There have been a number of recent class actions commenced in
Canada relating to pricing disclosure – and in particular,
the alleged practice of "drip pricing", whereby a company
advertises a base price through various media but additional fees
and surcharges are disclosed later in the sales/reservation
process. However, in a recent decision, the Superior Court of
Québec underscored the risks and challenges for plaintiffs
in pursuing such cases, and provided guidance for advertisers and
on-line retailers in respect of their pricing practices. In
particular, in Prince v.
Avis Group Inc. et al., the Court refused to authorize the
class action proceedings brought against car rental companies
seeking compensation on behalf of Québec consumers based on
alleged violations of consumer protection legislation. In so doing,
the Superior Court specifically endorsed the advertising best
practices of one defendant, and provided some welcome comfort to
companies who take steps to advertise a total estimated price as
part of their on-line practices.
The class action sought compensatory damages as well as punitive
damages due to alleged violations of the Consumer Protection
Act ("CPA") and the Civil Code
of Québec in relation with the pricing practices of
major car rental companies in Québec. More specifically, the
proposed representative plaintiff, Norman Prince, claimed that the
car rental companies charged a higher price compared to the base
price advertised on the companies' websites.
On August 4, 2016, Justice Johanne Mainville of the Superior
Court of Québec concluded that the pricing practices of
Entreprise Rent-A-Car Canada Company, and its related entities,
complied with the CPA as the total estimated price clearly appeared
on the reservation website.
Mr. Prince failed to bring any evidence of a prejudice caused by
the alleged faults. The examination of Mr. Prince, authorized by
the Court, confirmed the absence of damages suffered by him, as
well as his overall satisfaction with the services offered by the
As regards the claim for punitive damages, Justice Mainville
cites with approval the Supreme
Court of Canada ruling to the effect that a mere violation
of a provision of the CPA, if any was found in the present case, is
not sufficient to justify an award of punitive damages. It is only
further to an analysis of the whole of the merchant's conduct,
as disclosed by the allegations of the proposed class action, that
the court may determine "whether the imperatives of prevention
justify an award of punitive damages in the case before
In addition, Mr. Prince's lack of standing was fatal to his
claim. It is the individual claim of the representative plaintiff
that must be considered at this stage. In the absence of proven
prejudice, Justice Mainville concluded that Mr. Prince could not
justify an individual claim.
The most surprising part of the case just might be how Mr.
Prince learned that he was suggested by Merchant Law Group LLP as
the class representative. "Once in a while I
"Google" my own name" is how Mr. Prince indicated
learning, quite by accident, that proceedings had been filed on his
behalf. The limited evidence on record demonstrated that Mr. Prince
was not in a position to properly represent the class members, a
requirement under Article 575 of the Québec Code of
The Court's decision may still be subject to appeal, but it
does provide some much needed guidance to advertisers and on-line
retailers in many industries who seek to pass-on and disclose
additional state-imposed and other fees and surcharges as part of
their sales/reservation processes. While the Court's decision
appears to recognize a potential safe harbour from the perspective
of provincial consumer protection legislation, advertisers and
on-line retailers should review their pricing and disclosure
practices with experienced counsel given the existence of
overlapping federal and provincial legislation, the potential
enforcement risks and the interests of the class action bar in
Canada in seeking collective relief on behalf of consumers.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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