Julie Hopkins, Author at Arbitration Matters

February 13, 2023February 10, 2023

Manitoba – Vavilov inapplicable to arbitration appeals – #709

In Christie Building Holding Company, Limited v. Shelter Canadian Properties Limited, 2022 MBKB 239, Christie Building Holding Company, Limited (“Christie”), applied for leave to appeal two arbitral awards under section 44 of the Manitoba Arbitration Act, CCSM c. A120. Christie asserted six separate grounds for leave to appeal, one of which consisted of four alleged errors of contractual interpretation. It also argued that a portion of the main award should be set aside because: the respondent did not comply with the Arbitration Agreement on issues of document production; that it was not given a fair opportunity to examine parties; and the arbitrator relied on case law not cited by the parties. Chief Justice Joyal dismissed all applications. In holding that none of Christie’s arguments for leave to appeal gave rise to a question of law of arguable merit, he considered the applicable standard of review. He found that “the standard of review on which the merits of this appeal would have to be judged, assuming leave was granted, is reasonableness. Until the Supreme Court of Canada has answered the question of what effect, if any, Vavilov has on Teal Cedar and Sattva, those authorities remain good law and are binding on this court” (paragraph 95). He also stated that if the applicable standard of review was, in fact, correctness, he would have still denied leave as the incomplete record from the arbitration compromised his ability to conduct a meaningful review, even for the narrow purpose of assessing leave. He held it would, therefore, be “unfair to grant leave and proceed with an appeal when a proper and meaningful review would ultimately be impossible” (paragraph 102). This case summary will focus on the analysis of the applicable standard of review.

January 31, 2023January 26, 2023

Alberta – Power to prevent “manifestly unfair treatment” not power to stay arbitration – #706

In IBI Group Architects (Canada) Inc. v Edmonton (City), 2022 CarswellAlta 1805, the applicants, IBI Group Architects (Canada) Inc. and a related party (“IBI”), applied to stay an arbitration commenced by the City of Edmonton in favour of court proceedings. Although there is no express power to stay arbitrations under the Alberta Arbitration Act, RSA 2000, c A-43(“the Act”), the application was brought under subsection 6(c) which provides “[n]o court may intervene in matters governed by this Act, except for the following purposes as provided by this Act…(c) to prevent manifestly unfair or unequal treatment of a party to an arbitration agreement”. Previously, the Alberta Court of Appeal held in New Era Nutrition Inc. v Balance Bar Company, 2004 ABCA 280 (“New Era”), that courts could use subsection 6(c) to provide a remedy to cure unfairness arising from matters not covered by the specific language of the Act and that it could be used to allow “a party, faced with both a statement of claim and a notice to arbitrate, to apply to stay the arbitration on the basis that the matters in the two proceedings overlap and cannot be reasonably separated” in order to avoid unfairness (para. 43). IBI argued, among other things, that it needed the full participation and evidence of non-parties to the arbitration clause to defend itself and so if it were forced to arbitrate it would be unable to meet the case against it, which was manifestly unfair and so the arbitration should be stayed. Justice Dunlop, delivering his decision from the bench, refused the application to stay the arbitration as he determined that he had no jurisdiction to do so under the Act. He concluded that New Era “was no longer good law” in Alberta as the case had been considered and expressly overruled by the Supreme Court of Canada in TELUS Communications Inc. v. Wellman, 2019 SCC 19 (CanLII), [2019] 2 SCR 144 (“Telus v Wellman”).

October 12, 2022October 13, 2022

B.C. – Leave to appeal granted on question of law of public importance – #670

In The Graham-Aecon Joint Venture v. Malcolm Drilling Company Inc., 2022 BCCA 319, the Applicants (The Graham-Aecon Joint Venture and related entities) sought leave to appeal an arbitral award where the underlying dispute turned on the proper interpretation of section 8(d) of the Limitation Act, S.B.C. 2012 c. 13. That provision states that a claim is “discovered” “on the first day on which the person “knew or reasonably ought to have known…that, having regard to the nature of the injury, loss or damages, a court proceeding would have been an appropriate means to see to remedy the injury or loss”. Based on his interpretation of section 8(d), the Arbitrator had found that the claim was not time-barred. On application for leave to appeal, even though the Arbitrator’s reasons were “careful and thorough” Justice Voith decided to exercise his discretion to grant leave. He found the question of the proper interpretation of section 8(d) met the requirements of the Arbitration Act, S.B.C. 2020, c.2 for leave as it was a question of law that ‘cannot be dismissed through a preliminary examination’ and was of public or general importance as it had received little previous judicial attention.

August 15, 2022August 15, 2022

British Columbia – legal errors must reflect award’s actual reasons when read as a whole – #649

In The Fairways at Bear Mountain Resort Owners’ Association v Ecoasis Resort and Golf LLP, 2022 BCSC 1235, Justice Donegan considered the threshold question for granting leave to appeal a final award, which is whether the alleged errors were questions of law. In doing so she emphasized the importance of reading the award as a whole and considering what it was that the Arbitrator had actually decided. When that was done in this case, she concluded that neither of the two suggested grounds for appeal (both concerning the application of a limitation period) were questions of law alone but were, instead, questions of mixed fact and law that were based on the Arbitrator’s construction of the contract.

June 20, 2022June 17, 2022

British Columbia – Application to stay amendments falters on attornment – #628

The case Hawrish v. Hawthorn, 2022 BCSC 849 concerned an application by the Defendants to stay amendments to pleadings on the basis that the parties had previously agreed to arbitrate those matters. The issue was whether the stay should be granted when the Defendants had already attorned to the Court’s jurisdiction over the original claim. The Chambers Judge, Justice Wilson, refused the stay application. He reasoned that the only issue was whether the stay application was brought in a timely manner. This, in turn, depended on whether the amendments raised new and discrete claims or whether they simply related to the original claims. Justice Wilson concluded that, even with the amendments, the dispute in “pith and substance” remained the same (para. 68). The amendments were “simply additional material facts” (para. 67). As a result, he found the Defendants had attorned to the Court’s jurisdiction regarding the matters raised in the amendments and the application for the stay was dismissed.

April 25, 2022April 25, 2022

Ontario – Arbitrators can decide non-legal business disputes, but not in this case – #608

The case 1107051 Ontario Ltd. v. GG Kingspa Enterprises Limited Partnership, 2022 ONSC 1847 concerned the jurisdiction of an arbitrator to decide a business dispute that was not legal in nature. The Applicant, 1107051 Ontario Ltd. (“110”), applied to “set aside” a decision of an arbitrator to assume jurisdiction over a dispute about whether a major real estate development project at King Street West and Spadina Avenue in Toronto (the “Project”) should include a hotel component when the parties were deadlocked on the issue. Section 17(8) of the Ontario Arbitration Act allows a party to apply to the Court to “decide” a jurisdictional issue if, as here, an arbitrator decides it as a preliminary question, as opposed to with the merits. Justice McEwen granted the “set aside”. He agreed with the arbitrator that the dispute was of a business nature and not legal and, further, that parties could arbitrate such non-justiciable disputes if they clearly and specifically intended to do so. In this case, although the arbitration clause was described as broad, the dispute was beyond its scope because the dispute was required by the clause to arise “under this Agreement”. That meant the dispute had to be about more than just anything to do with the Project. It had to concern the rights and obligations of the parties under the Agreement. Although a hotel was contemplated as part of the Project, it was not a required component. Further, express authorization to determine a business issue would have been necessary.

March 1, 2022May 4, 2022

Alberta – Previous arbitral award did not create res judicata for regulator – #589

In TransAlta Corporation v Alberta (Utilities Commission), 2022 ABCA 37, TransAlta Corporation (“TransAlta”) argued on appeal that the Alberta Utilities Commission (“AUC”) erred in law when it refused TransAlta’s application to decide, as a preliminary matter, that certain issues were rendered res judicata by a previous arbitral award arising out of a dispute between TransAlta and a legislated entity called the “Balancing Pool”. The majority of the Court of Appeal dismissed the appeal as: (1) the AUC decision was an interlocutory ruling in an unfinished proceeding and the AUC may ultimately agree with the arbitral award; and (2) the AUC did not err when it refused to apply res judicata as a preliminary matter as it was making a decision in a different statutory context than the arbitral tribunal.

December 22, 2021May 4, 2022

Julie’s 2021 Top Pick: B.C. – Allard v The University of British Columbia – #567

Costs results in domestic commercial arbitrations are often based on, or consistent with, the norms of international commercial arbitration and can differ greatly from what is expected based on standard litigation practice. This can be an unpleasant surprise for counsel and their clients who are unfamiliar with this. In Allard v The University of British Columbia Justice Douglas confirmed that the “starting point” for an award of costs in domestic commercial arbitration is that the winner is entitled to its reasonable legal fees and disbursements, or what is referred to in litigation practice as “solicitor client costs” or “indemnity costs” and not “party party” costs, which many litigators would expect. There are, of course, exceptions to this “normal rule” for assessing costs. Alberta’s Arbitration Act, RSA 2000, c A-43 perhaps provides one, as is discussed below.

November 8, 2021May 4, 2022

B.C. – Leave to appeal granted; arbitrator found party’s actions estopped him from raising statutory time limit – #550

Meszaros v 464235B.C. Ltd., 2021 BCSC 2021, concerned a petition to have the Court set aside or, alternatively, to grant leave to appeal, two awards related to costs where a party failed to apply within the time limit provided under the previous B.C. Arbitration Act: Arbitration Act, R.S.B.C. 1996, c. 55. The arbitrator had found that the 30-day time limit for seeking costs could be subject to an estoppel that prevented the petitioner from relying on it to challenge the ability of an arbitrator to make an award of costs outside the time limit. Justice D. MacDonald of the British Columbia Supreme Court denied the application to set aside the award but granted leave to appeal on the issue of whether an estoppel could arise on the facts of this case as found by the Arbitrator.

September 13, 2021May 4, 2022

B.C. – Leave to appeal denied where alleged legal errors did not reflect arbitrator’s reasoning – #530

In Ecoasis Resort and Golf LLP v Bear Mountain Resort & Spa Ltd., 2021 BCCA 285, the Applicants (Bear Mountain and related companies) argued on leave to appeal that the arbitrator committed four extricable errors of law relating to whether it was an implied term of a lease that the lessees would have access to limited common property. The Arbitration Act, S.B.C. 2020, c. 2, like the previous Act, allows appeals on questions of law alone provided they satisfy certain other conditions. Two of the alleged extricable legal errors concerned whether the arbitrator implied a term based on a wrong principle; the third concerned whether the arbitrator, in interpreting the lease, allowed the factual matrix to overwhelm the words of the contract; the fourth concerned whether the arbitrator misapplied the law of the duty of good faith by implying a term into the agreement. On examination, Justice Bennett concluded that none of the alleged errors reflected the arbitrator’s reasoning and, further, “all of the so-called legal issues raised by the applicant, fall into the category of mixed fact and law. I do not see any extricable question of law arising from the reasons of the arbitrator” (para. 49). Leave to appeal was denied.