Ontario – expired limitation period pre-empts need to decide stay application

Ontario’s Court of Appeal in Glen Schnarr & Associates Inc. v. Vector (Georgetown) Limited, 2019 ONCA 1012 asserted jurisdiction to decide a claim’s viability rather than defer the decision to an arbitrator as mandated by section 7(1) of the Arbitration Act, 1991, SO 1991, c 17 and Dell Computer Corp. v. Union des consommateurs, 2007 SCC 34 (CanLII), [2007] 2 SCR 801. A court may pre-empt an arbitrator’s competence-competence to determine jurisdiction if it can decide that an applicable limitation period has expired.  This approach is presented as a second exception, independent to the “superficial consideration of the documentary evidence in the record” for questions of law or mixed fact and law. The approach addresses viability of claims and not the interplay of the arbitration agreement and the dispute. 

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Québec – plaintiff’s choice to pursue small claims despite arbitration delays dispute resolution

The Court of Québec in CMAT Marketing inc. v. Gars de Saucisses inc., 2019 QCCQ 7976 granted Defendant’s application to dismiss based on the parties’ agreement to arbitrate, a full year after CMAT Marketing inc. v. Gars de Saucisse inc., 2018 QCCQ 7514 referred the application to a hearing on the merits.  Despite the Court of Québec vigilant defence of access to justice initiatives in small claims division and despite the Court of Québec’s support of arbitration, their combined efforts resulted in delays uncommon in Court of Québec but occasioned by Plaintiff’s own decision to initiate court litigation and then resist referral to arbitration.

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B.C. – applicant claiming status as non-signatory party to arbitration clause fails to meet evidentiary burden

In AtriCure, Inc. v. Meng, 2020 BCSC 341, Mr. Justice Dennis K. Hori recognized the courts’ willingness to consider whether a litigant qualifies as a non-signatory party to an agreement to arbitrate but held that the applicant seeking the stay filed no evidence justifying such a status.  The case also documented a series of contracts signed between plaintiff and overseas corporations controlled by a single individual but for which plaintiff agreed to a variety of different substantive laws and dispute resolution processes.

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Ontario – court accommodates litigant in China impacted by coronavirus measures

In his January 24, 2020 reasons Paul Sun v. Duc-Tho Ma, 2020 ONSC 505, Mr. Justice Calum MacLeod accommodated a litigant whose ability to attend in court in Ontario was constrained by now-familiar government measures to control the coronavirus.  Those measures impacted travel and communication for the litigant located in China, obliging the litigant to participate by conference call to finalize the terms of a November 2019 trial decision.  Despite flexibility in accommodating for the coronavirus, Macleod J. declined to engage further in requests made for intervention. He emphasized the “very narrow” scope of his intervention due to an earlier Superior Court determination that other disputes between the parties were subject to exclusive resolution by arbitration in Taipei.

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B.C. – no need to give reasons when not departing from normal rule on costs

Though arbitrators should give reasons for departing from the “normal” costs rule, Madam Justice Lisa A. Warren in Goel v. Sangha, 2019 BCSC 1916 held that it does not follow that arbitrators must provide reasons for not departing from the normal rule.  Warren J. also held that an arbitrator cannot be faulted for following a process adopted by agreement of the parties and that, on appeal, absent further evidence, the court had no role in revisiting an arbitrator’s finding that such an agreement existed in fact.

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Ontario – summary judgment granted despite intersection with contract subject to arbitration

In P and A Holdings Inc. v. Kim, 2020 ONSC 546, Mr. Justice Paul R. Sweeny dismissed Defendant’s attempt to pause the litigation pending arbitration and, instead, granted summary judgment in Plaintiff’s favour.  Sweeny J. acknowledged that the promissory note, on which the court litigation was based, had been mentioned in a unanimous shareholders agreement which was subject to arbitration.  Despite that mention, (i) failure to pay on the note was not addressed as an obligation between the shareholders and (ii) the shareholders agreement provided no mechanism for recovery on the note.

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Québec – award homologated but interest rate in contract not added as award omitted mention

In BMLEX Avocats inc. v. Sahabdool, 2019 QCCQ 3552, Mr. Justice Luc Huppé agreed to homologate (recognize and enforce) an arbitral award but declined to modify the terms of the interest owing on the amount because the arbitral award did not mention it.  In the same decision, Huppé J. also ordered a third party to be solidarily liable for payment of the award amount.  Unlike a similar result in GGL Avocat v. Dumont, 2020 QCCQ 597, Huppé J. made no mention of the special vocation of the small claims court to favour access to justice and debt recovery.

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Québec – award homologated against arbitral party and non-party held solidarily liable for award amount

In GGL Avocat v. Dumont, 2020 QCCQ 597, Mr. Justice Daniel Lévesque homologated (recognized and enforced) an arbitral award against a party to the arbitration and ordered a third party to be solidarily liable for payment of the award amount.  Lévesque J. acknowledged that the legal matrix was “particular” but was prompted to issue the tandem orders because (i) the amount fell within the jurisdiction of small claims court which favours access to justice and debt recovery and (ii) the invoice underlying the award issued against both the arbitral party and the non-party.

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B.C. – stay granted despite anticipation that arbitrator applying U.S. law might not be able to grant claims

In Williams v. Amazon.com, Inc., 2020 BCSC 300, Madam Justice Karen Horsman stayed a proposed class proceeding for non-consumer claims seeking damages under Canada’s Competition Act, RSC 1985, c C-34 based on a standard form contract which submitted those claims to arbitration administered in the U.S. and subject to U.S. laws.  Respecting competence-competence, Horsman J. recognized several issues affecting jurisdiction but deferred them to the arbitrator.  She acknowledged the “real prospect” that a U.S. arbitrator (i) could decide that such claims were not available under U.S. substantive law and (ii) might lack jurisdiction to award the claimed damages but those were not sufficient to hold that the arbitration agreement was void, inoperative or incapable of performance.  In addition, Horsman J. held that the agreement to arbitrate overcame any unconscionability concerns raised in Heller v. Uber Technologies Inc., 2019 ONCA 1.

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Ontario – failing to file application to stay and taking significant steps in litigation justifies refusal of stay

In Paulpillai v. Yusuf, 2020 ONSC 851, Madam Justice Judy A. Fowler Byrne refused to stay litigation despite no challenge being made to the validity of the arbitration agreement.  Rather, she held that the parties requesting the stay had not only omitted to bring a motion to stay but had waived the benefit of the agreement by having taken significant steps in the litigation to date.

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