Canada / 13 July 2007 / Canada, Supreme Court of Canada / Dell Computer Corporation v. Union des consommateurs and Olivier Dumoulin
| Country | Canada |
| Court | Canada, Supreme Court of Canada |
| Date | 13 July 2007 |
| Parties | Dell Computer Corporation v. Union des consommateurs and Olivier Dumoulin |
| Applicable NYC Provisions | II | II(3) |
| Source |
2007 SCC 34, [2007] 2 S.C.R. 801 | online: CanLII |
| Languages | English |
| Summary | Dell Computer Corporation ("Dell"), a computer company headquartered in Toronto with a place of business in Montreal, listed incorrect product prices on its English-language website in April 2003. Dell noticed the error one day later and blocked access to the erroneous order pages. Olivier Dumoulin ("Dumoulin") circumvented the measures taken by Dell by using a deep link that enabled him to access the order pages without following the usual route, ordered a computer at the lower price incorrect price indicated there. When Dell refused to honor Dumoulin's order at the lower price, the Union des consommateurs and Dumoulin filed a motion for authorization to institute a class action against Dell. Dell applied for referral of Dumoulin’s claim to arbitration pursuant to an arbitration clause contained in the terms and conditions of sale, which provided for the arbitration of disputes under the rules of the National Arbitration Forum ("NAF") in the United States, and dismissal of the motion for authorization to institute a class action. The Superior Court of Quebec held that because of the arbitration clause in the terms and conditions, there was a foreign element in the relationship that triggered the application of Article 3149 Civil Code of Québec (CCQ), which prohibits waiver of the jurisdiction of Quebec courts in respect of actions involving, inter alia, a consumer contract if the consumer is domiciled in Québec. Dell appealed and the Court of Appeal of Quebec affirmed the decision. The Supreme Court of Canada overturned the judgments of the lower courts, dismissing the motion for authorization to institute a class action and referring Dumoulin’s claim to arbitration. The Court refused to find that arbitration inherently involves a foreign element that would trigger the application of Article 3149 of the CCQ, and considered instead that arbitration is a neutral institution without a forum and without a geographic basis. The Court then analyzed whether there was a valid arbitration agreement that could bind the parties. It referred to Article 940.1 of the Quebec Code of Civil Procedure, which it considered to "incorporate the essence" of Article II(3) NYC and Article 8 of the UNCITRAL Model Law on International Commercial Arbitration (the “UNCITRAL Model Law”), and which provides that if the parties have an agreement to arbitrate on the matter of the dispute, on the application of either of the parties, the court “shall” refer the parties to arbitration, unless the case has been inscribed on the roll or the court finds the agreement to be null. The Court noted that the increasingly prevalent approach to the competence-competence principle requires the court to limit itself to a prima facie analysis and refer the parties to arbitration unless the arbitration agreement is manifestly tainted by a defect rendering it invalid or inapplicable. The Court rejected the Union des consommateurs' arguments concerning the invalidity of the arbitration agreement on grounds unrelated to the NYC. |
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Attachment (1)
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