The court dismissed allegations of unfairness and bias in the arbitral proceedings
The Ontario Superior Court of Justice dismissed an application to overturn arbitral decisions in a commercial co-tenancy dispute, concluding there was no procedural unfairness, bias, or questions of law justifying an appeal.
The case involved multiple disputes between co-tenants operating separate businesses in a shared commercial property, where they share warehouse space and a showroom for their respective products. The applicants sought to overturn the arbitrator's substantive and cost-related decisions issued in 2023, which included rulings on rent adjustments, showroom display arrangements, and shared expenses. The applicants claimed the arbitrator violated principles of natural justice and procedural fairness and exhibited bias. Alternatively, they sought leave to appeal on questions of law or to remit the matter to a new arbitrator.
The court rejected the arguments of procedural unfairness, noting that the applicants had opportunities to present their case but chose not to engage fully in certain aspects of the arbitration. For instance, the arbitrator had allowed submissions on an exterior water claim, but the applicants declined to participate, arguing that the arbitrator lacked jurisdiction. The court found no basis to support claims denying natural justice, as the applicants had consciously decided not to make substantive submissions.
On allegations of bias, the court determined that the claims stemmed from dissatisfaction with the arbitrator's rulings rather than improper conduct. The court found no evidence to substantiate a reasonable apprehension of bias.
The applicants sought leave to appeal under the Arbitration Act, arguing that the arbitrator made errors in law. However, the court held that the arbitration agreement explicitly barred appeals by stating that the arbitrator's decisions were "final and binding." Furthermore, even if an appeal were permissible, the court found that the issues raised did not constitute questions of law but rather involved enforcing prior arbitral decisions.
The court also ruled that the matters in dispute—such as rent adjustments and the placement of showroom displays—did not meet the threshold of importance necessary to justify an appeal. The amounts and issues involved were modest and did not significantly impact the parties' rights.
The Superior Court granted the respondents' application to enforce the arbitral decisions, emphasizing that the arbitrator's rulings were consistent with prior awards and within the arbitration agreement's scope. The court declined to remit the matter to a new arbitrator, as it found no questions of law requiring re-determination.
