In Optiva Inc. v, Tbaytel, 2021 ONSC 2929, Mr. Justice W. Daniel Newton dismissed a post-award challenge to an arbitrator’s initial decision to proceed by way of summary judgment absent defendant’s consent. Newton J. determined that section 26 of Ontario’s Arbitration Act, 1991, SO 1991, c 17 describes hearings for “presentation of evidence” and “oral argument” but expresses no requirement for oral evidence. As the parties proceeded by affidavit, after cross-examination, and with oral argument, Newton J. held that arbitrator’s process had met requirement to “hold a hearing” as requested by defendant. Newton J also held that summary judgment should be available in arbitration for the same reasons as those given in Hryniak v. Mauldin, 2014 SCC 7 (CanLII), [2014] 1 SCR 87 provided the process “(1) allows the arbitrator to make the necessary findings of fact; (2) allows the arbitrator to apply the law to the facts; and (3) is a proportionate, more expeditious and less expensive means to achieve a just result”.
Continue reading “Ontario – arbitrator has jurisdiction to hear summary judgment despite party’s objection provided process complies with Hryniak – #474”Québec – fair administration of justice of complex construction dispute requires some litigants to arbitrate -#473
In four (4) court files involving five (5) litigants, Mr. Justice Bernard Synnott in Transport Richard Meloche Inc. v. Constructions Innovo Inc., 2021 QCCS 605 dismissed court litigation between two (2) of the litigants G and C and referred them to arbitration. Three (3) court files had already been joined for proof and hearing by an earlier court decision and G had successfully applied to intervene in and file an action in warranty in one (1) file and filed a cross-claim in another. Synnott J. resisted G’s arguments that enforcing its agreement to arbitrate would not favour the fair administration of justice. [informal translation] ‘If arbitration clauses had to be put aside each time several disputes arose from the performance of a construction contract, mandatary arbitration clauses would rapidly become obsolete and superfluous’. Synnott J. dismissed argument raising the potential for contradictory decisions and held G to its bargain. [informal translation] ‘In any event, the Court is of the opinion that it would be contrary to the interests of justice and its fair administration to deprive the parties of a process for dispute resolution, namely by way of arbitration, which they themselves chose and to which they freely agreed to submit by way of contract’.
Continue reading “Québec – fair administration of justice of complex construction dispute requires some litigants to arbitrate -#473”Alberta – binding valuation of shares not arbitrable, limits claims in litigation over overlapping issues – #472
To resolve the scope of an earlier share valuation and subsequent arbitration unsuccessfully challenging that valuation and their impact on current litigation, Madam Justice Susan E. Richardson in Lischuk v. K-Jay Electric Ltd, 2021 ABQB 280 explored five (5) key legal principles: estoppel by convention, res judicata, issue estoppel, cause of action estoppel and abuse of process by litigation. The parties disputed (i) termination of L’s employment contract with employer K and (ii) valuation of shares held by L’s holding company 997 under a shareholder’s agreement between 997 and employer K. L argued that a reasonable notice period after thirty-five (35) years of employment would extend the date at which his shares would be valued but 997’s contract submitted valuation of the shares as of the date of the termination. Richardson J.’s comments underline (a) the importance of drafting parallel contracts which speak to each other in the event of dispute, (b) the consequences of privity of contract and (c) the binding effect of decisions which the parties agreed would have binding effect.
Continue reading “Alberta – binding valuation of shares not arbitrable, limits claims in litigation over overlapping issues – #472”Ontario – complex contractual matrix and lack of privity prompts court to propose arbitration – #471
In CUSO International v. Pan American Development Foundation, 2021 ONSC 3101, Mr. Justice Calum MacLeod relied on forum non conveniens principles to resolve an application to stay Ontario litigation pending the outcome of litigation in Colombia. Despite a complex matrix of documents and contracts to which the litigants were not all parties, MacLeod J. urged the litigants to consider a submission agreement to arbitrate. Though that complexity and lack of privity often serve as lines of first resistance for a litigant objecting to arbitration, MacLeod J. relied on both as his prompts.
Continue reading “Ontario – complex contractual matrix and lack of privity prompts court to propose arbitration – #471”B.C. – court assists arbitration with subpoenas, subject to respect of implied undertaking of confidentiality – #470
In Octaform Inc. v Leung, 2021 BCSC 761, Mr. Justice Gordon C. Weatherill granted petitions under section 27 of the International Commercial Arbitration Act, RSBC 1996, c 233 and issued subpoenas to compel non-party witnesses to attend an ongoing arbitration. Observing that an “arbitration tribunal has the authority to control its own process, including the power to adopt its own rules and procedures for taking evidence that meet the needs of the particular case”, he added that “[i]t is not the role of this court to second guess the suitability of the processes adopted by the tribunal”. Weatherill J. had adjourned an initial hearing on the petitions to issue subpoenas to non-parties, judging the petitions to be premature. Provided with additional information since then, Weatherill J. confirmed the arbitrator’s determinations for approving the non-party witnesses’ attendance satisfied the court and warranted assistance. Weatherill J. issued additional terms to the witnesses’ attendance requiring the petitioner’s undertaking (i) not to use the evidence obtained anywhere else but with the court’s consent and (ii) to reimburse “respective reasonable legal expenses incurred in respect of their preparation for and attendance as a witness at the Arbitration”. The undertaking to restrict use mirrored in some respects the terms developed for the implied undertaking of confidentiality set out in Lac d’Amiante du Québec Ltée v. 2858-0702 Québec Inc., 2001 SCC 51 (CanLII), [2001] 2 SCR 743.
Continue reading “B.C. – court assists arbitration with subpoenas, subject to respect of implied undertaking of confidentiality – #470”Ontario – court all but drafts pandemic obituary for forum non conveniens as factor in fairness of arbitration venue – #469
Mr. Justice Edward M. Morgan in Kore Meals LLC v. Freshii Development LLC, 2021 ONSC 2896 included a forum non conveniens-type analysis to grant a stay, including whether the forum and venue identified in the agreement to arbitrate were unfair or impractical for a party. Morgan J. favoured competence-competence and referred the parties to arbitration administered by the American Arbitration Association, confirming that neither knew where the AAA was located and both informed him that arbitration was likely conducted online because they “presume so since the pandemic has moved most proceedings of this nature to a digital forum”. “If hearings are held by videoconference, documents filed in digital form, and witnesses examined from remote locations, what is left of any challenge based on the unfairness or impracticality of any given forum? To ask the question is to answer it”. Morgan J. observed that “[i]t is by now an obvious point, but it bears repeating that a digital-based adjudicative system with a videoconference hearing is as distant and as nearby as the World Wide Web. With this in mind, the considerable legal learning that has gone into contests of competing forums over the years is now all but obsolete. Judges cannot say forum non conveniens we hardly knew you, but they can now say farewell to what was until recently a familiar doctrinal presence in the courthouse”. Morgan J. added “what is true for forum non conveniens is equally true for the access to justice approach to the arbitration question. Chicago and Toronto are all on the same cyber street. They are accessed in the identical way with a voice command or the click of a finger. No one venue is more or less unfair or impractical than another”. Morgan J. also included a party’s co-defendant parent in the referral despite being non-party to the agreement to arbitrate.
Continue reading “Ontario – court all but drafts pandemic obituary for forum non conveniens as factor in fairness of arbitration venue – #469”Ontario – no appeal from Master’s order to stay litigation in favour of arbitration – #468
In Wang v. Mattamy Corporation, 2021 ONSC 2635, Ontario’s Divisional Court in brief reasons refused to vary or set aside a judge’s decision in Wang v. Mattamy Corporation, 2020 ONSC 7012 to dismiss an appeal from a Master’s order granting a stay of their litigation in favour of arbitration. In determining that Applicants had failed to demonstrate an error of law or palpable and overriding error of fact, the Court agreed that section 7(6) of Ontario’s Arbitration Act, 1991, SO 1991, c 17 is “a complete bar to the appeal” which provides that is no appeal from a decision of the court staying an action on the basis of an arbitration clause. For an opposite result in first instance on an appeal of a Master’s decision based on interpretation/application of Alberta rules of court and legislation, see the Arbitration Matters note “Alberta – court rules permitting appeal of Master’s stay decision consistent with section 7(6) of Arbitration Act – #412” regarding Agrium, Inc v. Colt Engineering Corporation, 2020 ABQB 807.
Continue reading “Ontario – no appeal from Master’s order to stay litigation in favour of arbitration – #468”Manitoba – applicant for leave to appeal cannot revisit procedural decisions creating limited evidentiary record – #467
In the context of an application for leave to appeal on a question of law, Mr. Chief Justice Glenn D. Joyal in Christie Building Holding Company, Limited v. Shelter Canadian Properties Limited, 2021 MBQB 77, rejected Applicant’s attempt to adduce extensive affidavit material to reconstruct the arbitration’s evidentiary record limited by the parties’ procedural decisions not to (i) have a court reporter attend the hearing and prepare a transcript and (ii) mark documents as exhibits. Respondent argued the decisions were consistent with “the characteristics of commercial arbitration and the need for efficiency, cost effectiveness, confidentiality and finality” and afterwards Applicant could not “tender a selective and disputed evidentiary record” and seek a court’s review of alleged errors of law which necessarily require a complete evidentiary record. Joyal C.J. agreed and limited the record to the awards and reasons, five (5) exhibits and the pleadings. Joyal C.J. declined to assess the impact of Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65 but commented that he found “persuasive, certain aspects of the reasons and conclusions set forth” in Cove Contracting Ltd. v. Condominium Corporation No. 012 5598 (Ravine Park), 2020 ABQB 106 and Ontario First Nations (2008) Limited Partnership v. Ontario Lottery and Gaming Corporation, 2020 ONSC 1516. Joyal C.J. observed “without deciding the issue, it need be acknowledged that it is anything but obvious that the Supreme Court of Canada intended Vavilov to apply to a statutory appeal of a commercial arbitration award and thereby overrule its own significant judgments in [Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53 (CanLII), [2014] 2 SCR 633] and [Teal Cedar Products Ltd. v. British Columbia, 2017 SCC 32 (CanLII), [2017] 1 SCR 688] along with the long-standing legal principles which acknowledge the reasons for limited judicial intervention in commercial arbitration.”
Continue reading “Manitoba – applicant for leave to appeal cannot revisit procedural decisions creating limited evidentiary record – #467”Québec – breach of public order involves outcome of award, not mistake in application of rules of public order – #466
In Perreault v. Groupe Jonathan Benoît, 2021 QCCS 1350, Mr. Justice Peter Kalichman dismissed an application to annul an award based on alleged breaches of public order. Kalichman J. held that [informal translation] ‘[t]o annul an award or to oppose its homologation on the ground that it is contrary to fundamental principles of public order, a party must do more than simply demonstrate that the arbitrator committed a mistake in the application of the rules of public order. It must demonstrate that the result itself is incompatible with public order’. Kalichman J. relied on Desputeaux v. Éditions Chouette (1987) inc., 2003 SCC 17 (CanLII), [2003] 1 SCR 178 to underline that (i) the courts’ consideration of an alleged breach of public order focused on the outcome of the award and (ii) an error in interpreting a mandatory statutory provision would not provide a basis for annulling the award as a violation of public order, unless the outcome of the arbitration was in conflict with the relevant fundamental principles of public order.
Continue reading “Québec – breach of public order involves outcome of award, not mistake in application of rules of public order – #466”B.C. – court enforces parties’ choice to apply International Commercial Arbitration Act to employment disputes – #465
In Johnston v. Octaform Inc., 2021 BCSC 536, Mr. Justice Nigel P. Kent dismissed an application to set aside an interim award which confirmed among other things that (i) disputes between the parties arising from employment agreements were subject to the International Commercial Arbitration Act, RSBC 1996, c 233 and (ii) the arbitrator had jurisdiction to grant equitable remedies. Kent J. held that the manner in which the parties framed their pleadings (i) supported application of the ICAA as a choice expressly made and (ii) was “an explicit recognition” of the arbitrator’s equitable jurisdiction and their agreement to apply Nevada law as the substantive law under section 28 of the ICAA reinforced that jurisdiction. Kent J. also upheld the arbitrator’s decision to dismiss Petitioners’ abuse of process claims, noting that Respondent “arguing diametrically opposed positions on the same point of law raised in two different legal proceedings … does not, however, necessarily amount to an abuse of process where it involves different contracting parties, different governing law, different lawyers/law firms representing the parties, no actual adjudication of the legal point in question, and no advantage obtained by the inconsistent submissions”. Kent J. dismissed Respondent’s objection that Petitioners applied outside the delay set by ICAA’s section 16(6), holding that the application qualified as a “proceeding” under B.C.’s COVID-19 (Limitation Periods in Court Proceedings) Regulation which suspended the limitation period. Kent J. also declined to engage in determining the impact of Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65.
Continue reading “B.C. – court enforces parties’ choice to apply International Commercial Arbitration Act to employment disputes – #465”