In 9221-2323 Québec inc. v. Excavation L. Martel inc., 2020 QCCS 4363, Mr. Justice Martin F. Sheehan enforced the parties’ agreement to arbitrate contractor’s claims for additional sums even if doing so might result in loss of the contractor’s right to publish (register) its legal hypothec (lien) within the statutory delay. Sheehan J. recognized that the arbitration award might issue only after the end of the construction work and, by mere lapse of time, extinguish the contractor’s right to publish its legal hypothec. Party autonomy included the ability to require arbitration as a condition precedent to exercising statutory rights to protect claims and thereby give notice to third parties of that claim. Sheehan J. determined that the contractor had agreed that its legal hypothec could be published only after arbitration, knowing that the award might issue too late.
Continue reading “Québec – party autonomy to design arbitration includes right to risk loss of statutory construction lien rights – #401”Alberta – protracted costly litigation highlights “perils of not having a dispute resolution mechanism built into a contract” – #400
In North Pacific Properties Ltd v. Bethel United Churches of Jesus Christ Apostolic of Edmonton, 2020 ABQB 791, Madam Justice Anna Loparco determined that the parties to an existing contract had not entered into a binding agreement to (i) extend a key date for performance or (ii) arbitrate disagreements under that extension. Loparco J. opened and closed her reasons noting the parties’ lost opportunity to engage in less costly, less protracted dispute resolution. “In the end, this is an unfortunate tale of two well-meaning parties who had no means of resolving their disputes prior to the Closing; the result was protracted and costly litigation. It highlights the perils of not having a dispute resolution mechanism built into a contract”.
Continue reading “Alberta – protracted costly litigation highlights “perils of not having a dispute resolution mechanism built into a contract” – #400”B.C. – doctrine of separability allows receiver to disclaim agreement to arbitrate while litigating main contract – #399
In Petrowest Corporation v. Peace River Hydro Partners, 2020 BCCA 339, B.C.’s Court of Appeal identified the particular status and powers of a court-appointed receiver exercising its jurisdiction under the Bankruptcy and Insolvency Act, RSC 1985, c B-3 and set out the doctrine of separability applicable to agreements to arbitrate. Their combined application supported the Court’s conclusion that a court-appointed receiver can sue on a contract and also disclaim application of the agreement to arbitrate contained in that contract. The Court held that doing so did not allow the receiver to “pick and choose” terms in a contract but instead merely recognized that the receiver had the option to pursue or disclaim two (2) separate contracts.
Continue reading “B.C. – doctrine of separability allows receiver to disclaim agreement to arbitrate while litigating main contract – #399”Federal – court declines to intervene regarding counsel’s alleged conflict of interest in investor-state arbitration – #398
In Geophysical Service Incorporated v. Canada (Attorney General), 2020 FC 984, Madam Justice Martine St-Louis declined to intervene in a decision by Canada’s legal representative refusing to remove a member from the legal team representing Canada in an investor-state arbitration. St-Louis J. held that (i) the staffing decision did not qualify as a public decision made by an entity subject to judicial review under the Federal Courts Act, RSC 1985, c F-7 and (ii) Applicants had not demonstrated the arbitral tribunal’s lack of jurisdiction to deal with the issue. Applicants raised concerns regarding an individual newly assigned to the legal team representing Canada in the arbitration. Applicants alleged a conflict based on that individual’s recent, prior employment relationship with the third-party funder with which Applicants had signed an agreement regarding its investor-state claim against Canada. Though St-Louis J. declined to intervene, in obiter she considered “there is little unambiguous evidence that [the individual] received information that would cause a conflict of interests”.
Continue reading “Federal – court declines to intervene regarding counsel’s alleged conflict of interest in investor-state arbitration – #398”Alberta – parties can agree to be bound by coin flips, Ouija boards and bespoke judicial resolution processes – #397
In Keeder v. AlGendy, 2020 ABCA 420, Madam Justice Jolaine Antonio denied leave to appeal consent orders which issued from a binding judicial dispute resolution process by which the parties had agreed to either resolve the issue themselves or be bound by the determination of the judge presiding the process. Antonio J.A. held the parties to their contract, applying precedent which held that such decisions are imposed on the parties as a result of their contract rather than the court’s authority. If the settlement falls apart, the parties must sue on their contract. Though the judge issues a determination, the decision is imposed as a result of their contract and not the court’s authority.
Continue reading “Alberta – parties can agree to be bound by coin flips, Ouija boards and bespoke judicial resolution processes – #397”Québec – court refers parties to arbitration but grants adjournment permitting parties to agree on arbitrator – #396
In Proservin Inc. v. Investissements Toro Inc., 2020 QCCS 3561, Mr. Justice Stéphane Lacoste demonstrated the Québec courts’ ready support of arbitration and their practical approach to assisting parties to appoint their own arbitrators. Citing the applicable legislative provisions in Code of Civil Procedure, CQLR c C-25.01 and principles issuing from key cases, Lacoste J. readily dismissed objections to the court referring the parties to arbitration. Having granted the application to nominate, Lacoste J. nonetheless granted the parties an adjournment to a specific date prior to which they were ordered to exchange on the nomination and informed that, failing agreement, he would resume the hearing and nominate an arbitrator from the competing choices.
Continue reading “Québec – court refers parties to arbitration but grants adjournment permitting parties to agree on arbitrator – #396”Ontario – interpreting agreement to allow appeal of procedural orders is commercially unreasonable – #395
In Converaidem, Inc. v. Mulcahy, 2020 ONSC 6747, Madam Justice Breese Davies dismissed an attempt to appeal interim procedural orders. One section of the parties’ agreement to arbitrate described rulings on procedural matters as “awards” and a later section allowed the parties to appeal “awards” on a question of law. Davies J. held that, as a general rule, the same word will be presumed to bear the same meaning throughout a contract but that the presumption of consistent expression may not apply if the resulting meaning is absurd or commercially unreasonable. Her reading of the various sections, individually and together, supported her conclusion that allowing appeals of the challenged procedural orders, despite being termed “awards”, would be commercially unreasonable.
Continue reading “Ontario – interpreting agreement to allow appeal of procedural orders is commercially unreasonable – #395”Ontario – application to extend time to file appeal denied because review of stay decision precluded – #394
In Wang v. Mattamy Corporation, 2020 ONSC 7012, Mr. Justice Michael A. Penny dismissed Plaintiffs’ application to extend the delay in which to appeal a Master’s decision staying their action in favour of arbitration. As part of his decision making, he had to determine the merits of their proposed appeal. Based on section 7(6) of Ontario’s Arbitration Act, 1991, SO 1991, c 17 which prohibits appeals of decisions under section 7, he held that the Master’s decision “falls squarely” within section 7 and “it is not appropriate for the court to engage in an analysis of the Master’s decision because any review of it is precluded” by section 7(6).
Continue reading “Ontario – application to extend time to file appeal denied because review of stay decision precluded – #394”Ontario – resort to arbitration commercially reasonable to resolve ambiguous non-compete clause – #393
In Way v. Schembri, 2020 ONCA 691, Ontario’s Court of Appeal set aside a decision granting summary judgment which, among other determinations, had held that it was “commercially unreasonable” to consider that arbitration was suitable to resolve disputes over an ambiguous non-competition clause. As part of his reasoning, the judge in first instance had observed that one party’s “suggestion that the answer to the ambiguities and lack of details in [non-competition clause] would be resolved by an arbitrator is commercially unreasonable and something that no businessperson would agree to”. The Court of Appeal disagreed, noting that “[g]iven the presence of arbitration provisions in countless business agreements, it cannot be that their existence alone is commercially unreasonable”.
Continue reading “Ontario – resort to arbitration commercially reasonable to resolve ambiguous non-compete clause – #393”Federal – successful offer in all-or-nothing final offer arbitration can include agreement to arbitrate – #392
In Canadian National Railway Company v. Gibraltar Mines Ltd., 2020 FC 1034, Mr. Justice Michael D. Manson held that, in final offer arbitration, the absence of reasons in a decision qualified the decision as reasonable and correct. Though one party objected to the other’s final offer including an agreement to arbitrate, Manson J. held that the arbitrator had to accept either offer “in its entirety” based on which offer the arbitrator considered more reasonable. Final offer arbitration’s “all-or-nothing” approach prevents an arbitrator from extracting reasonable terms from one offer for inclusion in the other and the Canada Transportation Act, SC 1996, c 10 prohibited the arbitrator from explaining the choice made.
Continue reading “Federal – successful offer in all-or-nothing final offer arbitration can include agreement to arbitrate – #392”