March 16, 2020

Me Before You: Sequencing and Substantive Rights in Williams v Amazon.com, Inc.

Iris Ngo & Winona Fitch

 

Update: After this post was written, a stay was granted by the court.

Background 

This decision in Williams v Amazon.com, Inc.is an oral ruling of BC Supreme Court on a procedural motion in a proposed class action against Amazon.^[1]The plaintiff alleged that Amazon entered into anti-competitive practices and brought claims for unjust enrichment, civil conspiracy, breach of the Competition Act, and breach of British Colombia’s Business Practices and Consumer Protection Act(Consumer Protection Act).

At Issue: Competing Substantive and Procedural Entitlements & Access to Justice

The “Conditions of Use” agreed to by the plaintiffs while using Amazon’s website included the following arbitration clause: 

Any dispute or claim relating in any way to your use of any Amazon.ca Service, or to any products or services sold or distributed by Amazon.ca or through Amazon.ca Services will be resolved in binding arbitration rather than in court, except that you may assert claims in small claims court if your claims qualify. The U.S. Federal Arbitration Act and US federal arbitration law apply to this agreement.^[2]

Amazon argued that not only it is entitled to a stay of court proceedings pursuant to s. 15(1) of British Colombia’s Arbitration Act, but also that s.15(1) entitles it to have its application for a stay heard prior to any application for class certification.

Meanwhile, the plaintiff sought to have both the application for a stay and its own application for class certification heard together. The plaintiff relied on s.12 of British Columbia’s Class Proceedings Act, which allows the court discretion over the conduct of class proceedings. The court noted that:

[The] discretion to determine the conduct of a class proceeding includes the discretion to determine the timing of procedural steps, and in particular whether an interlocutory application should precede the certification motion. The general rule under the Class Proceedings Act is that the certification motion is the first procedural step in a class action.^[3]

Whose application should be heard first? Both parties invoked concerns of efficiency and access to justice: Amazon argued that efficiency is best served through the arbitration arrangement voluntarily agreed to, and the plaintiff pointed to the efficiency of resolving a large number of claims simultaneously through a class action and suggested that hearing Amazon’s application first would cause unnecessary delay. 

Outcome

Ultimately, the court sided with Amazon, finding it has a substantive right under the Arbitration Act that “cannot be defeated on the plaintiff’s procedural choice, exercised unilaterally, to pursue his claim as a class action”.[4]Horsman J relied on the Supreme Court of Canada’s decision in Seidel v. TELUS Communications Inc., where the court granted a stay in relation to claims where the arbitration clause was not subject to a legislative override under the Consumer Protection Act. 

While Horsman J acknowledged the validity of the plaintiff’s access to justice concerns, she observed that access to justice may also be promoted through arbitration:

[I]t must be recognized that the Supreme Court of Canada has also found that arbitration clauses promote access to justice by allowing parties to voluntarily choose private, less expensive, and potentially less time-consuming methods of final dispute resolution outside of the traditional court system.^[5] 

In this case, delaying the stay application would have also delayed the final resolution of the dispute through arbitration. And while this decision this might lead to a bifurcation in proceedings, with claims under the Consumer Protection Act moving through the courts and the remainder through the agreed arbitration mechanism, the court followed Seidel in viewing such bifurcation as the inevitable consequence of a legislative decision that must be respected. 

Ultimately, the policy objectives of the Arbitration Act would be undermined by failing to give effect to a valid contractual arrangement freely entered into by the parties. It appears that such objectives weighed heavily in the court’s exercise of discretion in class certification proceedings. 

CJCA blog posts represent the individual opinions and perspectives of their authors. The Canadian Journal of Commercial Arbitration does not maintain or publish a collective or institutional view on any legal or political issue.