Commercial Arbitration – Frequently Asked Questions

Q. What is the difference between arbitration and mediation?
A. Mediation is an assisted negotiation where the parties use the services of a third party to reach an agreement. The mediator does not decide the dispute for the parties. Arbitration is a process which results in a binding and enforceable decision made by the arbitrator after hearing evidence or information provided by the parties. I also offer both services as well as med-arb services, in which some issues are mediated and when impasse is reached some issues are arbitrated.
Q. Why should I use an arbitrator, can’t I just mediate the dispute?
A. Mediation can often be an effective way of resolving a dispute provided both parties are open to a solution. Parties often try mediation before seeking arbitration. A mediator cannot impose a solution on an unwilling party. Some parties do not live up to the terms of a mediation agreement and the mediation agreement must then be enforced in court. Depending on what was agreed to the mediation agreement may or may not be capable of enforcement. An arbitrator after hearing the case can impose a binding and enforceable decision.
Q. Why should I use an arbitrator when the court system is free?
A. One of the main advantages of arbitration is privacy. Court processes are generally open which means that others can watch and observe what is going on at your hearing and obtain copies of documents filed with the court (unless there is a sealing order). An arbitrator can tailor the process to be more efficient and more timely than a court process. Further, the court system is not really free as there are many different court fees and to make effective use of the system you often need to engage a lawyer. Court cases tend to take longer and as a general rule the longer a case takes to resolve the more expensive it is.
Q. Am I able to recover the costs of arbitration if I win?
A. An arbitrator can make an award for the costs of using a lawyer and for the recovery of the share the party paid for the fees and disbursements of the arbitrator. Unlike court, arbitrators often base an award for legal fees based on the actual reasonable legal fees paid by the party, which is substantially more than what a judge would order in a court case. Most litigants in court are luck to recover 50 % of their actual legal fees. It is also open to the parties to agree on the principles the arbitrator should use to assess costs – such as an agreement that each party will bear their own costs and one-half of the fees and disbursements of the arbitrator.
Q. Isn’t an arbitration hearing just like court?
A. The process might in some cases resemble a court hearing where witnesses are called and cross-examined that is what the parties want or do not agree to a more flexible process. In other cases an arbitrator may decide a case based on documents only. Arbitration is a flexible tool and the arbitrator can assist in designing a cost effective process tailored to the dispute. For example it is open to the parties to use final offer selection, where the arbitrator picks one of the two options proposed by the parties.
Q. Are arbitration decisions published anywhere?
A. In British Columbia all labour arbitration decisions are filed with the Collective Agreement Arbitration Bureau and generally are publicly available on the Lexis Nexis Quick Law Data base. Some arbitrators file their labour decisions with reporting services such as Lancaster House. Commercial Arbitration awards are not published. Some statutory arbitration awards, for example Bill 13 forestry decisions are published on a government web-site. In a commercial matter if there is a need to enforce the award and there is litigation about the award some parts of the award which a judge refers to may be published in the judge’s decision. If the award is appealed some parts of the award may appear in the Judge’s decision.
Q. I would like to arbitrate a dispute with my business partner can you help?
A. Yes. In order to arbitrate you need the agreement of the other party, unless you are arbitrating under a written agreement that contains an arbitration clause. You can give me a call to see if this is a dispute that I could assist you with. Generally I do not need to know much about the details and when I have this discussion I do not get into the merits of the dispute and I do not give you an opinion about your chances of success. It is a short call to determine whether this is a matter capable of being arbitrated and whether I can assist you. You can get the ball rolling by printing out a joint appointment agreement (insert link) signing it and sending it to the other party for signature. If both parties sign the agreement appointing me, I will contact both of you and set up a preliminary meeting with both disputants, usually by telephone.
Q. There is a written clause in my business agreement, but the opposite party refuses to appoint an arbitrator. What can I do?
A. You likely need to talk to a lawyer. The usual remedy is to have a third party appointing agency make the appointment. By default in British Columbia, if the arbitration clause does not specify a set of arbitration rules, the rules of the British Columbia International Commercial Arbitration Centre applies. The Centre will assist in appointing an arbitrator from their panel roster. I am on the roster and you can request that the Centre put my name forward to the other party to arbitrate the dispute. You can also by agreement use the rules of another arbitration appointing body – ADRIC and they will appoint an arbitrator from their list. I am also on the ADRIC list.
Q. I have an arbitration clause in my business agreement, but the other side is suing me in B.C. Supreme Court. Don’t they have to use the arbitration clause and appoint an arbitrator?
A. It is important for you to contact a lawyer now. A party may try to avoid the use of arbitration by suing in court and unless you make a timely objection you may be stuck in the court process. A lawyer can assist you in applying to the court for an order to stay the Supreme Court law suit so that you can bring the dispute before an arbitrator.
Q. What happens after you are appointed as the arbitrator or you accept an arbitration appointment?
A. I generally arrange a pre-hearing conference with the parties often by way of telephone conference call. Following this meeting I issue directions for hearing which provides a road map or a set of mandatory steps that each party must take to ready the matter for a final decision by me. One of the matters always discussed are the fees and a mandatory retainer deposit is fixed which must be paid by each party. Other issues include exchange of statements and issues, orders for discovery and production of documents.
Q. I wish to arbitrate my family law dispute with my husband can you help?
A. No, I no longer offer services as a family law arbitrator.
Q. I would like you to be my lawyer at an upcoming arbitration hearing. Can you help me?
A. In arbitration matters I only act as a neutral and I am not available to assist you as a lawyer representing you or give legal advice about the merits of your case. Try contacting a lawyer and if you are unfamiliar with lawyers practicing in your community contact the Lawyer’s Referral Service.
Q. I have a problem with my apartment landlord can you help me?
A. I do not get involved in residential tenancy disputes. For more information contact the Tenancy Rights Action Coalition – Toll Free 1-800-665-1185, website – http://tenants.bc.ca/ or Residential Tenancies Branch http://www2.gov.bc.ca/gov/content/housing-tenancy/residential-tenancies . Residential tenancy disputes can be arbitrated but the Residential Tenancies Branch deals with this area of dispute resolution.