notes on new arbitration cases in Canada
In Nantel v Gonzalez (not reported), Justice Buchholz stayed an action as against one defendant of a group and referred its dispute with the Plaintiffs to arbitration, even though the Plaintiffs alleged solidary (joint) liability as against all Defendants.
Continue reading “Québec – Solidary liability allegation no bar to referral to arbitration for one defendant – #671”
In Tessier v 2428-8516 Québec inc., 2002 QCCS 3159, Justice Dufresne granted an application for a declinatory exception in respect of an originating application, and referred two disputes involving ownership of two closely connected companies to arbitration where the shareholders of only one of the two companies involved in the disputes were subject to an arbitration agreement. Justice Dufresne found that the disputes were linked. He relied upon the interests of justice and the principle of proportionality and found that [informal translation]“rather than depriving the shareholders of the first [company] of the effects of the arbitration clause, the shareholders of the second [company] should be ordered to be subject to it.”
Continue reading “Québec – Interests of justice require closely linked disputes to be arbitrated – #664”
In Doria v Warner Bros. Entertainment Canada Inc. et al., 2022 ONSC 4454, Justice Koehnen granted the Defendants’ motion to strike the Plaintiff’s Statement of Claim pursuant to Rule 21.1(3)(d) of the Ontario Rules of Civil Procedure, R.R.O. 1990, Reg. 194 on the ground that it was an abuse of process because it sought to relitigate issues that were previously decided by an arbitrator. The Plaintiff argued that s. 139 of the Ontario Courts of Justice Act. R.S.O. 1990, c. C.43, allowed him to bring a subsequent proceeding for the same or similar relief against a person who was jointly liable and who was not bound by a previous judgment. Justice Koehnen found that s. 139 did not apply these circumstances, where the Plaintiff had a full opportunity to have his entire claim adjudicated in the arbitration, was awarded judgment, and had fully collected on the judgment. The Plaintiff’s complaint was that the arbitrator did not grant him his full damages. The fact that the Defendants were not parties to the arbitration and therefore not bound by the award was irrelevant.
Continue reading “Ontario – Action abuse of process – even against new defendant – where issues already arbitrated – #661”
In Cannatechnologie inc. c. Matica Enterprises Inc., 2022 QCCA 758, the Québec Court of Appeal (Justices Bélanger, Rancourt and Moore) affirmed the principle that a court should limit itself to a prima facie assessment of whether or not a dispute comes within the scope of an arbitration clause. If it does, a court proceeding regarding the dispute should be stayed so that the arbitrator can rule on his or her own jurisdiction.
Continue reading “Québec – Light touch to determining arbitration clause application (except to the non-signatory, maybe!) – #638”
In Black & McDonald v. Eiffage Innovative Canada Inc., 2022 ONSC 1855, Justice Dow was faced with two motions: (1) the defendants’ motion to stay the Ontario action on the basis of forum non conveniens; and (2) the plaintiff’s motion to “compel” the defendants to participate in arbitration as a result of an arbitration clause contained in the relevant contract. Justice Dow granted the stay on the ground that British Columbia was the proper forum, but declined to “compel” the defendants to participate in arbitration. He found that whether the arbitrator had jurisdiction over the dispute was to be determined by the arbitrator at first instance and that any failure on the part of the defendants to participate in an arbitration would have consequences for them in that proceeding.
Continue reading “Ontario – Motion to “compel” participation in arbitration dismissed, despite arbitration clause – #635”
In Goel v Dhaliwal, 2021 BCSC 2382, Justice MacDonald dismissed as premature a motion to lift a stay of court proceedings in favour of arbitration for the limited purpose of allowing the plaintiffs to file an amended Statement of Claim with respect to claims against a defendant who was not a party to the arbitration. The parties did not agree on whether these claims were new or not. The arbitration had not yet concluded and the proposed amendments appeared to raise issues that overlapped with those which were before the arbitrator. Justice MacDonald found that the extent of the overlap, if any, would be clearer after the arbitration was concluded. In addition, the plaintiffs had also brought an application for judicial review of a Partial Final Award issued by the arbitrator which had not yet been disposed of. Justice MacDonald found that it was not clear whether the plaintiffs would pursue the amendments if they were successful on the judicial review application.
Continue reading “B.C. – Claims against non-party to arbitration agreement stayed with claims against parties – #581”
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.
Continue reading “Québec – Enforcement of foreign award against alter egos – #578”
In Vale Canada Limited v. Solway Investment Group Limited et al, 2021 ONSC 7562, Justice Koehnen considered, in the context of a motion to amend a Statement of Claim, the impact of a tolling agreement made in respect of claims made in arbitrations that had been commenced and concluded five years previous. In a decision that canvasses the law on the interaction of motions to strike and motions to amend, Justice Koehnen ultimately permitted the amendments, without prejudice to the defendants to plead a limitation defence and to bring a motion to strike.
Continue reading “Ontario – tolling agreement from arbitration overcomes limitation defence at pleadings amendment stage – #574”
In Mullen v Nakisa inc., 2021 QCCS 4388, Justice Granosik granted applications to stay an arbitration as against parties who were added as cross-respondents, even though they were not parties to the arbitration agreement, pending judicial review of the arbitrator’s decision to add them. Justice Granosik was concerned that the applicants could be deprived of their right to have a matter determined by a court, and even risked having the arbitration take place in their absence.
Continue reading “Québec – Stay of arbitrator’s decision to add third parties, force them to meet timetable, and refusal to hear them without payment – #553”
In 10053686 Canada inc. v. Tang, 2021 QCCS 3467, Justice Geeta Narang declined jurisdiction with respect to a dispute arising out of a Franchise Agreement. Plaintiffs were the franchisees and a director of a franchisee. Defendants were directors and shareholders of the franchisor. Justice Narang referred the case to private arbitration following Defendants’ demand for declinatory exception because the Franchise Agreement contained an arbitration clause. Justice Narang first concluded that the arbitration agreement was a “complete undertaking to arbitrate”, in conformity with the Supreme Court of Canada decision in Zodiak International v. Polish People Republic, [1983] 1 S.C.R. 529. She concluded that all allegations in the Plaintiffs’ claim were related to the franchisor-franchisee relationship and covered by the arbitration agreement. Secondly, she recognized the Legislator’s intention to favor a private dispute resolution mechanism over the public justice system whenever the parties have expressed the intention to resolve their dispute out of court. Thirdly, she granted Defendants’ demand for a declinatory exception, even though all Defendants and one of the Plaintiffs were non-signatories to the arbitration agreement. In interpreting the arbitration agreement liberally, she concluded that in this context ignoring the arbitration agreement because the Defendants were not parties to the arbitration agreement would be to rely upon a “blind technicality”.
Continue reading “Québec – Court favors arbitration even for related, but non-signatory, parties – #541”