Arbitration Clauses

Some contracts require consumers to waive their rights, to use private arbitration processes to resolve complaints instead of going to court or to promise not to participate in class action lawsuits.

While many companies make honest efforts to resolve complaints helpfully, the effect of restricting consumers’ rights by contract is to diminish consumer protections and in some cases to make satisfactory resolution impossible.

Ontario’s Consumer Protection Act voids any clause that attempts to make you waive your legal rights or promise not to go to court. Unless your contract pre-dates July 30, 2005, such contract clauses are legally ineffective. Consumers are not bound by them, even if they have accepted the agreement. The new law does not prevent you from agreeing to use arbitration after a dispute has arisen. Sometimes arbitration works quite well. But you cannot be forced to use arbitration instead of the courts or instead of complaining to the ministry. The choice is yours.

The Ministry of Consumer Services attempts to resolve disputes between consumers and businesses. It is important that you contact the business before sending us your complaint since your concerns will not be addressed until you have first approached the business directly. For tips on how to complain, visit Your Consumer Protection Toolbox.

If you have a dispute with a service provider, try to resolve the problem with them. But if you feel your rights are being violated, do not hesitate to consider all of your options.