B.C. Archives - Arbitration Matters

October 1, 2023October 1, 2023

B.C. – Court articulates principles on fixing conditions in leave applications – #778

In Kingsgate Property Ltd. v The Board of Education of School District No. 39, 2023 BCSC 1266, the Court considered the text, context and purpose of s. 31(3) of the (former) Arbitration Act R.S.B.C. 1996 c. 55 (the “Arbitration Act”). (Comparable language appears in s. 59(5) of the current B.C. domestic Act.) That section allowed a court to attach such conditions to an order granting leave to appeal an arbitration award as it considers just. The Court determined that s. 31(3) empowered the Court to impose conditions on granting leave to appeal that will prevent miscarriages of justice. Here, the Court made two such orders sought by the petitioner Kingsgate Property Ltd. (the “Tenant”). Firstly, the Court settled the terms of security with respect to the Tenant’s appeal of an award made in a rent review arbitration (the “Award”). Secondly, the Court ordered a stay of the Award and a default notice the Board of Education of School District No. 39 School Board (the “Landlord ”) had issued for arrears of rent (the “Default Notice”).

October 1, 2023October 2, 2023

B.C. – Med-arb process was “fundamentally flawed” – #775

In Shaikh v Brar, 2023 BCSC 1285, the applicants (“Tenants”) complained about an unfair mediation-arbitration process and applied for judicial review and an order setting aside a decision of an arbitrator from the B.C. Residential Tenancies Branch (“RTB”). This case note focusses on the med-arb issues it raises, not the relevant statutory regime, the nature of the Arbitrator’s discretion under it, or the standard of review. The Court found that the med-arb process was “fundamentally flawed” and set aside the award because the RTB Arbitrator: (1) used decision-making powers in the mediation stage that should have been reserved for the arbitration stage; and (2) went beyond the scope of appropriate exhortation to settle in the med-arb context.

September 13, 2023September 16, 2023

B.C. – “Neutral nationality principle” not limited to nationality in Court’s arbitral appointment – #773

In Fotmer v Tilray, 2023 BCSC 1323 , the Court held that in an international arbitration, an American company’s multiple connections to British Columbia (including a place of business) precluded court appointment of a Canadian arbitrator over the objection of the opposing party. After considering the neutral nationality principle, the Court found that although the respondent was incorporated in Delaware, its close and obvious connections to British Columbia could give rise to a perception of bias if a Canadian arbitrator were appointed. Such an appointment would risk undermining the integrity of the arbitral process.

September 12, 2023October 23, 2023

B.C. – Arbitration clause in contract of adhesion not unconscionable/against public policy – #772

In Williams v. Amazon.com Inc., 2023 BCCA 314 the Court upheld a partial stay of a proposed class action in favour of arbitration. It found that the Chambers Judge did not err when she concluded that an arbitration clause that formed part of a contract of adhesion was not unconscionable or against public policy. In doing so, the Court distinguished the case from the Supreme Court of Canada decision in Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., 2016 SCC 37 (“Ledcor”) on the issue of the applicable standard of review. In Ledcor, the Supreme Court determined that correctness standard applies when reviewing the interpretation of standard form contracts. Here, the British Columbia Court of Appeal found that a deferential standard was applicable because of the highly contextual and fact specific analysis required for determining unconscionability/public policy issues. The fact that a contract of adhesion was involved did not change that conclusion. The Court also distinguished this case from the Supreme Court of Canada decision in Uber Technologies Inc. v. Heller, 2020 SCC 16 (“Uber”), where the Supreme Court found an arbitration clause in a contract of adhesion invalid on the basis of unconscionability and, in concurring reasons, as against public policy. The Court distinguished Uber because of, among other things, the “profound” differences that it noted in the two cases between the arbitration clauses at issue and the vulnerability of the plaintiffs.

August 15, 2023August 14, 2023

B.C. – No unfairness for procedural irregularity, no jurisdiction to review facts – #763

In Anins v. Anins, 2022 BCCA 441 (leave to appeal refused 2023 CanLII 64855 (SCC)), the Court of Appeal for British Columbia upheld a lower court decision dismissing a petition to set aside a family arbitral award based on errors of law and procedural unfairness. The Court of Appeal agreed with the B.C. Supreme Court that the Arbitrator did not cause any unfairness in failing to make a procedural direction in writing, nor were his reasons insufficient for omitting reference to certain statutory provisions. The Court of Appeal also agreed that the appellant’s grounds for appeal on the merits raised pure questions of fact. These were not appealable under B.C.’s then-applicable domestic arbitration statute.

August 4, 2023August 1, 2023

British Columbia – Google wins stay of conspiracy claims; plaintiff refuses to arbitrate – #761

In Spark Event Rentals Ltd. v. Google LLC, 2023 BCSC 1115, the BC Supreme Court granted the Google Defendants a stay in favour of arbitration. The Court rejected Spark’s assertion that the applicable arbitration agreement prohibited it from commencing arbitration, and that the entire dispute with Google could not be resolved in arbitration. Spark had also sued affiliates of Apple in the action. Apple applied, unsuccessfully, to stay the action on the basis that it was so intertwined with the claims against Google that it would amount to an abuse of process for the BC litigation to proceed in parallel with an arbitration against Google on the same claims. However, Spark represented to the Court that if its claims against Google were stayed, it would not proceed with an arbitration; accordingly, the Court found that Apple’s stay application was moot. While the Court left the door open to Spark to arbitrate with Google, in effect the arbitration agreement appears to have provided a tactical shield for Google – for now. This may be a case to watch, as Canadian courts have not yet definitively ruled on the availability of joint and several damages from co-conspirators in private litigation under the Competition Act, RSC 1985, c C-3 4. Another unsettled question that may arise in due course is whether, in these circumstances, a party has a right of contribution and indemnity from a co-conspirator if it is ordered to pay more than its proportional share of damages.

June 7, 2023June 5, 2023

B.C. – High bar to arbitrate amended claims after attornment – #744

In Hawthorn v Hawrish, 2023 BCCA 182, the BC Court of Appeal addressed the often-difficult question of “who decides” key issues where arbitration agreements and court proceedings collide. The appeal concerned an amended notice of civil claim, which the defendants – who had already attorned to the court in respect of the original notice of civil claim – applied to stay in favor of arbitration. The core question was whether the amendments added new claims. The Court of Appeal affirmed the lower court’s refusal to refer the question first to arbitration, and the conclusion that the amendments were not new.

May 26, 2023June 20, 2023

B.C. –Issue estoppel may bind tribunal to prior arbitration award – #741

In Kingsgate Property Ltd. v Vancouver School District No. 39, 2023 BCSC 560, Justice Stephens granted leave to appeal from an arbitral award in a rent renewal dispute, in which the Arbitral Tribunal elected not to follow the interpretation of a key contractual provision from an arbitral award rendered decades earlier. In both rental renewal disputes, a key issue was a market value provision in a long-term lease of property. Justice Stephens found that the proper interpretation of a previous arbitral award and whether the Arbitral Tribunal properly applied the doctrine of issue estoppel raised questions of law. The leave grant decision will permit further court consideration of interesting and novel questions concerning the application of the doctrine of issue estoppel in an arbitration context.

May 25, 2023June 13, 2023

B.C. – Inadequate reasons on central issue a breach of natural justice – #740

In Bromley v. Getzie, 2023 BCSC 446 (“Bromley”), Justice Brongers remitted an arbitral award to the Arbitrator for reconsideration as a remedy for the arbitrator’s failure to observe the rules of natural justice, pursuant to s. 30 of the (former) British Columbia Arbitration Act, RSBC 1996, c. 55 (the “Act”). Justice Brongers found that the Arbitrator had breached principles of natural justice because he provided inadequate reasons on a “central issue” in dispute between the parties. This is a rare finding, but one which appears to rely, in part, on principles of natural justice as they relate to applications for judicial review in administrative proceedings. Regrettably, scant reasons are provided regarding the decision of Justice Brongers to order remittance of the matter to the arbitrator, rather than to set aside the award, as a remedy for the breach of natural justice.

May 9, 2023May 5, 2023

B.C. – No error of law where some evidence supports findings of fact – #735

In 1550 Alberni Limited Partnership v. Northwest Community Enterprises Ltd., 2023 BCCA 141, the British Columbia Court of Appeal confirmed the decision of Justice Groves, who refused to grant leave to appeal from an arbitral award that turned largely on the Arbitrator’s interpretation of the parties’ agreement, as modified during the course of its performance. The Court found that the petitioner failed to establish that the proposed appeal raised an extricable question of law – because there was some evidence that supported the findings of fact. In so doing, the Court left the issue of the standard of review of the Arbitrator’s decision following the Supreme Court of Canada’s decision in Canada (Minister of Citizenship and Immigration) v. Vavilov, [2019] 4 S.C.R. 653 for another day.