Québec Archives - Arbitration Matters

July 3, 2025July 4, 2025

Québec – Court annuls award for failure to respect appointment procedure in arbitration clause. – #912

In Medicell Pharmaceutical (S) Pte Ltd v. Pharmascience Inc. 2025 QCCS 1325, the Court annulled an interim arbitral award issued ex parte, holding that the arbitrator had not been validly appointed under the parties’ agreement, which provided that the arbitration was to be administered by and conducted by one arbitrator in accordance with the rules of the Québec Code of Civil Procedure (“CCP”). In setting aside the award, the Court emphasized that arbitration is consent-based and that a party cannot unilaterally appoint an arbitrator, even in urgent circumstances and even when the parties’ arbitration agreement allows for provisional measures. Crucially, the Court held that Applicant, which sought the annulment of the interim award, had not waived compliance with the agreed appointment procedure – its silence and engagement, albeit limited, did not amount to tacit acceptance of the arbitrator’s appointment.

May 9, 2025May 12, 2025

Québec – Court declines to set aside on grounds of infra petita. – #906

In EDT GCV Civil c Société de transport de Montréal, 2025 QCCS 256,the Court dismissed an application to set aside a domestic arbitral award based, among other grounds, on a refusal to exercise jurisdiction. Plaintiff, EDT GCV Civil (“EDT”), contended, among other things, that the arbitral tribunal refused to exercise jurisdiction over certain claims and that this constituted jurisdictional error based on the doctrine of infra petita described especially in international commercial arbitration. In its judgment, the Court regrettably declined to comment on whether this doctrine may apply under Québec law as a ground to set aside a domestic arbitral award.

May 9, 2025May 9, 2025

Québec – Clarification on territorial jurisdiction versus arbitral seat under C.C.P. – #904

In BE Franchise inc. v. 9415-1511 Québec inc., 2024 QCCA 1498, the Court of Appeal dismissed the Appellant’s appeal. It confirmed the Superior Court’s ruling that the court’s territorial jurisdiction was the Respondent’s domicile, unless the parties agree otherwise, according to the general territorial jurisdiction’s rules of the Code of Civil Procedure (sec. 41 to 48 C.C.P.) The Court also confirmed that the general territorial jurisdiction rules apply to arbitrations because of the absence of a district designation by the Parties and of the absence an agreement between the Parties or an arbitration rule that would give the arbitrator the jurisdiction to fix the place of arbitration and therefore the Court competent district. The Court also ruled that in Québec, the place where the arbitration award is made cannot be deemed to be the place of arbitration because of the language used in article 642 C.C.P., which is different from the language used in article 31(3) of the Model Law. Therefore, on this issue, Quebec law is different from the Model Law. In the present case, the Court of Appeal ruled that no facts showed that the place of arbitration was the same as the place where the award was rendered.

March 7, 2025March 7, 2025

Québec – Filing an action is not a waiver to arbitrate by Plaintiffs – #900

In Gauvin v. SBYC1935 Inc., 2025 QCCS 11, the Court granted an application by the Plaintiffs to have their own action stayed and referred to arbitration. The Defendant contested the application, arguing waiver of arbitration and tardiness in the filing of the application to stay, as the statutorily prescribed deadline to seek a stay was well past. The Defendant also argued the application was dilatory and an abuse of process by the Plaintiffs. The Court found that there was insufficient evidence of waiver and, noting that the deadline to seek a stay is not strict, it exercised its discretion to relieve the Plaintiffs’ delay.

November 22, 2024November 20, 2024

Québec – Peace River not considered where referral to arbitration sought under LACC/CCAA – #877

In 9327-6269 Québec inc. and Banque de Montréal, 2024 QCCS 3399, the Court dismissed the Creditor Applicants’ demand to lift the stay of proceedings under the Loi sur les arrangements avec les créanciers des compagnies (LACC)/ Companies’ Creditors Arrangement Act (CCAA) so that they could file proceedings against one of the Debtors (Laboratoires C.O.P. inc.) in a New York-seated arbitration, where they sought to be declared owners of potential tax credits and refunds to which they alleged they were entitled as part of the selling price under a Sale Purchase Agreement between the Applicants and the Debtors’ shareholders. The Sale Purchase Agreement contained an arbitration clause. The Applicants argued that under New York law the Sale Purchase Agreement created a constructive trust in their favour, as a result of which the tax credits and refunds received or to be received by the Debtor were never included in the Debtor’s assets. Therefore, the Applicants argued that they should not be subject to the CCAA. The Court dismissed the Applicants’ motion. Even if the Applicants obtained a favourable ruling from the arbitration tribunal, it would be ineffective because the constructive trust concept is not recognized under Québec law and it would be detrimental to other creditors of the Debtor. In any event, the arbitral award would not modify the distribution order of the Debtors’ assets to their creditors under the CCAA because, when a conflict of law arises, the CCAA’s application is governed by the lex fori, in this case Québec. Foreign law should not alter the outcome of the CCAA’s implementation due to its rehabilitative purpose. Therefore, lifting the stay would not help the Applicants and would only cause the CCAA procedure to be delayed.

October 25, 2024October 18, 2024

Québec – Award that violates municipal by-law does not offend public policy – #871

In Bélanger c Beauchamp, 2024 QCCS 3118, the Court homologated several awards rendered in the context of a dispute between two co-owners of an undivided property concerning the location and size of their parking spaces. The Defendant contested the homologation of one of the awards based on public policy grounds, alleging that the award violated a municipal by-law. The Court ruled that any violation of the municipal by-law that would result from the award did not amount to a public policy violation that justified refusing homologation, because it would not be a violation that offends the fundamental values underlying Québec public policy. The Court also decided that an award rejecting one of the parties’ applications for recusal of the arbitrator did not constitute an award within the meaning of the Québec Code of Civil Procedure (“CCP”), and so could not be homologated. This latter issue is not addressed in this case note.

September 25, 2024September 27, 2024

Québec – Parties May Agree Upon an Arbitral Appeal Mechanism – #864

In McLaren Automotive Incorporated c. 9727272 Canada Inc (unreported, rendered on August 2, 2024 in File no. 540-17-015649-328), the Superior Court of Quebec confirmed that parties may agree upon an arbitral appeal mechanism, despite article 648 of the Code of Civil Procedure (“CCP”), which states the only recourse against a final award is homologation or annulment. In this case, an arbitration appeal panel appointed by the parties overturned the decision of the arbitrator, in which he denied having jurisdiction over the dispute. The Claimant then applied to the Superior Court of Quebec, requesting the homologation of the arbitrator’s decision and the annulment of the appeal panel’s decision. In this first decision addressing the validity of an arbitral appeal process, the Court confirmed the validity and jurisdiction of the appeal panel and concluded that the existence and the decision of the appeal panel was valid, considering both the relevant articles of the CCP and the UNCITRAL Model Law on International Commercial Arbitration (the “Model Law”).

September 9, 2024September 9, 2024

Québec – First consideration of test for stay application for annulment application – #860

In ADRAQ (CSD) Laurentides c. Hamelin, 2024 QCCS 2324, the Court dismissed a motion brought pursuant to section 648 CCP to stay an application for annulment of an award to give the arbitrator the opportunity to correct it to eliminate the grounds for annulment. This is the first case to consider section 648 CCP. The Court developed the list of factors to be considered on such a motion. It also ruled that it has broad discretion in deciding a motion for a stay under section 648. In light of the preceding, the Court ruled that the judge deciding the merits of the application for annulment should decide the stay motion. That judge would have a better understanding of the case to determine whether a stay is appropriate considering the allegations, including alleged bias against the arbitrator, which the Court found were serious, and the respondent’s denial of the very existence of any grounds for annulment, leaving no place at this stage, for the arbitrator to correct his award. Therefore, the Court dismissed the respondent’s demand to stay the application for annulment.

August 30, 2024August 30, 2024

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.

August 28, 2024September 3, 2024

Québec – Court finds separate arbitration agreement, despite arbitration clause in contract – #857

In Roxboro Excavation Inc. v. Delsan-AIM Environmental Services Inc., 2024 QCCS 2331 the Court declined to hear a dispute between the Applicant, Roxboro Excavation Inc. (“Roxboro”), and the Defendant, Les Services environnementales Delsan-A.I.M. Inc. (“Delsan”), on the grounds that it lacked jurisdiction because the parties had agreed to submit the matter to arbitration. Even though the subject contract included an arbitration clause, the Court did not interpret the clause or otherwise consider whether that clause required the parties to arbitrate the disputes. The Court instead focussed its analysis and decision on a separate agreement the parties had negotiated to resolve their disputes by arbitration and not in court.