In Century 21 v Zoocasa, the BC Supreme Court upheld the validity of the so-called “browse wrap” agreements and awarded damages against Zoocasa for its breach of the Century 21 website terms of use when it pulled listings from the Century 21 website for use on its own real estate listing search engine. The decision marks the first recognition by a Canadian court that industry standard browse wrap agreements (i.e. a website’s posted terms of service) can form valid contracts without being brought to the attention of users or requiring any review/acknowledgement by the user before accessing the website.

The conflict between the parties arose in 2008 when Zoocasa, a search engine and aggregator of real estate listings, began “scraping” images, descriptions, and property details from the Century 21 website and reproducing them on its own site. Century 21 claimed that Zoocasa’s scraping was in breach of the terms of use of its website (the Terms of Use), and made additional claims that Zoocasa had both trespassed and violated Century 21’s copyright over the images and descriptions.

The court found Zoocasa liable for copyright infringement and for breach of contract, and dismissed Zoocasa’s claim that the Terms of Use lacks proper acceptance or consideration, ingredients which make a contract valid. Unlike its shrink wrap and click wrap predecessors, browse wrap agreements such as the Terms of Use lack the “click-through” license (e.g. in click wrap agreements, user acceptance is indicated by clicking on the “yes” or “accept” bottom) or active step taken by the user (e.g. in shrink wrap agreements, users signal their acceptance of software licensing terms by removing the plastic wrap from a software package) which signal the user’s acceptance of the terms of use. Zoocasa argued that there is no proper acceptance for browse wrap agreements and claimed that the terms of use on a website were like a billboard, where the user has no opportunity to accept or reject the terms. The court rejected this analogy, finding that “[t]here is nothing the observer of a billboard does that is capable of indicating consent. The observer merely views the billboard. A user of a website can respond by accessing deeper layers (pages) of the website.”

The court in Century 21 v Zoocasa found there to be proper acceptance in browse wrap agreements where there is continued access of a website by a user with notice of the terms of use, thereby indicating its acceptance of those terms. Century 21 also gave consideration by providing access to the information on its web site. The court specifically noted that Zoocasa is a sophisticated commercial entity who has not only been given notice of the Terms of Use, but who had also relied on similar terms of use on its own website with the knowledge that such terms were the industry standard. Zoocasa’s scraping of the Century 21 website after notice of these terms of use was found to be a breach of its contract with Century 21.

Century 21 was awarded a permanent injunction against Zoocasa preventing further breaches of the Terms of Use, damages of $1,000 for breach of contract, and $32,000 for copyright infringement ($250 per infringement for 128 infringements). While the decision marks an important step in the evolution of browse wrap agreements, the facts of this case were somewhat unique: Zoocasa was a sophisticated internet business which was aware of the terms of use, and the court recognized that those terms were reasonable. Whether the courts will be as willing to find the existence of a contract between a less sophisticated individual, or perhaps in a situation of more egregious terms of use, remains to be seen.