Ontario – Party bound by rule change despite not agreeing to it – #920

In InFrontier AF LP v. Rahmani, 2025 ONSC 3968 (CanLII) (“InFrontier”), the Court heard an application to recognize and enforce an award and considered the effect of  amendments to the arbitral rules chosen by the parties in their arbitration agreement. The parties had agreed to settle disputes by arbitration seated in Dubai using a specific set of arbitration rules (the “OldRules”) administered by a specific arbitral institution. Before the arbitration commenced, a change in Dubai law led to those rules being replaced by a new set of rules (the “New Rules”) to be administered by a different institution. As described below, there was a degree of connection between the Old Rules and the New Rules and between the two institutions. The arbitration proceeded under the New Rules. Mr. Rahmani, the Respondent in the arbitration, unsuccessfully challenged the arbitrator’s jurisdiction to proceed under the New Rules. He was also unsuccessful in the arbitration. InFrontier applied for recognition and enforcement of the award in Ontario. Mr. Rahmani opposed the application, arguing: (1) the composition of the tribunal and the arbitration procedure were not in accordance with the arbitration agreement because the arbitration proceeded, without his agreement, under the New Rules, (2) recognizing and enforcing the award would be contrary to public policy in Ontario because it was obtained as a result of a retroactive amendment to the arbitration agreement without the parties’ consent, and (3) he was unable to present his case during the arbitration. The Court rejected all his arguments.

This case summary deals only with Issue 1.

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Jim’s 2024 Hot Topic – The duty of good faith in domestic arbitration – #885

Rather than picking a specific case for a Holiday Hash-over I’ve opted for a broader theme: since arbitration is contractual, to what extent do/should the principles set out in the SCC’s 2014 decision in Bhasin v. Hrynew  2014 SCC 71 (“Bhasin”) and its descendants apply to a Canadian domestic arbitration and what practical difference might it make?

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Manitoba – Court denies stay in favour of arbitration for several (suspect) reasons – #868

In Bains and 10031670 Manitoba Ltd. v. Tworek et al, 2024 MBKB 111, the Court dismissed a motion to stay two court proceedings in favour of arbitration. In doing so, the Court ran afoul of some settled principles in Canadian (and international) arbitration law. These include interpreting the scope of the arbitration agreements, the test for a stay of proceedings in favour of arbitration, the separability presumption and concerns over inefficiency and multiplicity of proceedings where the dispute concerns both signatories and non-signatories to the arbitration agreement.

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Québec – Multiple arbitrator challenges res judicata and abuse of process – #859

In B Smart Technology Inc. v Norstan Communications Inc., 2024 QCCS 2416 (“B Smart”), the Court considered an application by Norstan Communications Inc. (“Norstan”) to dismiss originating applications of B Smart, in which B Smart sought an order to replace the arbitrator who was appointed to resolve their dispute. B Smart alleged that the arbitrator was biased and that his appointment was improper. What was important to the Court’s analysis was that B Smart had brought an earlier application before the Court to challenge this same arbitrator’s appointment. That judge held that the arbitrator was impartial and that his appointment was proper. Given those findings, the Court found that res judicata applied as a full answer to B Smart’s allegations and the application was dismissed. The Court also found that B Smart’s multiple attempts to challenge the arbitrator were an abuse of process.

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B.C. – Court strictly enforces arbitration rules to foreclose leave to appeal award – #843

In Bollhorn v Lakehouse Custom Homes Ltd., 2024 BCCA 192, the Court dismissed an application by the Appellant/Plaintiff Robert Bollhorn for leave to appeal an award of an arbitrator. This outcome resulted from the Court’s application of Rule 27 of the Vancouver International Arbitration Centre (“VanIAC”) Domestic Arbitration Rules (the “Rules”) and Section 59(3) of the Arbitration Act, SBC 2020, c 2. The former operates to foreclose appeals where the award is issued under the Expedited Procedures of the Rules, which the Court found applied to the case. The latter provides that there can be no appeal on a question of law where the arbitration agreement – in this case the parties’ adoption of the Rules – expressly disallows it.

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Ontario – International award enforced despite respondent’s non-participation – #839

Medivolve Inc. v. JSC Chukotka Mining and Geological Company, 2024 ONSC 2200, the Court refused Medivolve’s application to set aside an international arbitration award issued by a Moscow-seated tribunal, instead granting Chukotka’s application to recognize and enforce the award. Medivolve failed to appear at the arbitration and claimed that it had not been given proper notice or an opportunity to be heard. The Court found that Medivolve had proper notice of the arbitration within the meaning of Art. 36(1)(a)(ii) of the UNCITRAL Model Law on International Commercial Arbitration (the “Model Law”). It had received actual notice, by email, of the pendency and status of the arbitration well before the award was rendered even though it changed offices (without notifying the opposing party). 

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Ontario – Abuse of process precludes re-litigating arbitrator bias allegation – #827

La Française IC 2 v. Wires, 2024 ONCA 171 involved an appeal from a judgment recognizing and enforcing an arbitration award obtained by the Respondent. The Appellant/Claimant in the arbitration, entered into a funding agreement.  The arbitration arose when the Appellant/Claimant commenced proceedings seeking recovery of fees under the funding agreement. The central issue before the Court was whether the doctrine of abuse of process prevented the Appellant/Claimant from arguing on the application to enforce the judgment that the arbitrator was biased, when that issue had already been dismissed by the arbitral institution that heard and decided the challenge. 

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B.C. – “Lacuna” identified in B.C.’s domestic arbitration scheme? – #811

In Bollhorn v. Lakehouse Custom Homes Ltd., 2023 BCCA 444, One justice of the Court of Appeal for British Columbia referred an application for leave to appeal from the decision of an arbitrator to a full panel of that Court. The Court identified what it termed “a gap [in the legislative scheme] that may confound the general understanding of ‘where there is a right, there is a remedy’”. That gap arises from the apparent application of the Vancouver International Arbitration Centre [“VanIAC”] expedited arbitration rules to claims under $250,000, which preclude appeals unless the parties agree otherwise. 

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Québec – Arbitrator wrong to extend arbitration agreement to include third-party employees – #769

The Superior Court of Québec in Mullen c. Nakisa inc., 2023 QCCS 2678 held that employees not party to an arbitration agreement should not be added as parties to an ongoing arbitration. There is no support for the proposition that all third parties that are in some way related to the signatory parties of an arbitration agreement should be bound by it. This decision on the merits follows the stay granted by the Superior Court in October 2021 (Mullen c. Nakisa inc., 2021 QCCS 4388), covered in Case Note Québec – Stay of arbitrator’s decision to add third parties, force them to meet timetable, and refusal to hear them without payment – #553.

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International – Deliberation-related documents need not be produced, despite strong dissent – #766

In CZT v CZU, 2023 SGHCI 11, the Singapore International Commercial Court refused to order the arbitral tribunal to disclose deliberation-related documents in the context of a set-aside application under Article 34 of the UNCITRAL Model Law on International Commercial Arbitration (“Model Law”) despite the dissenting arbitrator’s statement that he had “lost any and all trust in the impartiality of [his] fellow arbitrators.” The applicant relied upon Article 34(2), alleging that the majority had breached the rules of natural justice, had exceeded the terms or scope of the submission to arbitration, that the arbitral procedure was not in accordance with the parties’ agreement, and that the award conflicted with Singapore public policy. For the reasons set out below, this case has relevance to Canadian international arbitration practice.

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