The Lawyers Weekly - February 11, 2011

Commercial
Continued From Page 10

tors, but facilitators. However, the Ontario Act provides that a person who is asked to be a mediator is required to make enquiries to determine if a current or potential conflict of interest exists, as well as any circumstances that may give rise to a reasonable apprehension of bias.

This duty of disclosure con-
tinues until the termination of
the mediation. A potential medi-
ator is deemed to have a conflict
if the mediator has a “financial
or personal interest in the out-
come of the mediation” or “an
existing or previous relationship
with a party or a person related
to a party to the mediation”: s.
7( 6). Further, there is a prohibi-
tion on a mediator acting as both
a mediator and arbitrator, unless
the parties otherwise agree.

Drafting ADR clauses

Corporate lawyers who draft
dispute resolution clauses may
want to refine their precedents to
provide that, when a dispute
arises and before litigation or
arbitration is commenced, the
parties will proceed with a media-
tion pursuant to the new legisla-
tion. If a settlement is reached, the
party who then needs to enforce
the settlement will have a reason-
ably straightforward enforcement
mechanism that could avoid the
need for more protracted litiga-
tion or arbitration.

International ADR in Ontario

There were a number of steps
taken in 2010 to try to establish
Ontario, and Toronto in particu-
lar, as a preferred place for inter-
national commercial dispute
resolution. For example, the past
year saw the formation of the
Toronto Commercial Arbitration
Society (http://torontocommer-
cialarbitrationsociety.com) with
the ambitious objective of pro-
moting and developing Toronto
as a world centre for commercial
arbitration.

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Halsbury’s® Laws of Canada – Agriculture / Alternative Dispute Resolution Dr. Donald Buckingham / Duncan W. Glaholt & Markus Rotterdam The Alternative Dispute Resolution volume is an invaluable resource for understanding the increasingly popular options available to resolve disagreement between parties without resorting to
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processes; conciliation; court annexed
alternative dispute resolution; practice
issues; and international commercial
arbitration.

Non-signatory was a state entity

Non-signatories
Continued From Page 10

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adian readers wondering whether a similar result would be reached by a Canadian court.

One may contrast the conclusion reached in Dallah with the decision of Ontario courts in COTISA v. STET International [1999] O.J. No. 3573, in which the principal of a group of companies was held to be bound by an agreement to arbitrate, although he did not sign the agreement himself. Possibly part of the distinction lies in the fact that the non-signatory in Dallah was a state entity.

Dallah serves as a colourful reminder of an obvious but frequently overlooked point. The failure to include all necessary parties to a dispute in an agreement to arbitrate can be a fatal error in an arbitration agreement. Even if one is ultimately successful in establishing a right to arbitrate against a non-signatory, the expenditure of time, money and effort to establish that result eliminates virtually all of the benefits of arbitration.

A failure to establish such a right may result in an aggrieved party having no effective remedy. In Dallah, the only other alternative would have been to sue the government of Pakistan in its own courts. 

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