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Alberta takes the lease out of lease/operator


Remember summer camp? Your mom wrote your name on everything you owned, from your underwear to the plate you used to slurp up your beans in the mess tent. After too many late nights telling ghost stories and giggling with friends, you might forget to pack your pillow for the trip home. But because your name was on it, you’d get your pillow back because everyone knew it was yours. It was a system that worked.

Maybe the people who make the rules at Alberta Motor Vehicles never went to summer camp.

If you’re one of the thousands of owner/operators who lease on with another carrier, you know that your vehicle registration must be in the name of that company in order to use its insurance and safety certificate.

For years, Alberta’s vehicle registration certificate listed the owner/operator’s name as the “lessor” – meaning “owner” – of the vehicle.

Then Alberta Motor Vehicles decided to make a change. It now defines a lessor is “an individual, partnership, or corporation which under the terms of a lease gives the legal right of possession, control of, and responsibility for the operation of the vehicle to another individual, partnership, or corporation.”

By rule, that means owner/operators can’t be lessors because they retain “ownership, possession, and exclusive use of the vehicle.”

The only lessor that could appear on the registration would be something like an equipment finance company, which owns the vehicle but leases it to another party to operate.

Let’s look at this in practice.

Say Joe’s Trucking is a new owner/operator leasing on to ABC Cartage.

If Joe owns his truck, only ABC Cartage’s name will appear on the vehicle registration. If Joe has a truck lease from CIT Financial, for example, ABC Cartage will be the “registrant” and CIT Financial will be the “lessor.”

The name “Joe’s Trucking” will be nowhere on the registration even though Joe owns the truck.

Proof of ownership

AMV says it shouldn’t matter whether an owner/operator’s name is on the vehicle registration because registration is not official proof of ownership. Only a valid bill of sale can show ownership.

(Tell that to another province when you want to register your vehicle somewhere other than Alberta. Those other provinces are looking for proof of ownership through registration of the vehicle).

Alberta also added another form for owner/operators to fill out. Owner/operators who want to register a vehicle in another company’s name are required to complete an Authorization for Vehicle Service form. It identifies what services may be requested on an owner or registrant’s behalf and who is authorized to request it.

This form must be signed and dated by all of the owners/registrants of the vehicle and presented with proof of ownership (bill of sale or lease) before the vehicle can be registered.

Big questions

Confused? You’re not the only one.

When vehicle tax and license policies change, usually there’s a good reason. But a lot of owner/operators in Alberta are scratching their heads over this one, since having your name on the registration certificate as proof that you own an expensive asset would seem to be an important detail.

What should an Alberta owner/operator do?

First, find the original bill of sale for your truck. Did you know that a registrant can sign the back of the registration certificate and use it as a bill of sale? Your original bill of sale is the only proof you have that you actually own your vehicle.

Second, when you leave the carrier you’re contracted to, get a release letter stating that the carrier no longer has interest in your truck. At the very least, make sure the letter includes the year, make, and VIN of your vehicle.

Third, if you’re an existing owner/operator and renewing your vehicle registration this year, don’t expect these changes to apply right away. Owner/operators who are already listed as “lessors” are not being removed unless it’s requested and appropriate backup documentation is provided to the government. At least, that’s how it is right now. Finally, did I mention to make sure you have your bill of sale tucked away somewhere safe? Maybe you should give it to your mom for safe-keeping. Hers was the best system of all.

***

Sandy Johnson has been managing IFTA, IRP, and other fleet taxes for more than 25 years. She operates FleetTaxPro.com, which provides vehicle tax and license compliance services for trucking operations ranging from single vehicles to large fleets. She can be reached at 877-860-8025 or FleetTaxPro.com.


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3 Comments » for Alberta takes the lease out of lease/operator
  1. LARRY BARCLAY says:

    who is the brain dead sob that thougt this up. two things this creates one more paper work two if the company ur leased to gos down the receiver can take ur truck and hold it until they feel like letting it gopeaple r forgetting pathfinder in the 80s how many guys lost every thing including there homes because that was the way there regestraion was set up and when they went down there was no warning. the outfit I was working for out of ft.st.john did the same thing the only thing that saved my ass was I had my own operating authority and insurance plates and the way I had my lease wrote up the address was my own

  2. LARRY BARCLAY says:

    who is the brain dead SOB that thougt this up.2 things this creates. one more paperwork.2 if the company ur leased to goes down the receiver can take ur truck and hold it as collateral until they feel like letting it go these idits in power r forgetting pathfinder ln the 80s and how many guys lost everything including there homes because that was the way there regestration was set up. when they went down there was no warning. The outfit I was working for out of FT.ST.JOHN did the same thing. the only thing that saved my ass was that I had my own operating authority insurance and plates the way I had my lease wrote up the address was my own

  3. Chuck L. says:

    Oh Ya NDP, stick it to the UNCKILLED LABOR SOME MORE. Go Notley Go W iskey, T ango, F oxtrot, over.

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