ONCA denies application of arbitration clause to non-consumer plaintiffs

On Wednesday, the Ontario Court of Appeal upheld a motion to certify class proceedings against Dell Computers. The main issue was the application of a mandatory arbitration clause in the purchase agreement. The Consumer Protection Act invalidated mandatory arbitration causes on July 31, 2005. The court held that this applied to agreements made before July 31, 2005 where the claim to be arbitrated arose after that date. In addition, approximately 30% of the class were non-consumer purchasers. The court refused to grant a partial stay with respect to these proceedings based on two considerations: (1) it would create unreasonable duplication and delay, and (2) given the complexity of the mandated arbitration procedure it was unlikely that any non-consumer claims would be addressed otherwise.