Still seized of the appointment process following his earlier decision to refer the parties to arbitration, Mr. Justice Jonathan Dawe in King Valley Estates Inc. v. Wong et al., 2020 ONSC 3950 accepted to grant Defendants’ application to appoint a candidate initially proposed, but now resisted, by Plaintiff. Despite months of opportunity and diligent efforts by Defendants, the parties returned before Dawe J. each proposing that the other’s candidate be named. Both candidates were “eminently qualified”, acceptable to both parties and not under “any disqualifying conflict”. Due to advantages perceived by Plaintiff’s candidate’s lower rate and cap on fees, Dawe J. expressed readiness to appoint that candidate at Defendants’ request subject to (i) re-confirmation of his interest and (ii) a schedule acceptable to Defendants.
Continue reading “Ontario – each party argues to have the other party’s candidate appointed arbitrator instead of their own – #345”Supreme Court – courts should not refer jurisdiction challenge to arbitrator if real prospect that challenge might never be resolved – #344
In Uber Technologies Inc. v. Heller, 2020 SCC 16, the Supreme Court of Canada introduced a third exception to its general rule that jurisdiction challenges should be referred first to the arbitrator. The exception contemplates scenarios in which validity of the arbitration agreement might not be determined if arbitration is too costly or inaccessible due to costs, distance or even a choice of law clause circumventing mandatory local policy. Staying an action in favour of arbitration would deny relief for claims made under the agreement and insulate disputes from resolution. The Court also asserted that unconscionability involves both inequality and improvidence but does not require intention. The Court further confirmed that employment disputes are not “commercial” for the purpose of the International Commercial Arbitration Act, RSO 1990, c I.9.
Continue reading “Supreme Court – courts should not refer jurisdiction challenge to arbitrator if real prospect that challenge might never be resolved – #344”Ontario – Appeal Court questions why arbitrate under a statute if statute does not apply to both parties – #341
In Travelers Insurance Company of Canada v. CAA Insurance Company, 2020 ONCA 382, Ontario’s Court of Appeal set aside an award which issued following a statutory arbitration because the Ontario statute did not apply to the defendant. The Court questioned how did Ontario statutory accident benefits for a Nunavut accident come to be arbitrated under Ontario’s Insurance Act, RSO 1990, c I.8 if that legislation’s priority rules only apply if both insurers are subject to those rules. The Court identified as a “serious” error the arbitrator’s determination that the Insurance Act applied to the defendant insurer. Despite that error, the Court is silent on (i) how/when parties can consent by contract to submit to statutory arbitration under a statute which does not apply to one of them and (ii) why apply the standard of review applicable to statutory arbitrations, recently restated in Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, to an appeal from a consensual arbitration.
Continue reading “Ontario – Appeal Court questions why arbitrate under a statute if statute does not apply to both parties – #341”Ontario – oppression remedy grants party control of dispute resolution covered by funding agreement – #336
In 1515474 Ontario Inc. v. Soocellus Ontario Inc., 2020 ONSC 270, Ontario’s Divisional Court upheld an order granting a shareholder control of the conduct of ongoing dispute resolution. Post-sale of G’s shares in F Co., G retained non-voting shares in F Co. with a right to receive net proceeds in F Co.’s litigation so long as G provided litigation funding and met other financial terms. F Co.’s eventual decisions to reduce activity in the litigation, to seek an end to it and to mediate so as to “accept the best reasonable offer we are able to negotiate” combined to qualify as oppression justifying the grant of litigation control. The order sought to rectify for breach of G’s reasonable expectations created by the sale of G’s shares in a company engaged in litigation but, unlike other oppression remedies, limited the grant of control to the conduct of litigation and not overall operations of F Co.
Continue reading “Ontario – oppression remedy grants party control of dispute resolution covered by funding agreement – #336”Ontario – securities commission exempts filer from filing even redacted copies of litigation funding agreements – #335
In Stans Energy Corp. (Re), 2019 CanLII 36437 (ON SEC), the Ontario Securities Commission granted an exemption to a filer from filing two (2) litigation funding agreements despite the documents qualifying as material contracts under Ontario’s 51-102 – Continuous Disclosure Obligations. To issue the exemption, the Securities Commission relied on (i) prior disclosure of key information, (ii) privilege and confidentiality issues which would be violated if further disclosure was made as well as (iii) not compromising the filer’s relationship with the funders.
Continue reading “Ontario – securities commission exempts filer from filing even redacted copies of litigation funding agreements – #335”Ontario – settlement rescinded based on innocent misrepresentation of material fact unknown to Defendant – #332
In Deschenes v. Lalonde, 2020 ONCA 304, Ontario’s Court of Appeal upheld rescission of a settlement on the basis of Defendant’s innocent misrepresentation regarding a fact material to Plaintiff’s decision to settle. Defendant’s actual or constructive knowledge that the representation was false was unnecessary. The Court distinguished rescission based on innocent misrepresentation from rescission based on unilateral mistake. Despite the strong presumption favouring finality of settlements, the Court reiterated that the ways to “upset” a settlement are the same as those applicable to other contracts, including fraud, misrepresentation, duress, undue influence, unconscionability, or mutual or unilateral mistake.
Continue reading “Ontario – settlement rescinded based on innocent misrepresentation of material fact unknown to Defendant – #332”Ontario – parties’ signature of arbitrator’s terms does not overwrite appeal process in original agreement – #331
In 547131 Ontario Limited v. MPI Torgan, 2020 ONSC 3186, Madam Justice Carole J. Brown disagreed that terms submitted by the arbitrator and signed by the parties overwrote the parties’ initial agreement in their main contract regarding appeals of any arbitral award. The arbitrator’s terms covered conflicts, compensation, the services of an arbitral secretary, cancellation policy, confidentiality, immunity and administration issues. Brown J. identified no indicia that the arbitrator’s terms altered the initial agreement that the award would be “final and binding” and not subject to appeal, even on a question of law with leave of the court.
Continue reading “Ontario – parties’ signature of arbitrator’s terms does not overwrite appeal process in original agreement – #331”Ontario – consent order prompts agreement to arbitrate to complete it and fresh litigation over vague term – #326
In Lokhandwala v. Khan et. al., 2020 ONSC 3209, Mr. Justice William M. LeMay determined that an offer received for a property qualified as “reasonable” according to a consent order agreed to by the parties in an earlier hearing. That consent order also included an agreement to arbitrate, if need be, the choice of real estate agent to list the property. LeMay J.’s reasons illustrate the care needed by parties to disputes when drafting terms to resolve their disputes so that today’s resolution does not inadvertently sow seeds for future, new disputes. The reasons also include helpful references to case law on judicial notice and the pandemic.
Continue reading “Ontario – consent order prompts agreement to arbitrate to complete it and fresh litigation over vague term – #326”Ontario – applicant seeking court appointment of arbitrator ordered to pay security for costs – #323
In Rayman Tiger Inc. v. Unger Tiger Inc., 2020 ONSC 691, Master Michael P. McGraw ordered that an arbitral party, applying for the appointment of an arbitrator, file security for costs related to its application. Having insufficient assets in Ontario or any reciprocating jurisdiction, the party had to post security in order to engage the court’s assistance for its arbitration. In ordering $15,000.00 rather than the $37,714.01 sought by respondents, Master McGraw distinguished the complexity of issues and facts of the eventual arbitration from those raised by the narrower application to appoint an arbitrator.
Continue reading “Ontario – applicant seeking court appointment of arbitrator ordered to pay security for costs – #323”Ontario – adequate reasons serve to justify/explain result so losing party knows why it lost – #320
In Wawanesa Mutual Insurance Company v. Renwick, 2020 ONSC 2226, Ontario’s Divisional Court determined that inadequate reasons fell short of their “very important purpose”, namely that “they justify and explain the result so that the losing party knows why they have lost and interested members of the public can satisfy themselves that justice has been done”. The Court prioritized that purpose, listing it ahead of the more oft-cited purpose of allowing for meaningful review by a court. Though not all parties prevail in their dispute resolution, they are entitled to know that their evidence and arguments were considered and why they did not prevail. As the Divisional Court added, “[h]owever, this does not mean that the decision maker must refer to every bit of evidence or argument before him. To be adequate, reasons do not have to be long or perfect”.
Continue reading “Ontario – adequate reasons serve to justify/explain result so losing party knows why it lost – #320”