Waivers of Liability: Balancing the Statutory Protections of Occupiers and Consumers


David Schnarr v Blue Mountain Resorts Limited, 2017 ONSC 114

This case results from an injury that the plaintiff suffered while skiing at the defendant’s ski resort. The plaintiff purchased a seasons pass on line and in the process the plaintiff signed a waiver releasing the ski resort of any liability for “any cause whatsoever, including negligence, breach of contract, or breach of any statutory or other duty of care, including any duty of care owed under the Occupiers’ Liability Act (“OLA”).” He then used the pass and mid-season struck a broken ski pole that was lying on the slope. This caused him to lose control and strike a tree, causing injuries.

The plaintiff brought a negligence action and Blue Mountain pled the very comprehensive terms of the waiver. Shortly before trial the plaintiff amended the claim to assert a breach of the warranty in the Consumer Protection Act (“CPA”) that services supplied to a consumer will be of “a reasonably acceptable quality”, and to enforce the statutes provisions that prohibit contracting out of the CPA.  He then brought a Rule 21 motion for a judicial determination of a question of law pertaining to the application and breadth of section 7(1) of the CPA. This motion engaged the interaction between the rights of consumers, pursuant to the CPA, and the rights and liabilities of occupiers, pursuant to the OLA.

The plaintiff’s position was that “no contracting out” provisions of section 7(1) of the CPA should be applied to vitiate the defendant’s waiver in its entirety, which would allow the plaintiff to pursue both of its claims. The defendant took the position that the provisions of the CPA, and in particular section 7(1), have no application to the defendant’s common law and statutory rights (under the OLA) to rely on exculpatory waivers. As a result, its waiver in this case should be upheld in its entirety.

The Court stated that where a waiver is limited in scope to the four corners of what the OLA intended to protect, such waivers would not be impacted by anything in the CPA and would apply with full force. However, where a waiver goes beyond the exculpatory parameters permitted by the OLA and purports to include terms that touch on the deemed warranty anticipated by section 9(1) of the CPA, the waiver exceeds the objectives of the OLA and is defective.

Justice Tzimas found that the specific references to “any type of loss or damage” and “breach of contract” are the specific terms within the defendant’s waiver that engage the protections contemplated by the CPA, particularly sections 7(1) and 9(1). The Court held that to the extent the defendant’s waiver attempts to prevent liability for breach of the deemed warranty in section 9(1), that part of the waiver is precluded by section 7(1) of the CPA.

Despite this defect in the defendant’s waiver, the Court stated that there was no basis for it to use section 7(1) of the CPA to strike the defendant’s waiver in its entirety. The waiver amounts to a “cluster of waivers” and only those terms that touch on the CPA protections need to be addressed. Nothing in the CPA suggests that an entire agreement or comprehensive waiver would become void if it disregarded CPA protections.

Justice Tzimas ultimately relied on the doctrine of notional severance and read down the defendant’s waiver. Justice Tzimas held that a notional severance of any CPA claims that the plaintiff could advance against the defendant from the waiver is most responsive to the requirements of both the OLA and the CPA. The Court found that a reading down of the waiver would be least disruptive to both parties and allow them each to benefit from their respective statutory protections. The remainder of the defendant’s waiver that did not touch on the substantive and procedural rights under the CPA remained enforceable.

The Court concluded by stating that this approach will allow the plaintiff to pursue its two distinct causes of action, negligence and breach of warranty. The plaintiff’s negligence claim will be subject to the defendant’s waiver. Consistent with the terms of the CPA, the plaintiff’s breach of warranty claim will not be subject to any waiver.

What the insurer should know

Where the injured party is a consumer buying a service from the occupier they can assert a claim for damages for failure to provide the service at a reasonably acceptable quality even in face of a release that would be a complete answer to an Occupiers Liability claim. The wording of reasonableness is similar to the obligation under the OLA so we can expect a similar assessment of the performance by the occupier.

Shawn O’Connor Kentt Coburn, Articling Student