COURT OF APPEAL FOR ONTARIO

CITATION: Toronto Standard Condominium Corporation No. 1628 v. Toronto Standard Condominium Corporation No. 1636, 2020 ONCA 612

DATE: 20201001

DOCKET: M51387 (C66825)

Strathy C.J.O., MacPherson, Pardu, Huscroft and Jamal JJ.A.

BETWEEN

Toronto Standard Condominium Corporation No. 1628

Applicant

(Respondent/Moving Party)

and

Toronto Standard Condominium Corporation No. 1636,

Soho Grand Condominiums Inc. and Soinco Limited

Respondents

(Appellants/Responding Parties)

Carol A. Dirks, Ronald Davis and Rachel Fielding, for the moving party

Allan Sternberg, Emily Hives and Philip Anisman, for the responding parties

Heard: June 17, 2020 by video conference

On appeal from the order of Justice Lorne Sossin of the Superior Court of Justice, dated March 22, 2019, with reasons reported at 2019 ONSC 1827.

Jamal J.A.:

A. overview

[1] Toronto Standard Condominium Corporation No. 1628 (“Condo 1628”) moves to quash an appeal brought by Toronto Standard Condominium Corporation No. 1636 (“Condo 1636”), Soho Grand Condominiums Inc. (“Soho”), and Soinco Ltd. (“Soinco”) from the order of the motion judge refusing to stay a court proceeding in favour of arbitration. Condo 1628 claims this court lacks jurisdiction because the appeal is barred by s. 7(6) of the Arbitration Act, 1991, S.O. 1991, c. 17 (“Arbitration Act”).[^1]

[2] Subject to certain exceptions under ss. 7(2) and 7(5), s. 7(1) of the Arbitration Act provides that if a party to an arbitration agreement commences a court proceeding about a matter they agreed would be submitted to arbitration, the court shall, on the motion of another party to the arbitration agreement, stay the court proceeding. Under s. 7(5), when arbitrable and non-arbitrable matters are combined in a single court proceeding, if certain conditions are met, the court may stay the proceeding with respect to the matters dealt with in the arbitration agreement and allow it to continue with respect to the other matters. Section 7(6) decrees: “There is no appeal from the court’s decision.”

[3] This motion concerns the scope of s. 7(6). Condo 1628 asks this court to overrule 20 years of its jurisprudence on when s. 7(6) bars an appeal.

[4] This court’s leading decision interpreting s. 7(6), Huras v. Primerica Financial Services Ltd. (2000), 2000 16892 (ON CA), 137 O.A.C. 79 (C.A.), held that if a motion judge decides that an arbitration agreement does not apply to the dispute before the court, then the Arbitration Act also does not apply, including the bar on appeals in s. 7(6). Huras has been followed by this court in seven unanimous decisions, including by two five-judge panels, and adopted as persuasive authority by the appeal courts of three other provinces with provisions identical to s. 7(6) in their arbitration statutes.

[5] Condo 1628 invites this court to overrule the Huras line of cases and quash this appeal based on the Supreme Court of Canada’s decision in TELUS Communications Inc. v. Wellman, 2019 SCC 19, [2019] 2 S.C.R. 144. In Wellman, Moldaver J. for the majority held that s. 7(5) “does not grant the court discretion to refuse to stay claims that are dealt with in an arbitration agreement”: at para. 8. He ruled that s. 7(5) “does not … permit the court to ignore a valid and binding arbitration agreement”: at para. 103. Wellman overturned this court’s contrary interpretation of s. 7(5) in Griffin v. Dell Canada Inc., 2010 ONCA 29, 98 O.R. (3d) 481, leave to appeal refused, [2010] S.C.C.A. No. 75, which had construed s. 7(5) as granting a motion judge discretion to refuse to stay claims dealt with in an arbitration agreement.

[6] As I elaborate below, although Wellman overturned Griffin on the interpretation of s. 7(5), it did not disturb the Huras line of cases on the interpretation of s. 7(6). In my view, the Huras line of cases was correctly decided.

[7] I also conclude that s. 7(6) does not bar an appeal from the motion judge’s order in this case. The motion judge found that the proceeding before the court combines matters that are dealt with in the arbitration agreement with other matters that are not dealt with in the arbitration agreement. Because the motion judge did not have the benefit of Wellman at the time of his decision, he applied this court’s decision in Griffin, refused to stay any part of the proceeding under s. 7(5), and allowed the entire proceeding to continue before the court. But as Wellman later confirmed, s. 7(5) does not grant the court discretion to refuse to stay claims that are dealt with in an arbitration agreement, and does not permit a court to ignore a valid and binding arbitration agreement. Because the motion judge granted relief that was unavailable under s. 7(5) or elsewhere in s. 7, he did not make a decision under s. 7, so an appeal is not barred by s. 7(6). And because this was a final order — terminating potential proceedings before the arbitrator and overriding a substantive contractual right to arbitrate — an appeal lies to this court under s. 6(1)(b) of the Courts of Justice Act, R.S.O. 1990, c. C.43.

[8] I would therefore dismiss the motion to quash the appeal.

B. background

(a) Facts

[9] This motion and the appeal arise in litigation about amounts owing under a cost-sharing agreement (“Reciprocal Agreement”) for the costs of certain common facilities in two adjoining condominium projects on Wellington St. West in Toronto.

[10] The Reciprocal Agreement is between Soho, the declarant[^2] of the two condominium projects, and Condo 1628. Condo 1628 and Condo 1636 each administer one of the two adjoining condominium projects.

[11] The Reciprocal Agreement apportion costs for the common facilities between Condo 1628 (responsible for 69%) and Condo 1636 (responsible for 31%). The common facilities are owned by Soinco, but are managed, operated, and controlled by Condo 1636. Condo 1636 assumed all the covenants and obligations of Soho under the Reciprocal Agreement and enforces any default of Condo 1628’s obligation to pay its share of the common facilities costs.

[12] The Reciprocal Agreement contains the following arbitration provision:

ARTICLE 6 ARBITRATION

6.1 The validity, construction and performance of this Agreement shall be governed by the laws of the Province of Ontario and any dispute that may arise under this Agreement shall be determined by arbitration by a single arbitrator to be agreed upon by the parties within thirty (30) days of written notification by any of the parties of a request for arbitration. If the parties are unable to agree upon the arbitrator, same shall be appointed upon application to a single judge of the Ontario Superior Court of Justice in accordance with and pursuant to the Arbitration Act, 1991 (Ontario), as amended. The arbitrator’s decision shall be final and binding upon the parties and shall not be subject to appeal.

[13] In addition, s. 132 of the Condominium Act, 1998, S.O. 1998, c. 19 (“Condominium Act”) provides that an agreement — such as the Reciprocal Agreement — between a declarant and a corporation created under the Condominium Act shall be deemed to contain a provision to submit any disagreement between the parties to mediation and, if mediation fails, to arbitration under the Arbitration Act.

[14] Condo 1628 paid its share of the common facilities costs for the years 2005‑2008 and 2015-2018, but disputed the amounts for the years 2009-2014. Condo 1628 and Condo 1636 mediated the dispute, as required by s. 132 of the Condominium Act, but when mediation failed, Condo 1628 refused to arbitrate the dispute and instead began an application before the Superior Court of Justice against Condo 1636, Soho, and Soinco.

[15] Condo 1628’s court application alleges that Soho imposed the Reciprocal Agreement on it through oppression, for which it seeks remedies under s. 135 of the Condominium Act, and based on false, deceptive, or misleading statements or information, for which it seeks remedies under s. 133 of the Condominium Act.[^3] It alleges that Soho controlled the board of directors of Condo 1628 when the Reciprocal Agreement was concluded and imposed a disproportionate share of the common facilities costs on Condo 1628, effectively subsidizing Condo 1636.

[16] Condo 1636, Soho, and Soinco responded by moving before the Superior Court to stay the court application in favour of arbitration.

(b) The motion judge’s decision

[17] The motion judge dismissed the motion and ruled that the “entire matter should proceed in the form of [an] application before th[e] court”: at para. 76.

[18] The motion judge rejected Condo 1628’s argument that because Soinco and Soho are not parties to the Reciprocal Agreement (Soinco is not a party and Soho’s rights and obligations were assumed by Condo 1636), they cannot rely on the arbitration agreement. He ruled that Soinco, Soho, and Condo 1636 are “closely connected”, which in his view “likely does not present a bar to arbitration for disputes under the Reciprocal Agreement”: at para. 34.

[19] The motion judge accepted that some of Condo 1628’s claims are arbitrable, as Condo 1628 had conceded, and held that none of the exceptions in s. 7(2) of the Arbitration Act to the mandatory stay under s. 7(1) apply: at paras. 67, 69-70. But he also ruled that Condo 1628’s court application seeks remedies that may not be available through arbitration, including remedies for oppression under s. 135 of the Condominium Act and for providing material information that was false, deceptive, or misleading under s. 133 of the Condominium Act: at paras. 14, 39‑42, 75. He ruled that the arbitration mandated by s. 132 of the Condominium Act “was clearly not intended to govern disputes whose core or essence is oppression”: at para. 63. He therefore held that s. 135 of the Condominium Act requires aspects of the court application to proceed in court, while the arbitration provision in the Reciprocal Agreement, s. 132 of the Condominium Act, and ss. 7 and 17(1) of the Arbitration Act require other aspects to proceed to arbitration: at para. 69.

[20] The motion judge ruled that it was not appropriate to bifurcate the arbitrable and non-arbitrable claims and held that all the claims could continue before the court. Relying on this court’s decision in Griffin, he stated that the discretion under s. 7(5) to grant a partial stay of the court proceeding should not be exercised where the claims cannot reasonably be bifurcated, because this “would lead to inefficiency, a potential multiplicity of proceedings, and added cost and delay”: at para. 73, citing Griffin, at para. 47. He therefore ordered the entire matter to proceed in court, at paras. 75-76:

While an arbitration could deal with some aspects of this dispute, and while other aspects remain contingent on how narrow or broad an arbitrator sees the jurisdiction of the arbitration clause in the Reciprocal Agreement and s. 132 of the Condominium Act, it is apparent that what I have concluded are the core or essential aspects of this application would need to proceed to this court to be resolved, as they arise under s. 135 of the Condominium Act.

Consequently, in light of s. 138 of the Courts of Justice Act and r. 1.04 of the Rules of Civil Procedure, to promote an efficient and complete adjudication of the allegations that [Condo 1628] has raised against [Condo 1636], Soho and Soinco, this entire matter should proceed in the form of the application before this court.

(c) Subsequent events

[21] A few weeks after the motion judge’s decision, the Supreme Court released Wellman. A majority of the Court overturned this court’s decision in Griffin on the interpretation of s. 7(5) of the Arbitration Act, on which the motion judge had relied.

[22] Condo 1636, Soho, and Soinco appealed the motion judge’s decision to this court, relying in part on Wellman.

[23] Shortly before the appeal was to be heard by a three-judge panel, this court asked the parties to be prepared to address whether it had jurisdiction to hear the appeal, given the comments of the majority of the Supreme Court in Wellman, at paras. 91 and 104, which mention s. 7(6) of the Arbitration Act.

[24] At the appeal hearing, Condo 1628 claimed that s. 7(6) bars the appeal. Its position was that this court should overturn the Huras line of cases on the interpretation of s. 7(6) and quash the appeal. As a result, this court adjourned the appeal to convene a five-judge panel for the motion to quash.

C. discussion

[25] The central issue on this motion is whether s. 7(6) of the Arbitration Act bars an appeal to this court from the motion judge’s order refusing to stay the court proceeding and permitting both the arbitrable and non-arbitrable claims to proceed in court. Condo 1628 contends that, given the reasoning in Wellman, this court should overturn the Huras line of cases on s. 7(6) and quash the appeal.

[26] To address this issue, I will first review the discussion in Wellman of the applicable statutory framework of the Arbitration Act. I will then review the Huras line of cases on s. 7(6). With that background, I will address three questions:

1. Did the Supreme Court in Wellman overrule the Huras line of cases on the interpretation of s. 7(6) of the Arbitration Act? My answer is “no”.

2. Should the Huras line of cases be overruled? My answer is “no”.

3. Does s. 7(6) of the Arbitration Act bar this appeal? My answer is “no”.

I would therefore dismiss the motion to quash the appeal.

(a) Wellman on the purpose and scheme of the Arbitration Act

[27] Wellman was mainly concerned with the proper interpretation of s. 7(5) of the Arbitration Act:

Agreement covering part of dispute

7(5) The court may stay the proceeding with respect to the matters dealt with in the arbitration agreement and allow it to continue with respect to other matters if it finds that,

(a) the agreement deals with only some of the matters in respect of which the proceeding was commenced; and

(b) it is reasonable to separate the matters dealt with in the agreement from the other matters.

[28] The Court had to decide whether s. 7(5) of the Arbitration Act gave a motion judge discretion to refuse to stay arbitrable claims in a proposed class action brought against a cellphone company on behalf of a class of customers consisting of both consumer claims, which were not subject to arbitration, and business customer claims, which were subject to arbitration. Such discretion had been recognized in Griffin, at paras. 46-62, and in the decision under appeal before the Supreme Court, Wellman v. TELUS Communications Company, 2017 ONCA 433, 138 O.R. (3d) 413, at paras. 8, 72-73, 76, 98. Such discretion was also recognized by the motion judge in this case: at paras. 72-76. However, Moldaver J. for the majority ruled that this was the wrong interpretation of s. 7(5). He overturned this court’s decision in Wellman and stayed the claims of the business customers because those customers were legally bound by the arbitration agreement: at para. 102.

[29] I will review in some detail Moldaver J.’s reasoning for reaching this conclusion because it is central to Condo 1628’s argument on this motion.

[30] Moldaver J. interpreted s. 7(5) in accordance with the modern approach to statutory interpretation: “the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of the Parliament”: at para. 47, citing E.A. Driedger, The Construction of Statutes, 2nd ed. (Toronto: Butterworths, 1983), at p. 87, and Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42, [2002] 2 S.C.R. 559, at para. 26.

[31] Moldaver J. stated, at paras. 51-56, that the purpose and scheme of the Arbitration Act reflect the policy that parties to a valid arbitration agreement should abide by their agreement, a policy that is tied to two principles. The first is “party autonomy” — “the principle that parties should generally be allowed to craft their own dispute resolution mechanism through consensual agreement”: at para. 52 (citations omitted). The second is “the principle of limited court intervention in arbitration matters”: at para. 55.

[32] He stressed that these policies and principles are intimately related: “[t]he policy that parties to a valid arbitration agreement should abide by their agreement goes hand in hand with the principle of limited court intervention in arbitration matters”: at para. 55 (emphasis added). The principle of limited court intervention in arbitration matters fosters party autonomy and respects the parties’ choice of arbitration as their dispute resolution mechanism. As Moldaver J. explained, the “hands off” approach to matters governed by the Arbitration Act is “in keeping with the modern approach that sees arbitration as an autonomous, self-contained, self‑sufficient process pursuant to which the parties agree to have their disputes resolved by an arbitrator, not by the courts”: at para. 56, citing Inforica Inc. v. CGI Information Systems and Management Consultants Inc., 2009 ONCA 642, 97 O.R. (3d) 161, at para. 14. I will return to the intimate relationship between these policies and principles later.

[33] Moldaver J. read s. 7(5) in the context of s. 6 and the rest of s. 7. Section 6 of the Arbitration Act provides:

Court intervention limited

6 No court shall intervene in matters governed by this Act, except for the following purposes, in accordance with this Act:

1. To assist the conducting of arbitrations.

2. To ensure that arbitrations are conducted in accordance with arbitration agreements.

3. To prevent unequal or unfair treatment of parties to arbitration agreements.

4. To enforce awards.

[34] He noted that s. 6 “signals that courts are generally to take a ‘hands off’ approach to matters governed by the Arbitration Act”: at para. 56.

[35] Moldaver J. also read s. 7(5) in light of s. 7(1), which provides:

Stay

7 (1) If a party to an arbitration agreement commences a proceeding in respect of a matter to be submitted to arbitration under the agreement, the court in which the proceeding is commenced shall, on the motion of another party to the arbitration agreement, stay the proceeding.

[36] He explained, at para. 63, that the general rule in s. 7(1) — that when a party to an arbitration agreement commences a proceeding regarding a matter dealt with in the agreement, the court shall stay the proceeding in favour of arbitration — “reaffirms the concept of party autonomy and upholds the policy underlying the Arbitration Act that parties to a valid arbitration agreement should abide by their agreement.”

[37] Moldaver J. also noted s. 7(2), which provides five exceptions to s. 7(1):

Exceptions

(2) However, the court may refuse to stay the proceeding in any of the following cases:

1. A party entered into the arbitration agreement while under a legal incapacity.

2. The arbitration agreement is invalid.

3. The subject-matter of the dispute is not capable of being the subject of arbitration under Ontario law.

4. The motion was brought with undue delay.

5. The matter is a proper one for default or summary judgment.

[38] He explained that these exceptions are “all cases where it would be either unfair or impractical to refer the matter to arbitration”: at para. 65, citing MDG Kingston Inc. v. MDG Computers Canada Inc., 2008 ONCA 656, 92 O.R. (3d) 4, at para. 36, leave to appeal refused, [2010] S.C.C.A. No. 94.

[39] Finally, Moldaver J. addressed s. 7(5), the partial stay provision, which he noted provides another exception to the general rule in s. 7(1): at para. 66. He held that ss. 7(5)(a) and (b) contain two preconditions and a discretionary exception:

• The two preconditions are, first, “the proceeding must involve both (1) at least one matter that is dealt with in the arbitration agreement and (2) at least one matter that is not dealt with in the arbitration agreement”; and, second, “it is reasonable to separate the matters dealt with in the [arbitration] agreement from the other matters”: at paras. 66-68 (emphasis in original).

• The discretionary exception provides that “[i]f both preconditions are satisfied, then instead of ordering a full stay [of the court proceeding], the court ‘may’ allow the matters that are not dealt with in the arbitration agreement to proceed in court, though it must nonetheless stay the court proceeding in respect of the matters that are dealt with in the agreement”: at para. 69 (emphasis in original).

[40] Moldaver J. refused to read s. 7(5) in isolation from ss. 7(1) and 7(2), as effectively a standalone provision giving the motion judge discretion to refuse to stay the court proceeding for the matters dealt with in the arbitration agreement: at paras. 73-74. Although this court had interpreted s. 7(5) that way in Griffin, Moldaver J. held that this was the wrong interpretation of s. 7(5). He held that such an interpretation conflicts with the policy underlying the Arbitration Act that parties to a valid arbitration agreement should abide by their agreement. It would also reduce the certainty and predictability associated with arbitration agreements by allowing “persons who are party to an arbitration agreement to ‘piggyback’ onto the claims of others … and potentially discourage parties from using arbitration as an efficient, cost-effective means of resolving disputes”: at para. 76.

[41] Moldaver J. added that s. 138 of the Courts of Justice Act, which provides that “[a]s far as possible, multiplicity of legal proceedings shall be avoided”, does not provide a basis to override s. 7(5). He noted that the stipulation in s. 138 that the court “shall” avoid a multiplicity of proceedings is tempered by language that the court must do so only “as far as possible”. He observed that s. 7(5) “expressly contemplates bifurcation of proceedings”, with a potentially concurrent arbitration and court adjudication, and therefore the court must give effect to the will of the legislature in s. 7(5): at para. 90.

[42] Moldaver J. thus held that when arbitrable and non-arbitrable matters are combined in a single court proceeding and it is reasonable to separate these matters, s. 7(5) gives the motion judge discretion to allow the court proceeding to continue in respect of the matters not dealt with in the arbitration agreement, provided that the judge stays the court proceeding in respect of the matters dealt with in the arbitration agreement. But under s. 7(5) the motion judge cannot refuse to stay the court proceeding in respect of the matters dealt with in the arbitration agreement: at paras. 101-102. Section 7(5) “does not … permit the court to ignore a valid and binding arbitration agreement”: at para. 103.

[43] Wellman expressly overturned this court’s contrary interpretation of s. 7(5) in Griffin. But Wellman also necessarily overturned other cases that have adopted the same erroneous interpretation of s. 7(5) as this court in Griffin. In Wellman, Moldaver J. noted that this court in Griffin had “referred to a line of cases in which courts refused a stay and allowed the action to proceed on the basis that only some of the litigants were bound by an arbitration clause and the claims were so closely related that it would be unreasonable to separate them”: at para. 34. The Ontario cases that Moldaver J. listed are Radewych v. Brookfield Homes (Ontario) Ltd., 2007 23358 (Ont. S.C.), aff’d 2007 ONCA 721; Johnston v. Goudie (2006), 2006 19931 (ON CA), 212 O.A.C. 79, leave to appeal refused, [2006] S.C.C.A. No. 410; Penn-Co Construction Canada (2003) Ltd. v. Constance Lake First Nation (2007), 66 C.L.R. (3d) 78 (Ont. S.C.), aff’d 2008 ONCA 768, 76 C.L.R. (3d) 1; Frambordeaux Developments Inc. v. Romandale Farms Ltd., 2007 55364 (Ont. S.C.). These cases must, in my view, be taken as having been overturned on the interpretation of s. 7(5). I will return to this point later.

[44] Finally, Moldaver J. discussed s. 7(6) briefly. Before addressing those comments, I will first review the Huras line of cases on the interpretation of s. 7(6).

(b) The Huras line of cases on s. 7(6) of the Arbitration Act

[45] In Huras, this court held that a motion judge’s decision that a matter is not subject to arbitration under an arbitration agreement is a decision outside the scope of s. 7, and thus an appeal from that decision is not barred by s. 7(6).

[46] Huras concerned a proposed class proceeding brought on behalf of a group of persons who had enrolled in a training program to become part of a company’s sales force. The trainees were not paid during the training period, but if later hired would sign an agreement providing that any dispute between the parties would be negotiated and then arbitrated.

[47] The motion judge in Huras dismissed a motion brought under s. 7(1) of the Arbitration Act to stay the proposed class proceeding and refer the dispute to arbitration because he held that the arbitration clause did not apply retroactively to the training period. On a motion to quash the appeal, Finlayson J.A. for the court held, at para. 10, that s. 7(6) did not bar the appeal if the motion judge had concluded that the arbitration agreement did not apply:

Where there is no arbitration clause, the Arbitration Act, 1991 has no application, or, putting it another way, the dispute lies beyond the scope of s. 7. It follows that if the court has decided that the Act is not applicable, then the prohibition against an appeal in s. 7(6) is equally not applicable: see Deluce Holdings Inc. v. Air Canada (1992), 1992 7654 (ON SC), 12 O.R. (3d) 131 (Gen. Div.) and Simmons v. London (City), [1997] O.J. No. 3073 (Gen. Div.).

[48] Finlayson J.A. held that the court had jurisdiction to hear the appeal under s. 6(1)(b) of the Courts of Justice Act, which provides that, unless an appeal lies to the Divisional Court, an appeal lies to the Court of Appeal from “a final order of a judge of the Superior Court of Justice”. He ruled that the dismissal of the stay motion was a final order as to the forum where the dispute would be resolved and affected the substantive contractual right to resolve the dispute by arbitration. Section 6(1)(b) therefore provided a right of appeal to this court: at paras. 12-17.

[49] In the 20 years since Huras was decided, Finlayson J.A.’s interpretation of s. 7(6) has been followed by this court in seven unanimous decisions, including by two five-judge panels: see Brown v. Murphy (2002), 2002 41652 (ON CA), 59 O.R. (3d) 404 (C.A.), at para. 8, per Charron J.A. (as she then was); Mantini v. Smith Lyons LLP (2003), 2003 20875 (ON CA), 64 O.R. (3d) 505 (C.A.), at paras. 15-16, per Feldman J.A., leave to appeal refused, [2003] S.C.C.A. No. 344; Woolcock v. Bushert (2004), 2004 35081 (ON CA), 246 D.L.R. (4th) 139 (Ont. C.A.), at para. 15, per Cronk J.A.; Smith Estate v. National Money Mart Co., 2008 ONCA 746, 92 O.R. (3d) 641, at para. 29, per Sharpe J.A. (five-judge panel), leave to appeal refused, [2008] S.C.C.A. No. 535; Inforica, at paras. 31-32, per Sharpe J.A.; Griffin, at para. 25, per Sharpe J.A. (five-judge panel); and Haas v. Gunasekaram, 2016 ONCA 744, 62 B.L.R. (5th) 1, at para. 3, n. 1, per Lauwers J.A.

[50] Brown and Griffin contain especially clear statements of the interpretation of s. 7(6) adopted in Huras.

[51] In Brown, Charron J.A. explained, at para. 5, that Huras first requires the court to interpret the arbitration agreement and to decide whether the subject matter of the action falls within its scope; only then can the court decide whether the appeal bar in s. 7(6) applies:

Where the motions court determines that the arbitration clause has no application, as it did in Huras, the dispute lies beyond the scope of s. 7 and the Arbitration Act is not applicable. Finlayson J.A. therefore concluded that the prohibition against an appeal in s. 7(6) was equally not applicable.

[52] Charron J.A. summarized when s. 7(6) applies, at para. 8:

[T]he bar under s. 7(6) applie[s] to any decision by the motions court under s. 7 to grant or refuse a stay of “a proceeding in respect of a matter to be submitted to arbitration under the agreement” within the meaning of s. 7(1). However, a decision by the motions court that a matter was not subject to arbitration under the terms of the arbitration agreement fell outside the scope of s. 7 and a right of appeal lay to this court from that decision. [Italics in original.]

[53] In Griffin, at para. 25, Sharpe J.A. summarized when s. 7(6) does not apply:

The Arbitration Act, s. 7(6) provides that "there is no appeal from the court's decision" on a stay application under the section. It is now well-established that this provision does not preclude an appeal from an order refusing to grant a stay on the ground that the matter is not subject to arbitration: Huras v. Primerica Financial Services Ltd., (2000), 2000 16892 (ON CA), 137 O.A.C. 79 (C.A.); Mantini v. Smith Lyons LLP (2003), 2003 20875 (ON CA), 64 O.R. (3d) 505, [2003] O.J. No. 1831 (C.A.); Inforica Inc. v. CGI Information Systems and Management Consultants Inc. (2009), 2009 ONCA 642, 97 O.R. (3d) 161 (C.A.); [Smith Estate v. National Money Mart Co., 2008 ONCA 746]. As the motion judge found that the matter was not subject to arbitration, on the authority of these cases, it follows that s. 7(6) does not bar an appeal to this court. [Emphasis added.]

[54] The Supreme Court in Wellman did not refer to this paragraph from Griffin.

[55] Two of the leading texts on Canadian arbitration law have summarized the jurisprudence on s. 7(6) in comparable terms.

[56] J. Brian Casey in Arbitration Law in Canada: Practice and Procedure, 3rd ed. (Huntington, N.Y.: Juris, 2017), states, at p. 367:

It is now well established that prohibition respecting appeal does not preclude an appeal from an order refusing to grant a stay on the ground that the matter is not subject to arbitration.

[57] Similarly, J. Kenneth McEwan and Ludmila B. Herbst in Commercial Arbitration in Canada: A Guide to Domestic and International Arbitrations (Aurora: Canada Law Book, 2004) (loose-leaf updated 2018) state, at para. 3:40.110:

[A] decision by the motions court that a matter (or, where applicable, all the claims) is not subject to arbitration under the terms of the arbitration agreement falls outside the scope of the stay provision and a right of appeal lies to the court of appeal from that decision. An order refusing a stay finally determines the forum in which the dispute is to be resolved and terminates any possible proceedings before the arbitral body. The order also deprives a party of the substantive right of resolving its dispute by good faith negotiation and arbitration. [Emphasis added; footnotes omitted.]

[58] Although the Ontario legislature has amended Ontario’s arbitration legislation several times since Huras was decided, and has enacted legislation allowing consumers to commence class proceedings regarding consumer agreements even when those agreements require mandatory arbitration, it has never overridden this court’s interpretation of s. 7(6): see S.O. 2006, c. 1, s. 1; S.O. 2006, c. 19, Sched. C, s. 1(1); S.O. 2009, c. 33, Sched. 2, s. 5; S.O. 2017, c. 2, Sched. 5, s. 13; and Consumer Protection Statute Law Amendment Act, 2002, S.O. 2002, c. 30, s. 8(1).

[59] This court’s interpretation of s. 7(6) in the Huras line of cases has also been adopted as persuasive authority by the appeal courts of Manitoba, New Brunswick, and Alberta in interpreting identical provisions in their arbitration statutes, all of which are modelled on s. 7(6) of the Uniform Law Conference of Canada’s Uniform Arbitration Act (1990): see Hnatiuk v. Court, 2010 MBCA 20, 251 Man. R. (2d) 178, at paras. 26-35; Chrysler Canada Inc. v. Eastwood Chrysler Dodge Ltd., 2010 MBCA 75, 262 Man. R. (2d) 1, at para. 37; Hopkins v. Ventura Custom Homes Ltd., 2013 MBCA 67, 294 Man. R. 168, at paras. 43-49; Briones v. National Money Mart Co., 2014 MBCA 57, 306 Man. R. (2d) 129, at paras. 21-22, leave to appeal refused, [2014] S.C.C.A. No. 355; SNC-SNAM, G.P., a partnership between SNC-Lavalin Inc. and Snamprogetti Canada Inc. v. Opron Maritimes Construction Ltd., 2011 NBCA 60, 336 D.L.R. (4th) 129, at paras. 35-40; A.G. Clark Holdings Ltd. v. HOOPP Realty Inc., 2013 ABCA 101, 544 A.R. 114, at paras. 6-14; and Lafarge Canada Inc. v. Edmonton (City), 2013 ABCA 376, 561 A.R. 305, at para. 4.

[60] In Opron Maritimes, at paras. 36 and 40, Richard J.A. (now Chief Justice) for the New Brunswick Court of Appeal explained why he found this court’s reasoning in Huras and later cases to be “compelling”:

The Ontario cases persuade me to conclude … that if a motion judge stays a proceeding on the grounds the conditions in s. 7(1) are met, there can be no appeal from that decision. Similarly, if a motion judge concludes that at least one of the criteria listed in s. 7(2) is met, and, as a result, refuses to stay the proceeding, there can be no appeal from that decision. Likewise, if a motion judge makes a determination under s. 7(5) of the [Arbitration Act, S.N.B. 1992, c. A-10.1], there can be no appeal from that decision. On the other hand, if the motion judge holds there is no applicable arbitration agreement upon which the proceedings could be stayed, or, in other words, if the judge does not make any of the determinations he or she might be called upon to make under s. 7 of the Arbitration Act, then s. 7(6) cannot be successfully invoked to bar an appeal. [Emphasis added.]

[61] The Alberta Court of Appeal in HOOPP Realty, at para. 13, agreed with Richard J.A.:

We agree with the conclusion reached by Richard JA of the New Brunswick court that, if the motion judge holds there is no applicable arbitration agreement upon which the proceedings could be stayed, then s 7(6) cannot be successfully invoked to bar an appeal: see Opron Maritimes at para 40. In such circumstances, the usual litigation process is followed. The litigants are entitled to access to all the court processes, including appellate review, the agreement itself having been determined to fall outside the provisions of the Arbitration Act, [R.S.A. 2000, c. A-43]. If the agreement is outside the scope of the Act, s 7(6) can have no application.

[62] This review of the Huras line of cases shows that courts have tackled the question of when s. 7(6) bars an appeal through several related inquiries. Courts have held that s. 7(6) does not bar an appeal when: (i) there is no arbitration agreement or no applicable arbitration agreement; (ii) the dispute lies beyond the scope of s. 7; (iii) the Arbitration Act does not apply; and (iv) the motion judge did not make a decision under s. 7. Each of these inquiries is directed at the same question — the question raised by s. 7(6) — whether the motion judge made a decision under s. 7 of the Arbitration Act. If the answer is “yes”, s. 7(6) bars an appeal. If the answer is “no”, s. 7(6) does not bar an appeal.

[63] With this background on Wellman and the Huras line of cases, I now turn to consider the three questions arising on this motion: (1) Did Wellman overrule the Huras line of cases? (2) Should the Huras line of cases be overruled? (3) Does s. 7(6) of the Arbitration Act bar this appeal?

Issue #1: Did the Supreme Court in Wellman Overrule the Huras Line of Cases?

[64] Although Condo 1628 relies on Wellman, it does not claim that Wellman overruled the Huras line of cases on the interpretation of s. 7(6). Its factum accepts that “Wellman expressly avoids ruling on s. 7(6)”, and states that Moldaver J. “declines to make a final ruling on [s. 7(6)] for a variety of reasons”.

[65] I agree with Condo 1628’s interpretation of Wellman on this point.

[66] Moldaver J. referred to s. 7(6) in two paragraphs of his reasons. The first time was at the end of the discussion of the “Section 7 Framework”, at para. 91:

(iv) Section 7(6) – Bar on Appeals

[91] Finally, s. 7(6) provides simply that “[t]here is no appeal from the court’s decision”. Given the absence of any qualifying language, s. 7(6) must be taken as referring to a “decision” made under any subsection contained in s. 7. This would include, for example, a decision to stay the proceeding under s. 7(1), a decision to refuse a stay under s. 7(2), or a decision to order a partial stay under s. 7(5).

[67] This paragraph was not part of the ratio decidendi of the majority decision, because this was not the legal point actually decided. The point actually decided was that the lower courts had erred in law “by interpreting s. 7(5) of the Arbitration Act incorrectly and refusing to order a stay that, under s. 7(1), was mandatory … [Section] 7(5) does not … permit the court to ignore a valid and binding arbitration agreement”: at para. 103.

[68] Still, para. 91 of Wellman forms part of the majority’s discussion of the s. 7 framework and should be viewed as obiter dicta intended to provide guidance, while mindful that not every phrase in a judgment of the Supreme Court should be treated as if enacted in a statute: R. v. Henry, 2005 SCC 76, [2005] 3 S.C.R. 609, at para. 57. I take Moldaver J.’s central point to be that the “decision” referred to in s. 7(6) is a decision “made under any subsection contained in s. 7” — an observation consistent with, and reflected in, the Huras line of cases.

[69] The second time Moldaver J. referred to s. 7(6) in Wellman was just before the conclusion of his reasons, at para. 104:

4. Section 7(6) – Bar on Appeals

[104] Finally, I note that the court below did not address the potential application of s. 7(6) of the Arbitration Act, and the matter was discussed only briefly during oral argument before this Court. Neither of the parties has suggested that the s. 7(6) bar applies. In the absence of full submissions, I do not consider it appropriate to make a final ruling on the matter.

[70] This paragraph flags for future consideration, and with the benefit of full submissions, the issue of when s. 7(6) applies. Because the interpretation of s. 7(6) was left open for future consideration, I conclude that Wellman did not overrule the Huras line of cases.

[71] I now turn to consider the issue flagged but not decided in Wellman — when s. 7(6) bars an appeal to this court. Subsumed in this issue is whether the Huras line of cases should be overruled.

Issue #2: Should the Huras Line of Cases Be Overruled?

(a) This court’s approach to overruling its own decisions

[72] As a general rule, this court is bound to follow its past decisions, even if an individual judge or a different panel of the court disagrees with them. As Sharpe J.A. explained on behalf of a five-judge panel in Fernandes v. Araujo, 2015 ONCA 571, 127 O.R. (3d) 115, at para. 45:

As an intermediate court of appeal, we are ordinarily bound to follow our past decisions, even decisions with which we disagree. It is important that we do so. Our common law legal tradition rests upon the idea that we will adhere to what we decided in the past. As expressed in the Latin phrase stare decisis, we stand by things that have been decided. The rule of precedent provides certainty, consistency, clarity and stability in the law. It fosters the orderly and efficient resolution of disputes and allows parties to obtain reliable legal advice and to plan their affairs accordingly.

[73] Even so, this court may depart from its own precedents. When this court is asked to overrule one of its own decisions, the court first asks whether the earlier decision was correctly decided. If the court determines that the earlier decision was wrongly decided, the court then asks whether the decision should be overruled, based on weighing the “advantages and disadvantages of correcting the error”, by focusing on “the nature of the error, and the effect and future impact of either correcting it or maintaining it”, including “the effect and impact on the parties and future litigants” and “on the integrity and administration of our justice system”: David Polowin Real Estate Ltd. v. Dominion of Canada General Insurance Co. (2005), 2005 21093 (ON CA), 76 O.R. (3d) 161 (C.A.), at paras. 107, 127, leave to appeal refused, [2005] S.C.C.A. No. 388; see also R. v. Jenkins, 2010 ONCA 278, 99 O.R. (3d) 561, at para. 29, leave to appeal refused, [2010] S.C.C.A. No. 223; Green v. Canadian Imperial Bank of Commerce, 2014 ONCA 90, 118 O.R. (3d) 641, at para. 15, aff’d 2015 SCC 60, [2015] 3 S.C.R. 801; and United States v. Aneja, 2014 ONCA 423, 120 O.R. (3d) 620, at para. 58.

[74] In what follows, I first summarize Condo 1628’s submission and identify the three propositions on which it is based. I then consider whether the Huras line of cases should be overruled.

(b) Condo 1628’s submission

[75] Condo 1628 submits that this court should overrule the Huras line of cases. Its submission rests on three propositions.

[76] First, Condo 1628 asserts that the Huras line of cases is not in accordance with the modern approach to statutory interpretation. Condo 1628’s factum contends that there are only two possible interpretations of s. 7(6): “either s. 7(6) bars all appeals under s. 7”, which it calls “the comprehensive interpretation”; or “s. 7(6) only bars appeals where a stay has been granted”, which it calls “the status quo interpretation”, and which it says is reflected in the Huras line of cases. Condo 1628 claims that this court should prefer the comprehensive interpretation over the status quo interpretation “[a]s most consistent with the purpose and spirit of the Arbitration Act, including the ‘hands off’ approach of limited judicial intervention that Wellman affirms”, and because “the comprehensive interpretation better reflects the modern approach to statutory interpretation”. Condo 1628 submits that s. 7 must be read as “a one-time opportunity for a party to an arbitration agreement to challenge a proceeding in the courts. Once that opportunity is exhausted, there is no further recourse. There is no appeal” (emphasis in original).

[77] Second, Condo 1628 asserts that s. 7(6) precludes any appeal “from a motion brought under s. 7, including this appeal” (emphasis added).

[78] Third, Condo 1628 asserts that the Huras line of cases is wrongly decided because it reads words into s. 7(6) by allowing an appeal to this court if the motion judge refused to stay the court proceeding. Condo 1628’s factum contends that the reasoning of the Huras line of cases is “[i]mpeccably logical, but this is not what s. 7 says”:

S. 7(6) does not distinguish between results. Whether a stay is granted or denied, the decision is still one under s. 7. It is the Court’s decision. S. 7(6) bars appeals from the “court’s decision”. Had the Legislature intended to bar appeals from stays but allow appeals from refusals it could have said so. It chose not to.

The status quo interpretation inferentially adds a term to s. 7: if the motions Court refuses the stay, then it is not a “court’s decision” under s. 7(6). This added term is unexpressed in s. 7. [Emphasis in original.]

(c) The Huras line of cases was correctly decided

[79] In addressing Condo 1628’s submission, I acknowledge that the proper interpretation of s. 7(6) of the Arbitration Act is not straightforward. The appellate jurisprudence in four provinces interpreting the eight words in s. 7(6) confirms this; see also Hnatiuk, at para. 27 (interpretation of s. 7(6) “not so straightforward” despite “first blush” reading of the provision); Opron Maritimes, at para. 39.

[80] As I will explain, however, ultimately I do not accept Condo 1628’s interpretation of s. 7(6) or the three propositions on which it is based. In my view, the Huras line of cases was correctly decided.

[81] Condo 1628’s first proposition is that the Huras line of cases does not reflect the modern approach to statutory interpretation. It says that the Huras line of cases fails to read the words of s. 7(6) in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Arbitration Act, the object of that Act, and the intention of the Ontario legislature.

[82] I do not agree with this submission.

[83] I start with the text of s. 7(6). Section 7(6) states: “There is no appeal from the court’s decision”. This raises the question: what “decision” is referred to?

[84] This question was answered by Moldaver J. in Wellman, at para. 91: “[g]iven the absence of any qualifying language, s. 7(6) must be taken as referring to a ‘decision’ made under any subsection contained in s. 7”. Moldaver J. gave as examples of “decisions” made under s. 7 “a decision to stay the proceeding under s. 7(1), a decision to refuse a stay under s. 7(2), or a decision to order a partial stay under s. 7(5)”: at para. 91.

[85] Interpreting s. 7(6) as barring an appeal when the court makes a “decision” under any other subsection of s. 7 reads s. 7(6) in context, which includes the rest of s. 7. By contrast, Condo 1628’s interpretation reads s. 7(6) as essentially a standalone provision, in isolation from the rest of s. 7, as barring an appeal whenever a motion is brought under s. 7 — this is Condo 1628’s second proposition, which I address below.

[86] The Supreme Court’s recent decision in Uber Technologies Inc. v. Heller, 2020 SCC 16, adds further weight to the view that s. 7(6) bars an appeal only from a “decision” made under s. 7 of the Arbitration Act. A majority of the Court held that an arbitration agreement in a standard form contact between Uber and its drivers was unenforceable. One issue before all three levels of court was which arbitration statute applied to the dispute — the Arbitration Act, which contains an appeal bar in s. 7(6), or the International Commercial Arbitration Act, 2017, S.O. 2017, c. 2, Sched. 5 (“ICAA”), which contains no counterpart to s. 7(6). Uber brought a motion under the ICAA to stay the proposed class proceeding in favour of arbitration. The motion judge agreed that the ICAA applied and stayed the proceeding: Heller v. Uber Technologies Inc., 2018 ONSC 718, 421 D.L.R. (4th) 343, at paras. 34, 50, 80. On appeal, this court had “serious reservations” about this conclusion, but stated that nothing turned on it and allowed the appeal because the court held that the arbitration agreement was unenforceable: Heller v. Uber Technologies Inc., 2019 ONCA 1, 145 O.R. (3d) 81, at paras. 16, 21, and 74. On further appeal to the Supreme Court, Abella and Rowe JJ. for the majority dismissed the appeal. They held that the Arbitration Act rather than the ICAA applied, but in a footnote remarked that had the motion judge issued a stay of the court proceeding under the Arbitration Act — the properly applicable statute — no appeal to the Court of Appeal would have been available because of s. 7(6). Abella and Rowe JJ. stated, at para. 19, footnote 5:

We note in passing that if the motion judge had issued a stay under the [Arbitration Act], no appeal to the Court of Appeal would have been available ([Arbitration Act], s. 7(6)). A direct appeal to this Court with leave would still have been permissible [citations omitted]. In this case, because the motion judge’s order was made (in error) under the ICAA, the Court of Appeal did have jurisdiction.

[87] In my view, Abella and Rowe JJ.’s footnote is consistent with the comments of Moldaver J. in Wellman, and both are consistent with the Huras line of cases — s. 7(6) of the Arbitration Act bars an appeal only when the motion judge made a “decision” under s. 7.

[88] This interpretation also respects the two principles animating the Arbitration Act — party autonomy and limited court intervention in arbitration matters. When, for example, a motion judge finds that an arbitration agreement and thus the Arbitration Act do not apply, neither principle is undercut. But if on appeal this court concludes that the arbitration agreement and thus the Arbitration Act do apply and that the dispute should be referred to arbitration, this court’s decision promotes party autonomy by holding the parties to their agreement to arbitrate. It also promotes limited court intervention in arbitration matters, because the court intervenes only to ensure that the dispute is arbitrated as agreed.

[89] By contrast, Condo 1628’s interpretation undercuts party autonomy by precluding an appeal even when a motion judge erroneously fails to give effect to an arbitration agreement. Further, although Condo 1628 extols its approach as respecting the principle of limited court intervention, its approach misunderstands that principle by detaching it from the principle of party autonomy. The principle of limited court intervention is a principle of limited court intervention in the arbitration process. Improperly ending an arbitration before it has begun does nothing to promote that principle and instead flouts the principle of party autonomy.

[90] I would therefore reject Condo 1628’s first proposition, that the Huras line of cases strays from the modern approach to statutory interpretation.

[91] I would also reject Condo 1628’s second proposition, that s. 7(6) bars an appeal from any motion brought under s. 7. Section 7(6) refers to a “decision”, not to “a motion brought”, under s. 7. To state the obvious, a motion may be brought on one statutory basis, but the court’s decision may be made on a different basis. Citing s. 7 in a notice of motion does not bar an appeal to this court. What matters is the statutory basis of the motion judge’s “decision” — whether the court’s decision was made under s. 7.

[92] Condo 1628 further argues that not only was the motion before the motion judge here “brought” under s. 7, because s. 7 was the “stated source” for the motion, but s. 7 was also the basis of the motion judge’s decision, because that provision was “integral” to his reasons. This argument does not depend on establishing that the Huras line of cases was wrongly decided; it asserts that even under the Huras line of cases, s. 7(6) bars an appeal. I will address this argument below when I apply the Huras line of cases to this appeal.

[93] Finally, I would reject the third proposition advanced by Condo 1628, that the Huras line of cases reads words into s. 7(6) by permitting appeals to this court when the motion judge refuses to stay the court proceeding. According to Condo 1628, the Huras line of cases creates an asymmetric rule: appeals are barred if the motion judge stays a court proceeding under s. 7 (which Condo 1628 accepts is correct), but appeals are not barred if the motion judge refuses to stay a court proceeding under s. 7 (which Condo 1628 claims is wrong).

[94] In my view, Condo 1628’s submission does not accurately describe the caselaw interpreting s. 7(6). The caselaw recognizes that there can be no appeal from a motion judge’s decision either to grant or refuse a stay if the decision is made under s. 7. For example, in Brown, Charron J.A. summarized the appeal bar in s. 7(6) as applying “to any decision by the motions court under s. 7 to grantor refuse a stay of ‘a proceeding in respect of a matter to be submitted to arbitration under the agreement’ within the meaning of s. 7(1)”: at para. 8 (italics in original, underlining added). Charron J.A.’s statement tracks the example Moldaver J. gave in Wellman, that s. 7(6) bars an appeal from “a decision to refuse a stay under s. 7(2)”: at para. 91 (emphasis added). See also Opron Maritimes, at para. 32: “if a motion judge concludes that at least one of the criteria in s. 7(2) is met, and, as a result, refuses to stay the proceeding, there can be no appeal from that decision” (emphasis added).

[95] Thus, the caselaw interpreting s. 7(6) does not create an asymmetric rule. Section 7(6) bars an appeal from a motion judge’s decision made under s. 7, whether that decision grants or refuses a stay.

[96] I would therefore reject each of the three propositions Condo 1628 advances to overturn the Huras line of cases. In my view, the Huras line of cases was correctly decided.

Issue #3: Does s. 7(6) of the Arbitration Act Bar This Appeal?

[97] The final issue is whether s. 7(6) of the Arbitration Act bars this appeal. If the motion judge made a decision under s. 7, then s. 7(6) bars an appeal; but if the motion judge did not make a decision under s. 7 and his decision involved a final order, an appeal lies to this court under s. 6(1)(b) of the Courts of Justice Act.

[98] As already noted, Condo 1628 asserts that the motion judge made a decision under s. 7 because s. 7 was the “stated source” of the motion before him and was “integral” to his reasons.

[99] Although there is force to Condo 1628’s argument that s. 7 was integral to the motion judge’s reasons, I have concluded that the motion judge did not make a “decision” under s. 7 of the Arbitration Act, and thus s. 7(6) does not bar this appeal. I reach this conclusion for three reasons.

[100] First, the motion judge did not make a decision under s. 7(1) of the Arbitration Act. He did not stay the court proceeding, in whole or in part.

[101] Second, the motion judge did not make a decision under s. 7(2) of the Arbitration Act. He held that none of the exceptions under s. 7(2) applies: at para. 67. This ruling is not challenged.

[102] Third, the motion judge did not make a decision under s. 7(5) of the Arbitration Act. That provision provides no statutory authority to refuse to grant a stay of the arbitrable claims. Such a disposition is unavailable under s. 7.

[103] The motion judge, however, refused to grant a stay of any part of the court proceeding. He applied this court’s decision in Griffin and concluded that he had statutory authority to override the parties’ arbitration agreement and to permit the entire action — including the arbitrable claims — to proceed in court: at paras. 72‑76. But the Supreme Court in Wellman held that s. 7(5) provides no such authority. Such a disposition is unavailable under s. 7. Under s. 7(5), the motion judge could order only a partial stay of the court proceeding — to allow the matters not dealt with in the arbitration agreement to proceed in court. Had he ordered a partial stay under s. 7(5), s. 7(6) would have barred an appeal from that decision. But he had no authority to order that “the entire matter should proceed in the form of the application before this court”: at para. 76. This was not a disposition available to him under s. 7(5).

[104] It is not enough, in my view, for a motion judge to intend or purport to make a decision under s. 7(5) to trigger the appeal bar in s. 7(6). Rather, s. 7(6) is triggered only where s. 7(5) provides statutory authority for the court’s decision, that is, where the potential disposition is permitted under s. 7(5). If s. 7(5) cannot sustain a motion judge’s decision to override an arbitration agreement, then that decision cannot be made under s. 7(5). Otherwise, even after the Supreme Court’s decision in Wellman, s. 7(6) would bar an appeal to this court if a motion judge continues to apply Griffin in error.

[105] I recognize that the motion judge did not have the benefit of Wellman when he made his decision. At the time, this court’s interpretation of s. 7(5) in Griffin would have afforded him a discretion to override the arbitration agreement and allow the entire court proceeding to continue before the court. But the Supreme Court in Wellman corrected this court’s earlier error of interpretation and explained what s. 7(5) always meant, from the day of its enactment. The Court did not change what s. 7(5) meant or alter its meaning with prospective effect only. Section 7(5) never provided statutory authority for the motion judge to override the parties’ arbitration agreement. Such a disposition has never been available under s. 7(5). The motion judge’s decision was thus not made — because it could not be made — under s. 7(5).

[106] I find support for this conclusion on the legal effect of the Supreme Court in Wellman overturning this court’s erroneous interpretation of s. 7(5) in Lord Nicholls’ speech in National Westminster Bank plc v. Spectrum Plus Limited, [2005] UKHL 41, [2005] 2 A.C. 680. Lord Nicholls eloquently described how, generally, a court correcting an erroneous judicial interpretation of legislation does not change the law or overrule a previous decision with prospective effect only. Instead, the court gives effect to the legislature’s intention from the date of the enactment of the legislation. As Lord Nicholls explained, at para. 38:

[T]he interpretation the court gives an Act of Parliament is the meaning which, in legal concept, the statute has borne from the very day it went onto the statute book. So, it is said, when your Lordships’ House rules that a previous decision on the interpretation of a statutory provision was wrong, there is no question of the House changing the law. The House is doing no more than correct an error of interpretation. Thus, there should be no question of the House overruling the previous decision with prospective effect only. If the House were to take that course it would be sanctioning the continuing misapplication of the statute so far as existing transactions or past events are concerned. The House, it is said, has no power to do this. Statutes express the intention of Parliament. The courts must give effect to that intention from the date the legislation came into force. The House, acting in its judicial capacity, must give effect to the statute and it must do so in accordance with what it considers is the proper interpretation of the statute.

[107] This court cited Lord Nicholls’ comments approvingly in Ontario (Finance) v. Progressive Casualty Insurance Company of Canada, 2009 ONCA 258, 95 O.R. (3d) 219, at para. 57.

[108] It follows that when deciding whether s. 7(6) applies, this court cannot avoid evaluating whether s. 7(5) provides statutory authority for the motion judge’s decision. This court must first isolate the basis for the motion judge’s decision before deciding whether s. 7(6) bars an appeal. If s. 7(5) does not provide authority for the motion judge’s decision, then s. 7(6) does not bar this appeal.

[109] Condo 1628 disputes this, citing this court’s decision in Eggiman v. Martin, 2019 ONCA 974, leave to appeal refused, [2020] S.C.C.A. 44. It claims that this court “cannot entertain” an appeal if s. 7 was integral to the motion judge’s decision, even if he had no statutory authority to apply that provision. Respectfully, I do not agree.

[110] In Eggiman v. Martin, 2019 ONSC 1388 — released after this court’s decision in Wellman but before the Supreme Court’s decision — a motion judge had purported to apply s. 7(5) to refuse to stay an action where only some defendants were bound by an arbitration agreement. The effect of this decision was to override the arbitration agreement. The motion judge relied on this court’s decisions in Radewych(which was followed in Griffin) and Wellman. As I have already explained above at para. 43 of my reasons, the Supreme Court in Wellman overturned these decisions as having erroneously interpreted s. 7(5).

[111] This court dismissed the appeal in Eggiman as barred by s. 7(6). Although this court decided Eggiman after the Supreme Court’s decision in Wellman, the court did not refer to Wellman in its reasons. Rather, at paras. 8-10 of Eggiman, the court relied on this court’s decision in Radewychand concluded that because the order under appeal fell squarely under s. 7(5), the appeal was barred by s. 7(6):

There is no appeal to this court from the order of the motion judge. Section 7(6) is very clear on this point. If it is determined that the arbitration provision applies to the issue that is raised in the proceeding, and thus s. 7 is invoked, then s. 7(6) precludes any appeal from the decision rendered respecting the motion to stay, whether that order grants or refuses the stay: Brown v. Murphy (2002), 2002 41652 (ON CA), 59 O.R. (3d) 404 (C.A.), at para. 8.

This same point is made in Radewych v. Brookfield Homes (Ontario) Ltd., 2007 ONCA 721, where the court said, at para. 4: “[The motion judge’s] decision … falls squarely within s. 7(5) of the Arbitration Act and as such, s. 7(6) of that Act applies and renders his decision unappealable.”

As a consequence, this appeal must be dismissed. In reaching that conclusion, we are not to be seen as agreeing with the analysis engaged in by the motion judge. Rather, we simply do not reach his analysis as any review of it is precluded by s. 7(6). [Emphasis added.]

[112] I agree with the above remarks to the extent they accept that the operative question under s. 7(6) is whether the motion judge made a decision under s. 7. I respectfully disagree, however, with how s. 7(6) was applied in Eggiman. In my view, a motion judge’s decision cannot “fall squarely within s. 7(5)” if the Supreme Court of Canada has repudiated that interpretation of s. 7(5), with effect from the date of the enactment of the legislation. Section 7(5) has never provided a court with authority to override an arbitration agreement, despite this court’s erroneous interpretation of s. 7(5) in Griffin and Radewych. Such a disposition is unavailable and has always been unavailable under s. 7(5). All that is left, then, is the motion judge’s intended or purported reliance on s. 7(5) as statutory authority, but without any legal basis in the statute to do so. Nor, in my respectful view, can one avoid addressing whether s. 7(5) provides statutory authority for the motion judge’s decision. That issue must be addressed to determine whether the judge’s decision was made under s. 7(5), and thus whether s. 7(6) applies.

[113] The Supreme Court refused leave to appeal in Eggiman, but as is well known, the refusal to grant leave “should not be taken to indicate agreement with the judgment sought to be appealed[] from”: Canadian Western Bank v. Alberta, 2007 SCC 22, [2007] 2 S.C.R. 3, at para. 88.

[114] To conclude, in my view, the motion judge here had no statutory authority under s. 7(5) of the Arbitration Act to refuse to stay the claims subject to arbitration and to override the arbitration agreement. Such a disposition is unavailable and has always been unavailable under s. 7(5). The motion judge’s decision was therefore not made under s. 7 of the Arbitration Act, so s. 7(6) does not bar an appeal. And because his order was final — terminating any possible proceedings before the arbitrator and countermanding a substantive contractual right to arbitrate — an appeal from that order lies to this court under s. 6(1)(b) of the Courts of Justice Act.

[115] This conclusion about the application of s. 7(6) is faithful to the principles animating the Arbitration Act: it respects the parties’ autonomy to arbitrate their disputes, and it involves no court intervention in the arbitration process. It also honours the intention of the Ontario legislature as to the meaning and scope of s. 7(5) of the Arbitration Act.

[116] By contrast, Condo 1628’s approach to the application of s. 7(6) subverts the principles animating the Arbitration Act: it fails to respect party autonomy by overriding a valid arbitration agreement, and it involves court intervention in the arbitration process by ending any arbitration before it has begun. It also flouts the intention of the Ontario legislature as to the meaning and scope of s. 7(5) of the Arbitration Act.

D. disposition

[117] I would dismiss the motion to quash the appeal, with costs to the respondents in the agreed amount of $20,000 all inclusive.

Released: October 1, 2020 (“G.R.S.”)

“M. Jamal J.A.”

“I agree. G.R. Strathy C.J.O.”

I agree. J.C. MacPherson J.A.”

“I agree. G. Pardu J.A.”

“I agree. Grant Huscroft J.A.”

APPENDIX

Rules of Civil Procedure, R.R.O. 1990, Reg. 194

1.04(1) These rules shall be liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits.

To Defendant

21.01(3) A defendant may move before a judge to have an action stayed or dismissed on the ground that,

Jurisdiction

(a) the court has no jurisdiction over the subject matter of the action[.]

Arbitration Act, 1991, S.O. 1991, c. 17

Court intervention limited

6 No court shall intervene in matters governed by this Act, except for the following purposes, in accordance with this Act:

1. To assist the conducting of arbitrations.

2. To ensure that arbitrations are conducted in accordance with arbitration agreements.

3. To prevent unequal or unfair treatment of parties to arbitration agreements.

4. To enforce awards.

Stay

7 (1) If a party to an arbitration agreement commences a proceeding in respect of a matter to be submitted to arbitration under the agreement, the court in which the proceeding is commenced shall, on the motion of another party to the arbitration agreement, stay the proceeding.

Exceptions

(2) However, the court may refuse to stay the proceeding in any of the following cases:

1. A party entered into the arbitration agreement while under a legal incapacity.

2. The arbitration agreement is invalid.

3. The subject-matter of the dispute is not capable of being the subject of arbitration under Ontario law.

4. The motion was brought with undue delay.

5. The matter is a proper one for default or summary judgment.

Arbitration may continue

(3) An arbitration of the dispute may be commenced and continued while the motion is before the court.

Effect of refusal to stay

(4) If the court refuses to stay the proceeding,

(a) no arbitration of the dispute shall be commenced; and

(b) an arbitration that has been commenced shall not be continued, and anything done in connection with the arbitration before the court made its decision is without effect.

Agreement covering part of dispute

(5) The court may stay the proceeding with respect to the matters dealt with in the arbitration agreement and allow it to continue with respect to other matters if it finds that,

(a) the agreement deals with only some of the matters in respect of which the proceeding was commenced; and

(b) it is reasonable to separate the matters dealt with in the agreement from the other matters.

No appeal

(6) There is no appeal from the court’s decision.

Condominium Act, 1998, S.O. 1998, c. 19

Mediation and arbitration

132 (1) Every agreement mentioned in subsection (2) shall be deemed to contain a provision to submit a disagreement between the parties with respect to the agreement to,

(a) mediation by a person selected by the parties unless the parties have previously submitted the disagreement to mediation; and

(b) unless a mediator has obtained a settlement between the parties with respect to the disagreement, arbitration under the Arbitration Act, 1991,

(i) 60 days after the parties submit the disagreement to mediation, if the parties have not selected a mediator under clause (a), or

(ii) 30 days after the mediator selected under clause (a) delivers a notice stating that the mediation has failed.

Application

(2) Subsection (1) applies to the following agreements:

1. An agreement between a declarant and a corporation.

2. An agreement between two or more corporations.

3. An agreement described in clause 98 (1) (b) between a corporation and an owner.

Disagreements on budget statement

(3) The declarant and the board shall be deemed to have agreed in writing to submit a disagreement between the parties with respect to the budget statement described in subsection 72 (6) or the obligations of the declarant under section 75 to mediation and arbitration in accordance with clauses (1) (a) and (b) respectively.

Disagreements between corporation and owners

(4) Every declaration shall be deemed to contain a provision that the corporation and the owners agree to submit a disagreement between the parties with respect to the declaration, by-laws or rules to mediation and arbitration in accordance with clauses (1) (a) and (b) respectively.

Duty of mediator

(5) A mediator appointed under clause (1) (a) shall confer with the parties and endeavour to obtain a settlement with respect to the disagreement submitted to mediation.

Fees and expenses

(6) Each party shall pay the share of the mediator’s fees and expenses that,

(a) the settlement specifies, if a settlement is obtained; or

(b) the mediator specifies in the notice stating that the mediation has failed, if the mediation fails.

Record of settlement

(7) Upon obtaining a settlement between the parties with respect to the disagreement submitted to mediation, the mediator shall make a written record of the settlement which shall form part of the agreement or matter that was the subject of the mediation.

False, misleading statements

133 (1) A declarant shall not, in a statement or information that the declarant is required to provide under this Act,

(a) make a material statement or provide material information that is false, deceptive or misleading; or

(b) omit a material statement or material information that the declarant is required to provide.

Right to damages

(2) A corporation or an owner may make an application to the Superior Court of Justice to recover damages from a declarant for any loss sustained as a result of relying on a statement or on information that the declarant is required to provide under this Act if the statement or information,

(a) contains a material statement or material information that is false, deceptive or misleading; or

(b) does not contain a material statement or material information that the declarant is required to provide.

Oppression remedy

135 (1) An owner, a corporation, a declarant or a mortgagee of a unit may make an application to the Superior Court of Justice for an order under this section.

Grounds for order

(2) On an application, if the court determines that the conduct of an owner, a corporation, a declarant or a mortgagee of a unit is or threatens to be oppressive or unfairly prejudicial to the applicant or unfairly disregards the interests of the applicant, it may make an order to rectify the matter.

Contents of order

(3) On an application, the judge may make any order the judge deems proper including,

(a) an order prohibiting the conduct referred to in the application; and

(b) an order requiring the payment of compensation.

Courts of Justice Act, R.S.O. 1990, c. C.43

Court of Appeal jurisdiction

6 (1) An appeal lies to the Court of Appeal from,

(b) a final order of a judge of the Superior Court of Justice, except an order referred to in clause 19 (1) (a) or an order from which an appeal lies to the Divisional Court under another Act[.]

Stay of proceedings

106 A court, on its own initiative or on motion by any person, whether or not a party, may stay any proceeding in the court on such terms as are considered just.

Multiplicity of proceedings

138 As far as possible, multiplicity of legal proceedings shall be avoided.

[^1]: The relevant statutory provisions and rules are set out in an Appendix to these reasons.

[^2]: Under the Condominium Act, 1998, S.O. 1998, c. 19, s. 1(1), a “declarant” is defined to mean “a person who owns the freehold or leasehold estate in the land described in the description and who registers a declaration and description under this Act, and includes a successor or assignee of that person but does not include a purchaser in good faith of a unit who pays fair market value or a successor or assignee of the purchaser”.

[^3]: Section 135(1) of the Condominium Act provides that an order for an oppression remedy may be sought by application to the Superior Court of Justice. Section 133(2) provides that an application to recover damages against a declarant for making a material statement or providing material information that is false, deceptive, or misleading may be sought by application to the Superior Court of Justice.