Browser Beware! Browse Wrap Agreements are Enforceable in Canada

On September 2, 2011, the Supreme Court of British Columbia held, in Century 21 Canada Limited Partnership v Rogers Communications Inc. [2011 BCSC 1196] (the “Century 21 case”), that the act of merely “browsing” on a website can, in certain circumstances, be deemed to create an enforceable contract between a user (i.e. the person browsing) and the owner of a website.  The case establishes an important precedent in the progression of contract law as it applies to the internet.

“Browse wrap” agreements can be differentiated from other types of “wrap” agreements, e.g. “shrink wrap” and “click wrap”.  Generally speaking, a browse wrap agreement is created: (i) when a user navigates into a website from a page containing notice of the website’s terms of use (e.g. a terms of use hyperlink and explanatory text), and (ii) the relevant terms of use indicate that they are binding on the user if they continue to use the website.  In such cases, agreement to the terms of use is indicated by a user through the act of progressing into a website.  Whereas, in shrink wrap agreements, acceptance is indicated through the act of physically removing the packaging of a product (e.g. the plastic wrapper) and, in click wrap agreements, acceptance is indicated through the act of clicking a button icon (e.g. the “I Agree” button).

In the Century 21 case, Zoocasa, a subsidiary of Rogers Communications, operated a real estate search engine that displayed property listings from a variety of other real estate websites. Zoocasa obtained listing information by accessing the content of Century 21’s website and copying listings without permission. Century 21 applied to the court for an injunction and damages against Zoocasa. Their claim was based, amongst other factors, on Century 21’s terms of use contained on its website. The terms of use prohibited commercial use of the website by users.

In holding that Century 21’s terms of use were enforceable as a browse wrap agreement, the court considered the presence of contractual elements as follows:

• Sufficient Notice.  A properly enforceable browse wrap agreement will provide the user with: (i) sufficient notice of a website’s terms of use, and (ii) the opportunity to read such terms of use prior to acceptance.

• Acceptance.  If, following notice of a website’s terms of use, a user takes a service of a website (e.g. by continuing to browse), with the knowledge that the taking of the service is deemed to indicate agreement (this must be clearly stated in the relevant terms of use), then such browsing may constitute acceptance of the browse wrap agreement.

• Consideration.  As with traditional contracts, consideration is necessary to form a browse wrap agreement.  Courts will generally find consideration in the exchange of promises.  However, the nature of the information or service contained on a website is also relevant to the presence of consideration.

• Certainty of Terms.  If a website owner unilaterally amends or removes its terms of use, without further notice to a user, the enforceability of the applicable browse wrap agreement may be called into question.  In the Century 21 case this was not an issue, as the relevant terms of use were not subsequently amended.

The Century 21 case represents an important milestone in the progression of contract law and e-commerce.  It is also a positive development for website owners and operators in Canada seeking to rely on a browse wrap agreement to protect their commercial information, provided that they have properly drafted their terms of use.

For more information on e-commerce matters, do not hesitate to contact Murphy & Company at (604) 360-7014 or by email at: tmurphy@murphyandcompany.ca

This article is not legal advice and is not intended as legal advice.  This article is intended to provide only general, non-specific legal information.  This article is not intended to cover all the issues related to the topic discussed.  The specific facts that apply to your matter may make the outcome different than would be anticipated by you.  This article is based on British Columbia law.  You should consult with an attorney familiar with the issues and the laws of your country.  This article does not create any attorney client relationship and is not a solicitation.