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Ontario|Arbitration / Mediation
496 What is arbitration & when is it appropriate?In Ontario, the Arbitrations Act, 1991, governs what may be loosely termed, private "domestic" or commercial arbitrations and arbitrations conducted in accordance with other statutes. Most common law provinces have a similar Act. For example, in British Columbia there is the Commercial Arbitration Act and in New Brunswick the Arbitration Act.
The definition of arbitration given by the "American Arbitration Association" is applicable in Ontario and other common law provinces. The definition states that arbitration is:
"The submission of a dispute to one or more impartial persons for a final and binding decision. Through contractual provisions, the parties may control the range of issues to be resolved, the scope of the relief to be awarded and many of the procedural aspects of the process."
Arbitrations are usually binding. That is, the parties agree beforehand to be bound by the decision to be made by another person, often referred to as a third party neutral, arbitrator or arbitral tribunal.
The parties to an arbitration agreement have wide latitude as to the arbitration agreement that will govern them.
If the parties agree, among other things, they have the option of:
o introducing elements of informality;
o simplifying the procedure so that it is far removed from the requirements of the courtroom setting;
o permitting the matter to be presented through written arguments and documents without the attendance of witnesses;
o ensuring that the arbitrator's award or decision is final and that there is no right to appeal to the courts in any circumstances.
Alternatively, the parties may, for example, agree that:
o the arbitration procedure will be more stringent than that found in the public court system;
o a panel of arbitrators and not just a single arbitrator will hear the case and render a decision; and
o either party, as of right, may appeal the arbitrator's or panel's award on any issue of fact or law or mixed fact or law.
Arbitration is appropriate in those cases where the parties all agree to submit their dispute to arbitration. Most likely these parties have decided that they cannot resolve the dispute amongst themselves, that outside conciliators or mediators will not assist them and they, therefore, wish some other person to impose a decision that will be binding upon them, whether or not they like the decision rendered.
For more information about arbitration, refer to other sections of Legal Line.