Contractual Obligations – Prof. Helge Dedek Introduction 1

Dell mistakenly listed lower prices for two models of handheld computers, and blocked access to the order pages. M. Dumoulin and several others place an order though a still-accessible link, Dell refuses to honour lower price, the Union des Consommateurs and Dumoulin claim against Dell; Dell applies for referral of the claim to arbitration. The terms and conditions of sale, which could be accessed by hyperlink, contained an arbitration clause.

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  “In the case at bar, the Union argues that, pursuant to art. 1435 C.C.Q., the arbitration clause is null because it is an external clause and because it has not been proven that Mr. Dumoulin knew of its existence.”
  

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  The consumer could access the arbitration clause directly, it is therefore not an external one. (clauses that are readily accessible form part of the contract)
  
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  With respect to paper documents, there is a test of physical separation for clauses to be treated as external. (test not transposed to internet)
  

Bastarache & LeBel (not dissenting on this point):

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  Rather than concluding that hyperlinked clauses are always or never external, it is reasonable to look at whether or not the hyperlink is functional and clearly visible. Furthermore, it the case at bar, Dell was consistent with industry standards and a reasonable consumer engaged in e-commerce would have expected to find a company’s terms and conditions at the bottom of a web page.
  

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  In a consumer contract or a contract of adhesion, however, an external clause is null if, at the time of formation of the contract, it was not expressly brought to the attention of the consumer or adhering party, unless the other party proves that the consumer or adhering party otherwise knew of it.”
  

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  Offer accepted when T drove his car up to ticket booth and the ticket was issued. It could not after that fact be altered by any words printed on the ticket (i.e. to exempt the company from liability).
  
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  The “condition” can only be binding if (a) the customer is aware that the ticket is issued subject to it, or; (b) the company has done what was reasonably sufficient to give him notice of it (e.g. printing it “in red ink with a red hand pointing to it, or something equally startling”)
  

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  The harsher the terms, the higher the requirements for notice.
  
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  The document might serve other purposes (e.g. receipt) that obscure its nature as a “contract”.
  
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  Use of signs to inform customers of terms and conditions – depend on their visibility – reasonable person standard
  

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  If form had been signed, A would have no case: terms of contract are binding if the contract is signed, whether or not the signer was aware of the terms and conditions
  
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  R argues that previous dealings and A’s conduct imply consent to the terms despite lack of signature  rejected: previous dealings relevant only if they imply knowledge of terms  no knowledge, no signature means terms not binding
  
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  “There can be no conditions in any K unless they are brought into it by expression, incorporation, or implication. They are not brought into it simply because one party has inserted them into similar transactions in the past…”
  
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  Without recourse to estoppel, signature to K is conclusive (L’Estrange v. F. Graucob, Ltd.)
  
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  Effect of estoppel is limited to the K in relation to which the representation was made (cannot aid party in relation to other transactions)  no demonstration here that M knew/understood conditions (i.e. he is NOT estopped from saying that he signed previous Ks without knowing what was in them) previous dealings are NOT evidence of knowledge
  

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  Fine print – designed to conceal rather than to inform. At the time, a signature was binding, even if there was no actual knowledge (policy consideration – to allow people to get out of signed contracts by pleading ignorance, whole institution of contract making might be undermined. I guess it is more subtle these days, and the institution of contract making has become more flexible.)
  
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  Why not go through torts – why is this case a contracts case? Because one can waive one’s recourse to tortuous liability in a contract. That is exactly what we are dealing with here actually.
  
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  Much time devoted to the nature of the K, considering that the case turns on the fact that it was never signed
  
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  The issue here is whether prior dealings have constituted a notice of prior terms; some sense that prior dealings have to have a certain frequency, here unsatisfied
  
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  Devlin’s assessment of prior dealings here is purely subjective – he seems to be on his own here, both in the HofL and in his own subsequent jurisprudence: prior dealings are usually not totally subjectively indicated
  
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  Typically, the question is whether notice has been given that there are other terms out there, and that you agree to abide by them (a sense that terms are usually there, whether or not people have read and understood them)
  
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  The parties were not operating in a normative void: if conditions were not incorporated, then there was still a K with those terms implied by law
  
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  The case eventually turns on the lack of signature – but the reasoning makes you wonder if a similar result would have been achieved even with a signature
  
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  Gives considerable indication that the signature/notice-of-terms distinction is unreasonable, and the legislature should act
  

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  Even though the contract was unsigned, the parties were both aware of the terms and conditions that would normally govern this sort of transaction. There was no reason to expect that the crane would be hired without terms and conditions attached.
  
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  Both parties in similar business, with similar bargaining power; IPHL imposed similar conditions on rental of its own equipment – so “the conditions on the form should be regarded as incorporated into the K”
  
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  Negligence on the part of the driver would have exempted the plaintiff from responsibility. There was no negligence established on either side in the sinking of the crane, so the defendant is responsible based on contractual liability for damage to the crane.
  

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  This situation is quite distinguishable from McCutcheon for a few reasons. (1) The contracting parties were in a different relationship. Here, they are both professionals who are expected to be aware of the standard contracting terms. In McCutcheon, one party was a customer (no specialty in the area of shipping) whereas the other was a professional. (2) Here, there was knowledge of the terms and conditions. In McCutcheon, there was no knowledge of the terms and conditions.
  
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  Industry standard: if both parties know that certain reasonable conditions are habitually imposed on certain transactions, and if both parties know the substance of these conditions, then these conditions can be held to form part of the K – even if indicia of consent to condition not found on a particular occasion.
  
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  Denning rejects two interactions as not enough to show prior dealings – but how many times would be enough?