Québec – court enforces ex parte award stemming from e-mail notice to non-participating parties – #087

In brief reasons, Mr. Justice Michel A. Pinsonnault in Centre Sheraton v. Canadian League of Gamers Inc., 2018 QCCS 1945 homologated a final award which issued ex parte against non-participating defendants.  The case delivers on several of arbitration’s promises, including reduced formalities, shorter timelines, ability similar to courts to proceed ex parte and facility to have a final award homologated as a judgment of a court unless one of a limited number of grounds is proven to the court’s satisfaction.  The apparent simplicity of the process listed in Pinsonnault J.’s reasons belies the contribution of several key components which enable those promises to be met: Québec’s Code of Civil Procedure, CQLR c C-25.01 (“C.C.P.”),  an experienced arbitrator, an established administering institution and its rules, a court supportive of arbitration as an alternative route to dispute resolution.

From service of notice of arbitration to the court’s homologation of the final award, eight (8) months and four (4) days or 246 days.  The arbitration, initiated by Le Centre Sheraton Limited Partnership (“Plaintiff”) against Canadian League of Gamers Inc. and Mr. Gregory Spievak (“Defendants”), was administered by the Canadian Commercial Arbitration Centre and homologated pursuant to articles 645 and 646 C.C.P.

Pinsonnault J.’s decision demonstrates that one party’s non-participation in the arbitral process cannot stall the process from reaching a resolution.  The decision reiterates the Superior Court’s readiness to endorse and homologate validly-made ex parte arbitration awards, provided steps necessary to satisfy the court have been taken.

Pinsonnault J.’s reasons resist being condensed any further from their own economy of words.  The following is the entirety of the reasons which precede the Pinsonnault J.’s decision to homologate the final award.  Footnote references to the few exhibits have been removed and the key dates have been underlined.

[1] WHEREAS on September 6, 2017 a Notice of Arbitration was filed against the Defendants by the Plaintiff to the Canadian Commercial Arbitration Centre (hereafter “CCAC”);

[2] WHEREAS the CCAC sent by email to the Defendants on September 11, 2017 a copy of the Notice of Arbitration;

[3] WHEREAS the Defendants did not respond within the prescribed time to the Notice of arbitration;

[4] WHEREAS on October 10, 2017, the Plaintiff sent to the CCAC a request to proceed Ex Parte;

[5] WHEREAS the same day, the Defendants sent an email to the CCAC, which demonstrated that they had received the arbitration proceedings;

[6] WHEREAS on October 19, 2017, an Arbitral Award was rendered by Mtre  Michel A. Jeanniot, the arbitrator appointed in connection with the dispute between the parties (the “Arbitral Award”);

[7] CONSIDERING  that Plaintiff is requesting that the Arbitral Award be homologated by this Honorable Court in order to give it full effect and the enforceability of a judgment of the Court;

[8] CONSIDERING the Defendants’ failure to answer the summons and to attend the present hearing;

[9] CONSIDERING that the Application to homologate the Arbitral Award is well founded;

When homologating the award, Pinsonnault J. attached a copy of it to his decision with a mention that it form an integral part thereof as if recited at length therein.  He also ordered legal costs against Defendants.

His decision applies the provisions of article 645 C.C.P. which stipulate that as soon as the award is homologated, the award acquires the force and effect of a judgment of the court.  The same article reinforces the limits established against a court reviewing the merits of the award and Pinsonnault J.’s brief treatment reflects both the spirit and the letter of non-interference stipulated by article 645 C.C.P.

The arbitration process leading to Pinsonnault J.’s decision applies the provisions in article 635 C.C.P.  The latter article expressly provides for and allows ex parte procedures as well as termination given a claimant’s failure to prosecute.

635. If a party fails to state its contentions, attend at the hearing or present evidence in support of its contentions, the arbitrator, after recording the default, may continue the arbitration.

 However, if the party that submitted the dispute to arbitration fails to state its contentions, the arbitration is ended unless the other party objects.

The courts are authorized to refuse to homologate an award on limited grounds, listed in article 646 C.C.P.  Those few grounds include proof under article 646(4) C.C.P. that “the party against which the award or measure is invoked was not given proper notice of the appointment of an arbitrator or of the arbitration proceedings, or it was for another reason impossible for that party to present its case”.

The evidence provided by Plaintiff in support of the homologation identified e-mail notification to Defendants.  That form of notification qualified as adequate notice for the arbitrator, the administering institution and the Superior Court.  The result supports the confidence parties can have in obtaining a fair, prompt, enforceable resolution to their dispute by nominating an experienced arbitrator, involving an established administering institution and appearing before a court supportive of arbitration as an independent route to dispute resolution.

A different result occurred in 9220-7414 Québec inc. v. 9325-3722 Québec inc., 2018 QCCS 1628 when defendants provided evidence that the notice given did not meet the terms set out in the rules and defendants denied receipt of any documents initiating the arbitration.  In that instance, Madam Justice Lise Bergeron determined that proper notice had not been given and dismissed the application to homologate the award.