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Arbitration agreements

Validity

What are the validity requirements for an arbitration agreement?

The UNCITRAL Model Law specifically provides that an arbitration agreement must be in writing in the form of:

  • a document signed by the parties;
  • an exchange of letters or other means of communication which provide a record of an agreement; or
  • an exchange of pleadings in which the existence of an agreement is alleged and not denied.

Domestically, formal requirements for arbitration agreements are found in provincial legislation, which differ slightly from province to province. In most provinces, the agreement must be in writing but in Ontario this is not required. Like in the Model Law, it is possible for an arbitration agreement to be found in multiple written documents or through electronic communications. In Quebec, a written arbitration agreement may also be found if one party alleges such an agreement in writing and the alleged counterparty does not object. 

Enforcement of agreements

How are arbitration agreements enforced in your jurisdiction? What is the attitude of the national courts towards arbitration agreements?

Canadian courts typically enforce arbitration agreements and are deferential to parties’ agreements to arbitrate. Unless it is clear that the arbitration agreement is void, inoperative or incapable of being performed, Canadian courts are likely to defer to the arbitrator the initial task of determining the existence and scope of the arbitration agreement, in accordance with the competence-competence principle.

Consolidation

Can an arbitral tribunal with its seat in your jurisdiction consolidate separate arbitral proceedings under one or more contracts, and, if so, in what circumstances?

Despite the potential desirability of consolidating resources and conducting appropriate multi-party or multi-contract arbitrations under one roof, consolidation can generally be ordered only with the consent of all parties (unless the applicable arbitral rules specifically provide for the tribunal to consolidate arbitrations absent specific consent). In some cases, tribunals and courts have found express or implied consent to order consolidation.

Choice of law

How is the substantive law of the dispute determined? Where the substantive law is unclear, how will a tribunal determine what it should be?

Arbitral tribunals apply the law chosen by the parties. If the parties have not expressly selected an applicable law, then the proper law of the contract must be determined in light of their agreement, considered as a whole, and any surrounding circumstances. In general, the law with which the agreement appears to have the closest and most substantial connection ought to prevail.

Separability

Are there any provisions on the separability of arbitration agreements?

The Model Law provides that an arbitration clause which forms part of a contract must be treated as an agreement independent of the other terms of the contract, and a decision by the arbitral tribunal that the contract is null and void must not entail, by operation of law, the invalidity of the arbitration clause.

Domestic arbitration legislation in Ontario, Alberta, Manitoba, New Brunswick, Nova Scotia and Saskatchewan provides that if the arbitration agreement forms part of another agreement, it shall, for the purpose of a ruling on jurisdiction, be treated as an independent agreement which may survive even if the other (main) agreement is found to be invalid.

The Civil Code of Quebec provides that an arbitrator may conclude that the parties have a valid and enforceable arbitration agreement and at the same time find that the other terms of their agreement are void, even when their complete agreement is found in a single document. 

Multiparty agreements

Are multiparty agreements recognised?

Yes.

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