International/Model Law Archives - Page 3 of 4

November 18, 2022November 23, 2022

Federal – Amazon purchasers’ class-action competition claims referred to arbitration – #683

In Difederico v. Amazon.com, Inc., 2022 FC 1256, Justice Furlanetto of the Federal Court granted Defendants’ motion to refer to arbitration claims asserted under section 45 of the Competition Act, RSC 1985, c C-34 (the “Competition Act”) by a proposed class representative plaintiff. Of interest to arbitration observers, the judgment considered the circumstances which qualify as “commercial legal relationships” within the meaning of the United Nations Foreign Arbitral Awards Convention Act, RSC 1985, c 16 (2nd sup) (“UNFAACA”), the statute which implements the New York Convention into the federal law of Canada. The New York Convention, Article II(3), requires a court of a contracting State, at the request of a party, to refer claims covered by an arbitration agreement to arbitration, unless the arbitration agreement is null and void, inoperative, or incapable of being performed. This case also features detailed analysis of the access-to-justice exception to the competence-competence principle recognized in Uber Technologies, Inc. v. Heller, 2020 SCC 16 (“Uber”).

November 10, 2022May 12, 2023

Québec – No enforcement of award against alter egos – #681

In a much-anticipated decision, the Québec Court of Appeal overturned Justice Pinsonneault’s first instance decision and quashed the seizure before judgment by garnishment taken against a subsidiary and non-party to an arbitration to answer for the debt of the parent pursuant to an arbitral award. Justice Pinsonneault’s decision was discussed in a previous case note concerning CC/Devas (Mauritius) Ltd. v. Republic of India, 2022 QCCS 7. In Air India, Ltd. v. CC/Devas (Mauritius) Ltd., 2022 QCCA 1264, the Court of Appeal unanimously granted the appeal of the parent, ruling that a foreign award cannot be enforced against a third party’s assets unless it is proven: (1) that the third party is the debtor’s alter ego; and (2) that the third party was used in order to conceal fraud, abuse of right or a violation of a public order rule by the debtor. The Court of Appeal ruled that the applicable criteria for the enforcement of a foreign award against the shareholder of a condemned party were the same as the applicable criteria to lift the corporate veil, as codified at section 317 CCQ. Here, those criteria were not met, and the court did not lift the corporate veil.

November 8, 2022November 15, 2022

Ontario – Foreign award enforcement upheld on appeal despite previous attornment to court – #679

In Wang v. Luo, 2022 ONSC 5544, Justice LeMay, sitting as an Ontario Divisional Court judge, upheld the enforcement of a foreign arbitral award rendered under the auspices of the China International Economic and Trade Arbitration Commission (“CIETAC”). He rejected the Appellant’s arguments that the Superior Court of Justice erred in enforcing the award, including an argument that enforcement was improper given the Respondent’s previous attempt to pursue its claim before the Ontario Small Claims Court.

October 11, 2022October 7, 2022

Manitoba – Arbitration Agreement Invalid due to Unconscionability and no Consideration – #669

In Pokornik v. SkipTheDishes Restaurant Services Inc., 2022 MBKB 178, Justice Chartier considered the principles arising from Uber Technologies Inc. v. Heller, 2020 SCC 16 (CanLII) (“Uber”) in a contract of adhesion between a restaurant delivery corporation, SkipTheDishes, and one of its individual couriers. Justice Chartier found that there was no arbitration agreement; SkipTheDishes asserted that the courier was bound to a new agreement with an arbitration agreement that only became effective after she sued. Had he found otherwise, Justice Chartier would have found the agreement to be invalid due to unconscionability and a lack of consideration. These findings were despite efforts by SkipTheDishes to address some of the concerns that animated the Supreme Court of Canada’s decision in Uber.

August 29, 2022August 29, 2022

Ontario – Failure to pay award does not justify security for costs – #653

In Amelin Resources, Inc. v. Victory Energy Operations LLC, 2022 ONSC 4514, Associate Justice C. Wiebe dismissed a motion for security for costs under Rule 56.01(1)(d) of the Ontario Rules of Civil Procedure, finding that Victory, the Defendant/Moving Party, did not meet its onus of showing that there was “good reason to believe” that Amelin, the Plaintiff/Responding Party, had insufficient assets to pay the Victory’s costs in Ontario. Amelin’s failure to pay amounts granted to Victory under an arbitration award and U.S. Court order did not suffice.

July 19, 2022July 21, 2022

British Columbia: – Court partially stays class action related to videogame “loot boxes” – #639

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.

June 9, 2022June 7, 2022

Ontario – Receiver not bound by international arbitration clause with foreign seat – #626

In Royal Bank of Canada v. Mundo Media Ltd., 2022 ONSC 2147, Justice Penny found that a court-appointed receiver was not required to arbitrate claims under New York law-governed contracts that provided for JAMS arbitration seated in New York. He found that the B.C. Court of Appeal’s analysis in Petrowest Corporation v. Peace River Hydro Partners, 2020 BCCA 339, which focused on the separability of the arbitration clause, was not binding on him, and declined to follow it. Rather, Justice Penny focused on the insolvency law “single proceeding” doctrine. He found that the appointment of the receiver rendered the arbitration clause “inoperative”.

April 27, 2022April 25, 2022

Federal – Pirating action stayed under New York Convention – #610

In General Entertainment and Music Inc. v. Gold Line Telemanagement Inc., 2022 FC 418, Justice Fothergill of the Federal Court allowed an appeal of the prothonatory’s order and stayed an action for breach of certain provisions of the Copyright Act, the Trademarks Act and the Radiocommunication Act in favour of arbitration seated in Bermuda. In doing so, he applied Article II.3 of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the New York Convention) and the Supreme Court of Canada’s jurisprudence on staying court proceedings in favour of arbitration. The prothonatory erred in applying the law relating to a forum selection clause to an arbitration clause.

March 28, 2022March 31, 2022

B.C. – Court recognizes/enforces Swiss award, rejecting public policy defence – #597

In Enrroxs Energy and Mining Group v Saddad, 2022 BCSC 285, Justice Crerar granted a petition to enforce a foreign arbitral award under the International Commercial Arbitration Act, RSBC 1996, c 233 (ICAA) and the Foreign Arbitral Awards Act, RSBC 1996, c 154 (FAAA). He rejected the respondent’s attempts to resist enforcement based on the public policy ground in subparagraph 36(1)(b)(ii) of the ICAA and art. V(2)(b) of the FAAA. Justice Crerar also rejected the respondent’s request to stay execution pending a valuation of certain assets that the petitioner had seized, which the responded complained could result in double recovery.

January 31, 2022May 4, 2022

Québec – Enforcement of foreign award against alter egos – #578

In CC/Devas (Mauritius) Ltd. v. Republic of India, 2022 QCCS 7, Justice Pinsonnault was seized with several questions with respect to two seizures before judgment by garnishment, which were authorized within the context of an application for recognition and enforcement of arbitral awards rendered outside of Québec. What makes this situation of interest is the fact that the seizures before judgment involved assets (money) owned by third parties who were not defendants to the arbitration or named in the awards for which recognition is sought (still pending). They are not implicated at all in the facts alleged in the dispute leading to these awards and they are not targeted in the awards either. Nonetheless, Justice Pinsonnault concluded that the allegations against these third-party corporations (fully owned by the respondent, Republic of India) were sufficient to cause him to confirm the seizure against one of them, although with a revised scope. The seizure against the other corporation was dismissed for other reasons related to the State Immunity Act. The application for recognition and enforcement of the awards remains pending.