Dell’s Appeal Crashes in the Supreme Court of Canada – May 25 2010
TORONTO – In a judgment released May 20, 2010, the Supreme Court of Canada has dismissed Dell Canada Inc.’s application for leave to appeal the January 20, 2010 judgment of the Court of Appeal for Ontario.
On January 20, 2010, a five judge panel of the Court of Appeal for Ontario unanimously dismissed two appeals brought by Dell Canada Inc. seeking to enforce a mandatory consumer arbitration clause and to stay a class action lawsuit involving approximately 119,000 class members across Canada who purchased Dell’s 1100, 1150, 5100, 5150 and 5160 Inspiron laptop computers between March 2003 and May 2005.
In dismissing the appeals, Justice Robert J. Sharpe, on behalf of the Court of Appeal, stated that: “Consumer contracts tend to be contracts of adhesion where the suppliers of services and sellers of goods are in a position to impose their own terms unilaterally. Both academic research and the common sense reflected by the findings of the motion judge in this case indicate that suppliers and sellers regularly insert arbitration clauses in order to defeat claims rather than out of a genuine desire to arbitrate disputes with consumers. Such disputes often involve small claims that are not individually viable. Such claims only become viable if they can be aggregated by way of a class proceeding.”
The Court of Appeal’s decision upheld the decision of Justice Joan Lax of the Ontario Superior Court of Justice who denied Dell’s motion to stay the proceedings in favour of multiple mandatory arbitrations and certified the action as class proceeding on February 3, 2009. Justice Lax then dismissed Dell’s subsequent motion to reconsider her decision dismissing the stay motion. Dell subsequently appealed these decisions to the Court of Appeal. In addition, Dell sought to appeal the certification decision; Dell’s motion for leave to appeal the certification decision was dismissed on July 31, 2009.
“The Supreme Court of Canada’s judgment finally brings to a close the appellate process regarding Dell’s attempts to shut the class action down in favour of arbitration and now enables class members to benefit from the discovery phase”, said Joel P. Rochon, one of the lawyers representing the class.