Top 10 Canadian Arbitration Cases of 2024: Key lessons for in-house counsel

Foreword 

Canadian courts have a strong and consistent track record of enforcing valid arbitration agreements and supporting arbitration as a mode of dispute resolution. This year’s Top 10 Arbitration Cases for In-House Counsel shows this trend continues. However, quite appropriately, where the court needs to intervene to ensure justice, and it has jurisdiction to do so, it will do so. This supports arbitration as an attractive method of dispute resolution by instilling checks and balances and, in turn, confidence in the integrity of the arbitral process in Canada.

With respect to enforcing arbitration agreements, we feature three decisions in which courts in Ontario and Manitoba had to determine whether to stay a proposed class proceeding in favour of arbitration agreements contained in standard form contracts of adhesion. In one of the cases, the Court granted the stay, finding the arbitration agreement valid. In the other two, the class proceedings were allowed to proceed as the arbitration agreements were judged unconscionable or against public policy. These cases demonstrate that, at least with contracts of adhesion, whether accessing arbitration would be unduly onerous for the weaker party will be critical to the question of the enforceability of an arbitration agreement.

We also highlight decisions showing Canadian courts’ willingness to support the arbitration process. In one case, the Court refused to stray from the codified grounds for setting aside arbitral awards under international arbitration legislation. In another, the Court acceded to a party’s request to assist in obtaining evidence from a third party who refused to cooperate absent a court order. In yet another case, the Court of Appeal for Ontario clarified the standard for arbitrator disclosures, reinstating an award set aside in the court below.

Finally, although Canadian courts will generally not interfere with the merits of an arbitrator’s decision, respecting the parties’ choice of umpire, they will honour the parties’ agreement to involve the court on appeal where the parties have chosen to retain that right. This signals a mature understanding of party autonomy, arbitration’s guiding principle.

Index

• Aroma Franchise Company, Inc v. Aroma Espresso Bar Canada Inc.
  Ontario Court of Appeal clarified an arbitrator’s duty of disclosure and held that an arbitrator was under no duty to disclose a second unrelated arbitration which had no common parties or overlapping issues.

• Lochan v. Binance Holdings Limited
  Court of Appeal upheld dismissal of stay in favour of arbitration based on unconscionability and public policy.

• Wasylyk v. Lyft  &  Pokornik v. SkipTheDishes Restaurant Services Inc
  Manitoba and Ontario courts reached different outcomes on the question of the enforceability of arbitration agreements involving gig workers.

• Giacchetta v. Beck
  Alberta Court of King’s Bench found that it is an error of law for an arbitrator not to consider all the evidence filed in an arbitration and not to provide sufficient reasons in an award.

• Royal and Sun Alliance Insurance v. Ontario Provincial Police 

  Ontario Superior Court ordered disclosure by a non-party in support of arbitration.

• La Française IC2 v. Wires
  Ontario Court of Appeal found that it is an abuse of process to resist enforcement of an award based on grounds previously raised, dismissed, and not appealed.

• Sound Contracting Ltd v. Campbell River (City)
  British Columbia Supreme Court set aside an award due to the failure to provide adequate reasons, on the basis that it did not meet standards of natural justice.

• Medivolve Inc v. JSC Chukotka Mining and Geological Company
  Ontario Superior Court confirmed common law principles are generally unavailable to set aside an award where Article 34 of the Model Law does not apply.

• Quanta Canada Holdings II ULC v. Bremar Construction Ltd
  Alberta Court of King’s Bench provided valuable guidance on “importance” for purposes of the test for granting leave to appeal an award on a question of law.

• McLaren Automotive Incorporated v 9727272 Canada Inc.
  Quebec Superior Court held that internal arbitration appeal mechanisms do not violate public policy, do not derogate from the jurisdiction of the courts, and do not violate the principle of proportionality.