signs it
Show answer and explanation
Correct answer: At the time the consignor signs it
Section 2(1) requires the dealer to prepare the consignment agreement and give the consignor a copy at signing. This document requirement does not replace any licence conditions on consignment activity.
Based on: Motor Dealer Consignment Sales Regulation s. 2(1); official source checked 2026-10-24
Official reference ↗Which statement about consignment trust money is correct?
- It can be seized by the dealer's creditors
- It cannot be used as collateral by the dealer
- It belongs to the dealer once deposited
- It may pay the dealer's rent if it is repaid later
Show answer and explanation
Correct answer: It cannot be used as collateral by the dealer
Payments are held in trust for the consignor and lien holder, remain their beneficial property, must not be used as collateral and are not subject to seizure against the dealer.
Based on: Motor Dealer Consignment Sales Regulation s. 6(1)–(2); official source checked 2026-10-24
Official reference ↗After a consigned vehicle sells, when must the dealer notify the consignor?
- Within one day after the sale
- Within 14 days after the sale
- Only once the buyer's cheque clears
- At the end of the agreement's term
Show answer and explanation
Correct answer: Within one day after the sale
The agreement must state that the dealer notifies the consignor of the sale within one day after it, and that proceeds are paid within 14 days unless the consignor waives this in writing after the sale.
Based on: Motor Dealer Consignment Sales Regulation s. 2(2)(j)(i); official source checked 2026-10-24
Official reference ↗Unless the consignor waives it in writing after the sale, when must the sale proceeds be paid out?
- Within 14 days after the sale
- Within 2 days after the sale
- Within 90 days after the sale
- Within 30 days after the sale
Show answer and explanation
Correct answer: Within 14 days after the sale
Disbursement of the sale proceeds must take place within 14 days after the sale unless the consignor specifically waives this right in writing after the sale.
Based on: Motor Dealer Consignment Sales Regulation s. 2(2)(j)(ii); official source checked 2026-10-24
Official reference ↗What must the consignment agreement tell the consignor about the ownership transfer forms?
- Give them to the first person who test-drives it
- Leave them with ICBC until the vehicle is sold
- Sign them in blank so the dealer can sell quickly
- Do not sign them over to the dealer in blank
Show answer and explanation
Correct answer: Do not sign them over to the dealer in blank
The agreement must state that the consignor must not sign vehicle ownership registration forms over to the dealer in blank.
Based on: Motor Dealer Consignment Sales Regulation s. 2(2)(f); official source checked 2026-10-24
Official reference ↗What must the purchase agreement for a consigned vehicle state?
- The dealer's commission and the consignor's minimum price in full
- The consignor's home address and phone number for follow-up questions
- The vehicle is on consignment and payments go to the dealer's trust account
- The vehicle is sold as-is and the buyer gives up the Sale of Goods Act
Show answer and explanation
Correct answer: The vehicle is on consignment and payments go to the dealer's trust account
Besides the usual content, the purchase agreement states that the vehicle is on consignment and that cheques, drafts or money orders must be payable to the dealer's trust account at a BC savings institution.
Based on: Motor Dealer Consignment Sales Regulation s. 4(1)–(2); official source checked 2026-10-24
Official reference ↗For which purpose may a dealer withdraw consignment trust funds?
- To pay the consignor or a lien holder under the agreement
- To cover a short-term shortfall in the dealer's payroll
- To pay the dealer's fee before the consignor is paid
- To make a deposit on another vehicle for its inventory
Show answer and explanation
Correct answer: To pay the consignor or a lien holder under the agreement
Withdrawals are allowed only to pay sale proceeds to the consignor or lien holder, to correct a deposit made by mistake, or to pay the dealer as the agreement allows after those disbursements.
Based on: Motor Dealer Consignment Sales Regulation s. 6(4); official source checked 2026-10-24
Official reference ↗Which way of paying the dealer is allowed in a consignment agreement?
- A fee taken from the buyer's deposit before the sale is final
- An amount above an agreed minimum price, payable only if sold
- A share of the consignor's other income for one year
- A monthly storage charge set later at the dealer's choice
Show answer and explanation
Correct answer: An amount above an agreed minimum price, payable only if sold
The dealer's pay may be a fixed amount if sold, a fixed fee whether or not sold, a percentage of the selling price if sold, an amount above an agreed minimum if sold, or a combination of those fees.
Based on: Motor Dealer Consignment Sales Regulation s. 2(2)(c); official source checked 2026-10-24
Official reference ↗What minimum type size applies to consignment and purchase agreements?
- 12 point bold throughout
- 8 point, in plain language
- 10 point, in capital letters only
- 6 point, in legal language
Show answer and explanation
Correct answer: 8 point, in plain language
Every consignment agreement and purchase agreement must be in plain language, in not less than 8 point type, and easy for a reasonable person to understand.
Based on: Motor Dealer Consignment Sales Regulation s. 5; official source checked 2026-10-24
Official reference ↗How soon must a dealer deposit a buyer's payment for a consigned vehicle into its trust account?
- When the consignor asks
- Within seven days of receiving it
- At the end of the month
- Within one day of receiving it
Show answer and explanation
Correct answer: Within one day of receiving it
Within one day after receiving payment from the purchaser, the dealer must deposit it in a designated trust account at a savings institution in BC.
Based on: Motor Dealer Consignment Sales Regulation s. 6(3); official source checked 2026-10-24
Official reference ↗Which item must a consignment agreement contain?
- The minimum price the consignor will accept
- The dealer's commission on its other sales
- The names of buyers who viewed the vehicle
- The highest price the dealer expects to get
Show answer and explanation
Correct answer: The minimum price the consignor will accept
The consignment agreement must include a full vehicle description, the minimum price the consignor will accept, how the dealer is paid, the duration, trust and title statements, warranty and insurance details, and the duties on sale.
Based on: Motor Dealer Consignment Sales Regulation s. 2(2)(b); official source checked 2026-10-24
Official reference ↗
Consignment sales: key rules to remember
Our summary of what the official handbook says on this topic, in our own words. Read it before or after the practice questions above, then check the original chapter. Read the official chapter ↗
Consignment sales
- In a consignment, what role does the dealer play?: A consignment is an arrangement where a vehicle is entrusted to a dealer for sale, under a conditional sale for resale, or for display for sale. The dealer acts as agent for the owner (consignor).
- When a consignment is negotiated, when must the dealer give the consignor a copy of the prepared consignment agreement?: Section 2(1) requires the dealer to prepare the consignment agreement and give the consignor a copy at signing. This document requirement does not replace any licence conditions on consignment activity.
- Which item must a consignment agreement contain?: The consignment agreement must include a full vehicle description, the minimum price the consignor will accept, how the dealer is paid, the duration, trust and title statements, warranty and insurance details, and the duties on sale.
- Which way of paying the dealer is allowed in a consignment agreement?: The dealer's pay may be a fixed amount if sold, a fixed fee whether or not sold, a percentage of the selling price if sold, an amount above an agreed minimum if sold, or a combination of those fees.
- What must the consignment agreement tell the consignor about the ownership transfer forms?: The agreement must state that the consignor must not sign vehicle ownership registration forms over to the dealer in blank.
- After a consigned vehicle sells, when must the dealer notify the consignor?: The agreement must state that the dealer notifies the consignor of the sale within one day after it, and that proceeds are paid within 14 days unless the consignor waives this in writing after the sale.
- Unless the consignor waives it in writing after the sale, when must the sale proceeds be paid out?: Disbursement of the sale proceeds must take place within 14 days after the sale unless the consignor specifically waives this right in writing after the sale.
- What must the purchase agreement for a consigned vehicle state?: Besides the usual content, the purchase agreement states that the vehicle is on consignment and that cheques, drafts or money orders must be payable to the dealer's trust account at a BC savings institution.
- What minimum type size applies to consignment and purchase agreements?: Every consignment agreement and purchase agreement must be in plain language, in not less than 8 point type, and easy for a reasonable person to understand.
- How soon must a dealer deposit a buyer's payment for a consigned vehicle into its trust account?: Within one day after receiving payment from the purchaser, the dealer must deposit it in a designated trust account at a savings institution in BC.
- Which statement about consignment trust money is correct?: Payments are held in trust for the consignor and lien holder, remain their beneficial property, must not be used as collateral and are not subject to seizure against the dealer.
- For which purpose may a dealer withdraw consignment trust funds?: Withdrawals are allowed only to pay sale proceeds to the consignor or lien holder, to correct a deposit made by mistake, or to pay the dealer as the agreement allows after those disbursements.
Other topics
- The VSA, the Motor Dealer Act and who is regulatedHow the Vehicle Sales Authority administers the Motor Dealer Act and parts of the BPCPA, the legal definitions of motor dealer, motor vehicle and sale, the five-vehicle deeming rule, exemptions, the VSA's jurisdiction, publication of enforcement actions and the $10 transaction levy.
- Salesperson licensingSalesperson activity, applications, conditions, renewal and the distinction between unpaid introductions and rewarded activity that requires a licence.
- Dealer registration, premises and recordsWhat a dealer needs to be registered, trading only in the registered name from registered premises, online sales, per-location registration and expiry, refusal and cancellation, changes to report in 14 days, certificates, records kept two years and wholesale auctions.
- Code of conductThe duties every licensee and dealer owes under the code of conduct: honesty and integrity, no discrimination, putting every representation in writing, prompt replies, no misleading charges, no intimidation, protecting records and not helping anyone break the law.
- Sale agreements and material factsWhat new and used vehicle agreements must contain, the material facts a dealer must disclose (taxi, police, racing, damage, rental, imported for sale, odometer), vehicles not suitable for transportation, odometer replacement and when a vehicle is new, used or a demonstrator.
- Advertising, price display and dealer feesDealer numbers in ads, window-sticker and all-in price rules for new and used vehicles, demonstrator wording, documentation and finance placement fees, lowest advertised price and the BPCPA rules on price representations.
- Deceptive and unconscionable practices (BPCPA)Who is a consumer and a supplier, examples of deceptive acts or practices, the supplier's burden of proof, the factors for unconscionable practices and their effect, void waivers and prohibited terms on reviews and arbitration.
- Leases, distance sales, deposits and returnsLease disclosure and the one-clear-day lease cancellation right, why purchases have no cooling-off period, distance sales cancellation rights, deposits with and without a written agreement, and the buyer's right to inspect.
- Motor Dealer Customer Compensation FundDealer contributions and late charges, who can claim and which losses qualify, the written demand and deadlines, exclusions, the $20,000 maximum, the Board's powers and dealer repayment.
- Complaints, enforcement, odometers and curbersComplaints and inspections, undertakings, compliance and freezing orders, receivers, administrative penalties and their limits, odometer offences, fines and time limits, and how to recognize and deal with curbers.
- Sale of Goods Act, liens and financingImplied conditions of title, description, fitness, merchantable quality and durability, which ones can be excluded for used goods, lien searches, negative equity, extended-term loans and finance fees.