Epicor Software Corp. v. RB Packing & Seals Inc.

CITATION: Epicor Software Corp. v. RB Packing & Seals Inc., 2017 ONSC 5959
COURT FILE NO.: CV-17-579012-CL

DATE: 20171005

ONTARIO SUPERIOR COURT OF JUSTICE (COMMERCIAL LIST)

Epicor Software Corp.

-and-

RB Packing & Seals Inc.

BEFORE: F.L. Myers J.

COUNSEL: Andrew McCoomb and Danny Urquhart, counsel for the Applicant Gregory Azeff and Stephanie De Caria, counsel for the Respondent

HEARD: August 31, 2017

ENDORSEMENT (TRANSCRIBED)

[1] The Application is dismissed.

[2] The ICAA [International Commercial Arbitration Act, 2017, S.O. 2017, c. 2, Sched. 5] applies as Epicor’s place of business is in the US. It admits so in the Notice of Arbitration. The Canadian subs are not the same entity.

[3] I agree that the arbitrator committed a reviewable error in deciding the issue on a theory of the case not argued by the parties. This amounts to Epicor having been unable to present its case under ss. 34(2)(ii) of the UNCITRAL Model Law. See: Consolidated Contractors Group S.A.L. v. Ambatov Minerals S.A., 2016 ONSC 7171.

[4] For completeness only, I note that in my view the contract ousted any right of appeal both in s. 13.11(c) and in its incorporation by reference of R. 5.4.7 of the ADR Institute of Canada Rules.

[5] In light of the findings under s. 34, I am authorized to send the matter back for argument on the merits again. But I heard that argument. Not only do I view the Arbitrator’s decision as having been reasonably open to him, I agree with him.

[6] I know when a cause of action accrues. I know when a dispute is brought. I do not know how to tell when a “disagreement or controversy” is brought.

[7] The scope of review of the Arbitrator is reasonableness. Moreover, I do not accept that the agreement was a take it or leave it standard form. The printed form says that it is only part of the agreement. The work orders and other customized negotiated documents are also part of the contract. These are sophisticated parties negotiating a commercial agreement. There is no basis to say that RB could not have negotiated the pre-printed terms. As such, interpretation of the agreement is a mixed question of fact and law under Creston Moly Corp. v Sattva Capital Corp., 2014 SCC. That also means that the Arbitrator’s decision would be subject to deference on appeal, and in fact, there can be no appeal of mixed law and fact under s. 45 of the Arbitration Act, 1991, SO 1991, c 17 even if the statute applied.

[8] Finally, even if the limitation period expired the same facts would apply as a defence to Epicor’s claim. That is, the decision has little practical effect.

[9] I agree with Penny J. in paragraph 34 of Ambatov that court intervention into private arbitration is and should be rare. The parties did not want courts solving their contractual disputes and they are entitled to the process they agreed upon.

[10] Where the question has little real-world effect and was reasonably decided (after hearing full argument) sending the parties back for a re-hearing serves no good purpose and I exercise the discretion to decline relief under section 34 of UNCITRAL despite the grounds made out in that section.

[11] The parties are willing to try to negotiate costs. If they are unable to do so they can contact my office to convene a case conference to argue costs.

F.L. Myers J.

Date: October 5, 2017