Ontario – summary judgment enforces settlement issuing from arbitration

In Furniture.com Inc. v. Leon’s Furniture Ltd., 2019 ONSC 7451,  Madam Justice Sandra Nishikawa granted summary judgment for breach of a settlement entered into after arbitration began.  Nishikawa J.’s decision was the latest in a sequence of different dispute resolution options undertaken by the parties – arbitration, court application for leave to appeal an award, private settlement and summary judgment to enforce settlement.  Nishikawa’s reasons also demonstrate that resolution went ahead despite defendant’s evidentiary objections and other ongoing dispute resolution in the U.S.

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Ontario – Vavilov standard applies to statutory insurance arbitration but not private commercial arbitration

In Allstate Insurance Company v. Her Majesty the Queen, 2020 ONSC 830, Madam Justice Breese Davies held that Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65 altered judicial intervention on appeals from insurance arbitration mandated by legislation.  Davies J. held that legislation which includes a statutory appeal mechanism signals legislative intent that courts are to perform an appellate function in respect of the administrative decision and apply appellate standards of review. Davies J. distinguished between appeals of statutory arbitrations and private commercial arbitrations, the latter being seen as autonomous, self-contained process in which courts should “generally” not intervene.

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Ontario – litigation stayed to permit arbitrator to determine jurisdiction and issues subject to arbitration

In a pair of decisions, Deco Homes (Richmond Hill) Inc. v. Mao, 2019 ONSC 6223 and Deco Homes (Richmond Hill) Inc. v. Li, 2019 ONSC 7501, Mr. Justice Lorne Sossin acknowledged overlap of buyers’ claims subject to statutory arbitration and vendor’s claims for breach of contract not covered by arbitration.  Respectful of competence-competence, Sossin J. stayed the actions to allow an arbitrator to make a first determination, reasoning that vendor’s claims could not be resolved without recourse to questions that lay within the agreement’s exclusive scope. To identify the dispute, he included vendor’s claims and those raised by each buyer.

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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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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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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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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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Ontario – Olympic athletes cannot relitigate sports arbitration dispute as tort action

In Sokolov v. The World Anti-Doping Agency, 2020 ONSC 704, Mr. Justice Mario D. Faieta granted summary judgment on a jurisdictional issue, dismissing a tort claim made by athletes denied entry to the 2016 Olympic Games in Rio.  Faieta J. held that the athletes sought to litigate the same factual matrix which they had unsuccessfully arbitrated before the Court of Arbitration for Sport and that the “essential character” of the dispute was within the scope of the arbitration agreements.  Though he considered the arbitration agreements to be more like arbitration imposed by statute or adhesion contracts, he expressly considered the impact on international sports if he signalled a willingness of domestic courts to resolve matters otherwise reserved for more specialized tribunals.   

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Ontario – agreement to arbitrate disputes involving “construction, meaning or effect” does not cover “enforcement”

In Illumina Holdings Inc. v. Brand Alliance Inc. et al, 2020 ONSC 1053, Mr. Justice Cory A. Gilmore gave effect to an agreement to arbitrate disputes involving “construction, meaning or effect” of an agreement and refused to stay litigation based on enforcement of the agreement.  Gilmore J. held that the claims involved “a straightforward contract case” and that breach of an enforceable agreement was not the same as the meaning of that agreement.  Demonstrating the courts’ own readiness and flexibility to provide resolution of disputes, Gilmore J. then went on to determine that the disputes did not warrant a trial and issued orders on the merits of the claims made.

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Ontario – majority shareholder referring contract interpretation to arbitration is not oppressive conduct

In Richcraft Homes Ltd. v. Urbandale Corporation et al., 2020 ONSC 411, Mr. Justice Robert J. Smith dismissed a minority shareholder’s action which alleged oppression based on a majority shareholder requesting a legal opinion favourable to its interests and then submitting the interpretation to arbitration.  Smith J. held that any party to a commercial agreement, including a majority shareholder, is entitled to seek a legal opinion concerning interpretation its rights under a contract and, instead of acting illicitly on any interpretation, refer interpretation of the contract to arbitration.

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