Stefanie A. Holland

This decision addresses an application for leave to appeal an arbitrator's decision and a cross-application to enforce arbitral awards.

The central issue was whether a franchisee is entitled to damages under section 7(2) of the Arthur Wishart Act (Franchise Disclosure), 2000 (AWA) for misrepresentation in a disclosure document voluntarily provided by a franchisor, but not legally required under section 5 of the AWA.

The court found that the arbitration agreement's "final, conclusive and binding" language excluded a right of appeal.

Even if leave to appeal were possible, the court was not satisfied that the importance of the matters at stake justified an appeal.

The court upheld the arbitrator's decision, finding it reasonable and correct, that section 7(2) of the AWA only applies to misrepresentations in disclosure documents *required* by section 5, not those voluntarily provided, especially for commercially sophisticated franchisees.

Consequently, the application for leave to appeal was dismissed, and the application to enforce the arbitral awards was granted.

This endorsement addresses the costs of a motion where default judgment obtained by the plaintiff, Western Steel and Tube Ltd., against the defendants, including Canadian Tire Corporation, Limited, was set aside.

The court found the plaintiff primarily responsible for the need for Canadian Tire's motion due to procedural misconduct, including failure to provide notice of the default trial and to make full disclosure of material facts.

Despite the plaintiff's arguments regarding the default of Jiangsu Sainty Sumex Tools Corp. Ltd., the court ordered the plaintiff to pay Canadian Tire $75,000 in all-inclusive costs, emphasizing the plaintiff's inappropriate conduct and refusal to accept reasonable settlement offers.

No costs were awarded for or against Jiangsu Sainty Sumex Tools Corp. Ltd.

The defendants, Jiangsu Sainty Sumex Tools Corp. Ltd. and Canadian Tire Corporation, Limited, moved to set aside a default judgment granted against Jiangsu Sainty Sumex and its prior noting in default.

Canadian Tire also sought to set aside or vary the judgment, particularly its in rem declarations concerning intellectual property rights, arguing they were non-binding on Canadian Tire.

The default judgment was obtained by the plaintiff without notice to counsel for either defendant and without full disclosure of material facts to the court, including a Trademark Opposition Board decision against the plaintiff's claimed trademark, an expired patent, and ongoing discussions with the defaulting defendant's counsel.

The court found the plaintiff's conduct inappropriate and set aside the default judgment due to lack of notice and non-disclosure.

The noting in default for Jiangsu Sainty Sumex was also set aside, conditional on the defendant posting security for damages and costs, providing an affidavit of documents, and producing a witness for discovery, to ensure the matter proceeds to a full trial on the merits.