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<xTITLE>Uber’s Arbitration Clause Ruled Unconscionable by the Supreme Court Of Canada</xTITLE>

Uber’s Arbitration Clause Ruled Unconscionable by the Supreme Court Of Canada

by Indraneel Gunjal
July 2020 Indraneel Gunjal

Uber’s service agreement for the drivers of its food delivery services in Canada required them to resolve any dispute with Uber through arbitration in the Netherlands. Such arbitration could only be initiated after depositing a filing fee of US $14,000 along with other legal fees and costs. A driver filed a class-action suit against Uber in the Ontario courts claiming that this arbitration clause violated the Ontario’s Employment Standards Act, 2000. Uber responded by filing for a stay of the proceeding and argued that the matter must be resolved through arbitration in the Netherlands.

When this issue came up before the Supreme Court of Canada on appeal, it allowed the driver’s class action to proceed in the Ontario Courts and found the arbitration clause in the Uber drivers’ contracts to be ‘unconscionable’.  The Supreme Court based its finding on the fact that the clause was a part of a non-negotiated standard form contract, where there was a substantial gulf in sophistication between the parties to the contract, i.e. the driver and Uber and the former could not be expected to understand the financial and legal implications the arbitration clause.

For the decision of the Supreme Court of Canada see here https://decisions.scc-csc.ca/scc-csc/scc-csc/en/item/18406/index.do

For more information see also https://law.missouri.edu/arbitrationinfo/2020/07/07/ubers-arbitration-clause-ruled-unconscionable-by-the-supreme-court-of-canada/

 

 

Biography


Indraneel Gunjal is an attorney from India and an advanced degree graduate from Stanford Law School, Class of 2020 with a specialization in International Economic Law, Business & Policy. Before joining Stanford, he worked with the Trade Policy Division of the Department of Commerce, Government of India where he was a member of the legal team representing India in its inter-state trade and investment disputes, Free Trade Agreement (FTA) negotiations, and also tasked with formulating and reviewing its trade policy.



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