Ontario – Party bound by rule change despite not agreeing to it – #920

In InFrontier AF LP v. Rahmani, 2025 ONSC 3968 (CanLII) (“InFrontier”), the Court heard an application to recognize and enforce an award and considered the effect of  amendments to the arbitral rules chosen by the parties in their arbitration agreement. The parties had agreed to settle disputes by arbitration seated in Dubai using a specific set of arbitration rules (the “OldRules”) administered by a specific arbitral institution. Before the arbitration commenced, a change in Dubai law led to those rules being replaced by a new set of rules (the “New Rules”) to be administered by a different institution. As described below, there was a degree of connection between the Old Rules and the New Rules and between the two institutions. The arbitration proceeded under the New Rules. Mr. Rahmani, the Respondent in the arbitration, unsuccessfully challenged the arbitrator’s jurisdiction to proceed under the New Rules. He was also unsuccessful in the arbitration. InFrontier applied for recognition and enforcement of the award in Ontario. Mr. Rahmani opposed the application, arguing: (1) the composition of the tribunal and the arbitration procedure were not in accordance with the arbitration agreement because the arbitration proceeded, without his agreement, under the New Rules, (2) recognizing and enforcing the award would be contrary to public policy in Ontario because it was obtained as a result of a retroactive amendment to the arbitration agreement without the parties’ consent, and (3) he was unable to present his case during the arbitration. The Court rejected all his arguments.

This case summary deals only with Issue 1.

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Ontario – “No appeal” means “no appeal” (and other stuff) – #903

In Joseph Lebovic Charitable Foundation, et al v. Jewish Foundation of Greater Toronto, et al, 2024 ONCA 933,(“Lebovic“) the Court confirmed its prior ruling in Iris Technologies Inc. v. Rogers Communications Canada Inc., 2022 ONCA 634 (“Iris”). In both cases the arbitrator ruled, as a preliminary question, they had jurisdiction to decide the matter before them. In both cases one of the parties unsuccessfully sought a review of that ruling pursuant to s. 17(8) of the Ontario Arbitration Act, 1991. In both cases that party attempted to appeal to the Court of Appeal. And in both cases the motion to appeal was quashed with the Court of Appeal holding that s. 17(9) clearly prohibits any appeal from such a review.

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Jim’s 2024 Hot Topic – The duty of good faith in domestic arbitration – #885

Rather than picking a specific case for a Holiday Hash-over I’ve opted for a broader theme: since arbitration is contractual, to what extent do/should the principles set out in the SCC’s 2014 decision in Bhasin v. Hrynew  2014 SCC 71 (“Bhasin”) and its descendants apply to a Canadian domestic arbitration and what practical difference might it make?

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Ontario – Missed Opportunity re Implications of Set-Aside Test for Procedural Unfairness? – #850

In Vento Motorcycles, Inc. v. United Mexican States, 2024 ONCA 480 (CanLII) (for ease of reference, “Vento-CIPPIC“), the Court addressed The Samuelson-Glushko Canadian Internet Policy and Public Interest Clinic’s (“CIPPIC’s”) application to intervene in Vento’s appeal of last year’s Ontario Superior Court of Justice’s dismissal of Vento’s application to set aside a 2020 international arbitration award [Vento Motorcycles, Inc. v. United Mexican States, 2023 ONSC 5964 (CanLII), (“Vento”)]. That and related decisions were discussed in several Arbitration Matters previous blogs, including 810, 796, 572, and 807. CIPPIC’s application was unsuccessful. The Court rejected its application for three reasons: (1) it hadn’t shown a sufficient link between its expertise and the issues in the appeal or its unique perspective; (2) the higher threshold to be granted leave to intervene in a private dispute; and (3) the risk CIPPIC’s intervention would unjustifiably expand the scope of the appeal.  

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Ontario – Parties share responsibility to keep arbitration moving – #835

In Bank-Strox Renovation Inc. v. Lugano View Limited, (“Bank-Strox”) the Court dismissed the defendant’s motion to dismiss a construction lien action for delay where the had parties agreed to have their dispute resolved by arbitration. As a reminder of the sharp distinction between litigation and arbitration, the Court held that a respondent in an arbitration has the same, or in some circumstances a greater, contractual obligation to keep the arbitration moving as the claimant. Simply sitting back and doing nothing is not a basis to later seek dismissal of the claim for delay. That might work in a court case but it won’t where the parties have agreed to move their dispute to arbitration.

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B.C. – Reasons for granting anti-suit injunction to prevent arbitration different than litigation – #818

In Axion Ventures Inc. v Bonner, 2024 BCSC 45 (“Axion”), the Court addressed a British Columbia application for anti-suit injunctions to prevent the respondents from proceeding with a Washington State lawsuit and an arbitration seated in Thailand. Axion is a skirmish in the ongoing war over the ownership and control of Axion Ventures Inc. and Axion Interactive (the two applicants in this case) and their assets and those of their subsidiary and related entities in other jurisdictions around the world. The applicants were both plaintiffs and defendants in litigation already underway in BC. For reasons described below the Court ultimately adjourned the anti-suit injunction applications. However, it recognized a distinction between anti-suit injunctions sought in respect of foreign court actions and those sought in respect of commercial arbitrations; namely, that the latter do not engage principles of comity. And of particular interest to BC counsel, the Court suggested there is no absolute rule in BC that an anti-suit can only be sought after a stay application is brought in the foreign proceeding.

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Jim Reflects (2023): Browne v Dunn is just a rule of fairness: a comment on the Vento case – #810

I’ll take Vento Motorcycles, Inc. v. United Mexican States 2023 ONSC 5964 (Vento) as my top pick for 2023. It’s a reminder that just because the strict rules of evidence may not apply in an arbitration doesn’t mean the rationale for some of those rules should be ignored. In this case, it was an alleged breach of the rule in Browne v Dunn, the very rule all Commonwealth litigators had beaten into their heads by their professors, their principals, or, for some of the less fortunate among us, a judge. At heart Browne v Dunn is about fairness, and ensuring fairness is a, perhaps the, cornerstone of arbitration.  

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Manitoba – Procedural choices made for efficiency bind losing parties – #783

With what the Respondent must hope is the final chapter of a long and expensive saga, in Christie Building Holding Company, Limited v Shelter Canadian Properties Limited, 2023 MBCA 76 (CanLII), the Court of Appeal confirmed parties must live with the consequences of their decisions on how to conduct the arbitration. The parties agreed to forego obtaining transcripts of the arbitration and the formalities of entering thousands of documents as exhibits (only five were formally marked as such). C lost the arbitration and clearly regretted its agreement to limit the evidentiary record. The nature of the “record” was at the heart of the Applicant C’s two trips to the Manitoba Queen’s Bench, one to the King’s Bench, and two to the Court of Appeal. C was unsuccessful at every turn. In the end, the Court of Appeal did not agree the lower court had mistakenly declined jurisdiction by rejecting C’s attempt to recreate the record by adducing affidavit evidence of what was formally before the arbitrator. In the circumstances, the Court held the “record” would consist of the two awards and accompanying reasons, the pleadings, and the five marked exhibits.

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