Stay/Declinatory Exception Archives - Page 6 of 9

September 7, 2022September 12, 2022

Québec – Stay of homologation application where parties disagreed on award’s meaning – #656

In Syndicate of co-owners of Quartier Urbain 3 v Habitations Bellagio Inc, 2022 BCCS 2445, the Applicant sought the homologation of an arbitral award dated October 28, 2021, which ordered the Respondent to carry out certain corrective work on the Applicant’s residential building. The parties disagreed upon the meaning of the award. Therefore, Justice Lussier stayed the homologation application for a short time to allow the parties to return to the Arbitrator to try to reach agreement on the meaning of the award. Because the Arbitrator was functus officio (presumably because the parties were too late to seek an interpretation of the award from the Arbitrator), she was not to participate in the meeting as arbitrator.

August 15, 2022August 15, 2022

Québec – Parallel proceedings insufficient to justify disregard of arbitration agreement – #651

In Travelers Insurance Company of Canada v Greyhound Canada Transportation, 2022 QCCQ 4746, Justice Davignon declined jurisdiction over part of a dispute – the Plaintiffs sued the Defendants for recovery of damages as a result of an explosion on their property; in a separate action, one Defendant sued the other to recover any damages it might be required to pay to the Plaintiffs, relying upon a warranty provision in the Defendants’ agreement (to which the Plaintiffs were not parties). That agreement contained both a forum selection and arbitration clause. Justice Davignon declined jurisdiction over the warranty claim. He was unmoved by the fact that this would result in the dispute being debated in two different forums – the court, in respect of the principal action, and arbitration, as to the warranty claim – and gave full effect to the arbitration clause in the agreement between the Defendants.

August 11, 2022August 11, 2022

Ontario – Stay Granted where Competing Arguable Interpretations of Scope of Arbitration Agreement – #648

In Biancucci v Buttarazzi, 2022 ONSC 4054, Justice Myers followed the analytical framework for a stay application under s. 7 of the Arbitration Act, 1991, S.O. 1991, c. 17 (the “Act”) as set out in Haas v. Gunasekaram, 2016 ONCA 744. The arbitration agreement at issue was contained in a settlement agreement, and interconnected litigation and arbitration taking place over a decade made analysis of the scope of the arbitration agreement complex. Ultimately, Justice Myers confirmed that there were competing arguable interpretations of scope and granted the stay, leaving jurisdiction to be ultimately determined by the arbitral panel.

July 29, 2022August 2, 2022

Ontario: Stay ordered as promissory note captured by separate arbitration agreement – #643

In Pioneer Cannabis Corp. v. 2715615 Ontario Inc., 2022 ONSC 3998, the Plaintiff’s action was stayed pursuant to s. 7(1) of Ontario’s Arbitration Act, 1991 (the “Act “) and the parties’ arbitration agreement found in their “Master Cannabis Agreement” (the “MCA”). The Plaintiff Pioneer Cannabis Corp (“Pioneer”) commenced an action alleging that the Defendants 2715615 Ontario Inc and Mr. Sangha owed money pursuant to a promissory note. The parties had entered into a number of agreements relating to cannabis retail consulting and brand licensing services including the MCA, a Retail Services Authorization Agreement (the “RSAA”), and a promissory note. On its motion to stay, the Defendants argued that the Plaintiff’s claim fell within the arbitration clause in the MCA. The Plaintiff, however, argued since its claim wass based solely on the promissory note, which should be viewed as a standalone instrument, it fell outside the scope of the arbitration clause. Associate Justice Robinson disagreed with Pioneer, found the arbitration agreement covered the promissory note, and granted the stay. As outlined below, in reaching his conclusion, Associate Justice Robinson applied the five-part test established by the Court of Appeal for Ontario in Haas v Gunasekaram, 2016 ONCA 744 (“Haas”)at paragraph 17 to determine whether an action should be stayed in favour of arbitration (the “Haas Test”).

July 21, 2022July 25, 2022

Ontario – Arbitration clause not consideration; provides only detriment to contracting party – #641

In Goberdhan v Knights of Columbus, 2022 ONSC 3788, Justice Harris dismissed the Defendant’s motion to stay the Plaintiff’s wrongful dismissal action in favour of arbitration. The parties signed three employment contracts over a period of 8 years; the last two each contained a mandatory arbitration clause. The Plaintiff argued that there was no consideration for the second and third contracts, so he was entitled to sue. The Defendant argued that the arbitration clause itself was consideration and that a stay should be ordered because it was “arguable” that the dispute fell within the terms of the arbitration agreement. Justice Harris rejected the Defendant’s argument. He found that the last two contracts lacked consideration because there was no benefit flowing to the Plaintiff; essentially, he gave up his right to sue, which was a detriment, and gave him nothing in return. Therefore, because the main contract failed for lack of consideration, so too did the arbitration clause.

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.

July 18, 2022July 18, 2022

Québec – Light touch to determining arbitration clause application (except to the non-signatory, maybe!) – #638

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.

July 5, 2022July 14, 2022

British Columbia – Effect of consent orders staying proceedings in favour of arbitration – #636

Williams v. Audible Inc., 2022 BCSC 834 (“Audible”) is the second of two decisions by Justice Horsman extending stays of proceedings in favour of arbitration under s. 15 of the former Arbitration Act, R.S.B.C. 1996, c. 55 in the context of class proceedings. The first, Williams v. Amazon.com Inc., 2020 BCSC 300 (the “Amazon Stay Decision”), concerned a separate class proceeding, brought by the same representative plaintiffs as in Audible, alleging similar causes of action, but against Amazon. That decision is under appeal. In this case, Justice Horsman granted the stay sought by Audible. Following the principles in Seidel v TELUS Communications Inc., 2011 SCC 15, the parties agreed to a consent stay of proceedings in favour of arbitration in respect of the plaintiff’s non-consumer protection legislation claims because of the arbitration clause in the relevant contracts. On this application, Justice Horsman found that, because the representative plaintiffs’ non-consumer claims were stayed by virtue of a consent order, there was no proceeding in which to advance the claims of the other possible class members, whose claims related to a period of time when Audible’s contracts did not contain arbitration clause. Therefore, she granted an extension of the stay of those proceedings to cover those claims too.

July 5, 2022July 5, 2022

Ontario – Motion to “compel” participation in arbitration dismissed, despite arbitration clause – #635

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.

June 21, 2022June 17, 2022

Ontario – No stay despite broad arbitration clause – #629

In FNF Enterprises Inc. v. Wag and Train Inc., 2022 ONSC 2813,Justice Ramsay dismissed the Defendant’s motion for a stay of proceedings under section 7 of the Ontario Arbitration Act, 1991, S.O. 1991, c. 17. The Defendant sought a stay of proceedings based on an arbitration clause included in a lease agreement. Justice Ramsay concluded that, standing alone, the arbitration clause suggested that issues arising out of the lease agreement shall be determined by way of arbitration, but he decided that, interpreting the lease agreement as a whole, the arbitration clause did not extend to an issue concerning collection of unpaid rent, which could be sought by action. Therefore, Justice Ramsay declined to stay the proceedings.