ADRIC: The Arbitration Landscape in Canada

Hannah Johnston

The ADRIC (ADR Institute of Canada) Arbitration Forum was held on Tuesday, September 21st, on the second day of CanArbWeek 2021. This event focused on the present and future of arbitration in Canada. It featured three mini panels and a keynote speaker. All contributed to an engaging discussion about recent changes to Canadian arbitration law and practice, and offered insights about what is to come.

First off, Megan Keenberg of Van Kralingen & Keenberg LLP and Daniel Baum of Langlois Lawyers shared their experiences and a dual perspective on case management arbitration in Ontario and Quebec, respectively. In case management arbitration, parties refer procedural issues to an arbitrator for determination. Baum noted that civil litigation in Quebec already includes a case conference procedure, and this protocol can be effective to narrow issues and help the parties to reach a quick determination. Keenberg replied that Ontario courts are backlogged, with trial dates booked a year out, so case management or substantive arbitration is a good option for time sensitive or document heavy matters.

When determining if case management arbitration is a good fit, Keenberg and Baum suggested that parties look at the scope of what a judge can do, consider the appeal options for the outcome, and address how to deal with interim costs. They concluded that case management arbitration can be a useful tool and is on the rise in both Ontario and Quebec, as parties think creatively about how to resolve disputes while judicial resources remain overwhelmed.

The second panel focused on the dispute funding industry, which provides third-party financing of some or all of arbitrants’ legal expenses. It featured both funder (Annie Lespérance, Omni Bridgeway) and counsel (Lauren Tomasich, Osler, Hoskin & Harcourt LLP) perspectives. Lespérance talked about how to grow an arbitration practice with funding, that it can help parties and counsel differentiate themselves from competitors and gain access to non-recourse funding. OMNI boasts an 89% win or settle track record with their clients and offers alternative payment options such as a financing agreement for multiple pooled contingencies.

Keenberg added that it can feel good, as a practitioner, to say that you have funding for a case. It means clients and other lawyers have endorsed the viability of your claims. Tomasich added that dispute funding can also leverage relationships with funders to grow capital. It is not part of a traditional litigation practice but is increasing in popularity. Also, this method should still be offered to high-value clients. Even if they have a lot of money, they might not want to pay legal fees in a traditional sense, and this is one was to invest “float funding” instead.   

The keynote speaker, Independent Arbitrator William (Bill) Horton, took a global approach and focused on the worldwide community. He started by observing that international arbitration is a monopoly and has little need for arguments why it is better than litigation in the courts; by contrast, domestic arbitration needs to offer tangible benefits over litigation, or else parties will abandon it. He also touched on the recent Vavilov and Uber decisions, and closed out with comments about the current technological landscape for lawyers.

Horton professed himself to be a fan of Zoom because there is little loss to arguments made, and he already has a paperless practice, but he did acknowledge a human need for the personal and unplanned interactions of normal life. More pandemic wisdom – lawyers are maximizers and like to complicate things, but we can now see that it’s possible to do our jobs without travelling, printing countless materials, and renting hearing rooms. COVID-19 has taught the legal profession to minimize, Horton said.

The final panel, a discussion of legislative reforms, featured J. Brian Casey of Bay Street Chambers, Alexander Gay from Justice Canada, and Ludmila B. Herbst, QC of Farris LLP. The panel also touched on Vavilov, and the uncertainty that it has generated for commercial arbitration. There was some support for robust court intervention, but also uneasiness about legislation that would prescribe the standard of review. Another interesting topic was non-lawyers as arbitrators. Panelists discussed how the legal profession can rely on these individuals for their specific expertise if it applies to the dispute, but that the legislation is quiet about specific protections for these arbitrators.  

The event closed with a call for each panellist to suggest three changes they would make to the provinces’ domestic arbitration legislation. Casey called for a default position of no appeals unless the parties opt-in to appellate review, clear language that a “set aside” is not a form of judicial review, and a section that putting an onus on parties, counsel, and arbitrators to perform their contractual obligations in the arbitration process in good faith. Gay focused on closing doors to judicial intervention: getting rid of appeal rights and having a good look at domestic legislation that refers to the Statutory Powers Procedure Act. Herbst had been involved in drafting the BC Arbitration Act, 2020, and was not able to recommend much in addition to the amendments enacted in that statute, but stated that she would be happy to see more confidentiality of arbitrator fees and processes in the new legislation, so there is less of a sense that parties must air things out in court.