Removing an Arbitrator During an Arbitration

I believe that I am not being treated fairly by an Arbitrator.  Can I get him/her removed?

Relevant Statutes Under Arbitration Act, S.O. 1991

s.6  No court shall intervene in matters governed by this Act, except for the following purposes, in accordance with this Act:

1. To assist the conducting of arbitrations.
2. To ensure that arbitrations are conducted in accordance with arbitration agreements.
3. To prevent unequal or unfair treatment of parties to arbitration agreements.
4. To enforce awards. 1991, c. 17, s. 6.
5. (1)  A party may challenge an arbitrator only on one of the following grounds:
6. Circumstances exist that may give rise to a reasonable apprehension of bias.
7. The arbitrator does not possess qualifications that the parties have agreed are necessary
8. (1)  The court may remove an arbitrator on a party’s application under subsection 13 (6) (challenge), or may do so on a party’s application if the arbitrator becomes unable to perform his or her functions, commits a corrupt or fraudulent act, delays unduly in conducting the arbitration or does not conduct it in accordance with section 19 (equality and fairness). 1991, c. 17, s. 15 (1).
9. (1) In an arbitration, the parties shall be treated equally and fairly. 1991, c. 17, s. 19 (1).

Idem

(2) Each party shall be given an opportunity to present a case and to respond to the other parties’ cases. 1991, c. 17, s. 19 (2).

s.46(7) 

Note:  In my assessment of the Owers decision you referred me to, I felt this decision was not relevant or helpful in regard to the issue to be researched.  The Owers decision involved the question as to whether a stay of the arbitration would be appropriate without first setting aside a court order for the arbitration.  It does not address the question of the removal of an arbitrator for reasons of failing to comply with the relevant statutes or regulations.

I did a key cite search on the O Regs, and no case law was turned up for these Regs.  I would conclude from this that, as yet, no reported matter has as yet been adjudicated with respect to compliance with these regs.

What follows is case law that may be of assistance to you in making any arguments for removal:

In Hercus v. Hercus, the wife sought to remove the arbitrator on the basis of s.19 of the Arbitration Act (“the ‘equality provision”).   Where this case, by analogy, may be significant to you is in the fact that the Court found grounds to remove the arbitrator on the basis of a s.19 violation in which the arbitrator failed to await the results of an investigation report before rendering his reasons.  As the Court noted at paragraphs 138-141:

I am deeply concerned, however, that knowing that an investigation was underway at the instance of a report from his office, Mr. McWhinney relied on the allegations of abuse as a basis for his decision without waiting for the outcome of the investigation.

139     One might argue that there was some urgency in releasing an arbitral award changing custody and the primary residence of the children given the abuse allegations. However, the evidence is that the report of abuse was made to Ms Moody on October 2, 2000 but not reported formally to the authorities until October 17, 2000. Further, Mr. McWhinney’s decision, although dated October 13, 2000 was apparently not issued until October 16, 2000 and not to take effect until October 27^th 2000 “when the boys would in any case be residing with their father.” Clearly there was no urgency in issuing a decision until after the completion of the investigation on October 25^th, 2000.

140     The decision of the mediator/arbitrator was to decline to wait for the result of a serious investigation into child abuse. He then rendered a decision in which he wrote,

Mrs. Price’s failure to make any submission or to comment on Mr. Hercus’ submission in this matter, the statements of the boys and the presence of physical punishment, have all had a significant impact on my decision to make an award in which the primary residence of the boys has been moved to the home of the father.
141     In my opinion, Mrs. Price was treated very unfairly by this conduct. Mrs. Price’s refusal to participate in the process did not obviate her right under s. 19(1) of the Act to be treated equally and fairly. Given the apparent lack of urgency in changing the residence of the children, it would have been incumbent on the arbitrator to incorporate or at the very least consider the results of the investigation in the decision in order for him to meet the standard imposed by s. 19(1) of the Act.

The significant factor to take away from this decision was that the Court rendered its disposition on the basis of  a violation of the mediation/arbitration process.  It did not make judgment on the arbitrator’s substantive decision.  Having noted that a failure to await the results of a report violated the equality provisions of section 19 of the Arbitration Act, the Court – for other reasons stated therein as well – overturned the award and removed the arbitrator.  The judicial jurisdiction for overturning an award and removing an arbitrator is grounded in s.46(7) of the Arbitration Act.  The Court here exercised its jurisdiction on the basis of a violation of the process grounded in the equality provisions of section 19.  In regard to your argument, you may indeed argue that the screening provisions are provided so as to ensure equality between the parties.  Is there dicta to that effect in the case law?  I did a thorough check for a nexus between a family arbitration and a power “balance” or “imbalance” between husband and wife as part of the process, as well as a check as to the requirement to screen in an arbitration process.  The search turned up no relevant case law on this point.  So you will have to make the above-noted argument without benefit of supporting case law.  Nevertheless, I believe it is a common sense matter to argue that the requirement for screening on power imbalances is an issue that goes to the heart of equality, and that it does arguably engage the s.19 equality provisions of the Arbitration Act.

The statutory basis for the Court to exercise its jurisdiction in intervening is s.6 of the Arbitration Act (excerpted above) – particularly s.6(2), which sets out that a court may intervene to ensure that arbitrations are in accord with arbitration agreements.  Pursuant to O Reg 134/07, the arbitrator’s declaration to consider the results of a screening “throughout the arbitration” is incorporated into the med/arb agreement under s.2(1)(b) of O Reg 134/07.  Thus, a failure to screen for power imbalances or a failure to consider the results of the report, if any, “throughout the arbitration”, is a breach of the terms of the med/arb agreement which incorporates these statutory terms.  Thus, pursuant to s.6 of the Arbitration Act, you can ask for the Court to intervene.  You can also raise the argument that s.6 (3) of the Arbitration Act (the equality term) is engaged here as well, since your argument is that a failure to sufficiently screen for power balances goes to the root of a concern for equality and fairness between the parties.  To support that argument, as noted above, the Hercus decision can be cited as an example in which a failure of the arbitrator to consider the results of a relevant report was deemed to go to the matter of equality under s.19, resulting in the overturning of an award and the removal of the Arbitrator under s.46(7).  Note, however, that s.46(7) is a remedial provision available – under a  limitation period – to challenge the results of the arbitrator’s decision and to remove that arbitrator if the matter is remitted back for arbitration.  Section 6, on the other hand, provides jurisdiction for the court to intervene at any point to ensure equality and an compliance with the arbitration agreement.

To see a sample case in which one party requested the intervention of the court to remove an arbitrator, and the court’s disposition in intervening pursuant to s.6, see Kay v. Korakianitis.

Note that, under s.15, the Court’s specific jurisdiction to remove an arbitrator is grounded in corruption, fraud, delays, and section 19 (equality and fairness).  Thus, it would seem that, to prevail on the application for removal at this sage in the proceedings, your argument should be that a failure to comply with the regs on screening engages s.19 (fairness and equality), and that it is therefore more practical to remove the arbitrator now, rather than wait for a challenge to overturn the award and have him removed pursuant to s.46(7), similar to Hercus.

In sum:

Based on the time allotted, I can report that there is no relevant case law on the screening requirements or on any of the other requirements under O Reg 134/07.  The majority of case law I found, where an arbitrator was deemed to treat the parties unequally, had nothing to do with procedure requirements, but rather an alleged favour or advantage given to the other side.  Whether or not you can thus connect s.19 to a failure to consider a screening report throughout the arbitration is therefore a legal gray area.

s.19 gives you the authority to ask for the removal of the arbitrator at this point in the proceedings; however, a time element may be applicable to keep this option open (when did you first become aware of this factor?)

s.6 provides a basis for the court to intervene, but not necessarily to the extent where an arbitrator is removed, unless you can again show that the failure to screen amounts to bias.  “Incompetence” is not an enumerated ground under s.15 (the removal provision), though I might argue that a failure to correctly follow procedure here might cause undue delays, and also point to a lack of concern on the part of the arbitrator to ensure that the power balance between parties is accounted for (thereby engaging the s.19 ground of s.15).

If you assert the court’s intervention pursuant to s.6, the result might simply be for the court to “assist in the conduct of the arbitration” by directing the arbitrator to create a record of screening or to screen the parties anew himself.

In regard to procedural irregularities that may invalidate a subsequent award (which is what a failure to comply with the regs essentially amounts to) , s.46(7) is applicable at that stage.

I trust that this explains the options that are open to you at this point.  Given the dearth of relevant case law, you would be navigating uncharted legal waters in making the arguments I proposed above; however, so long as you understand the workings of each applicable statute as discussed above, you might have an arguable case.  It really comes down to how egregious it is, under the circumstances, if the arbitrator has thus far shown no inclination to look into the existing power balance between the parties at this stage.  In my view, argue that this factor engages s.19, which in turn engages the court’s right to intervene to ensure compliance with the arb agreement and equality (under s.6) and also engages your right to request a removal at this stage under s.15.

Maryellen Symons

Barrister & Solicitor