The courts kicked-off the year with the release of a decision discussing condominium arbitrations and the importance of explicit appeal rights in arbitration agreements.
This case involved a unit owner, who operated a legal cannabis store at the condominium building. The condo believed this breached a rule prohibiting cannabis sale at the property. Through an arbitration proceeding, the unit owner was found to be in breach of the rule and section 119 of the Condominium Act (the “Act”). After the arbitration decision was given, the unit owner asked the court to grant leave to appeal the arbitration decision.
The arbitration agreement between parties sets out the four corners of an arbitrator’s jurisdiction and any appeal rights. Unless the agreement provides otherwise, the standard appeal provisions of the Arbitration Act apply, which allow parties to appeal a decision only on “questions of law” with the court’s leave (among other requirements). “Questions of law” are errors in the arbitrator’s application of the law.
In this case, the court analyzed the arbitration decision and the parties’ arguments and concluded that the arbitrator had considered more than just an application of law but had also applied facts to the law. This meant the court was being asked to review a question of “mixed fact and law”, and not a pure question of law. Since the arbitration agreement between these parties didn’t expressly provide for appeal of questions of mixed fact and law, the court had to deny leave to appeal to the unit owner under the narrow appeal rights of the Arbitration Act.
The court also highlighted that an arbitrator’s decision in a private arbitration proceeding should be reviewed with deference, acknowledging the jurisdiction of an arbitrator as a decision maker freely appointed and chosen by the parties.
It is important that arbitration agreements are carefully reviewed to reflect the parties’ wishes because the agreement defines the relationships and rights of the parties even after the end of the arbitration proceeding.