Québec Court rules that e-retailer may cancel sale due to evident pricing error

4 minute read
01 December 2015

The Court of Québec (Small Claims Division), in Faucher v. Costco Wholesale Canada Ltd. (2015 QCCQ 3366), has ruled that an online retailer who erroneously advertised computers on its e-commerce site for $2.00 was not obliged to honour its mistake. The plaintiff instituted legal proceedings against the retailer after the latter cancelled the plaintiff’s purchase order of 10 computers at $2.00 each–  claiming the retail value of all 10 computers ($9,379.99) in damages.

While retailers are liable for the accuracy of the prices they advertise, there have been instances in which Québec courts have allowed retailers to successfully allege a pricing error. In this case, the Court based its ruling in part on the retailer’s website Terms and Conditions of Use, which Terms were found at the bottom of each webpage, were one click away and therefore enforceable against the Plaintiff, and contained a provision whereby the retailer reserved “the right to cancel, to terminate or not to process orders (including accepted orders) where the price or other material information on the Sites is inaccurate”.

The Court held that the Plaintiff could not force the enforcement of the contract under the Civil Code of Québec due to the lack of an “offer” on the part of the retailer; in fact, no offer to contract existed given the retailer’s express desire not to be bound by pricing errors. The Court also noted that the blatant and unrealistic nature of the pricing error further vitiated the retailer’s consent to be bound by said price.

As for the existence of a contract under the QuébecConsumer Protection Act (the “C.P.A.), the Court noted that unlike the Civil Code of Québec’s definition of an “offer”, a retailer is deemed to have made an offer if the retailer’s proposal contains all of the essential elements of the intended contract, regardless of whether there is an indication of the retailer’s willingness to be bound in the event the proposal is accepted, and even if there is an indication to the contrary! While this rule might infer that the retailer would be bound by its advertised price, regardless of a statement to the contrary in its Terms and Conditions of Use, the Court noted that internet contracts possess their own unique attributes. Whether an offer has been made requires an analysis of which party initiated the offer.

The doctrine on internet sales has established the following distinction: If a consumer seeks out a product on website of his own accord and subsequently decides to make a purchase, the website is simply a proposal and it is the consumer, in pulling the information towards him/herself, who makes the offer (“pull media”). Inversely, when a merchant transmits, or “pushes” information directly to the consumer (“push media”), it is the merchant, in transmitting the information, who makes the offer. In this case, since the Plaintiff had visited the retailer’s site without having been solicited by the retailer, the Court held that the offer was initiated by the Plaintiff, and subsequently refused by the retailer. 

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