Online sales in Canada grew by 40% to $49.9 billion last year.  In the retail sector alone, more than 15% of retailers in Canada made online sales in 2006, up from only 10% the previous year.  A pair of new Supreme Court of Canada decisions has clarified e-commerce law in Canada by upholding mandatory arbitration clauses and class-action waivers. 

1.    Dell:  For a few days in 2003, Dell’s website contained a pricing error where certain handhelds were incorrectly offered at fire-sale prices. Although Dell moved quickly to correct the errors, a number of consumers managed to place online orders at the incorrect prices.  Dell refused to honour those orders.  In response, the consumers tried to institute a class action lawsuit against Dell.  Dell insisted that the matter had to go to arbitration under the terms of the online contract.  Enter the lawyers.

In the resulting case of  Dell Computer Corp. v. Union des consommateurs, 2007 SCC 34, the Supreme Court of Canada upheld Dell’s online contract and the case was referred back to arbitration.  Although Dell’s online contract did not appear on the sales page (it was merely referred to via a hyperlink) the Court decided that this was not fatal to the enforceability of the contract.

2.    Rogers:  The case of Rogers Wireless Inc. v. Muroff, 2007 SCC 35 involved a dispute about wireless roaming charges.  In that case, the Court applied the same principles as in Dell and upheld a mandatory arbitration clause in the Rogers service contract. 

As we noted in our earlier post mandatory arbitration clauses and class-action waivers are now ineffective in Ontario and Quebec under consumer protection legislation. 

 

Calgary – 10:45 MST