chroniques - Barreau du Québec

CHRONIQUES
DROIT DE L’ARBITRAGE
Babak BARIN and Eva GAZUREK*
Enforcement and Annulment of Arbitral Awards
in Quebec – Vive la différence !
I.
Introduction
In 1986, shortly after the
United Nations Commission on
International Trade Law (UNCITRAL) adopted its Model Law on
International Commercial Arbitration1 (“Model Law”), Canada became the first country in the world
to enact legislation premised on the
Model Law. Nine out of the ten
provinces and the federal government2 enacted legislation incorporating the Model law. The Province
of Quebec revised its Code of Civil
Procedure3 (“CCP”) to resemble it.4
The Explanatory note by the UNCITRAL secretariat on the Model Law
on International Commercial Arbitration depicts this document as “a
sound and promising basis for the
desired harmonization and improvement of national laws. It covers all stages of the arbitral process
from the arbitration agreement to
the recognition and enforcement of
the arbitral award and reflects a
worldwide consensus on the principles and important issues of international arbitration practice.”
While in the nine common law
provinces, domestic and international commercial arbitration is
legislated in two different statutes,5 in Quebec, both types of arbi-
* Admitted to practice law in Quebec, Ontario and England & Wales. Ms. Gazurek is
a McGill graduate and a student-at-law.
1. Model Law on International Commercial Arbitration, UNCITRAL, UN Doc.
A/40/17 Annex 1 (1985), 24 ILM 1302.
2. Canada’s Commercial Arbitration Act, R.S.C. 1985, c.16 applies to both domestic
and international commercial arbitration matters where at least one of the parties
to the arbitration is Her Majesty in right of Canada, a departmental corporation or
a Crown corporation or in relation to maritime or admiralty matters. Canada also
has a statute entitled An Act to implement the United Nations Convention on the
Recognition and Enforcement of Foreign Arbitral Awards, R.S.C. 1985, c. 16 (2nd
Supp.).
3. Code of Civil Procedure, R.S.Q., c. C-25.
4. Babak BARIN, “Provisional Remedies in domestic arbitrations: Time perhaps for
a fresh look in Quebec?”, (2004) 64 R. du B. 137 [BARIN].
5. See e.g., the British Columbia International Commercial Arbitration Act, R.S.B.C.
1996, c. 233, and the British Columbia Commercial Arbitration Act, R.S.B.C. 1996,
c. 55, or the Alberta International Commercial Arbitration Act, R.S.A. 2000, I-5 and
the Alberta Arbitration Act, R.S.A. 2000, A-43.
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431
tration are referenced in the same –
the CCP.6 To make it clear that the
Province of Quebec is distinct and
only choosing to be inspired by the
Model Law, Article 940.6 of Book
VII, Title I of the CCP declares:7
940.6 Where matters of extraprovincial or international trade
are at issue in an arbitration, the
interpretation of this Title, where
applicable, shall take into consideration:
(1) the Model Law on International Commercial Arbitration as
adopted by the United Nations
Commission on International
Trade Law on 21 June 1985;
(2) the Report of the United
Nations Commission on International Trade Law on the work of its
eighteenth session held in Vienna
from the third to the twenty-first
day of June 1985;
(3) the Analytical Commentary on
the draft text of model law on
international commercial arbitration contained in the report of the
Secretary-General to the eighteenth session of the United
Nations Commission on International Trade Law. [Emphasis
added]
The CCP deals with the conduct of arbitrations and leaves the
procedure of the arbitration and
the manner in which evidence is
taken during the arbitral process
to the parties and the arbitral tribunal. The CCP also covers the recognition and enforcement of
domestic and foreign arbitral
awards. The Quebec Civil Code
(“C.C.Q.”) on the other hand, identifies the criteria for the validity of
arbitration agreements and, with
the exception of questions of public
order and certain matters such as
the status of persons8, it permits
parties to submit any dispute to
arbitration and for them to define
the arbitrator’s terms of reference.9
Unlike its rather quick adoption of the Model Law, Canada was
one of the last developed Western
countries to accede to the Convention on the Recognition and
Enforcement of Foreign Arbitral
Awards, more commonly referred
to as the 1958 New York Convention (“New York Convention”). In
light of the division of powers
between the federal and provincial
governments, the federal government and the nine common law
provinces enacted their own
respective statutes implementing
the New York Convention.10
6.
See A. Bianchi S.R.L v. Bilumen Lighting Ltd., [1990] R.J.Q. 1681. (“À mon humble sens, sauf pour la reconnaissance et l’exécution des sentences arbitrales
étrangères (art. 948-951.2 C.P.C.), le législateur n’a pas fait de distinction entre
un arbitrage domestique ou un arbitrage international.”)
7. BARIN, supra, note 4.
8. See Art. 2639 C.C.Q. which reads:
Art. 2639. Disputes over the status and capacity of persons, family matters or
other matters of public order may not be submitted to arbitration.
An arbitration agreement may not be opposed on the ground that the rules applicable to settlement of the dispute are in the nature of rules of public order.
9. Desputeaux v. Éditions Chouette (1987) inc., [2003] 1 S.C.R. 178 [Desputeaux].
10. With the coming into force of the Ontario International Commercial Arbitration
Act, R.S.O. 1990, c. I.9 (“OICAA”), and in particular, Articles 34, 35 and 36 of the
Model Law incorporated therein, the province of Ontario has since repealed its
Foreign Arbitral Awards Act, S.O. 1986, c.25. By contrast, British Columbia has
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Once again, to make its unique
character known, the Province of
Quebec in Article 948 of Book VII,
Title II of the CCP (Of Recognition
and Execution of Arbitration
Awards Made outside Quebec)
declared:
948. This Title applies to an arbitration award made outside Quebec whether or not it has been
ratified by a competent authority.
The interpretation of this Title
shall take into account, where
applicable, the Convention on the
Recognition and Enforcement of
Foreign Arbitral Awards as
adopted by the United Nations
Conference on International Commercial Arbitration at New York
on 10 June 1958.
[Emphasis added]
In Quebec, unlike elsewhere in
Canada11, an award rendered outside of the province (including in
another province) in civil and commercial matters is considered to be
a foreign award and is subject to
Articles 948 to 951.2 CCP. In order
for an arbitration award to be executory as a judgment in Quebec,
it must be homologated. 12 As
observed by Professor Brierley in
1987:
Le Québec s’est maintenant doté
d’une loi moderne sur l’arbitrage
en ce qui touche la structure juri-
dique de la convention d’arbitrage
et le régime d’exécution des sentences arbitrales. L’adoption de
la vision de l’arbitrage mise de
l’avant par la Loi type de 1985 et
la Convention de 1958 révèle une
volonté claire de mettre le droit
québécois en harmonie avec la
pensée dominante en ce domaine.
Le Québec, en faisant ainsi, a de
plus agi de concert avec les autres
provinces canadiennes. Les autorités législatives compétentes au
Canada ont alors créé, de façon
simultanée – on dirait presque de
façon spontanée – un ordre juridique nouveau pour l’arbitrage,
lui-même un mode déjà ancien
pour régler les différends. Mais le
Québec est arrivé à cet état de
choses en respectant son style
propre de pensée, c’est-à-dire sa
pensée civiliste.13
II. The Model Law and the
New York Convention as
they relate to the recognition and enforcement
of arbitral awards
A quick survey of the Canadian jurisprudential landscape
r e l a t i n g t o r e c o gn i t i o n a n d
enforcement of foreign arbitral
awards locates a large number of
decisions in Ontario in addition to
i n t e r e s t i n g de c i s i o n s b e i n g
reported in Alberta and British
Columbia. Despite the almost
twenty years which have gone by
two statutes, one implementing the Model Law and the other the New York Convention. Most of the other common law provinces, e.g. Alberta, have included the
New York Convention and the Model Law in the same.
11. In Ontario, for example, Article 1(3) of the Model Law which was incorporated in
the OICAA states that an arbitration is “international” if the parties to an arbitration agreement had, at the time of the conclusion of that agreement, their places of
business in different “states”. Section 1(7) of the enacting portion of the OICAA
explicitly states that “different States” means different countries.
12. Art. 946.6 and 951.2 CCP.
13. John E.C. BRIERLEY, “Une loi nouvelle pour le Québec en matière d’arbitrage”,
(1987) 47 R. du B. 259, 270 [BRIERLEY].
Revue du Barreau/Tome 64/Automne 2004
433
since the revision of the provisions
of the CCP relating to arbitrations,
surprisingly, there is only a few
cases emanating from Quebec.
The general approach of the
Canadian common law provinces
concerning the purpose and objective of the enforcement provisions
of the Model Law and those of the
New York Convention, as well as
the broad deference which must be
accorded to arbitral awards, is best
described in the following passages
offered by the Ontario Court of
Appeal:
The Model Law is a collaborative
effort among nations to facilitate
the resolution of international
commercial disputes through the
arbitral process. Article 5 of the
Model Law expressly limits the
scope for judicial intervention
except by application to set aside
the award or to resist enforcement
of an award under one or more of
the limited grounds specified in
Articles 34 or 36. Under Article 34
of the Model Law, the applicants
bear the onus of proving that the
awards should be set aside. If the
applicants fail to satisfy this onus,
Articles 35 and 36 of the Model
Law expressly require this court
to recognize and enforce the
awards. [...]
The grounds for challenging an
award under the Model Law are
derived from Article V of the New
York Convention on the Recognition and Enforcement of Arbitral
Awards (the “New York Convention”). Accordingly, authorities
relating to Article V of the New
York Convention are applicable
to the corresponding provisions in
Articles 34 and 36 of the Model
Law. These authorities accept
434
that the general rule of interpretation of Article V is that the
grounds for refusal of enforcement
are to be construed narrowly:
A.J. Van Den Berg, New York
Convention of 1958 Consolidated
Commentary, cited in Yearbook
Comm. Arb. XI (1996) at pp.
477-509.
An arbitral award is not invalid
because, in the opinion of the court
hearing the application, the Arbitral Tribunal wrongly decided a
point of fact or law: Quintette Coal,
supra, at p. 227. Where a tribunal’s jurisdiction is called into
question as it is here, an applicant
must overcome “a powerful presumption” that the Arbitral Tribunal acted within its powers:
Quintette Coal, supra, per Hutcheon J.A., at p. 223, citing with
approval Parsons & Whittemore
Overseas Co., Inc. v. Société Générale de L’Industrie du Papier, 508
F.2d 969 (2nd Cir. 1974).
The public policy ground for
resisting enforcement of an arbitral award has also been narrowly
construed. [...] [P]ublic policy
grounds for setting aside of an
award should apply only where
enforcement would violate our
“most basic notions of morality
and justice”. In this jurisdiction,
the Ontario Court of Appeal has
emphasized the care which courts
must exercise in relying upon public policy as a reason for refusing
enforcement of a foreign award.
[...]
Accordingly, to succeed on this
ground the awards must fundamentally offend the most basic
and explicit principles of justice
and fairness in Ontario, or evidence intolerable ignorance or corruption on the part of the Arbitral
Tribunal. The applicants must
establish that the awards are con-
Revue du Barreau/Tome 64/Automne 2004
trary to the essential morality of
Ontario.14
The Federal Court of Canada
(Trial Division), in a recent decision rendered in the context of a
NAFTA arbitration, made similar
comments15. In the latter decision,
the Federal Court observed:
In the case at bar, Article 34 of the
[Commercial Arbitration Code,
the federal government’s arbitration statute which is based on the
Model Law] spells out the limited
jurisdiction of the Court to set
aside an arbitration award.
It is noteworthy, that Article 34 of
the Code does not allow for judicial
review if the decision is based on
an error of law or an erroneous
finding of fact if the decision
is within the jurisdiction of the
Tribunal. The principle of nonjudicial intervention in an arbitral
award within the jurisdiction of
the Tribunal has often been
repeated. [...]
An arbitral award is not invalid
because, in the opinion of the
Court hearing the application,
the Arbitral Tribunal wrongly
decided a point of fact or law.16
To date, the Supreme Court of
Canada has not yet had the occasion to examine the provisions of
the Model Law or the New York
Convention as they relate to recognition and enforcement of foreign
arbitral awards. With the increase
in use and popularity of this type of
dispute resolution in Canada in
recent years, this will no doubt
come soon. While the terms “recognition and enforcement” are often
used interchangeably, they have
distinct meanings. As one commentator points out, “the precise
distinction, [...] is between ‘recognition’ and ‘recognition and enforcement’.”17 Recognition alone is a
defensive process. It will commonly arise when a court is asked
to grant a remedy in respect of a
dispute which has been the subject
of previous arbitral proceedings.
Conversely, enforcement requires
a court to not only recognize the
legal force and effect of an award
but, furthermore, to ensure that it
is carried out through legal sanctions.18
The Supreme Court of Canada
has, however, made its views
14. Re Corporacion Transnacional de Inversiones, S.A. de C.V. et al. v. STET International, S.P.A. et al. (1999), 45 O.R. (3d) 183 ¶ 21, affirmed by 49 O.R. (3d) 414
(C.A.). See also Dunhill Personnel System Inc. v. Dunhill Temps Edmonton Ltd.
(1993), 13 Alta. L. R. (3d) 241, [1993] A.J. 716 (C.A.).
15. Note, however, the decision of Holmes J., in Javor v. Francœur (2003), 13 B.C.L.R.
(4th) 195 ¶ 26., affirmed by the British Columbia Court of Appeal (2004), 25
B.C.L.R. 114, where an application by Javor to enforce an arbitration award
against the Respondent Francœur was dismissed, because Francœur was not a
party to the arbitration agreement. According to Holmes J., it was the intention of
both the Foreign Arbitral Awards Act, R.S.B.C. 1996, c. 154 and the International
Commercial Arbitration Act, R.S.B.C. 1996, c. 233 to limit enforcement of arbitration awards to the parties to the arbitration agreement.
16. Attorney General of Canada v. S.D. Myers, Inc., [2004] 3 F.C.R. 368, 390. See also
D.L.T. Holdings Inc. v. Grow Biz International, Inc., [2001] P.E.I.J. No. 29
(S.C.T.D.).
17. Alan REDFERN & Muir HUNTER, Law and Practice of International Commercial Arbitration, 4th ed. (London: Sweet & Maxwell, 2004) at 434 [REDFERN &
HUNTER].
18. REDFERN & HUNTER, Ibid. at 434-435.
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435
known about the deference which
must be shown to arbitral awards
in a domestic context and, in particular, regarding the concept of
public order as it relates to the
validity and enforcement of arbitration awards rendered in Quebec. As early as two years ago, in a
matter involving principally, the
arbitrability of copyright issues19,
the Supreme Court of Canada
remarked:
Public order arises primarily
when the validity of an arbitration
award must be determined. The
limits of that concept’s role must
be defined correctly, however...
[Article] 946.5C.C.P. requires that
the award as a whole be examined
to determine the nature of the
result. The court must determine
whether the decision itself, in its
disposition of the case, violates
statutory provisions or principles
that are matters of public order. In
this case, the Code of Civil Procedure is more concerned with
whether the disposition of a case,
or the solution it applies, meets
the relevant criteria than with
whether the specific reasons
offered for the decision do so. An
error in interpreting a mandatory
statutory provision would not provide a basis for annulling the
award as a violation of public
order, unless the outcome of the
arbitration was in conflict with
the relevant fundamental principl e s o f publ i c o r d er . T h a t
approach, which is consistent with
the language used in Article 946.5
C .C .P ., c o r r e spo nds t o t h e
approach taken in law of a number
of states where arbitration is gov-
erned by legal rules analogous to
those now found in Quebec law.
The courts in those countries have
limited the consideration of substantive public order to reviewing
the outcome of the award as it
relates to public order. (See: E.
Gaillard and J. Savage, eds.,
Fouchard, Gaillard, Goldman on
International Commercial Arbitration (1999), at 955-56, No.
1649; J.-B. Racine, L’arbitrage
commercial international et
l’ordre public, vol. 309 (1999), at
pp. 538-55, in particular at pp. 539
and 543; Société Seagram France
Di s t r i b u t i on v. S oc i é t é G E
Massenez, Cass. civ. 2e, May 3,
2001, Rev. arb. 2001.4.805, note
Yves Derains.) And lastly, in considering the validity of the award,
the clear rule stated in article
946.2 C.C.P., which prohibits a
court from inquiring into the merits of the dispute, must be followed. In applying a concept as
flexible and changeable as public
order, these fundamental principles must be adhered to in determ i n i n g t h e va l i d i t y of a n
arbitration award. [Emphasis
added]
III. Of Recognition and
Execution of foreign
arbitral awards in
Quebec
Under Quebec law, article 949
C.C.P. provides that foreign arbitral awards shall be recognized
and executed if the matter in dispute is one that may be settled by
arbitration in Quebec20 and if its
recognition and execution are not
contrary to public order.21 Article
19. Desputeaux, supra, note 9 ¶ 54.
20. Art. 949 C.C.P.
21. Phesco Inc. v. Canac Inc., J.E. 2000-2268, AZ-50080781 ¶ 16 (C.S.).
436
Revue du Barreau/Tome 64/Automne 2004
950 C.C.P. 2 2 enumerates the
grounds upon which the recognition and execution of a foreign
arbitral award may be resisted in
Quebec. A foreign authority need
not have ratified the foreign
award23 and the court examining
an application for recognition and
execution of an arbitral award cannot enquire into the merits of the
dispute.24 Moreover, rules applicable to recognition and enforcement
of foreign decisions set out under
Book Seven, Title Four of the C.C.Q.
do not apply to arbitral awards.
Lorsque le législateur québécois
parle de “décision” il réfère donc
clairement à des jugements.
La reconnaissance et l’exécution
des décisions étrangères constituent, tout comme les sentences
arbitrales québécoises et étrangères, un régime autonome, distinct
et complet en soi.
[...]
Si le législateur avait voulu soumettre les sentences arbitrales
étrangères à des règles précises
comme celles prévues aux articles
3155 et suivants du Code civil du
Québec pour les décisions étrangères, il l’aurait fait.
Ne l’ayant pas fait, la Cour en
vient à la conclusion que le législateur a voulu respecter les conventions d’arbitrage en laissant
a u x pa r t i es l e m a xi m u m
d’autonomie possible.25
Article 949.1 C.C.P. requires
that the application for recognition
and execution of an award rendered outside Quebec be made by
way of a motion for homologation
to the court, which would have had
competence in Quebec to decide
the matter in dispute submitted
to the arbitrators.26 This rather
unique local requirement cannot
be found in either the Model Law
or the New York Convention. The
interesting question that flows
from examining this provision is:
Does Article 949.1 C.C.P., either
intentionally or inadvertently,
trigger the application of Title III,
“International Jurisdiction of
Quebec Authorities” and in particular Article 3148 C.C.Q. found
under Book Ten (Private International Law) of the C.C.Q.?27
Article 3148 C.C.Q. states:
3148. In personal actions of a patrimonial nature, a Quebec authority has jurisdiction where
22. Note the existence of similar provisions with respect to awards rendered in Quebec. See Art. 946.2 to 946.5 and 947.2 C.C.P.
23. Art. 948 C.C.P.
24. Art. 951.1 C.C.P.
25. Varma-Sampo v. Beninco Holdings Canada inc., J.E. 2002-95, AZ-50106892
(C.S.) ¶ 15 [Varma-Sampo] and see also Jeffrey A. TALPIS & Jean-Gabriel
CASTEL, “Interprétation des règles du droit international privé”, in Le Barreau
du Québec et la Chambre des notaires du Québec, La réforme du Code civil (Québec: Les Presses de l’Université Laval, 1993) at 912.
26. Art. 949.1 C.C.P.
27. See also Jean Gabriel CASTEL & Janet WALKER, Canadian Conflict of Laws,
6th ed., (Toronto: LexisNexis, 2005) at 15-59 where a similar question is raised by
the authors. There are also two Quebec decisions (C.I.C. Corp. v. Thermo-Rite Co.,
J.E. 97-2221 (C.S.), appeal in 2001 and Argos Films v. Ciné 360 inc., [1991] R.J.Q.
1602 (C.A.)) which refer to Article 3148 C.C.Q. in the context of homologation
motions brought under article 949 C.C.P. Neither offers any substantial views
about the relationship between these two provisions.
Revue du Barreau/Tome 64/Automne 2004
437
(1) the defendant has his domicile
or his residence in Quebec;
(2) the defendant is a legal person,
is not domiciled in Quebec but has
an establishment in Quebec, and
the dispute relates to its activities
in Quebec;
(3) a fault was committed in Quebec, damage was suffered in Quebec, an injurious act occurred in
Quebec or one of the obligations
arising from a contract was to be
performed in Quebec;
(4) the parties have by agreement
submitted to it all existing or
future disputes between themselves arising out of a specified
legal relationship;
(5) the defendant submits to its
jurisdiction.
However, a Quebec authority has
no jurisdiction where the parties,
by agreement, have chosen to submit all existing or future disputes
between themselves relating to a
specified legal relationship to a
foreign authority or to an arbitrator, unless the defendant submits
to the jurisdiction of the Quebec
authority. [Emphasis added]
Could Article 3148 C.C.Q. be
used as a defence in a motion for
homologation of a foreign arbitral
award rendered in Geneva, Switzerland in the context of an International Chamber of Commerce
(ICC) software license arbitration
between a multi-national licensor
headquartered in California and
an Italian licensee, where the only
connection with Quebec is that the
defendant licensee has a branch
office in Montreal? The answer
appears to be straightforward
when one peruses the content of
Article 3148 (2) C.C.Q. and closing.
This conclusion of course, assumes
that the words “the court, which
would have had competence in
Quebec to decide the matter in dispute” found in Article 949.1 C.C.P.
trigger the application of the international jurisdiction of Quebec
authorities instead of referring to
their ratione materiæ jurisdiction.
The courts under the legislative authority of Quebec which
have jurisdiction in civil matters
are the Superior Court, the Court
of Quebec and the municipal
courts28. The jurisdiction of the
Superior Court and the Court of
Quebec extend throughout Quebec; the jurisdiction of the municipal court is limited to a designated
territory and is set out in special
laws29. Article 31 C.C.P. provides
that the Superior Court is the
court of original general jurisdiction and it hears in first instance
every suit not assigned exclusively
to another court by a specific provision of law. Except in class action
matters, the Court of Quebec has
jurisdiction, to the exclusion of the
Superior Court, in any suit where
the sum claimed or the value in
dispute is less than $70,00030.
Since there is no explicit attribution of jurisdiction in Article
949.1 C.C.P. and the Court of Quebec possesses the jurisdiction to
homologate domestic arbitral
awards as well as recognize and
execute foreign decisions, nothing
o u gh t t o pr e c l u de i t fr o m
28. Art. 22 C.C.P.
29. Art. 23 and 37 C.C.P.
30. Art. 34 C.C.P.
438
Revue du Barreau/Tome 64/Automne 2004
homologating foreign arbitral
awards. Moreover, since depending on the amount of the award, a
motion for its homologation could
be presented to either the Superior
Court or the Court of Quebec,
would interpreting the words “the
court, which would have had competence in Quebec to decide the
matter in dispute” to mean one of
these courts be considered as
“thinking outside of the box”?
Neither Article 3148 C.C.Q.
nor any reference to that provision
appears among the listed grounds
enumerated in Article 950 C.C.P.
for refusing recognition and execution in Quebec of a foreign arbitral
award. If the intention of the legislator was to create an additional
ground for refusing to recognize
and execute a foreign arbitral
award based on Article 3148
C.C.Q., should it not have explicitly said so?31 Article 3148 C.C.Q.
is relatively new law whereas Article 949.1 C.C.P. was already in the
previous version of the C.C.P. Is it
possible that, at the time of the
revision and adoption of the new
C.C.Q., the legislator omitted to
address this rather obvious inconsistency? Unfortunately, there is
no commentary or record of parlia-
mentary debate on to this particular issue.
A u t h o r s l i k e P r o fe s s o r
Brierley write that a foreign arbitral award cannot be annulled by a
Quebec authority.32 If annulment
and homologation are treated as
mirror images of one another, then
if a foreign award cannot be
annulled in Quebec, how can it be
homologated? Who is right, and
why about the various issues
raised above, will have to be determined in due course by an appellate court. In the meantime, relating Article 3148 C.C.Q. to 949.1
C.C.P. may undermine the very
reason the provisions of the New
York Convention were promulgated in Quebec and diminish the
trust and confidence placed by the
international commercial community in arbitral awards. Moreover,
relating these two provisions
together may unduly affect interprovincial commerce in this country.
As for the balance of the provisions under Book VII, Title II, Article 950(6) C.C.P. states that one of
the possible objections against the
recognition and execution of a foreign arbitral award in Quebec is its
31. Varma-Sampo, supra, note 25.
32. BRIERLEY, supra, note 13. “Au niveau de l’exécution de la sentence, les traits qui
distinguent les deux types de sentences sont donc limités. D’une part si, selon la
loi applicable, la sentence étrangère n’est pas encore devenue obligatoire pour les
parties, si elle a été annulée ou suspendue par une autorité compétente étrangère
du lieu dans lequel ou d’après la loi de laquelle elle a été rendue, il est alors loisible
à la partie contre qui la sentence est invoquée de s’opposer à son exécution au Québec. D’autre part, dans le cas d’une sentence interne, les motifs énumérés comme
voies d’opposition à la requête en homologation sont aussi disponibles comme
motifs pour une demande indépendante en annulation, celle-ci également en
forme de requête. En d’autres mots, la partie contre qui la sentence est rendue
peut attaquer la sentence de son propre chef plutôt que d’attendre la mise à
exécution par la partie à qui la sentence est favorable. Cette demande directe en
annulation de la sentence ne semble pas être prévue dans le cas de la sentence
étrangère.”
Revue du Barreau/Tome 64/Automne 2004
439
setting aside or suspension “by a
competent authority of the place or
pursuant to the laws of the place in
which the arbitration award was
made”. Article 951 adds that the
motion for homologation may be
postponed if the competent authority referred to in 950(6) C.C.P. has
made an application to have the
award set aside. The content of
both of these articles is in perfect
harmony with the provisions of the
New York Convention and the
Model Law.
IV. Of Recognition and
Annulment of domestic
arbitral awards in Quebec
Under Chapter VIII (Annulment of the Arbitration Award) of
Book VII, Title I, Article 947 C.C.P.
states that “the only possible
recourse against an arbitration
award is an application for its
annulment.” Article 947.2 C.C.P.
states that “Articles 946.2 to 946.5,
adopted as required, apply to an
application for annulment of an
award”. As is the case with foreign
arbitral awards, broad deference
and narrowly construed grounds
are set out in Article 946.4 C.C.P.
f or annulment of do m e s t i c
awards33. Annulment is obtained
by either a motion to the court
seeking such a relief or by opposition to a motion for homologation.34
The application for annulment
must be made within three months
after reception of the arbitration
33.
34.
35.
36.
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award or any decision correcting
any error in writing or calculation
or any other clerical error in the
award, any decision interpreting
(with prior agreement of the parties) a specific part of the award or
supplementing the award on any
part omitted.35 The Quebec Court
of Appeal has decided that this
delay is a matter of procedure and
not prescriptive limitation.36
Article 947.3 C.C.P. states
that “on the application of one
party, the court, if it considers it
expedient, may suspend the application for annulment for such time
as it deems necessary to allow the
arbitrators to take whatever measures are necessary to remove the
grounds for annulment, even if the
time prescribed in article 945.6 has
expired”. An analysis of the text
of the relevant provisions of the
C.C.P., the Model Law on which
they were based, the Report of the
UNCITRAL on the work of the
eighteenth session held in Vienna
from June 3 to 21, 1985 (“UNCITRAL Report”) and the Analytical
Commentary on the draft text of
the Model Law (“Analytical Commentary”) all support the conclusion that the measures contemplated by Article 947.3 go beyond
those listed in Articles 945.5 and
945.6.
By introducing a procedure for
the remission of disputes to arbitral tribunals, Article 947.3 C.C.P.
clearly and unambiguously recognizes the desirability in Quebec for
Art. 946.2, 946.4 and 946.5 C.C.P.
Art. 947.1 C.C.P.
Art. 945.6 C.C.P. and art. 947.4 C.C.P.
S.A. Louis Dreyfus & Cie. v. Holding Tusculum B.V., [1998] R.J.Q. 1722, 1730
(C.A.).
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arbitrators to be able to reconsider
their awards. Article 947.3 C.C.P.
allows arbitrators to take whatever
measures are necessary to remove
the grounds for annulment. The
words chosen by the Quebec legislator indicate that arbitrators
have been accorded powers significantly broader than those set out
in Article 945.6 C.C.P. to reconsider their own decisions. Article
947.3 C.C.P. is closely modelled
after Article 34(4) of the Model
Law which states:
The court, when asked to set aside
an award, may, where appropriate and so requested by a party,
suspend the setting aside proceedings for a period of time determined by it in order to give the
arbitral tribunal an opportunity
to resume the arbitral proceedings
and or take such other action as in
the arbitral tribunal’s opinion will
eliminate the grounds for setting
aside. [Emphasis added]
Indeed, when it refers to the
“grounds for setting aside” of an
award, Article 34(4) is quite clearly
referring to the grounds enumerated in Article 34(2). The Analytical Commentary which leaves no
doubt on this issue, observes:
Paragraph (4) envisages a procedure which is similar to the
“remission” known in most common law jurisdictions, though in
various forms. Although the procedure is not known in all legal
systems, it should prove useful in
that it enables the arbitral tribunal to cure a certain defect and,
thereby save the award from
being set aside by the Court.
[...]
The Court, where appropriate and
so requested by a party, would
invite the arbitral tribunal, whose
continuing mandate is thereby
confirmed, to take appropriate
measures for eliminating a certain remediable defect which constitutes a ground for setting aside
under paragraph (2).37 [emphasis
added]
The grounds listed in Article
34(2) of the Model Law served as a
guide for the preparation of the
grounds set out in Articles 946.4
and 946.5 C.C.P. It is thus clear
that “the grounds for annulment”
referred to in Article 947.3 C.C.P.
are exactly the same as those set
out in Articles 946.4 and 946.5
C.C.P. The UNCITRAL Report
indicates that while the drafters of
the Model Law debated the desirability and utility of Article 34(4),
in the end, and for the following
reasons, they decided to retain it in
the final version of the Model Law:
The prevailing view, [...], [is] that
the provision should be retained.
The mere fact that the procedure
of remitting the award to the arbitral tribunal [is] not known in all
legal systems was no compelling
reason for excluding it from the
realm of international commercial
arbitration where it should prove
useful and beneficial. It [is]
pointed out in support that the
procedure, where found appropriate by the Court, would enable the
arbitral tribunal to cure certain
defects which otherwise would
necessarily lead to the setting
aside of the award. Furthermore,
the general wording of paragraph
37. Commercial Arbitration: Interpretive documents for the Commercial Arbitration
Code at 163.
Revue du Barreau/Tome 64/Automne 2004
441
(4) [is] advantageous in that it provide[s] the Court and the arbitral
tribunal sufficient flexibility to
meet the needs of the particular
case.38
As one commentator aptly
notes, “Article 34(4) mitigates to
some extent the ‘all or nothing’
approach of the Model Law, under
which an award is either set aside
or left to stand. Where appropriate
and where requested by a party to
do so, the court may suspend for a
given period of time the proceedings for setting aside the award.
This allows the arbitral tribunal
an opportunity to resume the arbitral proceedings, or to take such
other actions as, in the arbitral tribunal’s opinion, will eliminate the
grounds for setting aside. In effect,
this is an equivalent provision to
that remitting the award to the tribunal for reconsideration.”39
In Quebec, to date, there is little case law or commentary on
Article 947.3 C.C.P. The record of
the parliamentary debate on this
provision is also silent on its utility
and scope. The Quebec Superior
Court’s decision in Bunyar v.
Larouche appears to be the only
case referring to this provision.40
That case involved a motion to
annul an arbitral award on the
basis that natural justice principles had been violated when the
arbitral tribunal had visited the
premises in dispute between the
parties in the presence of one of the
parties only. In their defence, the
38.
39.
40.
41.
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petitioners referred, among other
things, to Article 947.3 C.C.P.
Although an application pursuant
to Article 947.3 C.C.P. had not
been made in that case, the petitioners still argued that that provision was indicative of the legislator’s intent to restrict the intervention of the Superior Court to the
grounds found in Article 946.4 and
946.5 C.C.P.:
Enfin le procureur des intimés
rappelle l’article 947.3 du Code de
procédure qui donne, même pendant l’instance en annulation ou
en homologation de la sentence
arbitrale, au tribunal saisi d’une
requête en annulation d’une sentence arbitrale, discrétion à la
Cour Supérieure pour corriger la
situation que l’on décrit comme
source d’annulation possible.
Le Tribunal fait remarquer que
dans le cas présent, l’on n’a pas
demandé l’application de cette
procédure mais le procureur des
intimés insiste pour rappeler que
le Tribunal se doit d’y voir l’esprit
et l’intention du législateur de
limiter aux cas très précisément
énoncés au Code de procédure la
possibilité d’intervention de la
Cour supérieure.41
While Bunyar may be of limited use in interpreting Article
947.3 C.C.P., it has the virtue of
implicitly recognizing the connection between Articles 947.3 and
946.4 C.C.P. The Superior Court’s
decision in Learned Entreprises
International Canada inc. v. Lyons
is also worthy of a quick mention,
Ibid. at 64.
REDFERN & HUNTER, supra, note 16 at 424-425.
Bunyar v. Larouche, [2001] R.J.Q. 1942 (S.C.) [Bunyar].
Bunyar, ibid. at 1944.
Revue du Barreau/Tome 64/Automne 2004
even though it does not specifically
consider Article 947.3 C.C.P.42 In
Lyons, the Court was asked to rule
on a motion to dismiss a motion to
annul an arbitral award on the
grounds that the application had
been made after expiry of the delay
found in Article 947.4 C.C.P. The
Court granted the motion to dismiss, ruling that the delay in Article 947.4 C.C.P. was peremptory.
This conclusion was reached by
looking, among other things, at the
intent of the legislator described
by the Court as follows:
Si l’on considère l’ensemble des
nouveaux articles 940 à 947, certaines intentions du législateur
sont apparentes. Il veut encourager et faciliter les arbitrages;
il veut réduire au minimum
l’intervention de la Cour par rapport aux sentences arbitrales; et
il veut, en autant que possible,
accélérer le processus d’arbitrage
pour permettre aux parties d’obtenir, et d’exécuter, une sentence
arbitrale de façon expéditive.43
[Emphasis added]
Even though Article 947.3
C.C.P. was not specifically examined in Lyons, the comments of the
Court concerning the intervention
of courts in the arbitration process
are instructive. Article 947.3
C.C.P. should be interpreted keeping in mind the legislator’s clear
intent that the courts’ intervention
in the arbitration process must be
limited, minimal and for assistance only. The introductory comments presented by the members
of the Quebec National Assembly
during the provision by provision
review of the bill respecting An Act
to amend the Civil Code and the
Code of Civil Procedure in respect
of arbitration resonate the legislator’s intent described in Lyons.
Article 947.3 C.C.P. introduces an important and practical procedure in Quebec enabling an arbitral tribunal to remove whatever
grounds are necessary to prevent
annulment of an award. The procedure is designed to be triggered
within the framework of an application for homologation or annulment. Accordingly, it is not unreasonable to assume that in the
absence of such proceedings, permission of the court may not be
necessary. The more interesting
question to answer, however, is
whether (in light of this provision)
an arbitral tribunal itself has the
unilateral authority to “revisit” a
prior decision when it considers
such action necessary to remove a
ground for annulment. There is
nothing in the Model Law or the
New York Convention to guide the
courts on this question. With previously popular concepts such as
functus officio becoming outdated
in international commercial arbitration, this is an area where the
Quebec courts’ intervention will be
crucial.
Conclusion
With the specific reference
which has been made to the Model
Law in the C.C.P. and the enactment of the New York Convention
42. Learned Entreprises International Canada inc. v. Lyons, J.E. 99-1680, AZ99021798, inscription in appeal, August 26, 1999 (C.A.M., no 500-09-008521-999)
[Lyons].
43. Lyons, ibid.
Revue du Barreau/Tome 64/Automne 2004
443
provisions pertaining to the recognition and execution of foreign
arbitral awards, the law of arbitration in Quebec has undergone several important changes, at times
consistent with and at others
divergent from the original text of
the Model Law developed by
UNCITRAL in 1985. As this brief
article tries to highlight, the law of
arbitration in Quebec is evolving.
Even if there was any doubt before
444
about the role and importance of
this field in Canada, faced with
exponential growth, there is no
such uncertainty now. What
remains to be seen is how Canada
will use its common law and civil
law heritage to offer the rest of the
world a unique Canadian perspective on the law and practice of
international commercial arbitration.
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