notes on new arbitration cases in Canada
In A.L. Sims and Son Ltd. v. British Columbia (Transportation and Infrastructure), 2022 BCCA 440, Justice Dickson held that a material misapprehension of evidence going to the core of the outcome of an arbitral award can amount to an extricable legal error on which a party can seek leave to appeal from the arbitral award. Sound familiar?
Continue reading “B.C. – When findings of fact become errors of law – #715”
In 3-Sigma Consulting Inc. v Ostara Nutrient Recovery Technologies Inc, 2023 BCSC 100. Justice Matthews granted a stay of proceedings, finding that the, “arguable case standard provides room for a judge to dismiss a stay application when there is no nexus between the claims and the matters reserved for arbitration, while referring to the arbitrator any legitimate question of the scope of the arbitration jurisdiction” relying upon Clayworth v. Octaform Systems Inc., 2020 BCCA 117 at para. 30. Here there was such a nexus, so the matter was referred to the arbitrator to decide jurisdiction.
Continue reading “B.C. – Recent shift towards competence-competence in arbitration clause interpretation? – #714”
In Spirit Bay Developments Limited Partnership v. Scala Developments Consultants Ltd., 2022 BCCA 407 (“Spirit Bay”) the Court affirmed the principle that courts should be reluctant to intrude in arbitral proceedings – even in cases where the award contains unhelpful discursions into irrelevant legal principles and legal errors that don’t affect the outcome.
Continue reading “B.C. – Appeal requires legal errors to affect outcome – #713”
In Care Tops International Limited v. PPN Limited Partnership, 2022 BCSC 2252, Master Robertson of the BC Supreme Court refused to set aside a pre-judgment garnishing order because the Plaintiff failed to draw the Court’s attention to a mandatory arbitration clause during the ex parte application granting that order. Master Robertson found that this omission was not material because it would have had no impact on the outcome; the arbitral proceedings had not yet commenced. As such, she did not have to determine if the Court, or an arbitral tribunal, was better placed to determine the interim relief.
Continue reading “B.C. – Court upholds pre-judgment garnishing order despite arbitration clause – #712”
In The Graham-Aecon Joint Venture v. Malcolm Drilling Company Inc., 2022 BCCA 319, the Applicants (The Graham-Aecon Joint Venture and related entities) sought leave to appeal an arbitral award where the underlying dispute turned on the proper interpretation of section 8(d) of the Limitation Act, S.B.C. 2012 c. 13. That provision states that a claim is “discovered” “on the first day on which the person “knew or reasonably ought to have known…that, having regard to the nature of the injury, loss or damages, a court proceeding would have been an appropriate means to see to remedy the injury or loss”. Based on his interpretation of section 8(d), the Arbitrator had found that the claim was not time-barred. On application for leave to appeal, even though the Arbitrator’s reasons were “careful and thorough” Justice Voith decided to exercise his discretion to grant leave. He found the question of the proper interpretation of section 8(d) met the requirements of the Arbitration Act, S.B.C. 2020, c.2 for leave as it was a question of law that ‘cannot be dismissed through a preliminary examination’ and was of public or general importance as it had received little previous judicial attention.
Continue reading “B.C. – Leave to appeal granted on question of law of public importance – #670”
In Escape 101 Ventures Inc. v March of Dimes Canada, 2022 BCCA 294, Justice Voith (for the Court) allowed an appeal of a commercial arbitral award on two grounds of significance: (1) the arbitrator demonstrated a material misapprehension of evidence going to the core of the outcome – this constituted an extricable error of law subject to appeal; and (2) an appeal is allowed with respect to “any question of law arising out of an arbitral award”, but this is not limited to errors arising from the formal award of the arbitrator. Here, the error was patent from the record, but was not apparent in the arbitrator’s reasons. The Court remitted the issue back to the arbitrator for reconsideration rather than substitute its own decision because there was no record of the proceedings, so it lacked the necessary evidentiary foundation to do so. (This was also the first appeal under the new B.C. Arbitration Act, S.B.C. 2020, c. 2.)
Continue reading “B.C. – Material misapprehension of evidence is an extricable error of law – #662”
In The Fairways at Bear Mountain Resort Owners’ Association v Ecoasis Resort and Golf LLP, 2022 BCSC 1235, Justice Donegan considered the threshold question for granting leave to appeal a final award, which is whether the alleged errors were questions of law. In doing so she emphasized the importance of reading the award as a whole and considering what it was that the Arbitrator had actually decided. When that was done in this case, she concluded that neither of the two suggested grounds for appeal (both concerning the application of a limitation period) were questions of law alone but were, instead, questions of mixed fact and law that were based on the Arbitrator’s construction of the contract.
Continue reading “British Columbia – legal errors must reflect award’s actual reasons when read as a whole – #649”
In MDG Contracting Services Inc. v. Mount Polley Mining Corporation, MDG sought leave to appeal an arbitral award on the basis of section 30 (errors of law) and to set aside the award on the basis of section 31 (failing to observe the rules of natural justice) of the former B.C. Arbitration Act, RSBC 1995, c 55. Justice McDonald dismissed MDG’s petition on the basis that it failed to meet the threshold requirement for granting leave in cases where there is a “clearly perceived and delineated” question of law, or, a rare extricable question of law. Rather, MDG’s arguments raised questions of mixed fact and law by submitting that despite the Arbitrator making a correct statement regarding the law, when properly applied, it should have resulted in a different outcome. The court also rejected MDG’s argument that the Arbitrator failed to observe the rules of natural justice when he failed to explain how he reached a “summary conclusion”, as the Award contained ample detail regarding the Arbitrator’s findings.
Continue reading “B.C. – Leave to appeal threshold not overcome by strategic drafting – #645”
In Petty v Niantic Inc., 2022 BCSC 1077, Justice Mayer stayed a proposed class action in favour of arbitration, except in respect of claims advanced under B.C.’s Business Practices and Consumer Protection Act [BPCPA]. He rejected the Representative Plaintiffs’ arguments that the arbitration agreements were null and void for unconscionability and/or violating B.C. public policy. He also applied the competence-competence principle, holding the arbitral tribunal should decide first as to its jurisdiction over claims based on the Competition Act where the parties’ contract provided for California law.
Continue reading “British Columbia: – Court partially stays class action related to videogame “loot boxes” – #639”
Williams v. Audible Inc., 2022 BCSC 834 (“Audible”) is the second of two decisions by Justice Horsman extending stays of proceedings in favour of arbitration under s. 15 of the former Arbitration Act, R.S.B.C. 1996, c. 55 in the context of class proceedings. The first, Williams v. Amazon.com Inc., 2020 BCSC 300 (the “Amazon Stay Decision”), concerned a separate class proceeding, brought by the same representative plaintiffs as in Audible, alleging similar causes of action, but against Amazon. That decision is under appeal. In this case, Justice Horsman granted the stay sought by Audible. Following the principles in Seidel v TELUS Communications Inc., 2011 SCC 15, the parties agreed to a consent stay of proceedings in favour of arbitration in respect of the plaintiff’s non-consumer protection legislation claims because of the arbitration clause in the relevant contracts. On this application, Justice Horsman found that, because the representative plaintiffs’ non-consumer claims were stayed by virtue of a consent order, there was no proceeding in which to advance the claims of the other possible class members, whose claims related to a period of time when Audible’s contracts did not contain arbitration clause. Therefore, she granted an extension of the stay of those proceedings to cover those claims too.
Continue reading “British Columbia – Effect of consent orders staying proceedings in favour of arbitration – #636”