December 12, 2024

By Jonathon Clark 

If you are party to an agreement to arbitrate in Ontario, and cannot agree on the arbitrator, either party may apply to the Superior Court to appoint an arbitrator.[1]

THE ISSUE

Can you appeal the judge’s order if you are unhappy with it?

Short answer: No.

THE LAW

Section 10 of the Arbitrations Act, 1991, gives judges the power to appoint an arbitrator.

Subsection 2 of that section reads:

“There is no appeal from the court’s appointment of the arbitral tribunal”.

Seems clear enough?

THE CASE

Nothing about Ontario law is really clear until the Court of Appeal says so.

In Toronto Standard Condominium Corporation No. 2299 v. Distillery SE Development Corp. the party attempting to appeal argued that the appointment of the arbitrator was pursuant to the arbitration agreement, not to the Act, and that therefore an appeal was possible. Their pleading to the Superior Court did not mention section 10, but did rely upon section 6 of the Act. Section 6 says that:

No court shall intervene in matters governed by this Act, except for the following purposes, in accordance with this Act:

1. To assist the conducting of arbitrations.
2. To ensure that arbitrations are conducted in accordance with arbitration agreements.
3. To prevent unequal or unfair treatment of parties to arbitration agreements.
4. To enforce awards.

The Court of Appeal made short work of the argument that section 10 did not apply, saying that:

Section 10 is the only arguably applicable provision of the Act that contemplates the court appointing an arbitrator… If the authority to appoint came from the Act, it came from s. 10, whether or not the application judge referred to it.

The appeal was quashed. It is now up to the appointed arbitrator to determine his jurisdiction (the real issue in dispute that led to the appeal).

TAKEAWAYS

• It is always better to agree on the arbitrator to be appointed, if possible.
• This is not a reason to appoint the wrong arbitrator, but
• If you do not reach an agreement, you will be stuck with the Court’s choice, which might well be the other side’s suggestion.
• Like judges, not all arbitrators are created equally.

 

WHAT WEILERS LLP CAN DO TO HELP YOU

At Weilers LLP, our corporate commercial and dispute resolution lawyers have experience interpreting arbitration clauses in agreements and do our best to make sure our clients understand them, but in order for that to work, our clients need to be open with us about their understanding of the terms, and of course, need to read the fine print.

If you plan to go to arbitration, whether on your own initiative or you are dragged into an arbitration, Weilers LLP has lawyers well-suited to represent you at a realistic cost, with realistic advice and strong representation. We work closely with our own commercial drafting colleagues within the firm to provide clear and concise opinions. We are able to share the same cooperation with many outside lawyers who appreciate our commitment to our mutual clients.

For all your dispute resolution needs, give Weilers LLP a call to see if we are the right lawyers for you.

[1] The results and rights are different if your arbitration is governed by the International Commercial Arbitration Act, 2017.