B.C. – court adjourns its assistance to issue subpoenas approved in international commercial arbitration – #416

Despite having “no difficulty accepting” the arbitrator’s conclusion that non-party witnesses had testimony “relevant to the issues in the Arbitration and material to its outcome”, Mr. Justice Gordon C. Weatherill in Octaform Inc. v Leung, 2021 BCSC 73 opted to adjourn an arbitral party’s applications to issue subpoenas in assistance of an arbitration conducted under the International Commercial Arbitration Act, RSBC 1996, c 233.  Weatherill J. did affirm that arbitrations are “autonomous, self-contained, self-sufficient processes”, did acknowledge that “[i]t is the task of the Arbitrator to determine the truth” and did note that the arbitrator had not varied his initial approval of the subpoenas request after having participated in fourteen (14) days of hearing. Nonetheless, Weatherill J. considered the applications “premature”.  He commented on whether one witness had been duly contacted and recorded that the other witness had set conditions on potentially attending. The witnesses did have over three (3) months between service of the October 9, 2020 applications and the January 14, 2021 hearing at which the witnesses were represented and could have addressed any concerns about willingness to participate. Weatherill J. still opted to see whether either witness in the future “unreasonably refuses to provide written evidence in chief and attend the hearing of the Arbitration for viva voce examination in chief, cross-examination and re-examination”. At that future time he advised “I will consider issuing the requested subpoenas”.

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Québec – no legal principle to support applying competence-competence for mediation – #415

In a proposed class action involving claims under an insurance policy for indemnification for business interruption due to COVID-19 measures, Mr. Justice Gary D.D. Morrison in 9369-1426 Québec inc. (Restaurant Bâton Rouge) v. Allianz Global Risks US Insurance Company, 2021 QCCS 47 referred the parties to mediation and arbitration and dismissed the application for authorization.  While Québec law did not state that parties to an insurance contract can submit their disputes to arbitration, it also does not stipulate that they cannot.  The Code of Civil Procedure, CQLR c C-25.01’s class action provisions are procedural and do not modify substantive law or create jurisdiction for the courts over disputes which parties have lawfully excluded. Having relied in part on proportionality to refer the parties, Morrison J. declined to comment on whether his order would “require each individual insured to proceed by way of the lengthy and costly dispute resolution process, which may discourage many from exercising their rights”.  Morrison J. also held that competence-competence does not arise in referral to mediation “as there exists no legal principle in support of such an approach”.

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Ontario – raising arbitration in defence helps demonstrate defendant did not waive arbitration – #414

In Elgin Mills v. Farhanian, 2020 ONSC 6435, Master Karen E. Jolley granted an application for a stay, holding that a defendant does not attorn to the court process by filing a defence wherein it specifically raises the arbitration provision.  Master Jolley followed the precedent set by ABN Ambro Bank Canada v. Krupp Mak Maschihnenbau GmbH, 1996 CanLII 12449 (ON SCDC) which held that reference to arbitration in a defence may be treated as a request to arbitrate, « were one needed« .  She further held that defendant’s delayed application for a stay, coupled with light activity in the litigation, did not justify refusing stay and that the work in the litigation could be repurposed for an arbitration.

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Québec – sequential arbitrations without exclusion of courts renders clause invalid in real rights litigation – #413

Distinguishing between actions involving personal and real rights, Mr. Justice Martin Castonguay in Specter Aviation v. Laprade, 2020 QCCS 4392 held that article 3148 para. 2 of the Civil Code of Québec, CQLR c CCQ-1991 did not apply to deny the court’s jurisdiction when a party invoked an agreement to arbitrate.  Rather, article 622 of Code of Civil Procedure, CQLR c C-25.01 governed when the dispute involved ownership of an aircraft and it required him to consider whether the parties had negotiated a binding, mandatory agreement to arbitrate.  Castonguay J. determined that the parties’ agreement to arbitrate was ambiguous and invalid, including a mention of two (2) sequential arbitrations and lacking an express exclusion of the courts if the parties did undertake arbitration.

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Alberta – court rules permitting appeal of Master’s stay decision consistent with section 7(6) of Arbitration Act – #412

In Agrium, Inc v. Colt Engineering Corporation, 2020 ABQB 807, Madam Justice Nancy Dilts held that unsuccessful applicants could appeal to a justice of the court a Master’s decision refusing a stay under section 7(1) of the Arbitration Act, RSA 2000, c A-43.  The legislated right of appeal from a Master’s decision under the Alberta Rules of Court, Alta Reg 124/2010  does not contradict the policy decisions underlying the Arbitration Act. The Court of Queen’s Bench Act, RSA 2000, c C-31creates layers of decision making authority” and section 7(6) did not intend to render Master’s decisions on stay applications “unappealable”.  Section 7(6) should “not be read in a manner that would be inconsistent with that legislated right”. Having jurisdiction to hear the appeal, Dilts J. held that she retained jurisdiction under section 7(1) to consider waiver and attornment notwithstanding expiry of a limitation period in which to commence arbitration.

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