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4. Internet Agreements
(a) CPA Coverage of Internet Agreements
For our present CPA purposes, an "internet agreement" is defined straightforwardly as [CPA 20(1)]:CPA s.20(1) "internet agreement" means a consumer agreement formed by text-based internet communications; Note however that even if a consumer agreement qualifies as being an 'internet agreement' that it is not covered by the rules set out in this section if the consumer's "total potential payment obligation under the agreement, excluding the cost of borrowing", is equal
to or less than $50 [CPA 37(1); CP Reg 31].
(b) Contents and Disclosure Requirements for Internet Agreements Before Execution
Before an Internet Agreement is entered into ('executed') the supplier must disclose the following information to the consumer [CPA s.38(1); CP Reg 32]:- Supplier Name
If a person, partnership or corporation their correct legal name, and as well any business names used.
- Contact Information of Supplier
The telephone number and business address of the supplier, and information respecting other ways, if any, in which the supplier can be contacted by the consumer, such as their fax number and e-mail address.
- Description of Goods and Services
A fair and accurate description of the goods and services to be supplied, including of any technical requirements related to their use.
- Costs and Charges List
An itemized list of the prices to be charged the consumer for the goods and services, including taxes and shipping charges.
- Extra Charges
A description of each additional charge that applies or may apply, such as customs duties or brokerage fees, and the amount of the charge if the supplier can reasonably determine it.
- Total Charges
The total amount that the supplier knows is payable by the consumer under the agreement, including 'extra charges' (above) or, if the goods and services are to be supplied during an indefinite period, the amount and frequency of periodic payments.
- Terms and Methods of Payment
- Dates of Performance
The date or dates on which delivery, commencement of performance, ongoing performance and completion of performance are to occur, as applicable.
- Delivery Details
For goods and services that are to be delivered,
- the place to which they are to be delivered, and
- if the supplier holds out a specific manner of delivery and will charge the consumer for delivery, the manner in which the goods and services are to be delivered, including the name of the carrier, if any, and including the method of transportation to be used.
- Service Performance Details
For services that are to be performed, the place where they are to be performed, the person for whom they are to be performed, the supplier's method of performing them and, if the supplier holds out that a specific person other than the supplier will perform any of the services on the supplier's behalf, the name of that person.
- Extra-CPA Consumer Rights and Supplier Obligations Regarding Cancellation, Returns, Exchanges and Refunds
The rights, if any, that the supplier agrees the consumer will have in addition to the rights under the Act and the obligations, if any, by which the supplier agrees to be bound in addition to the obligations under the Act, in relation to cancellations, returns, exchanges and refunds.
- Trade-In Details
If the agreement includes a trade-in arrangement, a description of the trade-in arrangement and the amount of the trade-in allowance.
- Currency
The currency in which amounts are expressed, if not Canadian.
- Other Supplier-Imposed Restrictions, Limitations and Conditions
General requirements for disclosure are explained at this link:
General Disclosure Requirements
Disclosure required respecting internet agreements must be "accessible", and must be "available in a manner that ensures" both that "the consumer has accessed the information" and that they can "retain and print the information" [CPA 38(3)].
(c) Execution Must be Express
While under the common law contracts can be entered into either expressly (writing or orally) or implicitly (by behaviour), internet agreements must be executed expressly. That is, when dealing with an internet agreement the supplier is under a legal duty to "provide the consumer with an express opportunity to accept or decline the agreement and to correct errors immediately before entering into it" [CPA s.38(2)].
This provision, with the phrase: "immediately before entering into it", is designed to prevent the supplier from burying an offer somewhere in preliminary communications, the terms of which get lost later in the communications shuffle. If this is done properly, a technique commonly used is to reiterate the offer just prior to execution followed by a clickable 'confirmation' button.
(d) Additional Disclosure and Copy Delivery Requirements for Internet Agreements After Execution
The supplier must deliver a written copy of the internet agreement to the consumer within 15 days after the agreement is executed (entered into) [CPA 39(1), CP Reg 33(1)], and the agreement must contain the following information [CPA s.39(2); CP Reg 33(2)]:- Consumer Name
- Date of Execution of Internet Agreement
The date on which the agreement is entered into.
- Original Disclosure Information
All the original pre-agreement disclosure information listed in (b) above ["Contents and Disclosure Requirements for Internet Agreements Before Execution"].
The agreement may be delivered in either of the following manners [CPA s.39(3); CP Reg 33(3)]:- Copy for Retention
Transmitting it in a manner that ensures that the consumer is able to retain, print and access it for future reference, such as e-mail.
- Fax
- Mail or Other Delivery to Consumer-Specified Address
- Any Other Manner with Proof of Delivery
(e) Consumer Cancellation Right Where Supplier in Default of Disclosure or Execution Duties
The consumer may cancel the internet agreement at any time up to seven days after receipt of the consumer agreement if the supplier has failed [CPA s.40(1)]:- in their disclosure duties [as per (b) above: "Contents and Disclosure Requirements for Internet Agreements Before Execution"]; or
- to provide the consumer with an express opportunity to accept or decline the agreement or to correct errors immediately before entering into it [as per (c) above].
(f) Consumer Cancellation Right Where Non-Delivery of Consumer Agreement
The consumer may cancel the internet agreement at any time up to 30 days after execution (when agreement entered into) if the supplier fails to deliver a copy of the consumer agreement in accordance with (d) above ["Additional Disclosure and Copy Delivery Requirements for Internet Agreements After Execution"] [CPA s.40(2)].
(g) Remedial Variations
For the most part, internet agreements are governed by the same general remedial provisions that govern most consumer agreements, which are discussed in Ch.7, "Civil Remedies".
However in the key area of consumer's restitution duties after they have cancelled or rescinded the consumer agreement, there may be variation. Anyone dealing with an internet agreement and having to consider that issue should carefully review s.6(c) in the above-cited chapter ("Restitution by Consumer After Rescission: Special Rules: Additional Consumer's Restitution Duties for Specific Consumer Agreements" [Reg 81]).
(h) Sectors Exempted from Internet Agreement Rules
The following economic sectors, all of which have their own sector-specific chapters or law, are exempt from all internet agreement rules:- Accomodation [CP Reg 4]
- Public Auctions [CP Reg 5(1)]
- Perishable Food [CP Reg 7]
- Motor Vehicle Dealer Sales [CP Reg 9(1)1,(2)]
- Real Estate and Business Brokers Sales [CP Reg 9(1)2,(2)]
- Travel Industry Sales [CP Reg 9(1)3,(2)]
- Cemetaries, Funeral and Related Sales [CP Reg 9(1)4,(2)]
- Payday Loans [CP Reg 9(3)]
- *** Category "X" [CP Reg
8(1,2)]
5. Remote Agreements
(a) CPA Coverage of Remote Agreements
For CPA purposes, a "remote agreement" is a consumer agreement "entered into when the consumer and supplier are not present together" [CPA s.20(1)]. Note that this also captures internet agreements, making this an example of where one consumer situation may fall into two 'form' categories.
However, even if a consumer agreement qualifies as being a 'remote agreement' that it is not covered by the rules set out in this section if the consumer's "total potential payment obligation under the agreement, excluding the cost of borrowing", is equal to or less than $50 [CPA 44; CP Reg 36].
(b) Contents and Disclosure Requirements for Remote Agreements Before Execution
Before a Remote Agreement is entered into ('executed') the supplier must disclose the below information to the consumer [CPA s.45; CP Reg 37(1)]. Such disclosure may be made either orally or in writing, and may be made by referring the consumer to a pre-existing publication setting out the information required to be disclosed [CP Reg 37(2)]:- Supplier Name
If a person, partnership or corporation their correct legal name, and as well any business names used.
- Supplier Contact Information
The telephone number and, if the consumer is required to deal with the supplier at particular premises, that address.
- Description of Goods and Services
A fair and accurate description of the goods and services to be supplied, including of any technical requirements related to their use.
- Costs and Charges List
An itemized list of the prices to be charged the consumer for the goods and services, including taxes and shipping charges.
- Extra Charges
A description of each additional charge that applies or may apply, such as customs duties or brokerage fees, and the amount of the charge if the supplier can reasonably determine it.
- Total Charges
The total amount that the supplier knows is payable by the consumer under the agreement, including 'extra charges' (above) or, if the goods and services are to be supplied during an indefinite period, the amount and frequency of periodic payments.
- Terms and Methods of Payment
- Dates of Performance
The date or dates on which delivery, commencement of performance, ongoing performance and completion of performance are to occur, as applicable.
- Delivery Details
For goods and services that are to be delivered,
- the place to which they are to be delivered, and
- if the supplier holds out a specific manner of delivery and will charge the consumer for delivery, the manner in which the goods and services are to be delivered, including the name of the carrier, if any, and including the method of transportation to be used.
- Service Performance Details
For services that are to be performed, the place where they are to be performed, the person for whom they are to be performed, the supplier's method of performing them and, if the supplier holds out that a specific person other than the supplier will perform any of the services on the supplier's behalf, the name of that person.
- Extra-CPA Consumer Rights and Supplier Obligations Regarding Cancellation, Returns, Exchanges and Refunds
The rights, if any, that the supplier agrees the consumer will have in addition to the rights under the Act and the obligations, if any, by which the supplier agrees to be bound in addition to the obligations under the Act, in relation to cancellations, returns, exchanges and refunds.
- Trade-In Details
If the agreement includes a trade-in arrangement, a description of the trade-in arrangement and the amount of the trade-in allowance.
- Currency
The currency in which amounts are expressed, if not Canadian.
- Other Supplier-Imposed Restrictions, Limitations and Conditions
General requirements for disclosure are explained at this link:
General Disclosure Requirements
(c) Execution Must be Express
While under the common law contracts can be entered into either expressly (writing or orally) or implicitly (ie. by behaviour) - remote agreements must be executed expressly. That is, when dealing with a remote agreement the supplier is under a legal duty to "provide the consumer with an express opportunity to accept or decline the agreement and to correct errors" [CP Reg s.38].
(d) Additional Disclosure and Copy Delivery Requirements for Remote Agreements After Execution
The supplier must deliver a written copy of the remote agreement to the consumer by the earlier of the following dates [CPA s.46(1), CP Reg 39(1)]:- 30 days after the first billing to the consumer; or
- 60 days after execution (entering into) of the agreement.
The agreement must contain the following information [CPA s.46(2); CP Reg 39(2)]:- Consumer Name
- Date of Execution
The date on which the agreement is entered into.
- Original Disclosure Information
All the original pre-agreement disclosure information listed in (b) above ["Contents and Disclosure Requirements for Remote Agreements Before Execution"] excepting that instead of "Supplier Contact Information" as set out in (b) above, the following shall be substituted:Supplier Contact Information
The telephone number and business address of the supplier, and information respecting other ways, if any, in which the supplier can be contacted by the consumer, such as the fax number and e-mail address of the supplier.
The agreement may be delivered in either of the following manners [CPA s.46(3); CP Reg 39(3)]:- Copy for Retention
Transmitting it in a manner that ensures that the consumer is able to retain, print and access it for future reference, such as e-mail.
- Fax
- Mail or Other Delivery to Consumer-Specified Address
- Any Other Manner with Proof of Delivery
(e) Consumer Cancellation Right Where Supplier in Default of Disclosure Duties
The consumer may cancel the remote agreement at any time up to seven days after receipt of the consumer agreement if the supplier has failed with their disclosure duties in accordance with (b) above ["Contents and Disclosure Requirements for Remote Agreements Before Execution"] [CPA 47(1)].
(f) Consumer Cancellation Right Where Non-Delivery of Consumer Agreement
The consumer may cancel a remote agreement at any time up to one year after execution (when agreement entered into) if the supplier fails to deliver a copy of the consumer agreement in accordance with (d) above ["Additional Disclosure and Copy Delivery Requirements for Remote Agreements After Execution"] [CPA s.47(2)].
(g) Remedial Variations
For the most part, remote agreements are governed by the same general remedial provisions that govern most consumer agreements, which are discussed in Ch.7, "CPA Civil Remedies".
However in the key area of consumer's restitution duties after they have cancelled or rescinded the consumer agreement, there may be variation. Anyone dealing with a remote agreement and having to consider that issue should carefully review s.6(c) ("Restitution by Consumer After Rescission: Special Rules: Additional Consumer's Restitution Duties for Specific Consumer Agreements" [Reg 81]).
(h) Sectors Exempted from Remote Agreement Rules
The following economic sectors, all of which have their own sector-specific chapter or law, are exempt from all remote agreements rules:- Accomodation [CP Reg 4]
- Public Auctions [CP Reg 5(1)]
- Perishable Food [CP Reg 7]
- Lottery Schemes [CP Reg 8]
- Motor Vehicle Dealer Sales [CP Reg 9(1)1,(2)]
- Real Estate and Business Brokers Sales [CP Reg 9(1)2,(2)]
- Travel Industry Sales [CP Reg 9(1)3,(2)]
- Cemetaries, Funeral and Related Sales [CP Reg 9(1)4,(2)]
- Payday Loans [CP Reg
9(3)] - *** Category "X" [CP Reg 8(1,2)]
6. Amendment, Renewal and Extension Regardless of Related Consumer Agreement Terms
(a) Overview
All of the forms of consumer agreement discussed in this chapter may be amended, renewed or extended in accordance with the following requirements [in (b) below], regardless of whether the original agreement provides for such changes or not [CP Reg 41(1)].
(b) Amendment, Renewal or Extension Requirements
These requirements are that [CP Reg 41(2)]:- the supplier or the consumer makes a proposal for amendment, renewal or extension;
- the supplier provides disclosure to the consumer updating the applicable original disclosure information required for the specific form of consumer agreement [see s.2(c),3(b), 4(b) or 5(b) above as applies]; and
- the other party explicitly accepts the proposal. Mere acknowledgement of receipt of the proposal does not constitute acceptance [CP Reg 41(3)].
(c) Effective Date
Any amendment, renewal or extension so made is only effective on the date set out in the proposal if the proposing party "provides a written copy of an updated version of the agreement to the consumer within 45 days after" agreement [CP Reg 41(4)]. The amendment, renewal or extension cannot effect party rights prior to that date [CP Reg 41(5)].
(d) Early Consumer Cancellation Rights For Renewed Direct Agreements
In the case of a direct agreement - an amendment, renewal or extension made in accordance with these procedures also renews the consumer's right to early consumer cancellation of the consumer agreement [see s.3(d) above] [CP Reg 41(6)].
These cancellation rights, when applied to the original making of the consumer agreement, are available - without reason - for 10 days after a copy of the consumer agreement is delivered to the consumer. However in the case of amendment, renewal or extension the legislation does not say what 'new' date triggers the counting of the ten days.
There are two candidates for this trigger date: the date of acceptance of the proposal, and the date that the updated disclosure is delivered to the consumer. Again the legislation is ambiguous on whether the updated disclosure is due prior to acceptance of the proposal, but the better interpretation seems to be that it is. That being the case, the only logical date from which the 10 days 'early cancellation' period starts to run is the date that the proposal is accepted.
However, in the event that a proposal is accepted before the updated disclosure is provided, a good argument exists that either the amendment, renewal or extension is void for failure to comply with the Reg 41(2) requirements, or that the early cancellation period only starts to run from receipt of the updated disclosure. In either case it seems that the consumer would be well-positioned to treat the contract as rescinded.
(e) Original 'Form' of Consumer Agreement Preserved
Despite having been amended, renewed or extended in accordance with these rules in a manner that would otherwise change their original characterization as an internet, direct or remote agreement, these agreements retain their original 'forms' [CP Reg 43].
7. Amendment, Renewal and Extension in Where Specific Consumer Agreement Terms (Not Applicable to Direct Agreements)
(a) Overview
In addition to the generally-available method set out in s.6 above, all of the forms of consumer agreement discussed in this chapter - except direct agreements - may be amended, renewed or extended in accordance with the following proposal requirements, if the original consumer agreement satisfies the qualifying conditions set out below in (b) [CP Reg 42(1)].
(b) Qualifying Conditions
A consumer contract may only be amended, renewed or extended under this section if all of the following conditions are met [Reg 42(2)]:- it provides for amendment, renewal or extension;
- it indicates "what elements of the agreement the supplier may propose to amend, renew or extend and at what intervals the supplier may propose" to do so;
- it gives the consumer "at least one of the following alternatives to accepting the supplier's proposal":
- termination of the consumer agreement, or
- retaining the existing consumer agreement unchanged;
and
- it requires the supplier to give the consumer advance notice of a proposal.
(c) Proposal Content and Disclosure Requirements
Any amendment, renewal or extension made under a proposal which does not comply with the below-listed content and disclosure requirements is ineffective [Reg 42(7)].
Further, such a proposal must be consistent with the terms of the original agreement:- respecting "what elements of the agreement the supplier may propose to amend, renew or extend and at what intervals the supplier may propose" to do so; and
- in giving the consumer either the alternative of terminating the consumer agreement, or retaining the existing consumer agreement unchanged. The proposal must, at least 30 but not more than 90 days before the proposed effective date, "be provided to the consumer in such a way that it is likely to come to his or her attention", and must contain the following information [CP Reg 42(5)]:- Updated Disclosure
Updates of the applicable original disclosure information required for the specific form of consumer agreement [see s.2(c), 4(b) or 5(b) above as applies].
- Changes and Changed Text Must be Specified
"All changes proposed to be made to the agreement, including, for each provision that is to be changed, the text of the provision as it would read after the change".
- Date Effective
"The date on which the amendment, renewal or extension would become effective".
- Specify Acceptable Means of Response
A means for the consumer to respond to it that is cost-free to the consumer and is easy to use [CP Reg 42(6)].
- State Effect of Non-Reply
What "the effect will be if the consumer does not respond to the notice".
(d) Effective Date
The amendment, renewal or extension proposed is effective on the later of the date specified in the proposal or 30 days after the proposal is delivered to the consumer [CP Reg 42(3)]. It cannot effect party rights prior to that date [CP Reg 42(4)].
(e) Original 'Form' of Consumer Agreement Preserved
Despite having been amended, renewed or extended in accordance with these rules in a manner that would otherwise change their original characterization as an internet or remote agreement, those agreements retain their original 'forms' [CP Reg 43].
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