Linda Irene Knol

Two related applications arose from a commercial arbitration concerning a Liquidity Payment obligation under a financing arrangement between a dairy company and a pension fund.

The moving party sought to set aside a final arbitral award under s. 46(1) of the Arbitration Act, 1991, alleging breaches of procedural fairness and arguing the arbitrator’s contractual interpretation was unreasonable.

The court held the arbitration process was fair, the parties had adequate opportunity to present their cases, and the arbitrator’s interpretation of the Liquidity Payment Agreement was consistent with its plain language.

The application to set aside the award was dismissed.

The responding party’s application to enforce the arbitral award and supplementary costs award was granted, with interest fixed at 3% in accordance with the contract and applicable statutory rates.

The applicants appealed an arbitration award concerning a franchise dispute under the Arthur Wishart Act (Franchise Disclosure), 2000 and alleged negligent misrepresentation in financial forecasts relating to a Canadian Tire store development.

They argued the arbitrator applied an incorrect legal test for negligent misrepresentation and erred in assessing reliance, causation, and damages.

The court held that the scope of review was limited to errors of law and concluded the arbitrator had effectively applied the correct test from Queen v. Cognos Inc. The arbitrator’s findings that the forecasts were not negligently prepared and that the applicants did not rely on them were factual determinations not subject to appeal.

The court also upheld the arbitrator’s approach to damages and the interpretation of the release provisions in the dealer contract.