Alberta – “surrounding circumstances” for contract interpretation exclude subjective intentions – #460

In 719491 Alberta Inc. v. The Canada Life Assurance Company, 2021 ABQB 226, Mr. Justice W. Patrick Sullivan dismissed attempts to identify an error of law based on the arbitrator’s handling of surrounding circumstances known at the time of contract formation. Sullivan J. agreed that contract interpretation required reading the contract as a whole, giving the words used their ordinary and grammatical meaning, consistent with those surrounding circumstances but disagreed that “surrounding circumstances” included the parties’ subjective intentions. The latter cannot serve to add to, detract from, vary or otherwise overwhelm the agreement’s written words.  In obiter, Sullivan J. also endorsed the concurring three (3)’s approach in Wastech Services Ltd. v. Greater Vancouver Sewerage and Drainage District, 2021 SCC 7 to apply Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65 to appeals of commercial arbitration awards.

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Alberta – arbitrator’s breach of procedural fairness in costs award leads to set aside of award on merits – #455

In Ostergaard v. Uhl, 2020 ABQB 789, Madam Justice Sandra L. Hunt McDonald set aside an award on the merits and its corresponding costs award after determining that the costs award involved a breach of procedural fairness stemming from how the arbitrator determined costs.  Recognizing that arbitral tribunals have “extended leeway” to determine their own procedure under section 20 of the Arbitration Act, RSA 2000, c A-43 in order to “ensure, in part, a workable ‘fit’ to address both the needs of the parties before them and the specific issues in play”, Hunt McDonald J. observed that such leeway “does not provide the ability to disregard the rules of natural justice”.  Due to “a flood” or “onslaught” of submissions by A following the award on the merits, the arbitrator acknowledged significant inconsistencies involving how he calculated certain inputs “going to the very heart of the contractual dispute” and decided that procedurally their revisions would only be accounted for as an offset to the costs award.  In doing so, Hunt McDonald J. held that the arbitrator constructed a process procedurally unfair to A and his costs methodology bestowed a relative advantage upon R to the detriment of A.

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Alberta – appeal court suggests parties arbitrate lingering dispute over chambers decision if lacking clarity – #454

In MEG Energy Corp v Canexus Corporation, 2021 ABCA 101, the Court of Appeal upheld a chambers judge’s analytical approach to determining ownership of disputed equipment but disagreed with his reliance on unsworn and insufficient evidence when applying the approach.  The Court left it to the parties to consider whether the chambers judge’s reasons provided “sufficient clarity” to determine ownership but, if not, (i) directed them to either return to the chambers judge or (ii) suggested they determine the issue by arbitration as set out in their contract.

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Alberta – issue not “expressly” referred to arbitrator may not preclude appeal but still live enough to signal overlooked opportunity to plead – #429

Preferring the “narrow interpretation” of section 44(3) of the Arbitration Act, RSA 2000, c A-43, Madam Justice Shaina Leonard in Athan Homes Inc v. Phan, 2021 ABQB 119 determined that the fundamental breach issue had not “expressly” been submitted to the arbitrator for decision and section 44(3) did not preclude leave to appeal.  Applicant did succeed in identifying a question law but Leonard J. determined that its appeal had no merit.  Leonard J. also dismissed Applicant’s alternative application to set aside the award due to alleged lack of opportunity to plead on the issue of fundamental breach.  Though she had determined that fundamental breach had not been referred “expressly” to the arbitrator for the purpose of section 44(3), Leonard J. also determined that the issue was before the arbitrator for the purpose of natural justice.  Omitted from the parties’ Joint Memorandum list of issues submitted to the arbitrator, the fundamental breach issue was present in the pleadings and Respondents’ written argument.  Applicant’s choice not to make submissions on the issue did not result in a lack of opportunity to be heard.

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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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Alberta – court has no authority to impose private arbitration absent parties’ consent or an agreement – #405

In Stuve v. Stuve, 2020 ABCA 467, Alberta’s Court of Appeal upheld a chambers judge’s refusal to order the parties to engage in binding arbitration, agreeing that a judge has no jurisdiction to impose private arbitration without consent of the parties or an agreement to that effect. The Court held that “[s]pecific legislative language would be required for the court to have the power to require parties to participate in an extra judicial private process such as arbitration”.  Neither the Alberta Rules of Court, Alta Reg 124/2010 or the Arbitration Act, RSA 2000, c A-43 empowered the judge to do so.  “The parties commenced litigation in the publicly funded courts, and are entitled to access to court processes to resolve their dispute. Citizens have a right to access to the court, which is the public dispute resolution institution”.

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