Uber Technologies Inc., et al. v. David Heller
(Ontario) (Civil) (By Leave)
Employment law - Labour standards, Contracts, Private international law, Arbitration - Employment law — Labour standards — Contracts — Private international law — Arbitration — What is the proper role for a court (and how and to what extent does the competence competence principle apply) in determining the validity of an arbitration agreement? — What is the proper allocation of responsibility as between the courts and the legislatures in determining whether to allow for or restrict arbitration, and to what extent must courts defer to that legislative determination? — What is the governing test for the unconscionability doctrine in determining the enforceability of an arbitration agreement?.
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The applicants, Uber Technologies Inc., Uber Canada Inc., Uber B.V., and Rasier Operations B.V. are part of a group of companies that have come to be known collectively and individually as Uber. Uber has developed computer software applications for GPS enabled smartphones for transportation and restaurant delivery. David Heller, a resident of Ontario, has been licensed to use the Uber driver app (UberEATS) to deliver food in Toronto since February 2016. He has never used the app to provide personal transportation services. In order to use the driver app, Mr. Heller had to meet certain criteria and accept Uber’s licencing agreement. That agreement states that it is governed by the law of the Netherlands. It includes an arbitration clause stating that disputes connected to the agreement shall be resolved by arbitration in Amsterdam. Mr. Heller brought a proposed class action on behalf of Uber drivers alleging that they were employees of Uber and entitled to benefits under Ontario’s Employment Standards Act, SO 2000, c. 41 (“The ESA”). The Ontario Superior Court of Justice granted a motion brought by Uber to stay Mr. Heller’s action in favour of arbitration. The motion judge determined that Mr. Heller was unable to demonstrate any exceptions under the Arbitration Act, SO 1991, c. 17 — including unconscionability — warranting a denial of Uber’s stay motion. The Court of Appeal for Ontario allowed the appeal on the basis that the arbitration clause amounted to an illegal contracting out of the ESA and was thus invalid. It determined that it was for the court, not an arbitrator, to determine whether a stay was warranted. The court of appeal concluded that the arbitration clause was unconscionable at common law and grossly unfair.
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