Karen Lovell

The applicants sought to set aside a NAFTA Chapter 11 arbitral tribunal's damages award, arguing the tribunal exceeded its jurisdiction, breached procedural fairness, and rendered an award contrary to Canadian public policy.

The tribunal had previously found Canada breached its NAFTA obligations regarding an environmental assessment for a proposed quarry, but in the damages phase, awarded only $7 million USD for the lost opportunity of a fair assessment rather than the $440 million claimed for lost profits.

The Superior Court of Justice dismissed the application, finding the tribunal correctly applied the international law standard of proof, did not breach natural justice in its procedural rulings regarding expert reports, and rendered a decision that was not contrary to public policy.

The plaintiffs moved to remove the defendant's designated representative for examination for discovery, Peter Hill, due to an irreconcilable conflict of interest.

Hill had a lucrative consulting contract with one of the incumbent telecommunications providers whose conduct was central to the action, and his contract required him to prefer his client's interests.

The court found that Hill's contractual obligations and his evasive testimony during discovery demonstrated a preference for the incumbent's interests over his duties as a witness, rendering him a demonstrably unsatisfactory representative.

The motion was granted, and Hill was ordered to be replaced by Kelly Gillis or another suitable witness.

The applicant, the Attorney General of Canada, sought to set aside a NAFTA arbitral award that found Canada liable for breaching the prohibition on performance requirements under Article 1106.

Canada argued that the tribunal exceeded its jurisdiction by applying the wrong criteria to determine whether the impugned guidelines fell within Canada's reservation for subordinate measures under Article 1108.

The Superior Court of Justice dismissed the application, holding that the tribunal's interpretation of the NAFTA reservation provisions was a question of merits, not a true question of jurisdiction under Article 34(2)(a)(iii) of the Commercial Arbitration Code.