Tilden Rent-A-Car Co. v. Clendenning
Encyclopedia
Tilden Rent-A-Car Co. v. Clendenning (1978), 83 DLR (3d) 400 is a leading Canadian contract law decision from the Court of Appeal for Ontario on standard form contract
s. 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.
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.
, for the court, held that Clendenning could collect from the insurance. Dubin observed that:
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 so lengthy and onerous terms cannot assumed to be assented to.
Standard form contract
A standard form contract is a contract between two parties where the terms and conditions of the contract are set by one of the parties, and the other party is placed in a "take it or leave it" position with little or no ability to negotiate terms more favorable to it.Examples of standard form...
s. 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.
Background
Clendenning rented a car from Tilden Rent-A-Car. He signed the rental agreement which contained an exclusion clauseExclusion 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...
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 DubinCharles Dubin
Charles Leonard Dubin, OC, O.Ont, QC was a Canadian lawyer and former Chief Justice of Ontario. He is best known for leading the Dubin Inquiry into the use of steroids by athletes.-Early life:...
, 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 factumNon est factumNon est factum is a doctrine in contract law that allows a signing party to escape performance of the agreement. A claim of non est factum means that the signature on the contract was signed by mistake, without knowledge of its meaning, but was not done so negligently...
.
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 so lengthy and onerous terms cannot assumed to be assented to.