Upon application by the liquidator of G’s succession, Madam Justice Aline U.K. Quach in Charron v. Charron, 2021 QCCS 2043 granted the liquidator leave to intervene in shareholder A’s motion to nominate a mediator regarding a dispute he had with shareholder C. Though the dispute appeared to only involve A and C who held common shares, Quach J. held that their dispute might impact the value of G’s preferred shares administered by the liquidator. As such, Quach J. determined that the liquidator had a sufficient, probable, direct and personal interest in the matter in dispute. The shareholders’ agreement contained a stepped dispute resolution process, involving mediation as a first step followed, if need be, by arbitration.
Continue reading “Québec – liquidator of preferred shareholders’ succession granted leave to intervene in common shareholder’s motion to nominate a mediator – #484”Québec – application for referral to arbitration has no autonomous status once plaintiff discontinues action – #483
In Gagné v. Gagné, 2021 QCCA 823, Québec’s Court of Appeal agreed that defendants’ application for referral to arbitration did not qualify as a cross-demand and the court was not seized of that application as an independent claim. Plaintiff had discontinued his action after the parties had pleaded defendants’ application for referral and during advisement. The Court held that defendants could not require the court to issue a decision after plaintiff filed the discontinuance. The court faced a juridical void given that there was no dispute to refer to arbitration and had no basis to conclude that defendants had acquired rights to have a decision on a referral to arbitration of a matter which had already terminated. The Court qualified an application for referral as limited to contestation of plaintiff’s action and, without that action, had no distinct or autonomous status in regard to a right invoked by defendants.
Continue reading “Québec – application for referral to arbitration has no autonomous status once plaintiff discontinues action – #483”Ontario – offer to settle in advance of stay application must contain real compromise to justify higher costs – #482
In Kore Meals LLC v. Freshii Development LLC, 2021 ONSC 3736, Mr. Justice Edward M. Morgan provided guidance on how to make an offer to settle in advance of an application to stay which would qualify for the increased costs eligible under Rule 49.10(2) of Ontario’s Rules of Civil Procedure, RRO 1990, Reg 194. Morgan J. observed that advising that “Defendants were right and the Plaintiff was wrong” and that defendants would apply for a stay contains no real compromise. Defendants’ offer to refrain from defending or seeking a stay of proceedings if plaintiff would walk away from the claim is not an offer which attracts increased costs. Morgan J. nonetheless granted costs on a partial indemnity scale, qualifying them as reasonable. He determined that the motion required “considerable legal research”, counsel “did what it to took to win the motion” and he was “not inclined to second guess [FD]’s counsel’s investment of time and effort” regarding an amount of fees which would not surprise “a sophisticated corporate party”.
Continue reading “Ontario – offer to settle in advance of stay application must contain real compromise to justify higher costs – #482”Alberta – absent summary judgment motion, stay granted because summary judgment exemption is premature – #481
In Melcor Reit Limited Partnership (Melcor Reit GP Inc) v. TDL Group Corp (Tim Hortons), 2021 ABQB 379, Master W. Scott Schlosser stayed a proceeding because plaintiff’s reliance on the summary judgment exemption in section 7(2)(e) of Alberta’s Arbitration Act, RSA 2000, c A-43 was “at the very least premature”. Master Schlosser held that a party resisting referral to arbitration under section 7(2)(e) must have first filed a summary judgment application and, until doing so, the exemption was not in issue. Master Schlosser also contrasted the state of summary judgment principles applicable when the Arbitration Act was first introduced and the current status of those principles following Hryniak v. Mauldin, 2014 SCC 7 (CanLII), [2014] 1 SCR 87. He noted that “[s]omething now suitable for Summary Judgment is quite different from what might have been suitable when Section 7(2)(e) of the Arbitration Act was passed into law” and “[a]n expansive reading of summary disposition is likely much wider than what was originally intended by the Act”.
Continue reading “Alberta – absent summary judgment motion, stay granted because summary judgment exemption is premature – #481”Nova Scotia – absent summary judgment motion, stay declined if there is arguable case for summary judgment – #480
Despite the absence of a motion for summary judgment, in VistaCare Communications Services of Canada Inc. v. Verge Technologies Inc., 2021 NSSC 161, Madam Justice Mona Lynch declined a stay under section 9(2)(e) of the Commercial Arbitration Act, SNS 1999, c 5 because the party resisting the stay “has satisfied me that there is an arguable case for summary judgment”. Lynch J. determined that whether a matter is a proper one for summary judgment (i) “does not mean deciding whether summary judgment would be granted as doing so would be too high a bar to meet” or (ii) “cannot be only whether summary judgment will be sought as that bar is too low”. Lynch J. held that “[w]here there is no summary judgment motion with the stay motion, the proper test should be whether there is an arguable case for summary judgment”.
Continue reading “Nova Scotia – absent summary judgment motion, stay declined if there is arguable case for summary judgment – #480”Ontario – security for costs order in recognition application appealable “because it speaks to the response of Canadian courts to international comity” – #479
In China Yantai Friction Co. Ltd. v. Novalex Inc., 2021 ONSC 3571, Ontario’s Divisional Court granted leave to appeal (i) a decision dismissing an application to order that the award debtor deposit the award amount pending opposition to recognition of the award and (ii) a decision granting an order for security for costs against the non-resident award creditor seeking recognition. The award debtor had not applied to set aside or suspend the award in Beijing where the award was made and had not argued any of the grounds listed in article 36(1)(a) of the International Commercial Arbitration Act, 2017, SO 2017, c 2, Sch 5 to resist recognition. The Divisional Court held there was “reason to doubt the correctness of the decision”. Though the matter involved recognition of an arbitral award issued outside of Canada rather than a court decision, the Divisional Court considered the appeal “important because it speaks to the response of Canadian courts to international comity and our relationship to the courts of other countries”.
Continue reading “Ontario – security for costs order in recognition application appealable “because it speaks to the response of Canadian courts to international comity” – #479”Ontario – ability to decide limitation issue before referral to arbitrator relieves parties from rearguing issue – #478
In Maisonneuve v. Clark, 2021 ONSC 1960, Madam Justice Sally Gomery held she had jurisdiction to determine whether an application for referral to arbitration was time-barred because (i) the record provided sufficient insight with respect to limitation issues despite having to draw some inferences and (ii) Ontario’s Rules of Civil Procedure, RRO 1990, Reg 194 urged that they be “liberally construed to secure the just, most expeditious and least expensive determination” of the limitation issue. Gomery J. commented that those reasons justified her deciding the issue, thereby relieving parties of having to reargue it before arbitrator. Gomery J. also observed that “the exercise of interpreting a contract is different than the exercise of interpreting a statutory provision”. The latter is a question law, requiring courts to “discern the mischief that the legislator intended to address in enacting legislation, and to interpret the statutory language to further the legislator’s purpose, sometimes to address problems that were not even contemplated when the law was passed”. The former is a mixed question of fact and law. “A contract is not made to address a societal issue or need. It is made to order the relationship between the parties or to resolve a specific problem they have at a particular time”.
Continue reading “Ontario – ability to decide limitation issue before referral to arbitrator relieves parties from rearguing issue – #478”Manitoba – no meeting of minds to arbitrate due to unsuccessful attempts to access online contractual schedules – #477
In Razar Contracting Services Ltd v. Evoqua Water, 2021 MBQB 69, Mr. Justice David Kroft dismissed an application to stay in favour of arbitration, holding that (i) a bidder’s inability to access an online link to other documents containing an agreement to arbitrate and (ii) absent evidence that such agreement had been brought to the bidder’s attention demonstrated “no meeting of the minds in respective of the agreement to arbitrate”. Kroft J. held he had jurisdiction to determine whether the facts established an agreement to arbitrate within the meaning of article 7(2) of the UNCITRAL Model Law on International Commercial Arbitration (1985). He concluded that “the evidence, viewed objectively, does not establish, on a balance of probabilities, the three elements required for a binding contract: intention to contract; settlement of essential terms; and, sufficiently certain terms”.
Continue reading “Manitoba – no meeting of minds to arbitrate due to unsuccessful attempts to access online contractual schedules – #477”Québec – attempt dismissed to limit arbitral jurisdiction by presumption statutory recourse excluded unless expressly included – #476
In Valiquette v. PL Nouvelle France Inc., 2021 QCCS 1096, Madam Justice Florence Lucas followed the lead recently set out in Groupe Dimension Multi Vétérinaire Inc. v. Vaillancourt, 2020 QCCS 1134 which dismissed attempts to limit an arbitral tribunal’s jurisdiction by way of presumption that statutory recourses were excluded unless expressly included. Lucas J. held that an arbitrator’s jurisdiction extends to all disputes relating directly or indirectly to the contract in which the agreement to arbitrate is contained, unless from its wording or the context a real intention by the parties to limit its scope. Lucas J. held that nothing in the agreement to arbitrate – which defined ‘Dispute’ in ‘excessively broad terms’ – or in the context of the matter permitted inferring the parties’ intention to limit the scope of their agreement to arbitrate or to exclude the oppression remedy from an arbitrator. Relying on the record before her, Lucas J. also definitively determined the issue of jurisdiction and referred the parties to arbitration.
Continue reading “Québec – attempt dismissed to limit arbitral jurisdiction by presumption statutory recourse excluded unless expressly included – #476”Federal – arbitral party’s post-recognition intentions not a ground to refuse recognition – #475
In Treaty Land Entitlement Committee Inc. v. Canada (Indigenous and Northern Affairs), 2021 FC 329, Mr. Justice Sébastien Grammond dismissed Canada’s submissions that he refuse registration of an award because (i) applicant had not explained how it intended to enforce the award and (ii) enforcement measures would not be available against the Crown. Grammond J. rejected them as “contrary to the philosophy underpinning” the Commercial Arbitration Act, RSC 1985, c 17 (2nd suppl) (“Code”), stating that recognition of an arbitral award may be obtained “as of right”. Grammond J. noted that “the reasons for which a court may refuse to homologate or annul an arbitration award are exhaustively set out” in article 36 of the Code and non-disclosure of applicant’s intentions with respect to enforcement is not one of those grounds. As for post-recognition enforcement issues, Grammond J. commented that “I need not speculate about the immunities Canada could raise if the applicants attempted to enforce the award”.
Continue reading “Federal – arbitral party’s post-recognition intentions not a ground to refuse recognition – #475”