In Ongko (Boswell) v. Ongko, 2025 ONSC 7235, the applicant was precluded from bringing her set-aside application. She was not only time-barred from doing so because she commenced the application after the statutory 30-day period, but the Court also held that it lacked jurisdiction to set aside an award and to remove an arbitrator for bias where a party fails to comply with the arbitrator challenge requirements of the Arbitration Act, 1991, SO 1991, c 17 and the terms of their arbitration agreement, which provided for a mandatory challenge process if either party had concerns about the arbitrator’s neutrality. The applicant elected not to proceed with the challenge before the arbitrator after she refused to pay the arbitrator’s fees. She then chose not to participate in the arbitration. The Court made clear that parties must continue to pay the arbitrator’s fees to complete the contractually agreed dispute resolution process. It also found that there was also no procedural unfairness stemming from her own choices.
Background – The parties were engaged in contentious family litigation since 2017. In a 2024 Final Order, they agreed to engage a parenting coordinator (“PC”) for a one-year term to implement (but not change) the terms of the relevant court order and recommendations of the family reunification therapist. After receiving independent legal advice, in October 2024, the parties entered into an arbitration agreement with the PC (the “PC Agreement”) under which they agreed to arbitrate matters that were within the scope of the PC’s services and waived any right to further litigate those issues in Court. It included that any award issued by the PC shall be final and binding upon the parties and may be incorporated into a consent order.
The PC Agreement contained a grievance process in the event that either party had concerns about any aspect of the PC’s function or lost confidence in the neutrality of the PC. It provided that the PC shall continue to act until she resigns or is removed by court order. It further provided that the activation of a grievance would not terminate the PC process, and any awards issued would be implemented and adhered to by the parties during the grievance process.
Almost immediately after she entered into the PC Agreement, the applicant took issue with the family therapist and PC, alleging both professionals were exceeding the scope of their mandate. In early February 2025, she advised the PC that she had lost confidence in her continuing to act. She instructed both professionals to stop all work and not to incur additional charges.
The PC invited the applicant to initiate the grievance process. The grievance hearing that was scheduled for February 19, 2025, was cancelled after the applicant refused to pay any further funds to the PC. As the grievance process was not pursued by the applicant, the PC continued to perform her role and the issues between the parties were arbitrated in mid-March. The applicant elected not to participate in the arbitration. The PC issued an arbitral award on March 24, 2025 (the “Award”).
The applicant brought a motion to the Court seeking to remove the PC on grounds of bias and impartiality, to set aside the Award, and to terminate the family therapist. The respondent argued that the Court lacked jurisdiction to grant such relief because the applicant had failed to follow the grievance procedure and dispute resolution clauses in the PC Agreement and to adhere to the challenge provisions in the Arbitration Act, 1991, SO 1991, c 17. He asked the Court to incorporate the Award into a formal court order and compel the applicant to comply with its terms.
Court’s Decision – The Court held that it did not have jurisdiction to hear any of the issues raised by the applicant with respect to her challenge of the PC and the Award. It did so for three reasons.
First, the Court held that it lacked jurisdiction to remove the arbitrator or set aside the Award on grounds of bias or impartiality because the applicant had “failed to comply with the dispute resolution terms of the PC Agreement, and with sections 13(1) and 13(3) of the Arbitration Act, 1991.” Both the PC Agreement and the legislation required the party to first raise the bias challenge directly with the arbitrator who shall decide the issue. It is only after that is done that a party may have recourse to the Court to remove an arbitrator. Therefore, as the applicant elected not to proceed with her grievance challenge before the Award was made, she “cannot now seek relief from the Court alleging a reasonable apprehension of bias on the part of the PC.”
The Court rejected the applicant’s argument that the grievance process was waived (presumably by the PC) when the PC refused to engage without sufficient funds to pay her fees. The Court characterized this as an attempt by the applicant to circumvent her duty to act on the PC Agreement with good faith and honest contractual performance. This principle requires, at a minimum, the remitting of funds to pay the PC so that she may undertake the agreed upon dispute resolution process.
Second, the Court held that it does have jurisdiction to remove an arbitrator in circumstances where the arbitration is not being conducted with equal and fair treatment to both parties, which requires each party to be provided with the opportunity to present a case and to respond to the case presented by the other party. Here, the applicant was given notice and an opportunity to participate in the arbitration but chose not to do so. Therefore, there were no grounds to remove the arbitrator.
Third, under the Arbitration Act, 1991, the applicant had thirty days from the issuance of the Award to commence her court challenge, but she did not do so until more than two months later. The Court thus held she was “statutorily precluded from pursuing an appeal or an application to set aside the Award.”
The Court granted the respondent a formal court order incorporating the terms of the Award. It declined the respondent’s request for an order compelling the applicant to comply with the terms of the Award, noting the applicant “is aware of her obligation to comply with Court orders” and failure to do so will result in enforcement under the Family Law Rules.
The Court also rejected the applicant’s request to remove the therapist, finding that she provided no compelling reasons to do so.
Contributor’s Notes:
Courts will hold parties accountable. That is the clear message conveyed by the Ontario court in this recent decision. They cannot seek relief to avoid the consequences of their own strategic choices.
The applicant made three strategic choices. She firstly decided not to complete the contractual grievance process nor to comply with the provisions of the legislation, which both required that the arbitrator first decide the bias challenge. She secondly decided not to pay the arbitrator’s fees to complete that grievance process. She thirdly commenced her set-aside application after the statutory deadline. The Court held her responsible for all of those choices.
The decision with respect to the applicant’s refusal to pay the arbitrator’s fees is interesting. Parties cannot create fiscal stalemates. They make an informed choice when entering into an arbitration agreement to opt into that process and out of the courts. As the Court made clear in this decision, they cannot circumvent their contractual obligations by refusing to live up to their end of the bargain. The Court imported the good faith in contractual performance doctrine from Bhasin v. Hrynew, 2014 SCC 71 into the arbitration agreement context.
If a party seeks to challenge an arbitrator or an award, whether for jurisdictional, bias or other grounds, make sure you are following the required steps in both your agreement and the applicable arbitration act.