Lauren Tomasich, Eric Morgan
Dec 13, 2017
The Ontario Court of Appeal recently confirmed the very high bar in Ontario to overturning international arbitral awards under the United Nations Commission on International Trade Law (UNCITRAL) Model Law (the Model Law).
Consolidated Contractors Group S.A.L. (Offshore) v. Ambatovy Minerals S.A. was an appeal from an unsuccessful challenge to an international commercial arbitration award. The appellant, Consolidated Contractors Group (CCG), challenged the Superior Court of Justice’s decision to uphold the arbitral award, arguing that portions of the award were made without jurisdiction, were made in breach of procedural fairness and violated public policy.
The arbitration concerned a slurry pipeline construction project related to a nickel mine in Madagascar. A panel of three arbitrators (the Tribunal) awarded the respondent, Ambatovy Minerals (Ambatovy), $25 million in respect of counterclaims made for liquidated damages for delay and additional costs. In turn, the Tribunal awarded CCG $7 million in respect of Ambatovy’s claims for breaches of contract.
Grounds for judicial review of arbitral decisions
The Ontario Court of Appeal rejected CCG’s argument that the arbitral award should be set aside and affirmed that only the most serious errors and injustices will merit judicial intervention.
The Court of Appeal held the following on each ground of challenge to the arbitral award:
This case affirms the Canadian public policy objective of limiting judicial intervention when parties have contractually agreed to resolve disputes by arbitration. The Court of Appeal affirmed the very limited bases on which a court can set aside an arbitral award on either procedural or substantive grounds. In short, only the most egregious and patently unfair circumstances will meet the high bar that would warrant judicial intervention.