B.C. – no breach of natural justice where arbitrator invites submissions on new issue but declines to incorporate them in award – #508

In Hotel Georgia Development Ltd. v The Owners, Strata Plan EPS849, 2021 BCSC 1236, Madam Justice Heather MacNaughton held that the arbitrator committed no breach of natural justice by inviting submissions on a new issue which he introduced but then declined to rely on out of fairness to Respondent. “Where an arbitrator considers an approach to an issue that has not been raised by either party, natural justice requires the arbitrator to give the parties an opportunity to comment on the approach. The fact that a party does not make sufficient use, if any, of the opportunity given by the arbitrator is not a breach of natural justice and, accordingly, not a basis for setting aside an arbitral award”.  MacNaughton J. observed that the arbitrator had signalled a gap in Claimant’s evidence and sought submissions on his ability to make a quantum meruit award. Despite having invited submissions and effectively granted Claimant an opportunity to compensate for its evidentiary gap, the arbitrator elected not to reproduce the responding submissions in the award.  “It would be clearly unfair and prejudicial to the Respondent to have a new legal basis for recovery of common law damages at this stage and I exercise my discretion against pursuing that analysis”.

Continue reading “B.C. – no breach of natural justice where arbitrator invites submissions on new issue but declines to incorporate them in award – #508”

B.C. – court issues sealing orders to avoid “defeating parties’ reasonable expectations of privacy in an ongoing arbitration” – #506

In Stewart v. Stewart, 2021 BCSC 1212, Mr. Chief Justice Christopher E. Hinkson issued sealing orders to protect materials filed (i) in a pending arbitration agreed to as part of the settlement of earlier court litigation and (ii) in court when the parties returned to court post-settlement to dispute compliance with the initial settlement.  Applying the two (2) part test developed for publication bans in Dagenais v. Canadian Broadcasting Corp., 1994 CanLII 39 (SCC) and applied to confidentiality orders in Sierra Club of Canada v. Canada (Minister of Finance), 2002 SCC 41, Hinkson C.J. determined that “disclosure of this information would be likely to undermine the public policy in this jurisdiction of encouraging arbitrations by defeating the parties’ reasonable expectations of privacy in an on-going arbitration”.  Hinkson C.J. limited his orders to specific documents and affidavit passages filed either in the ongoing arbitration or in court and referenced the confidentiality provisions in BCICAC’s (now VanIAC) former Revised Domestic Commercial Arbitration Rules of Procedure which applied to the arbitration.

Continue reading “B.C. – court issues sealing orders to avoid “defeating parties’ reasonable expectations of privacy in an ongoing arbitration” – #506”

B.C. – arbitration remains mandatory despite option given to only one party to waive arbitration – #503

In Malcolm Drilling Company Inc. v. The Graham-Aecon Joint Venture, 2021 BCSC 1136, Madam Justice Shelley C. Fitzpatrick issued a stay of proceedings despite plaintiff’s objection that only defendant had a peremptory right to refuse arbitration in response to plaintiff’s request to arbitrate. Fitzpatrick J. held that arbitration was mandatory if (i) either party requested it and (ii) arbitration was requested by plaintiff and defendant did not exercise its peremptory right to “waive” arbitration. Fitzpatrick J. also cautioned against an uncritical application of the “dated” approach to jurisdictional issues taken by decisions released prior to Seidel v. TELUS Communications Inc., 2011 SCC 15 (CanLII), [2011] 1 SCR 531, noting that “the persuasiveness of those decisions must be viewed with some skepticism given the more modern approach to arbitration”.

Continue reading “B.C. – arbitration remains mandatory despite option given to only one party to waive arbitration – #503”

B.C. – adverse inferences and undocumented terms thwart proof of binding settlement alleged in mediation – #498

In Govorcin Fisheries Ltd. v. Medanic Fisheries Ltd., 2021 BCSC 1092, Mr. Justice Frits E. Verhoeven dismissed Defendants’ claim that the parties had entered into a binding, verbal settlement agreement, determining that Defendants failed to meet the elements of an enforceable settlement set out in  Apotex Inc. v. Allergan, Inc., 2016 FCA 155.  Despite the complexity of the issues and disputed amount, the parties did not document the terms which Defendants alleged formed the parties’ agreement concluded during mediation.  “This case illustrates the difficulty of attempting to prove that a settlement agreement was reached verbally at a mediation, where nothing was signed by the parties signifying their agreement to a settlement, and, further, where there was no consensus between them that a settlement had been achieved”.  At the hearing to enforce the alleged settlement agreement, Verhoeven J. also drew adverse inferences based on the “unexplained” absence of “obviously a key material witness” who participated on Defendants’ behalf in the mediation and could have attended to challenge the facts adduced by Plaintiff.

Continue reading “B.C. – adverse inferences and undocumented terms thwart proof of binding settlement alleged in mediation – #498”

B.C. – appeal court declines to re-assess success in appeal of award where court remits valuation matter to arbitrator – #487

In Nolin v. Ramirez, 2021 BCCA 191, B.C.’s Court of Appeal declined to modify a costs award issued in first instance, reiterating its deference to such discretionary orders.  The Court did acknowledge that it could modify a costs award “without undue deference to the views of the trial judge” if the Court on appeal had modified the amount granted in first instance for the merits of the dispute and where “the amount or nature of the award was a factor in the costs award below”.  Because the judge in first instance had remitted a valuation matter to the arbitrator, the Court held that “[t]here are still issues outstanding that have been referred to the arbitrator, and without a final decision with respect to those issues, it is difficult to assess substantial success”.

Continue reading “B.C. – appeal court declines to re-assess success in appeal of award where court remits valuation matter to arbitrator – #487”

B.C. – court assists arbitration with subpoenas, subject to respect of implied undertaking of confidentiality – #470

In Octaform Inc. v Leung, 2021 BCSC 761, Mr. Justice Gordon C. Weatherill granted petitions under section 27 of the International Commercial Arbitration Act, RSBC 1996, c 233 and issued subpoenas to compel non-party witnesses to attend an ongoing arbitration. Observing that an “arbitration tribunal has the authority to control its own process, including the power to adopt its own rules and procedures for taking evidence that meet the needs of the particular case”, he added that “[i]t is not the role of this court to second guess the suitability of the processes adopted by the tribunal”.  Weatherill J. had adjourned an initial hearing on the petitions to issue subpoenas to non-parties, judging the petitions to be premature.  Provided with additional information since then, Weatherill J. confirmed the arbitrator’s determinations for approving the non-party witnesses’ attendance satisfied the court and warranted assistance.  Weatherill J. issued additional terms to the witnesses’ attendance requiring the petitioner’s undertaking (i) not to use the evidence obtained anywhere else but with the court’s consent and (ii) to reimburse “respective reasonable legal expenses incurred in respect of their preparation for and attendance as a witness at the Arbitration”.  The undertaking to restrict use mirrored in some respects the terms developed for the implied undertaking of confidentiality set out in Lac d’Amiante du Québec Ltée v. 2858-0702 Québec Inc., 2001 SCC 51 (CanLII), [2001] 2 SCR 743

Continue reading “B.C. – court assists arbitration with subpoenas, subject to respect of implied undertaking of confidentiality – #470”