Enforcing Arbitration Awards From Other Canadian Jurisdictions in British Columbia: Current Two-Step Process and Changes to Come
In what circumstances will arbitration awards obtained in other Canadian jurisdictions be enforced in British Columbia? That was the question before the British Columbia Supreme Court in Zonruiter v. Matthews, 2020 BCSC 568.
In this case, the Court dismissed the claimant’s application to enforce the Alberta arbitrator’s costs awards in British Columbia. Instead, the claimant needed to follow the usual two-step process of first obtaining a judgment in Alberta and then enforcing it in British Columbia pursuant to the Court Order Enforcement Act, R.S.B.C. 1996, c. 78 (the “COEA”).
This case involved a family law dispute and related legal proceedings in Alberta and British Columbia. The claimant and respondent were married in September 2013, and separated in December 2015. They have one child together. The parties lived in Lloydminster, Alberta. Following their separation, the claimant moved with the child to British Columbia. The respondent ultimately moved to British Columbia in 2017.
On July 4, 2016, the parties sought to resolve a number of issues in their family law dispute by way of an arbitration and entered into an arbitration agreement pursuant to s. 5 of the Arbitration Act, R.S.A. 2000, c. A-43 (the “Alberta Arbitration Act”). Key provisions of the arbitration agreement included the following:
- The parties waived the right to further litigate custody, parenting, child support and property issues under various pieces of Alberta and federal legislation.
- The parties agreed that the arbitration agreement "shall prevail and override" the Alberta Arbitration Act.
- The parties agreed that nothing in the arbitration agreement impaired "any enforcement rights that a party may have through the courts or otherwise."
- The arbitration agreement gave the parties a choice of having the arbitration conducted in accordance with the law of Alberta, or the law of another Canadian jurisdiction.
- The parties agreed that all awards made by the arbitrator are binding on the parties and "may be incorporated into a consent order of the Court of Queen's Bench of Alberta" and that "either party may apply for the enforcement of any award."
- The parties further agreed to enter into a Consent Order incorporating the terms of the award made by the arbitrator so that an application under the Alberta ArbitrationActto enforce the award would not be necessary.
The arbitrator made a number of awards in favour of the claimant, including a costs award on March 2, 2017 and a supplemental costs award on May 8, 2017 (the “Alberta Costs Awards”).
Despite having agreed to arbitrate all of their family law disputes, proceedings were ultimately commenced in Alberta and British Columbia. The claimant filed the arbitration awards made in Alberta, including the Alberta Costs Awards, in the British Columbia proceeding. The sole issue before the British Columbia Supreme Court was the enforceability of the Alberta Costs Awards in British Columbia.
The Court’s Decision
The claimant took the position that the Alberta Costs Awards were enforceable in British Columbia on the basis they were made in respect of a “family law dispute” and therefore enforceable without leave of the court pursuant to s. 29 of the Arbitration Act, R.S.B.C. 1996, c. 55 (the “BC Arbitration Act”) as well as in accordance with the Supreme Court Family Rules, B.C. Reg. 169/2009 (“SCFRs”). In support of her position, the claimant pointed to the following:
- the definition of “dispute” in the BC Arbitration Act includes “family law dispute”, which in turn is defined to have the same meaning as in the Family Law Act, S.B.C. 2011, c. 25 (the “BC FLA”);
- the definition of “family law dispute” in the BC FLA is broad, and on the claimant’s interpretation is not limited to disputes arising in British Columbia;
- section 29 of the BC Arbitration Act provides that leave of the court is not required to enforce an arbitration award made in respect of a family law dispute; and
- the SCFRsdefine "arbitration award" to mean an award within the meaning of the BC Arbitration Act made in respect of a family law dispute.
The Court disagreed with the claimant’s position, finding that the dispute over the Alberta Costs Awards was a dispute relating to the laws of Alberta, not British Columbia. As such, the claimant could not rely on the BC Arbitration Act or SCFRs to enforce the awards in British Columbia.
In coming to its decision, the Court analyzed the legislation and the SCFRs, and concluded that the process for enforcing the Alberta Costs Awards advanced by the claimant was flawed. In particular, the Court took issue with the breadth of the interpretation advanced by the claimant for the term "family law dispute", which is defined in the BC FLA as "a dispute respecting a matter to which this Act relates". The Court found that on the claimant’s interpretation, the BC FLA would apply to family law disputes arising anywhere in the world, including non-reciprocating jurisdictions. Such an interpretation raised a number of concerns for the Court, most notably that the British Columbia courts “could be used to enforce awards made in foreign jurisdictions which have regressive laws and/or do not abide by the rule of law”.
The Court further supported its interpretation with recourse to the differences in language used in arbitration legislation in other Canadian jurisdictions. In this regard, the Court noted that arbitration legislation in provinces such as Alberta and Ontario include provisions that expressly provide for the enforcement of arbitration awards made in other Canadian jurisdictions. Although not applicable to family law disputes, a similar provision will be included in British Columbia’s new Arbitration Act, S.B.C. 2020, c. 2, s. 61, which is not yet in force (the “New Act”). Had the British Columbia legislative assembly intended a similar enforcement process for out of province family law arbitration awards, the legislation would contain express provisions to that effect.
Finally, the Court noted that the claimant is not left without a remedy. She can enforce the Alberta Costs Awards in British Columbia using the two step process provided under the COEA of first obtaining a court order or judgment on the awards in Alberta, and then following the usual process for registering and enforcing foreign court orders in British Columbia.
Conclusion and Changes to Come
This decision confirms the current process in British Columbia for enforcing arbitration awards from other provinces and territories. Parties should be aware, however, that this approach to enforcement will soon change. As we previously discussed here, the New Act, which received Royal Assent on March 5, 2020 and will be coming into force by regulation on a date to be determined, will modernize and streamline the arbitration regime in British Columbia. Pursuant to s. 61 of the New Act, a party will be able to apply to the British Columbia Supreme Court to “recognize and enforce an arbitral award made in an arbitration with a place of arbitration in Canada”. This change will simplify the current process and will make it easier to enforce arbitral awards from other Canadian jurisdictions in British Columbia.
Zonruiter v. Matthews, 2020 BCSC 568 at para. 23.
Ibid at para. 21.
Ibid at para. 22.
Ibid at para. 24.
Ibid at paras. 25-27.
arbitration Arbitral Awards enforcement