364 THE ADVOCATE
VOL. 79 PART 3 MAY 2021
their claim) concluded without the benefit of independent legal advice and
in circumstances where there was a significant inequality of bargaining
power. The court concluded that the ADR provision “operates to defeat the
very claims it purports to resolve”.23
THE SUPREME COURT OF CANADA’S DECISION
The SCC seven-justice majority decision, co-authored by Justices Abella
and Rowe, dismissed Uber’s appeal solely on the basis that the ADR provision
was unconscionable (the majority sidestepped the question of whether
the provision was an unlawful contracting out of the Ont ESA). Justice
Brown concurred in dismissing the appeal but rested his decision on a
determination that the ADR provision was contrary to public policy.24 Justice
Côté, in a dissenting opinion that constituted a ringing endorsement of
freedom of contract generally and respect for the arbitration process specifically,
would have ordered a stay of the class action conditional on Uber
advancing the arbitration filing fees to Mr. Heller so that he could initiate
the arbitration.
The majority’s fundamental position is encapsulated in this observation:
“This is an arbitration agreement that makes it impossible for one party to
arbitrate. It is a classic case of unconscionability.”25 The majority concluded
that the domestic arbitration statute governed since the international arbitration
statute does not apply to labour and employment disputes.26 The
majority concluded that the courts, not the arbitrator, should determine if
an arbitration agreement is invalid where there is a bona fide challenge to
the arbitrator’s jurisdiction to hear and decide the dispute. The majority
concluded that Mr. Heller’s challenge to the arbitration provision was presumptively
legitimate, and that if a stay were not granted, the validity of the
arbitration agreement might never be determined due to the practical cost
barrier (characterized as a “brick wall”) Mr. Heller faced.
The majority held that unconscionability must be assessed in light of two
criteria. First, is there an inequality of bargaining power such that the
weaker party “cannot adequately protect their interests in the contracting
process”?27 Second, does the agreement constitute an “improvident bargain”
in the sense that it “unduly advantages the stronger party or unduly disadvantages
the more vulnerable party”?28 The majority cautioned that contracts
of adhesion may—but do not always—impose unfair bargains on a
weaker party. In this instance, the agreement was clearly improvident since
the requisite up-front costs were “disproportionate to the size of an arbitration
award that could reasonably have been foreseen when the contract was
entered into” and “effectively, the arbitration clause makes the substantive