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Facts[]

Rudder brought a class action on behalf of MSN subscribers in Canada for, among other things, improperly charging MSN subscriber's credit cards violating the terms of the contract. Microsoft filed to dismiss the class action on the grounds of forum non conveniens. They argued that the contract between them and the subscribers contained a forum selection clause which gave exclusive jurisdiction to Washington state to resolve any disputes. Rudder argued that the particular clause was not valid as it was not adequately brought to the attention of the user. The provision was sufficiently important that it required special notice.

Issue[]

  1. Are clickwrap licenses valid?
  2. Should a clause which binds an individual be upheld even if that clause is not seen?

Decision[]

Motion granted, action stayed.

☀Justice Warren Winkler found in favour of Microsoft and held that the clause was enforceable. Winkler rejected Rudder's argument, stating that "Admittedly, the entire Agreement cannot be displayed at once on the computer screen, but this is not materially different from a multi-page written document which requires a party to turn the pages."

Winkler observed that users were required to click on the "I agree" button to accept the terms, and that the impugned clause was no harder to read than any of the others. The sign-up procedure itself required users to click "I agree" twice, where the second time the user was told that they would still be bound to the terms even if they do not read them all. Winkler did not find it reasonable for Rudder to argue for the enforcement of all the other terms of the contract except for the forum clause. A finding in favour of the plaintiff, said Winkler, would not advance the goals of commercial certainty.

In concluding, Winkler held that "click-wrap" agreements in general should be "afforded the sanctity that must be given to any agreement in writing."

Reasons[]

The judge referred to Rudder’s cross-examination. Rudder therein admitted that the entire agreement was readily viewable by using the scrolling function on the portion of the computer screen where the agreement was present. The judge also reviewed the agreement himself and found that all of the terms were displayed in a relatively accessible format. A judgement for the plaintiffs “would lead to chaos in the marketplace, render ineffectual electronic commerce and undermine the integrity of any agreement entered into through this medium.”

Ratio[]

  • Click-wrap agreements are as valid as agreements in writing.
  • The onus is on the Plaintiff to show strong cause to override a term of exclusive jurisdiction. In absence of a strong cause, an exclusive jurisidction term will be enforced for the benefit of commerical certainty.
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