''Tilden Rent-A-Car Co. v. Clendenning'' (1978), 83 DLR (3d) 400 is a leading
Canadian contract law
Canadian contract law is composed of two parallel systems: a common law framework outside Québec and a civil law framework within Québec. Outside Québec, Canadian contract law is derived from English contract law, though it has developed disti ...
decision from the
Court of Appeal for Ontario on
standard form contracts. The Court held that a party can only be bound to a signed standard form contract when it is reasonable to believe that they consented to the terms.
[{{cite CanLII, year=1978, court=onca, num=1446, format=canlii]
Background
Clendenning rented a car from
Tilden Rent-A-Car
Tilden Rent-a-Car, later known as Tilden InterRent, was a Canadian car rental company that was founded by Sam Tilden. Its fleet was sold by the Tilden family to National Car Rental of the United States in June 1996.
History Origin
In 1925, Sam Ti ...
, a Canadian car rental company. He signed the rental agreement which contained an
exclusion clause
An exclusion clause is a term in a contract that seeks to restrict the rights of the parties to the contract.
Traditionally, the district courts have sought to limit the operation of exclusion clauses. In addition to numerous common law rules lim ...
denying coverage for accidents that occur if the driver had consumed any alcohol. Later, Clendenning hit a pole after having consumed alcohol. He pleaded guilty to impaired driving and tried to collect from the insurance policy to pay for the damages of his accident.
Opinion of the Court
Justice
Charles Dubin, for the court, held that Clendenning could collect from the insurance. Dubin observed that:
In modern commercial practice, many standard form printed documents are signed without being read or understood. In many cases the parties seeking to rely upon the terms of the contract know or ought to know that the signature of a party to the contract does not represent the true intention of the signer, and that the party signing is unaware of the stringent and onerous provisions which the standard form contains. Under such circumstances, I am of the opinion that the party seeking to rely on such terms should not be able to do so in the absence of first having taken reasonable measures to draw such terms to the attention of the other party, and, in the absence of such reasonable measures, it is not necessary for the party denying knowledge of such terms to prove either fraud, misrepresentation or non est factum
(Latin for "it is not ydeed") is a defence in contract law that allows a signing party to escape performance of an agreement "which is fundamentally different from what he or she intended to execute or sign". A claim of means that the signatur ...
.[p. 408-09]
Normally, a customer would have time to consider the whole agreement. But in this particular situation, renters are typically in a rush and do not normally have a chance to read the terms of the agreement. The judge observed that the rental system is designed to be speedy and, therefore, lengthy and onerous terms cannot assumed to be assented to.
See also
*
Boilerplate contract
A standard form contract (sometimes referred to as a ''contract of adhesion,'' a ''leonine contract'', a ''take-it-or-leave-it contract'', or a '' boilerplate contract'') is a contract between two parties, where the terms and conditions of the co ...
Notes
Canadian contract case law
1978 in Canadian case law
Car rental
Court of Appeal for Ontario cases
Driving under the influence