Supreme Court of Canada Dismisses Dell Class Action in Quebec

By mistake, Dell Computer Corp (Dell) posted a number of prices for computers on its web site that were well below its regular price. Orders for about 500 of these mistakenly low-priced computers were placed over a two-day period until Dell corrected the mistake. Dell refused to honour the posted prices and, instead, offered the affected consumers discounts and other incentives. A Quebec consumer and a consumer rights group sued Dell for refusing to comply with Dell's offer and, in order to bring the claim forward, attempted to commence a class action against Dell on behalf of all the affected consumers. Dell's web site contained on a sub-page terms of use accessible by a link from the main pages. The terms of use stated that any disputes would be settled by arbitration. Dell argued that the arbitration provision governed and, as such, the dispute could not proceed in court. In a 6-3, split decision, the Supreme Court of Canada agreed with Dell, dismissed the class action, and sent the plaintiff's case to arbitration. The reasons for judgment are both long and quite complex. Much turned on questions of procedure, especially on several provisions of Quebec's Civil Code, considerations which do not apply in other provinces, and it is likely that consumer legislation that has been subsequently enacted (in Ontario and BC, as well as in Quebec) would today produce a different result. However, both the majority and minority reasons addressed an important subsidiary issue - the enforcement of contract terms accessible via a hyperlink. On this issue, both the majority and minority judgments ruled that it is acceptable to enforce contract terms if the viewer is clearly invited to use the link, and is the terms are only one click away. The evidence showed that the consumer could access directly the page of Dell's web site containing the arbitration clause by clicking on the highlighted hyperlink. In the Court's view, this was analogous to a consumer being given a paper copy of a multi-page contract, with the arbitration clause appearing on the last page. For relevant news articles, visit: http://tinyurl.com/3yxec8; and http://www.cbc.ca/canada/montreal/story/2007/07/13/online-shopping.html This is a link to the full text of the decision, Dell Computer Corp v Union des consommateurs and Dumoulin, 2007 SCC 34. Summary by: James Kosa and Oren Weichenberg