[Gnso-igo-ingo-crp] ICANN and Contracts of Adhesion: Supreme Court of Canada ruling that might impact our work

[George Kirikos]

Hi folks,

There was an interesting ruling today from the Supreme Court of
Canada, that might impact our work (and ICANN policymaking in
general). See the article at:

http://www.michaelgeist.ca/2017/06/supreme-court-rules-facebook-cant-contract-b-c-privacy-law/

The text of the decision is at:

https://scc-csc.lexum.com/scc-csc/scc-csc/en/item/16700/index.do

In particular, it speaks to whether non-negotiated "take-it-or-leave
it" online contracts are enforceable.

"The automatic nature of the commitments made with online contracts
intensifies the scrutiny for clauses that have the effect of impairing
a consumer’s access to potential remedies."

"The burdens of forum selection clauses on consumers and their ability
to access the courtsystem range from added costs, logistical
impediments and delays, to deterrent psychological effects. When
online consumer contracts of adhesion contain terms that *****unduly
impede the ability of consumers to vindicate their rights in domestic
courts******, particularly their quasi-constitutional or
constitutional rights, public policy concerns outweigh those favouring
enforceability of a forum selection clause."

"It would be contrary to public policy to enforce a forum selection
clause in a consumer contract that has the effect of depriving a party
of access to a statutorily mandated court."

(emphasis added)

I would argue that compelling binding arbitration for disputes
initiated by IGOs takes away rights of registrants, and is a contract
of adhesion via this decision that cannot be enforced in Canada. This
supports "Option 1" analysis of maintaining the status quo as much as
possible, to not let ICANN policymaking tamper local laws.

As Professor Geist concluded:

"With the majority ruling against the enforceability of the forum
selection clause, the court has demonstrated their *****discomfort
with non-negotiated online terms that place consumers at a significant
disadvantage and may result in a loss of rights.***** While forum
selection clauses are an obvious manifestation of that, the
*****reasoning might also be applied to other online contractual terms
that seek to override important laws and protections.******* These
could include contractual terms that seek to override copyright user
rights or local consumer safeguards. The decision will undoubtedly
have a significant impact on online contracting in Canada, forcing
many online companies to reconsider whether their agreements are fully
enforceable and *****emboldening consumers to stand up for their
rights.*****"

(emphasis added)

Obviously this would impact other ICANN-mandated policies too that are
the result of unequal bargaining power between registrants and
ICANN/registries/registrars.

Sincerely,

George Kirikos
416-588-0269
http://www.leap.com/