The article you just read was brought to you by a few thousand dedicated readers. Will you join them?

Thanks for coming by The Tyee and reading one of many original articles we’ll post today. Our team works hard to publish in-depth stories on topics that matter on a daily basis. Our motto is: No junk. Just good journalism.

Just as we care about the quality of our reporting, we care about making our stories accessible to all who want to read them and provide a pleasant reading experience. No intrusive ads to distract you. No paywall locking you out of an article you want to read. No clickbait to trick you into reading a sensational article.

There’s a reason why our site is unique and why we don’t have to rely on those tactics — our Tyee Builders program. Tyee Builders are readers who chip in a bit of money each month (or one-time) to our editorial budget. This amazing program allows us to pay our writers fairly, keep our focus on quality over quantity of articles, and provide a pleasant reading experience for those who visit our site.

In the past year, we’ve been able to double our staff team and boost our reporting. We invest all of the revenue we receive into producing more and better journalism. We want to keep growing, but we need your support to do it.

Fewer than 1 in 100 of our average monthly readers are signed up to Tyee Builders. If we reach 1% of our readers signing up to be Tyee Builders, we could continue to grow and do even more.

If you appreciate what The Tyee publishes and want to help us do more, please sign up to be a Tyee Builder today. You pick the amount, and you can cancel any time.

Support our growing independent newsroom and join Tyee Builders today.
Before you click away, we have something to ask you…

Do you value independent journalism that focuses on the issues that matter? Do you think Canada needs more in-depth, fact-based reporting? So do we. If you’d like to be part of the solution, we’d love it if you joined us in working on it.

The Tyee is an independent, paywall-free, reader-funded publication. While many other newsrooms are getting smaller or shutting down altogether, we’re bucking the trend and growing, while still keeping our articles free and open for everyone to read.

The reason why we’re able to grow and do more, and focus on quality reporting, is because our readers support us in doing that. Over 5,000 Tyee readers chip in to fund our newsroom on a monthly basis, and that supports our rockstar team of dedicated journalists.

Join a community of people who are helping to build a better journalism ecosystem. You pick the amount you’d like to contribute on a monthly basis, and you can cancel any time.

Help us make Canadian media better by joining Tyee Builders today.
We value: Our readers.
Our independence. Our region.
The power of real journalism.
We're reader supported.
Get our newsletter free.
Help pay for our reporting.
Views

Clicking Away Your Rights?

Top court Dell decision sets standards for online contracts.

By Michael Geist 31 Jul 2007 | TheTyee.ca

Michael Geist's column on the Net and society appears every Tuesday in The Tyee. Geist holds the Canada Research Chair in Internet and E-commerce Law at the University of Ottawa, Faculty of Law, and also sits on the advisory board of the Canadian Internet Policy and Public Interest Clinic, which intervened in the Dell case. He can reached at mgeist@uottawa.ca or online at www.michaelgeist.ca.

image atom
Browsers launch OK. Class-action suits, not so much.

Late on a Friday afternoon in April 2003, Dell Computer's Canadian website featured a pair of erroneous prices for the Axim, the company's handheld computer. Rather than listing the two versions of the device correctly at $379 and $549, the site indicated that the price was $89 and $118. Dell blocked access to the pages the following day; however, the mistakes remained accessible throughout the weekend via a direct hyperlink.

Dell typically sold about three Axims each weekend, yet on this particular April weekend, 354 Quebec-based consumers placed 509 orders. Olivier Dumoulin was among those consumers and when Dell refused to honour the mistaken price, he joined forces with a Quebec-based consumer group to launch a class action lawsuit against the company. Dell tried to block the suit, arguing that its consumer contract provided that all disputes were to be resolved by arbitration.

Twin decision

The Dell case wound its way through the Canadian court system, concluding with a Supreme Court of Canada decision earlier this month. At issue in the case were two key legal questions -- first, whether contracts that include a clause forcing consumers to use arbitration to resolve all disputes (and thereby waive the ability to file a class action lawsuit) are enforceable. Second, whether the world of electronic commerce and online contracting permits companies to merely hyperlink to a contract's terms and conditions rather than including the terms directly on the ordering page.

Quebec trial and appellate courts both sided with Dumoulin, ruling that the arbitration clause was not enforceable and that the consumer class action could proceed. The Supreme Court overturned those decisions, concluding that the arbitration clause was enforceable and that the use of a hyperlink was sufficient.

Dell unsurprisingly welcomed the decision, maintaining that the ability to use arbitration "will lead to the fair and efficient resolution of cases for consumers and business alike." Consumer groups were furious, stating that the decision marked "a dark day for online shoppers in Canada."

Second opinion

Yet a closer examination of the decision and the current state of e-commerce in Canada suggests that neither side is right.

Dell may extol the virtues of arbitration clauses; however, the reality is that they have been largely eliminated from Canadian e-commerce contracts by provincial legislation in Ontario, British Columbia, and Quebec (the Quebec law was passed after the Dell incident) that bars companies from using such clauses to block potential class action lawsuits.

Indeed, a review of the consumer contracts used by many leading Canadian e-commerce companies reveals that the overwhelming majority -- including Chapters, Expedia, Future Shop, Best Buy, Sears, eBay, Rogers, Bell, the Bay, Zip, Roots, and Toys R Us -- do not include a binding arbitration clause. Exceptions to this general rule include Amazon.ca (which maintains that it operates outside Canada) and Bose Canada (which appears to be violating Ontario law).

While the Supreme Court could have adopted a more consumer-friendly approach -- a Washington State Supreme Court ruling released one day before the Dell decision struck down a clause that would have denied local consumers the ability to launch a class action lawsuit -- its practical effect is somewhat limited in light of the provincial statutes.

Terms and omissions

The effect of the Supreme Court's online contracting comments may be more far reaching. The court concluded that contractual terms and conditions can be enforceable even if the consumer is required to click on a hyperlink to access them (i.e. the terms are not found on the ordering page itself). It emphasized that the terms and conditions must be "reasonably accessible" and expressed the view that a hyperlinked document meets that standard.

Consumer groups fear that this opens the door to businesses deceiving consumers by sneaking unfavourable terms into hyperlinked contracts, yet that seems unlikely.

First, the enforceability of the online contracts rests on it being reasonably accessible. Businesses engaged in e-commerce will have to ensure that their contracts -- whether hyperlinked or not -- meet that standard.

Second, the enforceability of online contracts requires an analysis of both form and substance. While courts may be willing to enforce electronic contracts based on their form (i.e. available via a hyperlink), the actual terms of the contract (the substance) will be subjected to rigorous analysis that could lead a court to strike down overreaching or unusually one-sided terms.

The Dell decision provides a measure of clarity to the world of online contracting, however, the ultimate message for consumers may be an age-old one -- if a deal seems too good to be true, it probably is.

Related Tyee stories:

 [Tyee]

Share this article

The Tyee is supported by readers like you

Join us and grow independent media in Canada

Facts matter. Get The Tyee's in-depth journalism delivered to your inbox for free

LATEST STORIES

The Barometer

Tyee Poll: What Coverage Would You Like to See More of This Year?

Take this week's poll