Bell Mobility's slogan may ring hollow for some Canadians in
light of the Ontario Court of Appeal's decision in Sankar v. Bell Mobility Inc., 2016 ONCA 242, which will likely end the
$200-million class action involving as many as one million
Canadians. In reasons issued April 4, 2016, the Court upheld the
decision of the motions judge who, on a summary judgment motion,
found that Bell's practice of reclaiming unused balances on
prepaid cards was not a breach of contract and dismissed the claim.
The decision is noteworthy because the class action was dismissed
on a summary judgment motion (rather than after a full trial) and
because of the way the Court determined what documents formed the
contract between the parties.
The class proceeding involved Bell's pre-paid cellular phone
services and the "fate" of the balance remaining in a
customer's account when a customer failed to "top up"
the account before the end of its "active period." One of
the main common issues in the class action was whether the prepaid
cards expired on the last day of their active period or if they
expired the day after. Bell's practice was to claim any unused
funds the day after the end of the active period. For example, if
the active period ended on June 30, and the customer had not
purchased a top-up in order to extend their active period, Bell
would claim any remaining prepaid funds on July 1. The plaintiffs
claimed that their contract with Bell required Bell to wait until
the second day after the end of the active period before claiming
any remaining funds (i.e. July 2).
The motions judge found that at the time it entered into
contracts with its customers, Bell intended and customers
understood, that the agreement would expire at the end of the
active period and unused funds would be reclaimed by Bell after
that time unless the account was topped up before it expired. One
of the main grounds of appeal was that the motions judge improperly
relied on material beyond the initial agreements customers entered
into when they purchased these cards to interpret the contract
between Bell and its customers.
The Court found that the motions judge was entitled to rely on
documents such as the PIN receipts customers received when they
topped up their account, phone cards, brochures and websites in
addition to the initial agreements customers entered into and that
all these documents formed part of the contract between Bell and
its customers. The Court made it clear that there is a difference
between considering the factual matrix surrounding the formation of
a contact and considering the documents that make up the contract
itself. In its decision, the Court noted that "it is not
uncommon in modern contracts, including contracts made partly on
'paper' and partly on the internet, for contract terms to
be found in several 'documents'" and that "where
parties enter into interrelated agreements, the court is required
to look at all those agreements to determine their
Although the appellant argued that the motions judge should have
considered communications Bell sent customers after they purchased
prepaid cards, but before they expired because these were
misleading, and suggested customers had an additional day after the
end of the activation period to top-up their accounts, the Court
found that "these communications were not part of the factual
matrix surrounding the formation of the contract" and that
"at their highest" were post-contractual representations.
While these communications might be relevant for a
misrepresentation claim, they were not relevant for the contractual
claim that had been certified as a common issue.
Given the manner in which the Court determined what documents
formed the contract between Bell and its customers, the
Sankar decision may be increasingly significant in
light of the rise in internet-based components of service
agreements that begin with a customer signing a traditional
With thanks to Alexandra Hughes for her assistance.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
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