Premium Brands Operating GP Inc. v. Turner Distribution Systems Ltd., 2011 BCCA 75

• Judge: Newbury, Mackenzie and Hinkson, JJ.A.
• Court: Court of Appeal (British Columbia)
• Case Date: January 13, 2011
• Jurisdiction: British Columbia
• Citations: 2011 BCCA 75;(2011), 299 B.C.A.C. 289 (CA)

Premium Brands v. Turner Distr. (2011), 299 B.C.A.C. 289 (CA);

    508 W.A.C. 289

MLB headnote and full text

Temp. Cite: [2011] B.C.A.C. TBEd. FE.049

Premium Brands Operating GP Inc. (successor to Fletcher's Fine Foods Ltd.) (appellant/petitioner) v. Turner Distribution Systems Ltd. (respondent/respondent)

(CA038214; 2011 BCCA 75)

Indexed As: Premium Brands Operating GP Inc. v. Turner Distribution Systems Ltd.

British Columbia Court of Appeal

Newbury, Mackenzie and Hinkson, JJ.A.

February 18, 2011.

Summary:

A party to a commercial arbitration (Premium) moved for dismissal of the claims before the arbitrator due to delay. The arbitrator declined to dismiss the claims. Premium sought leave to appeal.

The British Columbia Supreme Court, in a decision reported at [2010] B.C.T.C. Uned. 258, granted leave to appeal.

The British Columbia Supreme Court, in a decision reported at [2010] B.C.T.C. Uned. 749, dismissed the appeal. Premium appealed.

The British Columbia Court of Appeal dismissed the appeal.

Arbitration - Topic 118

Right to arbitration - Enforcement - Defences - Laches - A party to a commercial arbitration (Premium) moved for dismissal of the claims before the arbitrator due to delay - The arbitrator found that the delay was inordinate and inexcusable and that, if he had the jurisdiction to do so, he would have dismissed the claims under Rule 3(5) of the Supreme Court Rules - However, as he found that he lacked that jurisdiction and that it was not "impossible" to proceed, within the meaning of Rule 34(3) of the Domestic Commercial Arbitration Rules of Procedure (the Rules), he declined to dismiss the claims - The British Columbia Court of Appeal dismissed Premium's appeal - The crux of Premium's argument was that a power or jurisdiction to dismiss for want of prosecution could and should be inferred from the obligation, confirmed expressly in the Commercial Arbitration Act, of an arbitration tribunal to observe the rules of natural justice - Underlying this argument was an analogy between statutory or administrative tribunals on one hand and arbitral tribunals on the other - However, the consensual nature of arbitration militated against readily inferring a jurisdiction merely on the basis of that analogy - Parties went to arbitration because they did not want to go to court - Both parties had contractual obligations to participate - The court was reluctant to "read in" an arbitral power that was not in the parties' agreement or the legislation unless it was clearly necessary to ensure fairness - In view of the specific powers available to an arbitrator under the Rules, natural justice did not require the implication of a general power to dismiss an arbitral dispute for want of prosecution - If Premium had applied for directions from the arbitrator as to what steps to take, the arbitrator could have invoked Rule 28(3) and have exercised his discretion in response to any non-compliance - Further, Rule 34(3) required the arbitrator to terminate if he or she could not conduct a proceeding that conformed with natural justice - The Rules were sufficient to allow an arbitrator to fulfill the demands of natural justice and procedural fairness - See paragraphs 23 to 46.

Arbitration - Topic 3668

The arbitrator - Duties of arbitrator - Procedural fairness - Under Rule 34(3) of the Domestic Commercial Arbitration Rules of Procedure (B.C.), the arbitration tribunal could "order the termination of the arbitration where it finds that the proceedings have become unnecessary or impossible" - The British Columbia Court of Appeal read that Rule "as requiring the arbitrator to terminate if he or she cannot conduct a proceeding that conforms with the principles of natural justice" - See paragraph 45.

Cases Noticed:

Bremer Vulcan Schiffbau Und Maschinenfabrik v. South India Shipping Corp., [1981] 1 All E.R. 289 (H.L.), refd to. [para. 1].

Blencoe v. Human Rights Commission (B.C.) et al., [2000] 2 S.C.R. 307; 260 N.R. 1; 141 B.C.A.C. 161; 231 W.A.C. 161; 2000 SCC 44, refd to. [para. 13].

L'Office Cherifien des Phosphates et al. v. Yamashita-Shinnihon Steamship Co.; Ship Boucraa, Re, [1993] 3 All E.R. 686 (C.A.), revd. [1994] 1 A.C. 486 (H.L.), refd to. [para. 13].

Canadian Imperial Bank of Commerce v. Kungle (1991), 8 B.C.A.C. 36; 17 W.A.C. 36; 62 B.C.L.R.(2d) 154 (C.A.), refd to. [para. 15].

Williston Navigation Inc. v. BCR Finav No. 3 et al., [2007] B.C.T.C. Uned. B32; 69 B.C.L.R.(4th) 187; 2007 BCSC 190, refd to. [para. 19].

Knight v. Board of Education of Indian Head School Division No. 19, [1990] 1 S.C.R. 653; 106 N.R. 17; 83 Sask.R. 81, refd to. [para. 19].

Lakeside Colony of Hutterian Brethren et al. v. Hofer et al., [1992] 3 S.C.R. 165; 142 N.R. 241; 81 Man.R.(2d) 1; 30 W.A.C. 1, refd to. [para. 19].

Baker v. Canada (Minister of Citizenship and Immigration), [1999] 2 S.C.R. 817; 243 N.R. 22; 174 D.L.R.(4th) 193, refd to. [para. 19].

Nova Construction Ltd. v. St. Lawrence Cement Inc. (1990), 95 N.S.R.(2d) 211; 251 A.P.R. 211 (T.D.), refd to. [para. 21].

Suburban Construction Ltd. v. Newfoundland and Labrador Housing Corp. (1985), 54 Nfld. & P.E.I.R. 91; 160 A.P.R. 91 (Nfld. T.D.), refd to. [para. 21].

Hayes Forest Services Ltd. v. Weyerhaeuser Co. (2008), 253 B.C.A.C. 238; 425 W.A.C. 238; 291 D.L.R.(4th) 49; 2008 BCCA 120, refd to. [para. 23].

Allen v. McAlpine (Sir Alfred) & Sons Ltd. et al., [1968] 2 Q.B. 229 (C.A.), refd to. [para. 25].

Misra v. College of Physicians and Surgeons (Sask.) (1988), 70 Sask.R. 116; 52 D.L.R.(4th) 477 (C.A.), refd to. [para. 26].

ATCO Gas and Pipelines Ltd. v. Energy and Utilities Board (Alta.), [2006] 1 S.C.R. 140; 344 N.R. 293; 380 A.R. 1; 363 W.A.C. 1; 2006 SCC 4, refd to. [para. 27].

Cunningham v. Lilles et al., [2010] 1 S.C.R. 331; 399 N.R. 326; 283 B.C.A.C. 280; 480 W.A.C. 280; 2010 SCC 10, refd to. [para. 28].

B.C. Gas Inc. v. Westcoast Energy Inc., [1990] B.C.J. No. 2924 (S.C.), refd to. [para. 30].

Dominion of Canada General Insurance Co. v. Certas Direct Insurance Co., [2009] O.T.C. Uned. H05; 75 C.C.L.I.(4th) 286 (Sup. Ct.), refd to. [para. 30].

R. v. National Joint Council for the Craft of Dental Technicians (Disputes Committee); Ex parte Neate, [1953] 1 Q.B. 704, refd to. [para. 30].

Quintette Coal Ltd. v. Nippon Steel Corp., [1989] 1 W.W.R. 120 (B.C.S.C.), refd to. [para. 30].

Insurance Corp. of British Columbia v. Dawd Holdings Ltd. (1988), 32 B.C.L.R.(2d) 216; 35 C.C.L.I. 193 (S.C.), refd to. [para. 30].

Crighton and Law Car and General Insurance Corp., Re, [1910] 2 K.B. 738, refd to. [para. 31].

Unione Stearinerie Lanza and Weiner, Re, [1917] 2 K.B. 558 (C.A.), refd to. [para. 32].

Crawford v. AEA Prowting Ltd., [1972] 1 All E.R. 1199 (Q.B.), refd to. [para. 33].

Bremer Vulkan Schiffbau Und Maschinenfabrik v. South India Shipping Corp., [1980] 1 All E.R. 420 (C.A.), refd to. [para. 36].

Haigh v. Haigh (1861), 5 L.T. 507, refd to. [para. 41].

Tundra Helicopters Ltd. et al. v. General Motors Corp. et al. (2002), 164 B.C.A.C. 289; 268 W.A.C. 289; 98 B.C.L.R.(3d) 238; 2002 BCCA 145, refd to. [para. 43].

Tundra Helicopters Ltd. v. Allison Gas Turbine - see Tundra Helicopters Ltd. et al. v. General Motors Corp. et al.

Authors and Works Noticed:

British Columbia International Commercial Arbitration Centre, Domestic Commercial Arbitration Rules of Procedure, rule 34(3) [para. 7].

British Columbia, Law Reform Commission, Report on Arbitration (1982), pp. 6, 7 [para. 5].

McEwan, J. Kenneth, and Herbst, Ludmila B., Commercial Arbitrations in Canada: A Guide to Domestic International Arbitrations, p. 5-1 [para. 30].

Mustill, Michael J., and Boyd, Stewart C., The Law and Practice of Commercial Arbitration in England (2nd Ed. 1989), generally [para. 42].

Russell, The Law of Arbitration (18th Ed. 1970), pp. 174 [para. 41]; 180 to 185 [para. 4]; 191 [para. 32].

Sullivan, Ruth, Sullivan and Driedger on the Construction of Statutes (4th Ed. 2002), generally [para. 27].

Counsel:

D.R. Bennett and R.D.W. Dalziel, for the appellant;

G. Johnson, for the respondent.

This appeal was heard at Vancouver, B.C., on January 13, 2011, by Newbury, Mackenzie and Hinkson, JJ.A., of the British Columbia Court of Appeal. On February 18, 2011, Newbury, J.A., delivered the following judgment for the court.