Court of Appeal for Ontario

Date: 2025-07-03
Docket: M55914 (COA-25-OM-0062)
Panel: Roberts, Zarnett and Gomery JJ.A.

Between

Steven Bulut and 1091369 Ontario Inc.
Applicants (Appellants)

and

Marko N. Bulut
Respondent (Respondent)

Appearances:
Peter Jervis and Sarah Fiddes, for the appellants
Rahul Shastri and David Winer, for the respondent

Heard: In writing

Reasons for Decision

Introduction

[1] The appellants seek leave to appeal the Superior Court application judge’s dismissal of the appellants’ motion for leave to appeal an arbitrator’s award. The respondent moves to quash the appellants’ motion for leave to appeal.

General Rule and Exception

[2] It is common ground that, as a general rule, no appeal lies from a refusal to grant leave to appeal an arbitrator’s award where the refusal is on the merits. The exception to the general rule is where the judge dismissing the leave application mistakenly declines jurisdiction: see Denison Mines Ltd. v. Ontario Hydro (2001), 56 O.R. (3d) 181, at para. 8; Baffinland Iron Mines LP v. Tower-EBC G.P./S.E.N.C., 2023 ONCA 245, 480 D.L.R. (4th) 426, at paras. 25-26; and Optiva Inc. v. Tbaytel, 2022 ONCA 646, 163 O.R. (3d) 439, at paras. 63-64.

Appellants' Submission

[3] The appellants submit that this case falls squarely within the exception because the application judge concluded that there were no errors of law rather than addressing the second prong of the leave to appeal test under s. 45(1)(b) of the Arbitration Act, 1991, S.O. 1991, c. 17 (“the Act”), thereby declining jurisdiction by “acting on a wrong principle”.

Court's Analysis

[4] We disagree.

[5] The application judge did not decline jurisdiction to hear the appellants’ leave motion but rather determined it on the merits. She adverted to the correct test for leave under s. 45(1) of the Act, which states:

45 (1) If the arbitration agreement does not deal with appeals on questions of law, a party may appeal an award to the court on a question of law with leave, which the court shall grant only if it is satisfied that,

(a) the importance to the parties of the matters at stake in the arbitration justifies an appeal; and

(b) determination of the question of law at issue will significantly affect the rights of the parties.

[6] The application judge concluded that the proposed grounds of appeal were not deserving of leave to appeal. She determined that the arbitrator had not made errors of law. This necessarily involved her considering whether there was a question of law significantly affecting the rights of the parties, as required under s. 45(1)(b) of the Act.

[7] As this court explained in McEwen (Re), 2020 ONCA 511, 452 D.L.R. (4th) 248, at para. 65: “[i]f the judge denying leave ‘has not mistakenly declined jurisdiction but has reached a decision on the merits of the application’, then no appeal would lie from the refusal of leave”. The fact that the application judge did not identify errors of law on the part of the arbitrator did not amount to declining jurisdiction: McEwen (Re), at para. 66; Optiva, at para. 66.

Disposition

[8] We therefore allow the respondent’s motion and quash the appellants’ motion for leave to appeal.

[9] The respondent is entitled to costs of this motion from the appellants. If the parties cannot agree on the amount of costs, they may deliver written submissions of no more than two pages plus a costs outline within seven days of the release of these reasons.

“L.B. Roberts J.A.”
“B. Zarnett J.A.”
“S. Gomery J.A.”