Offices in Ottawa and Perth
(613) 722-1500

CONTACT US (613) 722-1500

Taking them at their word? The validity of verbal contracts

Taking them at their word? The validity of verbal contracts

Mann Lawyers

Posted May 7, 2018

Ramsay v BCE Inc.

The Toronto Small Claims Court recently found that a telephone conversation between an individual consumer and Bell Canada constitutes a legally enforceable oral contract – one which cannot be superseded by written terms emailed after the fact.

In David Ramsay v BCE Inc. the Plaintiff Mr. Ramsay called Bell Canada and ultimately purchased internet and television services for a term of 24 months. Having reached an agreement by phone, Bell Canada then sent Mr. Ramsay an email containing new terms including an increased price and an entire agreement clause.

Deputy Judge De Lucia found that when the telephone conversation concluded, a contract was in place with all of the essential elements, including consideration and sufficiently clear terms. Bell Canada’s later attempt to unilaterally raise the agreed-upon price was thus in violation of a valid and enforceable contract.  A party to a contract cannot unilaterally insert new terms without fresh consideration.  Where new terms involve price increases, any attempt to unilaterally change the verbal contract will be considered high handed and unacceptable by the Court.

The Court explained that while Bell Canada has the commercial right to impose price changes, it cannot do so during a contractual term.  The term in this case was 24 months, as agreed upon verbally between the parties.  Bell Canada’s attempt to clarify, introduce and bring attention to the new terms of the contract through subsequent emails was held to be unacceptable.  Given that none of the new terms were part of the original contract, they were found to be unenforceable.

Implications for Commercial Parties

Even though the damages award was low, the Small Claims Court’s reasoning should provide a caution to companies that engage consumers by telephone.  If your company contracts over the phone, it may not be possible to supersede the terms of the initial verbal contract with subsequent written terms.

For the sake of clarity and consistency, it is always best practice to reduce contracts to writing.  This holds especially true for companies that regularly contract with individual consumers. Employees who engage consumers by telephone should be trained to ensure best practices are followed at every consumer interaction.  Ensuring contracting protocols are followed at each consumer interaction will reduce the likelihood of unexpected terms or liability for the corporation in the future.

Shauna Cant is a member of the Commercial Litigation team. She can be reached at 613-369-0359 or at shauna.cant@mannlawyers.com.

More Resources

Blog |
Environmental Law

By: 

Posted March 23, 2023

On Friday, March 10, 2023, the Ontario government released two proposals in respect of additional changes to the province’s Environmental Assessment Act, R.S.O. 1990, c.[...]
Blog |
Real Estate

By: 

Posted March 15, 2023

Clients often have a lot of questions about the purchase process, such as ‘when do I get my keys’ and ‘will we meet in person[...]
Blog |
Family Law

By: 

Posted March 13, 2023

Registering the birth of a new baby can be done online through the Service Ontario website. With the province’s ‘5-in-1 Newborn Bundle,’ you can register[...]
Blog |
Estate Litigation

By: 

Posted March 7, 2023

As is now clear, the traditional approach in estate litigation that “the costs of all parties are ordered payable out of the estate has been[...]
Blog |
Employment, Labour, and Human Rights

By: 

Posted February 21, 2023

The recent Ontario decision, Steele v. The Corporation of the City of Barrie, 2022 ONSC 7245 (“Steele”), has expanded on the case law centering on[...]
Blog |
Family Law

By: 

Posted February 14, 2023

The short answer is yes. The long answer is, it’s complicated. Children have a legal right to be heard and listened to according to the[...]

Subscribe to Our Newsletter

"*" indicates required fields

Name*
Consent*
This field is for validation purposes and should be left unchanged.