Originally from International Arbitration Court Decisions - 3rd Edition

JUDGMENT OF THE ONTARIO SUPERIOR COURT OF JUSTICE RENDERED IN 2002 IN CASE [2002] O.J. No. 665

Subject-Matters:
1) Electronic commerce. Whether a contract might be amended – and an arbitration clause included – through the posting of a website notice.

2) Whether the arbitration agreement was invalid because it was unconscionable.

Findings:
1) The amending provision in the company’s internet service agreements oblige customers to check relevant parts of the website periodically in order to determine whether amendments had been made. The company had provided its customers with sufficient notice of the amendments and the customers had accepted the amended agreement by continuing to use the service. Notices of amendments need not be posted on the website’s homepage.

2) The arbitration clause was not unconscionable since (i) the company did not use its bargaining power to take advantage of its customer, and (ii) it was not sufficiently divergent from standards of commercial morality so as to be improvident.

Parties:
Claimants: Stefan Kanitz, Hugh Wallis, Richard Pearce, James Carnegie and
John R. Wilson (Canada)
Respondent: Rogers Cable Inc. (Canada)

Place Of Court Proceedings:
Ontario, Canada

Applicable Law:
The Canadian Arbitration Act and Class Proceedings Act

Summary
The case involved a class proceeding on behalf of Rogers’ customers concerning alleged deficiencies in the Rogers@Home Internet service. Rogers sought to have the proceedings stayed on the basis of an arbitration provision in its user agreement, which was added when Rogers amended the original agreement.