When are Contracts of Adhesion Binding?

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In the Internet age, contracts of adhesion are common. Consumers routinely confirm their acceptance to terms and conditions that they have not read or understood.

In Apps v. Grouse Mountain Resorts Ltd., 2020 BCCA 78, the court addressed when contracts of adhesion are binding. In this case, a snowboarder from Australia was injured in the terrain park. He brought an action for negligence, the failure to warn, and for breaching the Occupiers Liability Act. The BC Court of Appeal found that the trial judge erred in upholding the waiver.

The plaintiff Mr. Apps raised “an issue that has troubled the courts ever since the Industrial Revolution: under what circumstances is such a waiver in a contract of adhesion (where the consumer must take it or leave it) binding on the consumer? This has been of particular concern where the waiver includes words excluding liability for the service provider’s own negligence.”

In the case of Mr. Apps he did not click any buttons or sign any forms. What brought the terms of the waiver to his attention?

Above the ticket booth was a sign that contained the terms of the waiver: “… As a condition of use of the ski area and other facilities, the ticket holder assumes all risk of personal injury, death or property loss resulting from any cause whatsoever including but not limited to: the risks, dangers and hazards of skiing…”

The Court of Appeal held that the defendant Grouse Mountain could only contract out of its duty of care under the Occupiers Liability Act if it took reasonable steps to bring the waiver clause to the plaintiff’s attention. The court held that insufficient steps were taken to bring the waiver of liability clause to the plaintiff’s attention. The more onerous the term, the more steps that must be taken to bring attention to the terms.

At paragraph 84, Justice Grauer wrote that “It will not avail the consumer to say, ‘I did not read the notice’, if the mountain took reasonable steps to draw the own negligence clause to the consumer’s attention. On the findings of the judge, it cannot be held to have done so.”

The trial judge was only permitted to consider what was posted on signs Mr. Apps could have seen at or before the time he purchased his ticket. “By the time Mr. Apps arrived at the Terrain Park, he had paid for his non-refundable ticket, taken the lift up the mountain, and had begun snowboarding. It was far too late to give notice of what was in the waiver. That had to be done at or before the ticket booth.”

After taking the “clear and easy to read” signs at the Terrain Park out of the equation, the court was left with the following findings from the trial judge.

•         The sign at the ticket booth was “difficult to read”;

•         The own negligence exclusion was “not highlighted or emphasized in any way”, but was buried in small print among many commas and semi-colons;

•         “It is unrealistic to believe that a person approaching the ticket booth would stop in front of the window to read the sign.”

Interestingly, Mr. Apps also signed a season pass for Whistler Mountain. “Of course, having signed it, he would be bound by its terms in relation to Whistler Mountain notwithstanding that he did not read it.”

Justice Grauer held that only actual knowledge of the terms through previous dealings is relevant. In this case, previous dealings with Whistler was not relevant. Mr. Apps did not read the Whistler season pass agreement. Constructive knowledge did not apply, and could not impute knowledge to him for the Grouse Mountain.

Despite the thoroughness of the Court of Appeal’s decision, the question remains for contracts of adhesion formed over the Internet – under what circumstances should a waiver of liability be binding? How many people read and understand those terms? For example, how many people are actually consenting to apps selling their data?

(Views are my own and do not represent the views of any organization. This article was originally posted on slaw.ca)

Privacy Rights in the Internet Age and The New Tort of Public Disclosure of Private Facts

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“Society has been scrambling to catch up to this problem [the publication of intimate photos or videos online without consent] and the law is beginning to respond to protect victims.” – Justice Stinson in Jane Doe 464533 v N.D., 2017 ONSC 127

Gradually courts have been awarding damages for the tort of public disclosure of private information. The tort of public disclosure of private information consists of the following elements: (a) the defendant publicized an aspect of the plaintiff’s private life; (b) the plaintiff did not consent to the publication; (c) its publication would be highly offensive to a reasonable person; and (d) the publication was not of legitimate concern to the public.

In Jane Doe 72511 v N.M., [2018] OJ No. 5741, Jane Doe sued her ex-boyfriend for abusing her and for uploading an intimate video of them online. Jane Doe also sued her abuser’s parents for failing to stop the abuse in their home.

One day, after a highly violent encounter, Jane Doe reported the defendant N.M. to the police. “N.M. forced Jane into his car… N.M. grabbed her head and smashed it into the passenger side window. Jane pulled the mirror down and, seeing that she was bleeding, ripped off the sun visor in shock… N.M. was angry that Jane had damaged the car. He parked in the driveway and came around to her side of the car… he dragged her out of the car by her feet and shoved her into his parents’ house.” He was charged and later convicted of assault.

In retaliation for his criminal conviction, N.M. uploaded a video of them engaged in a sex act. The video was seen over 60,000 times and downloaded an unknown number of times. The video has since been removed at the request of the plaintiff.

In deciding the civil suit, Justice Gomery found that N.M. was liable for assault, battery, and public disclosure of private information. He was ordered to pay her $20,000 in general damages for the abuse and $100,000 for the posting of the video online ($75,000 for general and aggravated damages and $25,000 in punitive damages). His parents were also found to be jointly and severally liable for Jane’s damages from the assault and battery as occupiers of the house. As occupiers of the house, they had a duty to take steps to keep her safe while she was there.

In recognizing the tort of public disclosure of private information, Justice Gomery reaffirmed that the courts should provide a civil recourse for victims of public disclosure of private information. Justice Gomery wrote that our courts need to “address a challenge posed by new technology… Failing to provide a remedy in this case would deprive Jane of recourse in the face of the breach of her privacy rights.”

In this case, the website was not sued for the publication of the video. Perhaps the company running the website was outside the jurisdiction of Canada. In which case, the best recourse may be to pressure the company in charge of the domain name registration to disable the site’s web address. (see the NYT article “Shut the Site Down,’ Says the Creator of 8chan, a Megaphone for Gunmen.) However, if there was a connection to Ontario, then courts should be willing to assume jurisdiction and sanction a company in the appropriate circumstances.

In the article “Ontario’s New Invasion of Privacy Torts”, Sarit Mizrahi writes that “the courts should be willing to treat a company’s decision to utilize inadequate security measures as sufficient to engage the tort of intrusion upon seclusion and public disclosure of private facts where the risk of privacy is appreciated.” Malicious users exist beyond revenge porn, including hackers. Hackers can exploit security flaws in our devices to breach privacy rights and disclose private information. For example, hackers can gain access to a television’s microphone and listen in on you in your home; hackers can gain access to a baby monitor; they can access a company’s database of credit cards and release the information.

Mizrahi writes that “While the law obliges these companies to protect the information and devices against unauthorized access, the reality is that the steps taken are often insufficient to abolish the security flaws exploited by malicious users… users are often left without a sufficient legal remedy for this serious invasion of their privacy.” By recognizing a civil right of action, the courts are enabling individuals to enforce their privacy rights.

(This article was originally posted on slaw.caViews are my own and do not reflect the views of any organization.)

Is Selling Prescription Eyewear Online Legal?

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Nowadays you can buy almost anything online: clothing, food, glasses, jewelry, medication, mattresses, and the list goes on. So is there a problem with buying prescription eyewear online?

The College of Optometrists of Ontario thought so. The College launched a court application against Essilor Group Canada Inc. for operating the online retailer Clearly.ca and Coastal. Almost every action taken by Clearly and Coastal happened in British Columbia. Consumers would order the glasses and contacts online, using a prescription from their doctor, and the glasses and contacts would be shipped from British Columbia. By ordering online, consumers would miss out on having their pupillary distance tailor-measured by a professional for their specific eyewear.

In the case College of Optometrists of Ontario et al v. Essilor Group Canada Inc., 2018 ONSC 206, the College argued that there was a risk of harm in allowing prescription eyewear and contacts to be sold online. Essilor argued that the College was actually concerned with maintaining a monopoly in Ontario by preventing online retail from operating in Ontario.

Justice Lederer ruled that the company violated the Regulated Health Professionals Act by accepting orders for prescription eyewear from Ontario residents in British Columbia and delivering them to Ontario residents. “Eyeglasses and contact lenses are to be dispensed with the proper involvement of an optometrist or optician licensed in Ontario.”

The Ontario Court of Appeal reversed the decision of Justice Lederer. Justice Brown, writing for the court, reasoned in College of Optometrists of Ontario v. Essilor Group Inc., 2019 ONCA 265, that a customer’s placement of an order from an Ontario-located device does not amount to dispensing eyewear. At paragraph 126, Justice Brown writes that: “the act of delivering eyewear to a person primarily has a commercial aspect, not a health care one… Where the supplier of the prescription eyewear operates in another province and complies with that province’s health professions regulatory regime when filling an online order placed by an Ontario customer, the final act of delivering that product to the Ontario purchaser does not amount to the performance of a ‘controlled act’ by the supplier.”

Justice Brown further wrote that applying the Regulated Health Professionals Act to the online sale of eyewear would grant a commercial monopoly to Ontario’s optometrists and opticians over the distribution of orders for prescription eyewear. If the legislature meant to do so, then it would need to legislate it explicitly. 

I anticipate the courts will be dealing with similar cases by regulatory bodies in the years to come. As the internet changes the way services are delivered, regulatory bodies will continue to question whether:

  • (a) there has been the unauthorized practice of medicine, law, engineering, teaching, accounting, and so on; and
  • (b) if the public’s safety has been undermined by providing these services online. 

In many instances, online services are a safe alternative to in-person services, like Telemedicine. In the book the Future of the Professions, Richard Susskind and Daniel Susskind write that “Many professionals seem to have lost sight of the reasons why we have personal interaction in the first place. It is a feature of the one-to-one nature of the traditional approach. As a consequence of its longstanding presence, it has gained an aura of indispensability. But we have to remember its origins – only as a feature … of sharing practical expertise. If, however, we can find better ways of sharing that expertise that require less personal interaction, then we should not defend this interaction for its own sake.”

(Views are my own and do not reflect the views of any organization.)

Book Review: The Contracts Handbook – A Practical Guide to Reviewing, Revising and Negotiating Commercial Contracts

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In “The Contracts Handbook: A practical Guide to Reviewing, Revising, and Negotiating Commercial Contracts”, Margaret Kerr explains contracts in simple terms. An excerpt of the book can be found here: The Contracts Handbook.

Most contract textbooks are written with the litigator in mind. Instead, this textbook is written for those that negotiate and draft contracts.

The textbook contains:

  • explanations of what makes a contract legally enforceable,
  • the significance of common clauses and when to use them,
  • how to amend an existing agreement,
  • a useful checklist for preparing a contract, and
  • sample contracts.

Kerr rightly points out that most contract textbooks do not contain a sample contract. A law student could easily study contract law for an entire year without reading a full contact.

Kerr writes that “textbooks are awash in Hail Mary Pass case law generated by litigators clutching at the hope of winning a dismal case… This book will instead set out the straight and narrow path, a conservative and safe statement of Canadian contract law…” Kerr accomplishes this goal.

I highly recommend this book to contract law students who want to supplement their assigned readings and to non-lawyers that engage in contract negotiations and preparation.

(Views are my own and do not represent the views of any organization.)

 

 

The Importance of the Principle of Open Court

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In the decision, Danso v Bartley, 2018 ONSC 4929, Justice Myers discusses the law regarding publication bans. Publication bans are rarely granted.

In Danso v Bartley, Ms. Bartley was claiming that Mr. Danso was the father of her child. In response, Mr. Danso launched a lawsuit. Mr. Danso claimed that he did not have sex with her. He requested a paternity test and a publication ban on the lawsuit, amongst other things. He claimed that publication of this lawsuit would damage his reputation. Danso is a religious leader. He operates 17 churches, including a chapter in Toronto.

At para 30, Justice Myers writes that when someone asks to seal court records or to prevent publication of court proceedings, it affects the principle of open courts. “The open courts principle protects the public’s right to know about court proceedings in Canada.” A public trial allows the public to scrutinize a court proceeding.  It is difficult for people to attend court. Those who cannot attend often rely on the press to inform them about the evidence presented, the arguments made, and the comments by the judge.  “The open court principle has been described as ‘the very soul of justice’, guaranteeing that justice is administered in a non-arbitrary manner”.

Justice Myers did not grant a publication ban. At para 42, he explains that it is in the public interest that discussions be based on facts rather than rumours and allegations. “Suppression of truth and public court proceedings after widespread attention across the county does not protect anyone. Mr. Danso should be free to respond to whatever is already affecting his reputation in his congregations. If members of a congregation know of the paternity issue, I cannot see any harm to the members or to the congregation of knowing that Mr. Danso sued for a DNA test and the DNA test proves the allegation of paternity is true.”

Justice Myers further explains that preventing the proceedings from being public undermines why courts have the power to make orders. Part of the reason courts’ have the power to make orders is to allow the public to review and scrutinize court proceedings. Myers J. eloquently writes that “Preventing this use of court proceedings deprives the public of a vital benefit that underpins society’s tacit agreement to empower civil courts.”

(Views are my own and do not represent the views of any organization.)

Moving for Partial Summary Judgment: Mason v. Perras Mongenais

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In Mason v Perras Mongenais, 2018 ONSC 1477, Mason sued two law firms and a lawyer for professional negligence. Mr. Mason hired the lawyer Mr. Chambers to represent him in his divorce proceeding. During the divorce proceeding, Mr. Chambers retained a tax lawyer (Mr. Perras) to advise on tax matters within the divorce proceeding. Mr. Chambers asked Mr. Perras to answer three questions. Mr. Perras answered the questions. However, during a settlement conference for the divorce proceeding before a judge, Mr. Chambers called Mr. Perras to answer a question “on the fly”. The client Mr. Mason then later alleged that the lawyers did not consider the tax consequences for the agreement that was made at the settlement conference.

The defendant law firm Perras Mongenais brought a motion for a partial summary judgment (meaning that the lawsuit would continue against the other defendants but not the law firm). A motion for partial summary judgment is reserved for special cases. Specifically,  for when an issue can be easily bifurcated from those in the main action. If the risk of duplication and inconsistent findings is high by bifurcating the issues, then a trial is required.

Justice F. L. Myers granted the motion for the partial summary judgment. Justice Myers looked at what the reasonably competent practitioner would do in the circumstances. He found that “Mr. Perras provided correct answers to the questions asked as circumstances allowed.”

In granting the motion for the partial summary judgment, Justice Myers wrote that the culture shift is required. Courts should default to resolve litigation without a trial when it can be done so fairly. “The trial process is so slow and expensive that its use has made civil justice inaccessible and unattainable for most Canadians.”

(Views are my own and do not represent the views of any organization.)

 

 

Time for a Culture Shift: Seepa v Seepa

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Procedural gamesmanship, incessant delay, and discovery without end have brought the civil justice system to the brink of a crisis.” Justice Myers in Letang v. Hertz Canada Limited, 2015 ONSC 72

Delay is endemic in civil cases.  It is a disease. It eats away at our justice system. And there appears to be no end. Especially considering the small budget for our courts.

In Seepa v. Seepa, 2017 ONSC 5368, Justice Myers attempted to address our complacency with delay. In Seepa, the siblings were fighting over their deceased mother’s assets. The mother had essentially cut one of her sons out of the will. As a result, the disinherited son wanted to challenge the division of property. He raised the issues of his mother’s incapacity, his mother being subject to undue influence, and the breach of fiduciary duty.

However, to launch his lawsuit, the disinherited son needed his mother’s medical and legal records. He needed the records to show some evidentiary basis to proceed with his claim. (Courts have enacted this threshold to protect estates from being wiped out by court processes when there is no evidence of impropriety.)

Justice Myers questioned whether he should grant access to the medical and legal records.  He raised the concern of a fishing expedition into the “deceased’s privileged legal files and most private, personal medical records”.  Noting that there is something innately offensive about an excluded relative romping through a testator’s most private records on meagre allegations. In spite of this, the inheriting son agreed to allowing his brother access to the records.

Justice Myers called for a for a shift away from automatically granting court orders on consent of the parties. “The court should be very reluctant to consign estates and beneficiaries to intrusive, expansive, expensive, slow, standard form fishing expeditions that do not seem to be planned to achieve the goals of civil justice for the parties.” The granting of a court order for access to medical and legal records further delays proceedings as the parties have to wait for the records to come in.

In the end, Justice Myers granted the order. The disinherited son was to pay the bills for the records. The inheriting son was hopeful that the “sunlight” would facilitate resolution between them. I hope for all their sake that the sunlight pours in.

(Views are my own and do not represent the views of any organization.)