Ontario – ability to decide limitation issue before referral to arbitrator relieves parties from rearguing issue – #478

In Maisonneuve v. Clark, 2021 ONSC 1960, Madam Justice Sally Gomery held she had jurisdiction to determine whether an application for referral to arbitration was time-barred because (i) the record provided sufficient insight with respect to limitation issues despite having to draw some inferences and (ii) Ontario’s Rules of Civil Procedure, RRO 1990, Reg 194 urged that they be “liberally construed to secure the just, most expeditious and least expensive determination” of the limitation issue.  Gomery J. commented that those reasons justified her deciding the issue, thereby relieving parties of having to reargue it before arbitrator.  Gomery J. also observed that “the exercise of interpreting a contract is different than the exercise of interpreting a statutory provision”.  The latter is a question law, requiring courts to “discern the mischief that the legislator intended to address in enacting legislation, and to interpret the statutory language to further the legislator’s purpose, sometimes to address problems that were not even contemplated when the law was passed”.  The former is a mixed question of fact and law.  “A contract is not made to address a societal issue or need. It is made to order the relationship between the parties or to resolve a specific problem they have at a particular time”.

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Ontario – arbitrator has jurisdiction to hear summary judgment despite party’s objection provided process complies with Hryniak – #474

In Optiva Inc. v, Tbaytel, 2021 ONSC 2929, Mr. Justice W. Daniel Newton dismissed a post-award challenge to an arbitrator’s initial decision to proceed by way of summary judgment absent defendant’s consent.  Newton J. determined that section 26 of Ontario’s Arbitration Act, 1991, SO 1991, c 17 describes hearings for “presentation of evidence” and “oral argument” but expresses no requirement for oral evidence.  As the parties proceeded by affidavit, after cross-examination, and with oral argument, Newton J. held that arbitrator’s process had met requirement to “hold a hearing” as requested by defendant.  Newton J also held that summary judgment should be available in arbitration for the same reasons as those given in Hryniak v. Mauldin, 2014 SCC 7 (CanLII), [2014] 1 SCR 87 provided the process “(1) allows the arbitrator to make the necessary findings of fact; (2) allows the arbitrator to apply the law to the facts; and (3) is a proportionate, more expeditious and less expensive means to achieve a just result”.

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Ontario – complex contractual matrix and lack of privity prompts court to propose arbitration – #471

In CUSO International v. Pan American Development Foundation, 2021 ONSC 3101, Mr. Justice Calum MacLeod relied on forum non conveniens principles to resolve an application to stay Ontario litigation pending the outcome of litigation in Colombia.  Despite a complex matrix of documents and contracts to which the litigants were not all parties, MacLeod J. urged the litigants to consider a submission agreement to arbitrate.  Though that complexity and lack of privity often serve as lines of first resistance for a litigant objecting to arbitration, MacLeod J. relied on both as his prompts.

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Ontario – court all but drafts pandemic obituary for forum non conveniens as factor in fairness of arbitration venue – #469

Mr. Justice Edward M. Morgan in Kore Meals LLC v. Freshii Development LLC, 2021 ONSC 2896 included a forum non conveniens-type analysis to grant a stay, including whether the forum and venue identified in the agreement to arbitrate were unfair or impractical for a party.  Morgan J. favoured competence-competence and referred the parties to arbitration administered by the American Arbitration Association, confirming that neither knew where the AAA was located and both informed him that arbitration was likely conducted online because they “presume so since the pandemic has moved most proceedings of this nature to a digital forum”. “If hearings are held by videoconference, documents filed in digital form, and witnesses examined from remote locations, what is left of any challenge based on the unfairness or impracticality of any given forum? To ask the question is to answer it”.  Morgan J. observed that “[i]t is by now an obvious point, but it bears repeating that a digital-based adjudicative system with a videoconference hearing is as distant and as nearby as the World Wide Web. With this in mind, the considerable legal learning that has gone into contests of competing forums over the years is now all but obsolete. Judges cannot say forum non conveniens we hardly knew you, but they can now say farewell to what was until recently a familiar doctrinal presence in the courthouse”.  Morgan J. added “what is true for forum non conveniens is equally true for the access to justice approach to the arbitration question. Chicago and Toronto are all on the same cyber street. They are accessed in the identical way with a voice command or the click of a finger. No one venue is more or less unfair or impractical than another”.  Morgan J. also included a party’s co-defendant parent in the referral despite being non-party to the agreement to arbitrate.

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Ontario – no appeal from Master’s order to stay litigation in favour of arbitration – #468

In Wang v. Mattamy Corporation, 2021 ONSC 2635, Ontario’s Divisional Court in brief reasons refused to vary or set aside a judge’s decision in Wang v. Mattamy Corporation, 2020 ONSC 7012 to dismiss an appeal from a Master’s order granting a stay of their litigation in favour of arbitration. In determining that Applicants had failed to demonstrate an error of law or palpable and overriding error of fact, the Court agreed that section 7(6) of Ontario’s Arbitration Act, 1991, SO 1991, c 17 is “a complete bar to the appeal” which provides that is no appeal from a decision of the court staying an action on the basis of an arbitration clause. For an opposite result in first instance on an appeal of a Master’s decision based on interpretation/application of Alberta rules of court and legislation, see the Arbitration Matters note “Alberta – court rules permitting appeal of Master’s stay decision consistent with section 7(6) of Arbitration Act – #412” regarding Agrium, Inc v. Colt Engineering Corporation, 2020 ABQB 807.

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Ontario – court invokes kompetenz-kompetenz to refuse stay of ongoing arbitration pending appeal/set aside – #464

In Kingston Automation Technology Inc. v. Montebello Packaging, 2021 ONSC 2684, Mr. Justice Graeme Mew dismissed an application to stay an award pending other applications to appeal that award and to set it aside.  Addressing one of applicant’s grounds which raised a jurisdictional issue involving whether all claims granted were within the scope of the agreement to arbitrate.  Mew J. noted that the applicant now objecting to those claims being added was the party which had added them.  Mew J. held that applicant had agreed to their inclusion, had not objected within the delays at the onset of the arbitration, only raising the objection “rather late in the game”. Mew J. also refused to order a stay of the arbitration which remained ongoing.  Applicant had made no application to stay to the arbitrator and Mew J. concluded he had no basis on which to intervene.  Mew J. acknowledged the potential for “wasted time and expense” but such could be compensated in an award for costs and “it is not, in any event, a basis for displacing the kompetenz-kompetenz principle by interfering with the arbitrator’s management of the arbitration”.

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