Abouzeid v. eXp Realty of Canada Inc et al., 2026 ONSC 3329 confirms that speculative concerns regarding institutional bias in the administration of an arbitration, absent evidence of actual unfairness or an inability to appoint an independent and unbiased arbitrator, will not render an arbitration agreement invalid, unconscionable, or incapable of performance, and will not prevent a mandatory stay under s. 7(1) of Ontario’s Arbitration Act, 1991, S.O. 1991, c. 17 (the “Arbitration Act”). The Court rejected the plaintiff’s two principal arguments: first, that the administering authority under the relevant arbitration agreement (JAMS) would be unable to administer an unbiased arbitration because the respondent frequently selected JAMS as an administering institution; and second, that the limited size of the Canadian JAMS arbitrator roster rendered the arbitration agreement incapable of performance (an issue for Canadian administering institutions to consider). These arguments failed because the parties were free to select any arbitrator – they were not restricted to the JAMS roster – and because repeat use of an administering authority does not give rise to bias.
Background – The dispute arose from the termination by eXp Realty of Canada Inc. (eXp Canada) of its Independent Contractor Agreement with Mr. Abouzeid entered into in March 2022.
In 2018, Mr. Abouzeid founded the Affinity Real Estate Group, a team of real estate brokers. He brought an action against eXp Canada and its parent company eXp World Holdings Inc. (“eXp World”), in which he alleged that he and his team were subsequently recruited to join both corporations. In March 2022, he entered into the Contract with eXp Canada.
On September 29, 2025, eXp Canada terminated the ICA. Mr. Abouzeid commenced an action on January 15, 2026, claiming relief relating to the termination, including specific performance and other relief under the Contract.
The parties disagreed on which version of the Contract applied; however, both versions contained an arbitration clause. Mr. Abouzeid argued that the March 2022 version of the Contract applied and eXp Canada argued that a later version applied because the it permitted eXp Canada to revise the terms unilaterally on notice, which revisions were deemed accepted absent a timely objection from Mr. Abouzeid. The later version provided that “[a]ny dispute, controversy, or claim arising out of or related to this [contract] or any breach or termination of this [contract] … shall be submitted to and decided by binding arbitration” (para. 17). It also provided that arbitration would be “administered by JAMS and held either virtually or in Toronto, Ontario before a single arbitrator” (para. 17). The March 2022 version required disputes to be submitted first to JAMS mediation and then, if unresolved, to JAMS-administered arbitration before three arbitrators.
The main difference between the two versions of the arbitration agreement was the earlier version, which Mr. Abouzeid argued applied to the dispute, required the appointment of three (rather than one) arbitrator. He relied on this in support of his argument that the JAMS roster was too limited.
Ultimately, the Court did not need to decide which version of the Contract applied.
In 2026, eXp Canada moved under s. 7(1) of the Arbitration Act to stay the action against it in favour of arbitration.
Issue – The issue before the Court was whether the action should be stayed in favour of arbitration, or whether Mr. Abouzeid had established one of the statutory exceptions under s. 7(2) of the Arbitration Act.
The Court applied the two-stage test from Peace River Hydro Partners v. Petrowest Corp, 2022 SCC 41(“Peace River”):
- at the first stage, the moving party must establish an arguable case that the technical prerequisites for a mandatory stay are met; and
- at the second stage, the party resisting arbitration must show, on a balance of probabilities, that one of the statutory exceptions applies (para. 15).
Mr. Abouzeid advanced two grounds for resisting the stay, arguing that each brought the arbitration agreement within one of the statutory exceptions under s. 7(2) of the Arbitration Act. First, he argued that the arbitration agreement was invalid because JAMS was allegedly eXp Canada’s repeat dispute-resolution provider. Mr. Abouzeid argued that an institution with a repeat, ongoing relationship with one party has an incentive to favour that party when administering disputes, such that requiring arbitration through that institution effectively precluded an independent arbitrator and was therefore contrary to public policy and unconscionable. Secondly, he argued that the agreement was incapable of being performed because the JAMS Canadian roster allegedly had too few arbitrators available for selection to allow the arbitration agreement to be performed. (Based on my search, there appears to be only two JAMs arbitrators based in Canada.)
Court’s Analysis – The parties agreed that eXp Canada met the four technical pre-requisites for a stay under the Peace River test: (a) an arbitration agreement exists: (b) court proceedings have been commenced by a party to the arbitration agreement; (c) the court proceedings are in respect of a matter that he parties agreed to submit to arbitration; and (d) the party applying for the stay in favour of arbitration does so before taking a “step” in the court proceedings. (Note that Ontario’s Arbitration Act does not itself use the phrase “step in the proceeding” and whether that prerequisite can properly be imported into an Ontario stay motion is not clear. However, since eXp Canada’s compliance with all four prerequisites was undisputed here, this issue did not arise on this motion.)
The burden therefore shifted to Mr. Abouzeid to establish a basis for the court to deny the stay.
The Court relied on Peace River for the proposition that a stay should be refused based on a statutory exception only in a “clear case”, and that “[w]here the invalidity or unenforceability of the arbitration agreement is not clear (but merely arguable), the matter should be resolved by the arbitrator” (para. 23).
The Court held that the Contract did not give JAMS, or eXp Canada, control over the identity of the arbitrator. It distinguished the case from Hooters of America, Inc. v. Phillips, 173 F (3d) 933 (4th Cir 199) (“Hooters”), where the employer-controlled appointment process was “crafted to ensure a biased decisionmaker” because it provided that the two arbitrators selected by the employee and by Hooters must select the third arbitrator from a list of arbitrators created exclusively by Hooters – i.e. Hooters had more control over arbitrator selecting than its contracting party, and from Monster Energy Company v. City Beverages, LLC, where the concern arose from an arbitrator’s undisclosed ownership interest in JAMS (with the result that he had an economic interest in the arbitration organization) and JAMS’s history of administering arbitrations for one party. By contrast, in this case, the Contract allowed the parties the ability to appoint an arbitrator outside of the JAMS roster, and therefore from a very wide pool of arbitrators, and there was no evidence the arbitrator here would have an economic interest in eXp Canada’s repeat use of JAMS.
The Contract required JAMS to administer the arbitration in accordance with its rules, but did not require the parties to select an arbitrator from JAMS’ roster. The Court held: “[t]here is no requirement in either version of the [contract] that an arbitrator must be selected from the JAMS roster of arbitrators,” and “[t]he fact that the arbitration is required to be administered by JAMS pursuant to the JAMS rules does not affect who the decisionmaker or decisionmakers will be” (para. 29). The Court therefore held that JAMS administration did not preclude the selection of an independent arbitrator and did not make the clause contrary to public policy. The decision does not address why Mr. Abouzied did not select an arbitrator from outside the JAMs roster.
The Court also rejected the unconscionability argument. Applying Uber Technologies Inc. v. Heller, the Court reiterated that unconscionability requires both inequality of bargaining power and a resulting improvident bargain. Mr. Abouzeid argued that the Contract was a lengthy standard-form agreement and that the arbitration clause was buried within it. However, he did not file any evidence about the circumstances in which the Contract was signed, whether he had an opportunity to negotiate, or whether he was vulnerable in the contracting process. The Contract also contained an acknowledgement that he understood the agreement and had been given a reasonable time and opportunity to consult counsel. On that record, the Court held that it was “unable to find that Mr. Abouzeid was vulnerable in the contracting process because of an inequality of bargaining power” (para. 38).
Finally, the Court rejected the argument that the arbitration agreement was incapable of being performed. Mr. Abouzeid submitted that, if the March 2022 version applied, the clause required a three-person tribunal, while the JAMS Canadian roster allegedly listed only two mediators or arbitrators. The Court held that this argument failed for the same reason as the public policy argument: neither version of the Contract required any arbitrator to be selected from a JAMS roster. As the Court put it, “under either version of the arbitration agreement in the [Contract], there is no requirement that an arbitrator be selected from a roster maintained by JAMS” (para. 43). The alleged size of JAMS’ Canadian roster therefore did not make the arbitration agreement incapable of performance.
Therefore, the Court granted eXp Canada’s motion and stayed the action. None of the statutory exceptions in s. 7(2) of the Arbitration Act were established. The arbitration agreement was neither invalid nor unconscionable, and it was capable of being performed. Since the technical prerequisites for a stay were met and no exception applied, the Court was required to stay the action under s. 7(1).
Commentary:
Abouzeid will likely be welcomed by arbitration practitioners because it confirms that the designation of a recognized arbitral institution to administer an arbitration will not, alone, be enough to render an arbitration agreement invalid, unconscionable, or contrary to public policy, where there is no evidence that the arbitrator would be biased or partial. However, the decision should not be read as establishing that an arbitral institution’s repeated administration of disputes for the same party could never give rise to concerns about arbitral independence or impartiality, particularly where there is only a short list of arbitrators available from which the parties can make a selection. The result here turned on the specific terms of the arbitration agreement. Mr. Abouzeid’s arguments failed because neither version of the Contract required the appointment of an arbitrator from the JAMS Canadian roster and could select from a wide pool of arbitrators. As a result, any concerns arising from the size of that roster or JAMS’s prior involvement in disputes involving the respondent did not make it impossible for there to be a fair and unbiased arbitration.
In this regard, the Court makes an important distinction between administration and appointment. An allegation that an institution has administered disputes for a repeat user does not necessarily establish that the resulting tribunal will be biased. By analogy, one would not ordinarily conclude that the Ontario Superior Court is biased simply because it has administered prior proceedings involving the same party. Prior involvement in the administration of cases does not, on its own, establish partiality.
The concern, however, could arise when the appointment mechanism itself undermines arbitral independence or impartiality. This was the challenge in Hooters, where the appointment mechanism drew from a roster so limited and one-sided that the counterparty had no meaningful choice of arbitrator. An institution avoids that defect so long as it maintains a sufficiently broad and independent pool of available arbitrators, regardless of how often it has previously administered disputes involving either party.
Accordingly, the more difficult question remains unresolved. The Court was not faced with, and did not address, a situation where an arbitration agreement requires the appointment of a JAMS roster arbitrator, or from a similarly limited roster. In such a case, concerns about the composition of the roster and the appointment process could conceivably result in a different outcome, where there is evidence of potential or actual bias.
This matters in practice because institutional clauses are often adopted because they are standard, tested, and predictable dispute-resolution mechanisms. A rule permitting challenges based solely on the identity of the administering institution would inject uncertainty into a vast number of existing commercial agreements. Abouzeid confirms that the relevant inquiry is whether the arbitration agreement preserves a fair and independent method of constituting the tribunal. Where the appointment process provides access to a wide range of independent arbitrators, the fact that an institution has previously administered disputes involving one of the parties will not undermine the validity of the clause. Since no such defect existed in Abouzeid, the plaintiff’s challenge could not succeed.
The unconscionability analysis is also instructive here. A finding of unconscionability requires evidence of both an inequality of bargaining power and an improvident bargain, as outlined in the Uber test. The plaintiff’s characterization of the Contract as a standard-form agreement imposed on him was not a substitute for the evidence that unconscionability demands; particularly, where the Contract itself contained an acknowledgment that he had been given a reasonable opportunity to consult counsel about the arbitration provisions and where he tendered no evidence on the issue of unconscionability.