Ontario – statutory undertaking to mediate/arbitrate contract disputes inapplicable if dispute’s “substance” involves breach of legislation – #497

In Carleton Condominium v. Poirier, 2021 ONSC 3778, Mr. Justice Paul B. Kane refused to convert Applicant’s application into an action despite Respondents’ submissions that Applicant had not engaged in mediation and arbitration before commencing the application.  An application would proceed on a record comprised of affidavit and cross-examination evidence whereas an action would lead to a hearing with viva voce witnesses and more extensive pre-trial procedural steps. Even though some of Applicant’s relief appeared to qualify as a disagreement for which the Condominium Act, 1998, SO 1998, c 19 imposed mediation and arbitration, Kane J. determined that (i) the “substance” of the application involved breaches of the legislation for which mediation and arbitration were not imposed and (ii) Applicant’s reliance on those breaches was not “to avoid mediation and arbitration”. 

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Ontario – court to consider application of Indian Act seizure exemptions to contingency agreement related to arbitration award – #496

In Bogue v. Miracle, 2021 ONCA 278, Ontario’s Court of Appeal remitted back to the applications judge an order appointing a receiver because the record did not provide the Court with a record relevant to argument that the order contravened exemptions from seizure provided in the Indian Act, R.S.C. 1985, c. 1-5. The order issued pursuant to section 101 of Ontario’s Courts of Justice Act, RSO 1990, c C.43 and upon application by the attorney for the successful arbitration party ACM who had signed a contingency agreement with that attorney as part of his retainer to represent ACM in the arbitration. The attorney sought the appointment of a receiver to “realize upon the debt for his benefit and [ACM]’s other creditors”.

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Québec – defendants must pay mediation fees when they refuse to participate in mediation court ordered at their request – #495

In Zen & Sens Inc. v. Entreprises Érick Boucher Inc., 2021 QCCQ 4224, Mr. Justice Pierre Cliche ordered Defendants to pay their and Plaintiff’s costs for a mediation in which Cliche J., upon application by Defendants, ordered the parties to engage but in which Defendants then refused to participate.  Though nominal, the mediator’s fees had been paid by Plaintiff due to Defendants’ refusal to participate and Plaintiff added those fees to its claims in its initial action which Cliche J. had suspended pending the mediation. Cliche J. did not homologate a costs award which had issued in an arbitration but ordered repayment as a distinct head of recovery in the litigation which he had suspended.

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Ontario – correctness standard applies on appeal of arbitration award under contract prescribed by statute – #494

In Kumer v. MTCC No. 775, 2021 ONSC 1181, Madam Justice Audrey P. Ramsay determined that a correctness standard applied to appeals of arbitration awards rendered under the Condominium Act, 1998, SO 1998, c 19.Ramsay J. observed that neither party argued Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65 and she accepted the guidance set out in (i) 90 George Street Ltd. v. Ottawa-Carleton Standard, 2015 ONSC 336 which noted that “arbitration pursuant to the Condominium Act is distinguishable and very different from the arbitration of a commercial dispute” and (ii) Metropolitan Toronto Condominium Corporation No. 590 v. The Registered Owners and Mortgagees of Metropolitan Toronto Condominium Corporation No. 590, 2020 ONCA 471 which remarked that a condominium declaration is “a special form of contract, the structure of which is prescribed by statute. It must adhere to certain statutory requirements”.  Both decisions distinguished Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53 (CanLII), [2014] 2 SCR 633 because it concerned commercial arbitration. Ramsay J. agreed with the Court of Appeal’s comments in 2020 that “while a declaration under the Condominium Act could be characterized as a contract, [it] is not the type of private contract negotiated between two parties, to which the comments in Sattva were directed. A declaration is a special form of contract, the structure of which is prescribed by statute. It must adhere to certain statutory requirements.

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Ontario – jurisdiction to correct/amend document affecting others reserved to Superior Court by legislation – #493

In Mensula Bancorp Inc. v. Halton Condominium Corporation No. 137, 2021 ONSC 2575, Madam Justice Marie-Andrée Vermette set aside an award in which the arbitrator, unsatisfied with the interpretation given by the “plain language” of a condominium declaration, “purported to deal with and correct what he thought were errors and inconsistencies”.  Doing so “crossed the line between interpretation and correction/amendment” and decided a matter beyond the scope of the agreement to arbitrate, justifying Vermette J.’s intervention under section 46(1)3 of the Arbitration Act, 1991, SO 1991, c 17.  Because a condominium declaration is “the equivalent of the constitution of a condominium corporation” and, registered, impacts current and prospective condominium owners, section 109 of the Condominium Act, 1998, SO 1998, c 19 reserves jurisdiction to the Superior Court to correct alleged errors and inconsistencies. The parties also reiterated that jurisdiction in their agreement to arbitrate which itself appeared in their applicable documents by virtue of that same legislation.

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Alberta – allocation of lien security to subcontractors adjourned pending arbitration between owners and general contractor – #492

In Avli BRC Developments Inc v. BMP Construction Management Ltd, 2021 ABQB 412, Master Andrew R. Robertson Q.C. adjourned an application for costs claimed against security provided further to an order under Alberta’s Builders’ Lien Act, RSA 2000, c B-7, holding that he could not determine and allocate amounts owing to subcontractors or related costs until a pending arbitration decided the amounts owing between the building owners and the general contractor.

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