In the recent decision of the Ontario Superior Court of Justice (“ONSC”), Xiamen International Trade Group Co., Ltd. v. LinkGlobal Food Inc., 2023 ONSC 6491, the applicant sought the recognition and enforcement of an arbitration judgment of the Xiamen Arbitration Commission (the “Award”).
The underlying arbitration dispute related to a contract entered into by the parties wherein the applicant was to purchase protective masks from the respondent for the purchase price of US $532,224.00. The contract between the parties contained an arbitration clause and a choice of law clause providing that the law of the People’s Republic of China governed any dispute over the contract between the parties.
In the arbitral proceeding in China, the applicant sought a refund of the purchase price of the masks and compensation for other costs incurred. A panel of three arbitrators unanimously ruled in favour of the applicant and granted the Award.
As the respondent failed to comply with the Award, the applicant commenced an application in the ONSC seeking recognition and enforcement of the Award.
In its endorsement, the ONSC advised that the grounds for refusing recognition or enforcement of a foreign arbitral award, as set out in the Model Law at Schedule 2 to the International Commercial Arbitration Act, 2017, SO 2017, c 2, Sch 5, are to be construed narrowly, and that the Model Law restricts the ability of the ONSC (or any Canadian courts) to interfere with international arbitration proceedings. Further, the grounds for refusing the recognition or enforcement of an international arbitral award for reasons of fairness or natural justice, require the foreign tribunal’s conduct to be “so serious that it cannot be condoned under Ontario law”, and the Canadian court must not permit “re-argument of the merits” of the underlying case “in the guise of a claim for breach of procedural fairness”. In granting the application, the ONSC found that none of the grounds for refusing to enforce an arbitral award are present in this case.
Lastly, a week before the hearing date, the respondent’s new counsel advised the applicant’s counsel that the respondent will be seeking an adjournment of the application hearing, even though the application date was known to the respondent for almost a full year. The ONSC weighed the factors relevant to an adjournment request, and ultimately denied the adjournment request for a number of reasons, including that the court is concerned with the administration of justice to (1) orderly process civil proceedings, and (2) effectively enforce court orders, including scheduling orders. The ONSC advised that that there is a “strong public interest in promoting the timely resolution of disputes” and therefore was of the view that an important factor to consider is that there would be significant delay caused by any adjournment.
At Gilbertson Davis LLP, our lawyers can assist you, your business, company, partnership or corporation in applying to the court for the recognition and enforcement in Ontario of your judgment obtained in another jurisdiction. Gilbertson Davis LLP lawyers have experience in proceedings involving Recognition and Enforcement of Foreign Judgments, Recognition and Enforcement of International Arbitration Awards, Commercial Litigation, Civil Litigation, Business Torts, and Business Litigation matters and can assist you in resolving your legal issues in a timely and cost-effective manner. Our mission is to provide creative, sensible, cost-effective, long-term resolutions to clients. Please contact Gilbertson Davis LLP to schedule a consultation.
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