The law relating to arbitration in Canada is governed by the Arbitration Act, which came into force in the year 1995. The arbitration in its generic meaning to negotiate to resolve differences conducted by some impartial party in an amicable manner without approaching the Court. The arbitration may take place pursuant to an arbitration agreement or a clause for arbitration in a contract. The "arbitration agreement" means an agreement by which two or more persons agree to submit to arbitration a dispute that has arisen or may arise between them. In case any dispute arises between the parties they resolve the disputes pursuant to the arbitration agreement by submitting to an independent umpire to adjudicate the matter of several persons forming an Arbitral Tribunal.
If the arbitration agreement does not specify the number of arbitrators who are to form the arbitral tribunal, it shall be composed of one arbitrator.
The arbitral tribunal may also be appointed on a party's application to The Court of Queen's Bench of New Brunswick, if
- the arbitration agreement provides no procedure for appointing the arbitral tribunal, or
a person with power to appoint the arbitral tribunal has not done so after a party has given the person seven days notice to do so.
If the arbitral tribunal is composed of three or more arbitrators, they shall elect a Chair from among themselves; if it is composed of two arbitrators, they may do so.
CONDUCT OF ARBITRATION
In an arbitration, the parties shall be treated equally and fairly. Each party shall be given an opportunity to present a case and to respond to the other parties' cases.
An arbitral tribunal that is composed of more than one arbitrator may delegate the determination of questions of procedure to the chair. In an arbitration, the arbitral tribunal shall admit all evidence that would be admissible in a court and may admit other evidence that it considers relevant to the issues in dispute.
The arbitral tribunal may determine the manner in which evidence is to be admitted. The arbitral tribunal shall determine the time, date and place of arbitration, taking into consideration the parties' convenience and the other circumstances of the case.
An arbitration may be commenced in any way recognized by law, including the following:
- a party to an arbitration agreement serves on the other parties notice to appoint or to participate in the appointment of an arbitrator under the agreement;
- if the arbitration agreement gives a person who is not a party power to appoint an arbitrator, one party serves notice to exercise that power on the person and serves a copy of the notice on the other parties; or
a party serves on the other parties a notice demanding arbitration under the agreement.
An arbitral tribunal requires that the parties submit their statements
a specified period of time. The parties' statements shall indicate the facts supporting their positions, the points at issue and the relief sought.
The arbitral tribunal may conduct the arbitration on the basis of documents or may hold hearings for the presentation of evidence and for oral argument; however, the tribunal shall hold a hearing if a party requests it.
The arbitral tribunal shall give the parties sufficient notice of hearings and of meetings of the tribunal for the purpose of inspection of property or documents.
A party who submits a statement to the arbitral tribunal or supplies the tribunal with any other information shall also communicate it to the other parties. If the party who commenced the arbitration does not submit a statement within the period of time specified under subsection 25(1), the arbitral tribunal may, unless the party offers a satisfactory explanation, make an award dismissing the claim.
An arbitral tribunal may administer an oath or affirmation and power to require a witness to testify under oath or affirmation. On the application of a party or of the arbitral tribunal, the court may make orders and give directions with respect to the taking of evidence for an arbitration as if it were a court proceeding.
AWARDS AND TERMINATION OF ARBITRATION
An arbitral tribunal shall decide a dispute in accordance with law, including equity, and may order specific performance, injunctions and other equitable remedies.
The arbitral tribunal shall decide the dispute in accordance with the arbitration agreement and the contract, if any, under which the dispute arose, and shall also take into account any applicable usages of trade.
If an arbitral tribunal is composed of more than one member, a decision of a majority of the members is the arbitral tribunal's decision; however, if there is no majority decision or unanimous decision, the chair's decision governs.
An award shall be made in writing and, except in the case of an award made on consent, shall state the reasons on which it is based. The award shall indicate the place where and the date on which it is made.
The award shall be dated and shall be signed by all the members of the Arbitral Tribunal, or by a majority of them if an explanation of the omission of the other signatures is included. A copy of the award is then delivered to each party.
A party may, within thirty days after receiving an award, request that the arbitral tribunal explain any matter. If the arbitral tribunal does not give an explanation within fifteen days after receiving the request, the court may, on the party's application, order it to do so.
The arbitral tribunal may, on its own initiative at any time or at a party's request made within thirty days after receiving the award, make an additional award to deal with a claim that was presented in the arbitration but omitted from the earlier award.
A party may appeal against an award to the Court of Queen's Bench of New Brunswick on a question of law with leave, which the court shall grant only if it is satisfied that
- the importance to the parties of the matters at stake in the arbitration justifies an appeal, and
determination of the question of law at issue will significantly affect the rights of the parties.
On a party's application, the court may set aside an award on any of the following grounds:
- a party entered into the arbitration agreement while under a legal incapacity;
- the arbitration agreement is invalid or has ceased to exist;
- the award deals with a dispute that the arbitration agreement does not cover or contains a decision on a matter that is beyond the scope of the agreement;
- the composition of the tribunal was not in accordance with the arbitration agreement or, if the agreement did not deal with that matter, was not in accordance with this Act;
- the subject- matter of the dispute is not capable of being the subject of arbitration under New Brunswick law;
- the applicant was not treated equally and fairly, was not given an opportunity to present a case or to respond to another party's case, or was not given proper notice of the arbitration or of the appointment of an arbitrator;
- the procedures followed in the arbitration did not comply with this Act;
- an arbitrator has committed a corrupt or fraudulent act or there is a reasonable apprehension of bias; or
the award was obtained by fraud.
However, an appeal from the court's decision in an appeal of an award, an application to set aside an award or an application for a declaration of invalidity may be made to The Court of Appeal of New Brunswick, with leave of The Court of Appeal of New Brunswick.
COSTS OF AN ARBITRATION
The costs of an arbitration consist of the parties' legal expenses, the fees and expenses of the arbitral tribunal and any other expenses related to the arbitration. If the arbitral tribunal does not deal with costs in an award, a party may, within thirty days of receiving the award, request that it make a further award dealing with costs.