Get Control Of The Dispute With Arbitration

When drafting an agreement, parties ought to consider how any resulting disputes are to be resolved. In a previous post, we identified that parties can refer matters to an expert for determination as a form of alternative dispute resolution. In that situation we briefly examined a recent decision rendered by Alberta's Court of Queen's Bench, Applied Industrial Technologies, LP v Sirois, 2018 ABQB 818 to learn how a provision in an agreement allowed for an agreed-upon expert to resolve disputes. Alternatively, parties may prefer to have disputes resolved via arbitration and if they agree to a clause that mandates arbitral proceedings, the Court tends to let that process govern.

There are multiple benefits provided to the parties of an agreement who insert a clause that requires a dispute be resolved by arbitration. By way of example, the parties will ensure that the dispute is resolved by a neutral third party, on issues selected by the parties, using a procedure selected by the parties. Essentially employing arbitral proceedings as a means of resolving a dispute provides more "control" to those parties involved.

In as much as it is valuable for the parties to decide that arbitration is the preferred choice for resolving a potential dispute, it is equally important for the parties to think critically of what process they wish to use for any arbitral proceeding. A clause that simply directs that a dispute shall be resolved by arbitration without more can...