John A. Terry

Mexico sought to set aside an international arbitral award rendered under NAFTA Chapter 11 in which an arbitral tribunal found Mexico liable for breaching the fair and equitable treatment standard and ordered Mexico to pay damages of approximately USD $80.9 million to American investors who operated casinos in Mexico.

Mexico alleged that the tribunal denied it a full and fair opportunity to present its defense by: (1) denying production of certain documents Mexico characterized as "key documents"; and (2) failing to address Mexico's argument regarding the availability of judicial review remedies in Mexican courts.

The court dismissed Mexico's application, finding that the arbitral proceedings were comprehensive and fair, that Mexico's document production denials were reasonable exercises of tribunal discretion, and that Mexico's failure to receive explicit reference to a minor argument did not constitute procedural unfairness.

The appellants appealed the dismissal of their application to set aside a NAFTA Chapter 11 arbitration award.

They argued the tribunal exceeded its jurisdiction by misapplying the causation standard and that the award violated public policy.

The Court of Appeal dismissed the appeal, affirming the narrow scope of judicial review for arbitration awards under the Commercial Arbitration Code.

The court held that the tribunal acted within its jurisdiction and that the award did not conflict with Canadian public policy, which requires a very high standard for intervention.

The Samuelson-Glushko Canadian Internet Policy and Public Interest Clinic (CIPPIC) brought a motion for leave to intervene as a friend of the court in an appeal concerning the test for procedural unfairness under the Model Law in international commercial arbitration.

The underlying appeal involved an arbitral claim by Vento Motorcycles Inc. against the United Mexican States under NAFTA, where Vento alleged denial of procedural fairness.

CIPPIC proposed an alternative "material" procedural fairness violation test.

The Court of Appeal dismissed CIPPIC's motion for leave to intervene, finding that CIPPIC did not sufficiently link its expertise to the issue, the case was a private dispute between sophisticated parties, and CIPPIC's proposed arguments risked expanding the scope of the appeal without providing a useful contribution.

The applicant, Vento Motorcycles, Inc., sought to set aside an arbitral award rendered by an ICSID tribunal, alleging two grounds: inability to present its case due to the tribunal's refusal to allow a witness to testify in response to impeachment evidence, and reasonable apprehension of bias by one of the arbitrators due to undisclosed offers of future appointments from the respondent.

The court dismissed the application, finding that Vento was able to present its case and that while a reasonable apprehension of bias existed for one arbitrator, it did not undermine the reliability of the unanimous award or produce real unfairness, especially given the collegial nature of the tribunal and the significant prejudice of redoing the arbitration.

The United Mexican States appealed a Superior Court of Justice decision that affirmed an arbitral tribunal's jurisdiction in a claim brought by Burr et al. under the North American Free Trade Agreement.

The arbitral tribunal had bifurcated proceedings into jurisdiction and merits phases, ruling it had jurisdiction over most claims.

Mexico's application to the Superior Court to set aside this jurisdictional ruling was dismissed.

Burr et al. moved to quash Mexico's appeal to the Court of Appeal.

The Court of Appeal granted the motion to quash, holding that the arbitral tribunal's ruling was a preliminary question of jurisdiction under Article 16(3) of the UNCITRAL Model Law on International Commercial Arbitration.

This article stipulates that a Superior Court's decision on such a preliminary jurisdictional ruling is 'subject to no appeal'.

The Court found that Mexico had not substantively pursued arguments under Article 34, which would permit an appeal, before the application judge.

This case management endorsement addresses procedural issues arising from a request by Concerned Citizens of North Stormont to discuss a possible recusal motion.

The court clarifies that allegations of reasonable apprehension of bias should be raised at the earliest opportunity, with counsel's knowledge being relevant.

It also discusses the court's jurisdiction to issue a Rule 2.1 notice in such circumstances and acknowledges the role of ongoing settlement discussions.

The Court held Yukon breached the Chapter 11 modern treaty land-use planning process by making major final-stage changes not properly proposed earlier and not grounded in changing circumstances.

Yukon’s approval was quashed, and the parties were returned to the s. 11.6.3.2 stage.

The Court rejected the Court of Appeal’s approach of resetting the process to an earlier stage and emphasized judicial restraint with robust legality review in modern treaty implementation.

This costs endorsement follows the dismissal of applications by Belokon, Entes, Sistem, and Stans (the "Applicants") to recognize and enforce arbitral awards against the Kyrgyz Republic (the "Republic"), and to declare an exigible ownership interest of the Republic in Centerra Gold Inc. shares held by Kyrgyzaltyn JSC.

The Republic and Kyrgyzaltyn (the "Respondents") sought costs.

The court awarded costs on a partial indemnity basis, rejecting claims for full or substantial indemnity.

It also determined that costs should be payable on a several, not joint and several, basis due to the unrelated nature of the Applicants and the court-directed common issue hearing.

The court limited the costs award to the common issue hearing, excluding prior jurisdiction motions or general recognition application costs, and considered previous compensation for materials.

The applicants sought a declaration that the Kyrgyz Republic held an exigible ownership interest in shares of Centerra Gold Inc. registered in the name of its wholly-owned subsidiary, Kyrgyzaltyn JSC, to enforce arbitral awards.

The court dismissed the applications, finding that the Agreement on New Terms (ANT) unambiguously established Kyrgyzaltyn JSC as the beneficial owner of the shares, not the Republic.

The court rejected arguments based on contract interpretation under New York law and trust principles under Canadian law, emphasizing the separate legal personality of the subsidiary and the lack of evidence for an ownership interest or trust.