Private Arbitration Clauses, Class Action Waivers And Canada’s Competition Act

The Federal Court of Appeal's recent decision in Murphy v Amway Canada Corp. has clarified the findings in Seidel v TELUS Communications confirming that in the absence of express statutory language overriding mandatory arbitration agreements and class action waivers, courts will continue to give effect to the parties' agreements to arbitrate individually and not by class action.

As we reported previously, the Supreme Court of Canada's 2011 decision in Seidel left some uncertainty as to the enforceability of mandatory arbitration agreements and class action waivers for statutory claims. A link to our previous legal update can be found here.

Background

On October 23, 2009, the appellant, Kerry Murphy, began a proposed class action proceeding against Amway Canada Corporation and Amway Global claiming their business practices were in violation of sections 52, 55 and 55(1) of the Competition Act. Murphy complained Amway failed to provide its distributors with an