Québec Archives - Page 7 of 19 - Arbitration Matters

January 27, 2022May 4, 2022

Québec – Arbitration 101: parallel proceedings, multiple arbitration clauses, competence-competence, arbitrability, separability, waiver – #577

In Specter Aviation v Laprade, 2021 QCCA 1811, the Court of Appeal faced circumstances in which both the court and an arbitral tribunal found that they had jurisdiction over the parties’ dispute. The applicant/appellant Specter and related corporation third-party/appellant United Mining Supply appealed the order of Justice Castonguay, who dismissed their request to stay the defendants’/respondents’ defence and counterclaim for lack of jurisdiction on the basis of an arbitration clause in one of the parties’ agreements. At about the same time, an arbitral tribunal ruled that it had jurisdiction over the parties’ dispute. Justice Sansfaçon, for the Court of Appeal, granted the appeal and stayed the counterclaim pending determination of the parties’ dispute by arbitration.

December 9, 2021May 4, 2022

Québec – partial award may determine scope of arbitration agreement for final award – #563

In Maïo v Lambert, 2021 QCCS 3884, Justice Castonguay denied an application to annul in part and modify a final award. He found that the arbitrator did not exceed the scope of his mandate, including in how he ruled on matters that had been circumscribed in a prior partial award, and that the applicant was essentially seeking an improper review of the merits of the dispute.

November 19, 2021May 4, 2022

Québec – Judicial immunity precludes compelled evidence on bias challenge; application to arbitrators? – #554

In Credit Transit Inc. v. Chartrand, 2021 QCCS 4329, Justice Lussier of the Québec Superior Court quashed a summons served upon a judge, which purported to compel him to give evidence in relation to an application to disqualify him as the appointed case management judge on grounds of alleged bias. The Court held that judicial immunity, which safeguards judicial independence, also protects judges from being compelled as witnesses in relation to the exercise of their judicial functions.

November 12, 2021May 4, 2022

Québec – Stay of arbitrator’s decision to add third parties, force them to meet timetable, and refusal to hear them without payment – #553

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.

November 9, 2021May 4, 2022

Québec – Arbitration clause interpreted liberally; ambiguity resolved using regular contract interpretation principles – #551

In 9369-1426 Québec Inc. DBA Restaurant Bâton Rouge v. Allianz Global Risks US Insurance Company, 2021 QCCA 1594, the parties disagreed about whether the plaintiff could bring a class action to resolve a coverage dispute or whether the dispute was required to go to arbitration. The policy contained both a stepped arbitration clause and a clause that said that the courts in the Court District in which the insured was located shall have exclusive jurisdiction in case of a coverage dispute. The Québec Court of Appeal confirmed that arbitration clauses should be interpreted in a large and liberal manner. If there is ambiguity, the usual principles of contractual interpretation apply without regard to any presumption that ambiguities are to be resolved to preserve a plaintiff’s right to resort to courts. The court found that the proper interpretation of the policy required coverage disputes to be arbitrated.

October 27, 2021May 4, 2022

Québec – No referral to arbitration; arbitration clauses intended to “subvert” litigation process – #547

In Sigounis c. Sigounis, 2021 QCCS 4185, as part of his ruling addressing several interim applications, Justice Pinsonnault refused to refer the parties to arbitration in a drawn-out family dispute. The underlying oppression remedy action was commenced by the Plaintiff Jimmy Sigounis against his father, Defendant Nicolas Sigounis, and sister, Defendant Argyro Sigounis (“Argyro”), regarding the family’s interests in various private corporations (the “Chenoy Corporations”). While the action was ongoing, the father sold his interests in the Chenoy Corporations to co-Defendant Argyro (the “Transaction”). Thereafter, the father passed away and his widow (the Plaintiff’s, mother Eleni Sigounis), who had previously not been involved in the action, took over as “Defendant in Continuance of Suit” in her capacity as the estate’s liquidator and universal legatee. The Plaintiff and his mother then learned of the Transaction, which they both viewed as prejudicial to their interests; including that the Transaction potentially left the estate insolvent. Accordingly, the mother made several filings with the Court, including a Cross-Application and a Declaration of Intervention against Argyro (the “Filings”), seeking the cancellation of the Transaction. In response, Argyro brought the subject interim applications, including an application to refer all matters raised in the Filings to arbitration pursuant to the identical arbitration clauses in the Transaction agreements. In rejecting Argyro’s application, Justice Pinsonnault found that the dispute, as a whole, fell within one of the exceptions in the arbitration clauses as “a severe dispute over family matters” thus rendering the dispute outside the scope of the arbitration clauses in the Transaction agreements. In addition, Justice Pinsonnault took issue with the timing of the Transaction, which took place over two years after the action was commenced, and the Defendants’ intentions of subverting the litigation process by including the arbitration clauses in the event that the Transaction was contested.

October 25, 2021May 4, 2022

Québec – Consideration of scope and applicability of arbitration clause – #545

In Dr. Catherine Morin-Houde Dentist Inc. v. Dr. Marie-Ève Costisella Inc., 2021 QCCS 4109, Justice Faullem of the Québec Superior Court reviewed the applicability of an arbitration clause and in doing so set out a number of principles relevant to an understanding of the scope of arbitration clauses and the assessment of arbitral jurisdiction.

October 13, 2021May 4, 2022

Québec – Court favors arbitration even for related, but non-signatory, parties – #541

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”.

September 14, 2021May 4, 2022

Québec – Arbitration clause cannot be avoided by bringing a class action – #531

In Centre de santé dentaire Gendron Delisle inc. c. La Personnelle, Assurances générales inc., 2021 QCCS 3463, Justice Davis reaffirmed that a valid arbitration clause will be enforced and cannot be avoided by the Plaintiff bringing a class action. In this matter, the Plaintiff sought authorization to bring a class action against various insurance companies under various insurance policies and to be appointed as representative Plaintiff on behalf of dental clinics which claimed business interruption losses caused by the COVID-19 pandemic. Justice Davis dismissed the request for authorization on the basis that it did not meet the requirements of Article 575(2) of the Code of Civil Procedure. However, he said that had he granted authorization, those insured dental clinics covered by an insurance contract containing a valid arbitration clause would have been excluded from the group covered by the class action and referred to arbitration.

August 31, 2021May 4, 2022

Québec – confidentiality order denied in court proceedings; parties reminded of confidential arbitration as an alternative – #526

In Douville v St-Germain, 2021 QCCS 3374, Justice Daniel Urbas denied a Defendant’s application for a confidentiality order in a defamation action, but reminded the parties that they could submit their dispute to arbitration, which would afford them the protection sought. Justice Urbas found that the applicant failed to establish a serious risk to an important public interest, but that a further application could be made in due time to seek the protection of specific exhibits or information.