Canada

Part I: what can be enforced?

1. What counts as an arbitral “award” that can be enforced?

In Canada, each province and territory has separate legislation governing the enforcement of arbitral awards. The term “award” is not defined in the provincial and territorial legislation governing the enforcement of domestic or foreign arbitral awards.

As a general matter, the following types of awards can be enforced in Canada:

• monetary awards for damages
• declaratory awards, if they declare rights that pertain to the parties to the arbitration
• subject to certain jurisdictional intricacies, interim awards, including orders for the detention, preservation, or inspection of relevant property and documents
• equitable remedies such as specific performance and injunctions

2. Formal requirements that an award needs to conform with to be enforceable

The form required for an arbitral award is governed by the arbitration agreement between the parties and the applicable provincial or territorial law governing the arbitration. As a general matter, awards for both international and domestic arbitrations must:

• be in writing
• state the reasons on which it is based, except in the case of an award on consent
• indicate the place where and the date on which it is made
• be dated and signed by all the members of the arbitral tribunal, or by a majority of them if an explanation of the omission of the other signature is included
• be delivered to each party

With respect to the content of the award, it is generally sufficient that the language demonstrates that the arbitrator has come to a decision upon the points submitted. In addition, the award should be certain such that no reasonable doubt can arise as to the arbitrators’ meaning.

3. Orders on interim measures: enforceability

a. Domestic awards

Interim or partial awards in domestic arbitrations are generally enforceable on the same basis as final awards, subject to the terms of the particular provincial or territorial legislation. Domestic legislation across the majority of Canadian provinces empowers arbitrators to make one or more interim awards, including orders for the detention, preservation, or inspection of property and documents that are subject to the arbitration or as to which questions may arise during arbitration and may order a party to provide security in that connection.

b. International commercial arbitration awards

Interim or partial awards in international arbitration are generally enforceable, subject to satisfying the requirements of the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration (1985) (Model Law).

4. Emergency awards: enforceability

a. Domestic awards

Emergency awards in domestic arbitration are generally enforceable if they meet the requirements for enforceability of interim or partial awards.

b. International commercial arbitration awards

Emergency awards in international arbitration are enforceable in accordance with the requirements of the Model Law.

Part II: resisting enforcement

5 a. How are awards set aside?

The grounds for setting aside an arbitral award are set out in the applicable provincial or territorial law governing the arbitration. As a general matter, awards for both international and domestic arbitrations can be set aside on the following grounds:

• A party entering into an arbitration agreement lacked the capacity to do so.
• The arbitration agreement is invalid or has ceased to exist under the law chosen by the parties.
• The award involves a dispute not covered in the arbitration agreement or pertains to a matter that is beyond the scope of the agreement.
• The composition of the tribunal is not aligned with the arbitration agreement or the relevant legislation.
• The subject matter of the dispute is beyond the scope of the relevant law.
• A party is not treated equally or fairly, was not given the opportunity to present a case or to respond to another party’s case or was not provided with proper notice of the arbitration or the appointment of an arbitrator.
• The procedures followed in the arbitration were not in compliance with the relevant legislation.
• An arbitrator committed a corrupt or fraudulent act or there is a reasonable apprehension of bias.
• The award was obtained by fraud.

b. Can enforcement be resisted if the respondent has not formally applied to set aside the award?

A court may set aside an arbitral award on its own initiative if it finds that:

• the subject matter of the dispute is not capable of settlement by arbitration under the relevant law, or
• the recognition or enforcement of the award would be contrary to the public policy of Canada

c. Can non-parties seek annulment?

Provincial and territorial law governing domestic and international arbitrations generally provide that an annulment of an arbitral award can only be sought at the request of a party against whom the award is invoked.

d. Grounds to seek setting aside

See questions II(5)(a) and II(5)(b).

e. Timelines to seek setting aside

The timelines to seek to set aside an arbitral award are provided for in the applicable provincial or territorial law governing the arbitration. As a general matter, domestic legislation requires that an application to set aside an award be commenced within 30 days after the applicant receives the award, correction, explanation, change, or statement of reasons on which the application is based. In cases involving allegations of corruption or fraud, the 30-day requirement may not apply. In Quebec, a party must submit the setting-aside application within three months of receipt.

With regards to international arbitration awards, Article 34(3) of the Model Law provides that a party must apply to set aside an award within three months of the date the party received the award or the date the tribunal disposed of a request under Article 33.

f. Grounds to resist enforcement

See questions II(5)(a) and II(5)(b).

g. Which court to go to for setting aside?

The specific court to go to for setting aside will depend on the relevant provincial legislation. For example, in Ontario, the Ontario Superior Court of Justice has jurisdiction over applications for setting aside both domestic and international arbitral awards. In Quebec, the relevant court is determined based on the value of the dispute submitted for arbitration but will either be the Court of Quebec or the Superior Court of Quebec.

In cases involving Her Majesty in right of Canada, a department or a Crown corporation or a Crown corporation in relation to maritime or admiralty matters, the Federal Court of Canada will have jurisdiction over the application.

h. Formal requirements before court can grant setting aside

See questions II(5)(a) and II(5)(b).

i. Do courts grant stay on enforcement as an interim measure?

Domestic legislation generally allows courts to grant a stay of enforcement as an interim measure. For instance, Arbitration Act, 1991 (Ontario) s50(5) provides that if the period for commencing an appeal, application to set aside an award, or application for a declaration of invalidity has not yet elapsed, or if such proceeding is pending, the court may order that the enforcement of the award is stayed until the period has elapsed without such a proceeding being commenced, or until the pending proceeding is finally disposed of.

The power to stay the enforcement of an arbitral award is discretionary and the court will generally consider whether:

• there is a serious question to be determined on the setting-aside application
• the moving party will suffer irreparable harm if the stay is not granted, and
• the balance of convenience favours granting the stay

Similarly, international awards may be recognised regardless of a setting-aside proceeding that is pending. Given that Article 36 of the Model Law provides limited grounds for refusing recognition and enforcement of an award, setting-aside proceedings will not necessarily have a suspensive effect.

j. What is the appellate mechanism against the decision of the court of first instance?

With respect to domestic arbitration, the appeal mechanisms are set out in provincial and territorial law. For example, Ontario’s Arbitration Act, 1991 s49 provides that an appeal from the court’s decision in an appeal of an award, an application to set aside an award or an application for a declaration of invalidity may be made to the Court of Appeal for Ontario, with leave of that court. For international arbitral awards, whether an appeal is available as of right or requires leave will depend on the nature and the value of the award, as well as the decision sought to be appealed.

Part III: enforcing foreign awards

As a result of their incorporation into Canadian law, the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958) (New York Convention) and the UNCITRAL Model Law provide the general framework for the recognition and enforcement of foreign arbitral awards in Canada. The provinces and territories have enacted legislation that either implements or is substantially based on the New York Convention and the Model Law.

6. New York Convention applicability

Canada is party to the New York Convention with accession having taken place in 1986. All provinces and territories have enacted statutes through which the text of the convention is incorporated.

7. Timelines for enforcement

The recognition and enforcement of foreign arbitral awards is governed by the rules of procedure applicable in the province or territory in which the application is made. Accordingly, the specific timelines for enforcement will vary from province to province and are determined by reference to different local legislation.

For instance, in Ontario, International Commercial Arbitration Act s10 explicitly requires that an application be brought within 10 years of the date of the final award.

8. Which court to go to? Relation with location of assets?

The specific court to go to for the recognition and enforcement of foreign arbitral awards will depend on the applicable provincial or territorial legislation. As a general matter, the ‘competent court’ will be set out in the province’s International Arbitration Act. For example, Ontario’s legislation provides that the Superior Court of Justice has jurisdiction over the recognition of both international awards made in Ontario and foreign arbitral awards.

The Federal Court of Canada maintains jurisdiction over an application for the recognition and enforcement of an award in relation to matters where at least one of the parties to the arbitration is Her Majesty in right of Canada, a departmental corporation or a Crown corporation or in relation to maritime or admiralty matters.

9. Can non-parties resist enforcement?

Once a foreign arbitral award has been made, a party cannot resist enforcement without first applying to the court to set aside or vary the order recognising the arbitral award.

10. Compelling disclosure of local assets? How to identify assets available for enforcement?

There are several ways in which a party can assess whether there are local assets available for enforcement, including:

• Provincial Land Titles Offices allow a judgment creditor to search for real estate property that is owned by the debtor.
• Provincial Personal Property Registries allow a judgment creditor to identify movable property of the debtor.
• Corporate registry searches provide creditors with access to publicly filed information by corporations which may include data about shares held in other corporations.
• The Office of the Superintendent of Bankruptcy allows for searches that reveal bankruptcy proceedings involving the debtor.
• Industry-specific databases include databases by securities commissions and regulators in the utilities or energy sectors, as well as registers of trademarks through the Canadian Intellectual Property Office.
• Examination in Aid of Execution is a judicial process that allows a judgment creditor to question a debtor under oath about their financial situation and assets.

11. Are third-party funded awards enforceable?

As a general matter, third-party funded awards are enforceable in Canada, provided that the third-party funding arrangement does not constitute maintenance or champerty and is not otherwise contrary to public policy. In British Columbia, the International Commercial Arbitration Act specifically recognises that third-party funding for an arbitration is not contrary to the public policy in British Columbia.

12. What interim reliefs are available pending enforcement of awards? Which of those reliefs are granted ex parte?

Article 17 of the Model Law provides that the following interim measures may be ordered by an arbitral tribunal:

• maintain or restore the status quo pending determination of the dispute
• take action that would prevent, or refrain from taking action that is likely to cause, current or imminent harm or prejudice to the arbitral process itself
• provide a means of preserving assets out of which a subsequent award may be satisfied, or
• preserve evidence that may be relevant and material to the resolution of the dispute

In considering whether to grant an interim measure, the party requesting it bears the burden of satisfying the tribunal:

• Harm not adequately reparable by an award of damages is likely to result if the measure is not ordered, and such harm substantially outweighs the harm that is likely to result to the party against whom the measure is directed if the measure is granted.
• There is a reasonable possibility that the requesting party will succeed on the merits of the claim. The determination on this possibility shall not affect the discretion of the arbitral tribunal in making any subsequent determination.

13. Formal requirements for enforcement application: what documents need to be filed in court

Article 35(2) of the Model Law requires that a party applying for the enforcement of an award must provide the original award or a copy with the enforcement application. Further, if the award is not made in the official language of the state (which, in Canada, is English or French), the court may request the party to provide a translated copy of the award in the state’s official language.

Article IV of the New York Convention provides that the party applying for recognition and enforcement must provide the duly authenticated original award (or a duly certified copy of the award), the original arbitration agreement (or a duly certified copy of the agreement) and, if necessary, a translated version of the above documents. The translation must be certified by an official or sworn translator or by a diplomatic consular agent.

14. Enforcing awards that have been annulled/set aside at other courts. Enforcing when an annulment application is pending at a foreign court

Generally, courts will adjourn enforcement proceedings pending the outcome of annulment proceedings. In Ontario, the Superior Court of Justice has provided a two-part test to be used when determining whether to adjourn an enforcement proceeding in cases involving an ongoing annulment proceeding at the seat of the arbitration. The court will assess: (1) whether there is an issue to be tried; and (2) the balance of convenience.

Similarly in Quebec, Article 654 of the Quebec Code of Civil Procedure encompasses discretionary power for the court to stay recognition and enforcement of an award. The Superior Court of Quebec has held that, in deciding whether to order a stay, the analysis involves a review of the “competing concerns on each side of the debate” with a number of guiding principles that the court should consider.

15. Once application for enforcement is allowed, how does the actual enforcement against assets work? What are the remedies available for tracing assets during enforcement proceedings including for assets disposed of by fraud?

Once the arbitral award is recognised, it may be enforced in the same manner as an order of the court, including through conventional asset-tracing techniques. See question III(10).

16. What is the procedure for repatriation of sums awarded after obtaining an order for enforcement?

The Canadian government does not restrict movement of funds into or out of the country and does not impose restrictions on the buying or selling of foreign currency.

17. Do courts grant orders for security for costs?

Yes, Article 36 of the Model Law allows for security for costs.

18. Exchange control regulations: do they affect payments to foreign award holders?

The Canadian government does not restrict movement of funds into or out of the country and does not impose restrictions on the buying or selling of foreign currency.

19. Enforcing awards from non-New York Convention places

The New York Convention and the UNCITRAL Model Law provide the general framework for the recognition and enforcement of a foreign arbitral award in Canada irrespective of the country in which it was made.

20. Enforcing against sovereigns

The rules regarding recognition and enforcement of awards against foreign states are provided in the State Immunity Act (Canada). While a foreign state can waive its immunity from enforcement in Canada, the circumstances outlined in the Act, such as commercial use of property, allow for enforcement against state-owned assets in Canada.

21. Appellate mechanism available?

Article 32 of the Model Law does not allow appeals and provides that the proceeding terminates when the tribunal issues the final award or otherwise issues an order terminating the proceeding. However, as discussed, a party may seek to set aside an international award according to the requirements provided in Article 34 of the Model Law.

Part IV: enforcing domestic awards

In general, provincial arbitration legislation provides that enforcement of domestic arbitral awards is mandatory unless:

• The period for appealing or applying to set aside the award has not expired.
• There is a pending appeal or application to set aside the award.
• The award has been set aside or the arbitration declared invalid.
• The award is a family arbitration award.
• The subject matter of the award is not capable of being the subject of an arbitration under the law of the enforcing province.

22. Timelines for enforcement

Provincial limitation statutes apply to applications to enforce arbitral awards and vary between provinces. For instance, in Ontario and British Columbia, the provinces have enacted a 10-year period whereas Alberta and New Brunswick provide for a two-year limitation period. In Quebec, arbitral awards are considered to be judgments for limitation purposes and are also subject to a 10-year limitation period.

23. Which court to go to? Relation with location of assets?

When enforcing domestic awards, the relevant court for the enforcement will typically be set out in the guiding domestic legislation. In Ontario, for example, the Arbitration Act, 1991 provides that the Superior Court of Justice shall give a judgment enforcing an award made in Ontario or elsewhere in Canada (subject to the exceptions listed in s50(3) and 50(4)). In Quebec, the relevant court is determined based on the value of the dispute submitted for arbitration but will either be the Court of Quebec or the Superior Court of Quebec.

The Federal Court maintains jurisdiction over an application for the recognition and enforcement of an award in relation to matters where at least one of the parties to the arbitration is Her Majesty in right of Canada, a departmental corporation or a Crown corporation or in relation to maritime or admiralty matters.

24. Compelling disclosure of assets? How to identify assets available for enforcement?

There are several ways in which a party can assess whether there are local assets available for enforcement, including:

• Provincial Land Titles Offices allow a judgment creditor to search for real estate property that is owned by the debtor.
• Provincial Personal Property Registries allow a judgment creditor to identify movable property of the debtor.
• Corporate registry searches provide creditors with access to publicly filed information by corporations which may include data about shares held in other corporations.
• The Office of the Superintendent of Bankruptcy allows for searches that reveal bankruptcy proceedings involving the debtor.
• Industry-specific databases include databases by securities commissions and regulators in the utilities or energy sectors, as well as registers of trademarks through the Canadian Intellectual Property Office.
• Examination in Aid of Execution is a judicial process that allows a judgment creditor to question a debtor under oath about their financial situation and assets.

25. Are third-party funded awards enforceable?

As a general matter, third-party funded awards are enforceable in Canada, provided that the third-party funding arrangement does not constitute maintenance or champerty and is not otherwise contrary to public policy.

26. What interim reliefs are available pending enforcement of awards? Which of those reliefs are granted ex parte?

It is possible to apply for interim reliefs pending the enforcement of awards. The specific types of interim measures available will, however, depend on the jurisdiction in which enforcement is sought. In general, interim measures available to applicants include:

• a certificate of pending litigation
• interim orders for custody or preservation of property
• interim injunctions
• orders for security for costs

27. Formal requirements for enforcement application: what documents need to be filed in court?

The formal requirements for an enforcement application vary slightly from province to province. For instance, in Ontario, Arbitration Act, 1991 s50(2) provides that the application shall be made on notice to the person against whom enforcement is sought, in accordance with the rules of the court, and shall be supported by the original award or a certified copy. Similarly, Quebec requires that an application for homologation of an award be accompanied by a copy of the award. In British Columbia, on the other hand, Arbitration Act s61(3) provides explicitly for a list of evidence required to accompany the original or certified copy of the award.

28. Once application for enforcement is allowed, how does the actual enforcement against assets work? What are the remedies available for tracing assets during enforcement proceedings including for assets disposed of by fraud?

At a high level, once a domestic arbitral award has been enforced by the court, it may be pursued in the same manner as any other judgment. Monetary judgments, for example, are typically enforced through either a writ of seizure and sale, garnishment, writ of sequestration, or through the appointment of a receiver. The specific enforcement mechanisms will often be governed by provincial rules of civil procedure; however, other statutes may also apply (for example, a judgment creditor is a “complainant” under the Ontario Business Corporations Act s248 and can apply to the court under the oppression remedy).

29. Do courts grant orders for security for costs?

Yes. As a general matter, the provincial and territorial arbitration legislation in Canada provides the court with the same powers with respect to the enforcement of arbitral awards as to the enforcement of its own judgments. The rules of court in Canada generally provide that the court can grant orders for security for costs.

30. Appellate mechanism available?

The appellate mechanism available will generally depend on the wording of the arbitration agreement and the relevant legislation. That being said, provincial legislation across Canada provides that domestic arbitration awards can be appealed only on a question of law with leave of the court.

For instance, in Ontario, Arbitration Act, 1991 s45 provides that if the arbitration agreement is silent with respect to appeals on questions of law, a party may appeal an award to the court on a question of law with leave. The court will then only grant leave if it is satisfied that: (a) the importance to the parties of the matters at stake in the arbitration justifies an appeal; and (b) determination of the question of law at issue will significantly affect the rights of the parties. Within the arbitration agreement itself, the parties may agree to exclude the right to an appeal or expand it to include questions of fact or mixed fact and law. As such, parties who wish to maintain broader appeal rights should ensure that the appropriate contractual provisions are included in the arbitration agreement.

In Quebec, Article 648 of the Quebec Code of Civil Procedure does not allow appeals of arbitral awards, whether domestic or international. They may only be challenged through an application for annulment.