Consumers' Co-operative Refineries Ltd. v. NewGrade Energy Inc., (1990) 81 Sask.R. 178 (QB)

• Judge: Barclay, J.
• Court: Court of Queen's Bench of Saskatchewan (Canada)
• Case Date: January 04, 1990
• Jurisdiction: Saskatchewan
• Citations: (1990), 81 Sask.R. 178 (QB)

Consumers' Co-op v. NewGrade (1990), 81 Sask.R. 178 (QB)

MLB headnote and full text

Consumers' Co-operative Refineries Limited (applicant) v. NewGrade Energy Inc. (respondent)

(No. 8367 A.D. 1989)

Indexed As: Consumers' Co-operative Refineries Ltd. v. NewGrade Energy Inc.

Saskatchewan Court of Queen's Bench

Judicial Centre of Regina

Barclay, J.

January 4, 1990.

Summary:

A commercial agreement provided that disputes involving interpretation of the agreement would be resolved by arbitration. The arbitration award was protected by a privative clause. Later, a dispute concerning the pricing arrangement was the subject of an arbitration. The board held that certain words were included by mistake and should be ignored when the clause was interpreted. One of the parties applied for judicial review. The party submitted that the award was based on an unreasonable interpretation and that the board exceeded its jurisdiction.

The Saskatchewan Court of Queen's Bench dismissed the application.

Arbitration - Topic 5574

The award - Arriving at an award - Effect of provisional opinions of arbitrator during hearing - Board found that certain words were inserted in an agreement by mistake and should be ignored before interpreting the clause - A party applied to have the award quashed - Party submitted that board should have told the parties that it was having difficulty in interpreting the clause - Parties could then adduce additional evidence and disabuse the board of its view - The Saskatchewan Court of Queen's Bench dismissed the application - The court held that the board was under no obligation to inform parties of its initial impressions of interpretation during a hearing - See paragraphs 52 and 53.

Arbitration - Topic 7807

Judicial review - General principles - Privative clause - Effect of - The Saskatchewan Court of Queen's Bench considered the issue of when consensual arbitrations were subject to judicial review - The court stated that a contractual privative clause had the same effect as a statutory privative clause - Therefore, a consensual arbitration empanelled to interpret an agreement would only be subject to judicial review if the interpretation was patently unreasonable - See paragraphs 17 to 29 and 47 to 48.

Arbitration - Topic 7910

Judicial review - Jurisdiction of the courts - Privative clause - Consensual arbitration - [See Arbitration - Topic 7807 above].

Arbitration - Topic 7960

Judicial review - Jurisdiction of arbitrator - Abuse of jurisdiction - General - An arbitration board was formed to interpret provisions in a consensual agreement - Board found that certain words were inserted by mistake and should be ignored - A party applied for judicial review on the ground the board committed a jurisdictional error or made an error of law on a matter outside its exclusive jurisdiction - The Saskatchewan Court of Queen's Bench dismissed the application - The court held that the board stayed within its mandate - Also, it employed the proper canons of construction in interpreting the agreement - See paragraphs 30 to 43.

Arbitration - Topic 8310

Judicial review - Grounds - Mistake - Error of law on the face of the record - [See Arbitration - Topic 7960 above].

Cases Noticed:

Re Suncor Inc. and McMurray Independent Oil Workers, Local #1 (1983), 42 A.R. 166; 142 D.L.R.(3d) 305, refd to. [para. 19].

Saskatchewan Government Employees Union v. Wascana Hospital (1988), 66 Sask.R. 56, folld. [para. 20].

Volvo Canada Limited v. International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW), Local 720, [1980] 1 S.C.R. 178; 27 N.R. 502; 33 N.S.R.(2d) 22; 57 A.P.R. 22; 99 D.L.R.(3d) 193, refd to. [para. 20].

Douglas Aircraft Company of Canada Ltd. v. McConnell et al., [1980] 1 S.C.R. 245; 29 N.R. 109, refd to. [para. 21].

R. v. Barber et al.; Ex parte Warehousemen and Miscellaneous Drivers' Union Local 419, [1968] 2 O.R. 245, refd to. [para. 21].

Alberta Union of Provincial Employees, Branch 63 v. Olds College, [1982] 1 S.C.R. 923; 42 N.R. 559; 37 A.R. 281; 136 D.L.R.(3d) 1; 21 Alta. L.R.(2d) 104, refd to. [para. 22].

Shalansky et al. v. Board of Governors of the Regina Pasqua Hospital, [1983] 1 S.C.R. 303; 47 N.R. 76; 27 Sask.R. 153, refd to. [para. 23].

Mar-Kee Enterprises Ltd. v. Jocan Machinery Ltd. and Johansson (1981), 8 Sask.R. 72 (Q.B.), refd to. [para. 25].

Fort McMurray School District #2833 v. Fort McMurray Roman Catholic Separate School District #32 (1984), 9 D.L.R.(4th) 224; 53 A.R. 191, affd. 71 A.R. 251, refd to. [para. 27].

Forbes v. Git et al., [1922] 1 A.C. 256, refd to. [para. 35].

Ford v. Beech (1848), 116 E.R. 693, refd to. [para. 36].

Smith v. Packhurst (1741), 26 E.R. 881, refd to. [para. 39].

Stone v. The Mayor, Aldermen, and Burgesses of Yeovil (1876), 1 C.P.D. 691, refd to. [para. 40].

Nicolene Ld. v. Simmonds, [1953] 1 Q.B. 543, refd to. [para. 41].

Douglas Aircraft Company v. United Automobile, Aerospace and Agricultural Implement Workers (1970), 10 C.L.L.C. 14,221 (S.C.C.), refd to. [para. 47].

Robert and United Metallurgists of America, Local 4589 v. Bombardier - M.L.W. Limited and Brody (1980), 32 N.R. 426, refd to. [para. 54].

Statutes Noticed:

Arbitration Act, R.S.S. 1978, c. A-24, sect. 10 [paras. 16, 45].

Authors and Works Noticed:

Anson, The Law of Contract (24th Ed.), p. 149 [para. 37].

Chitty on Contracts (25th Ed.), para. 789 [para. 38].

Russell on Arbitration (18th Ed.), p. 185 [para. 50].

Counsel:

Peter Foley, Q.C., and Larry F. Seiferling, Q.C., for the applicant;

Larry LeBlanc and Leonard D. Andrychuk, for the respondent.

This application was heard by Barclay, J., of the Saskatchewan Court of Queen's Bench, Judicial Centre of Regina, who delivered the following judgment on January 4, 1990.