CONVENTIONAL ARBITRATION
HISTORY
1986 marks the year of the reform of arbitration in Quebec and a turning point for arbitration in Quebec. Since then, the scope of arbitration has undergone significant developments.
That year, on 12 May, 1986, Canada ratifies the New York Convention* and, later on that same year, the Commercial Arbitration Act is enforced.
* (Convention on the Recognition and Enforcement of Foreign Arbitral Awards adopted on 10 June, 1958, by the United Nations Conference on International Commercial Arbitration in New York)
In 1986, Quebec also initiates the turning that came to result in November of that same year ; the scope of arbitration is the object of fundamental changes in the fields of Provincial jurisdiction :
- The rules concerning the internal commercial arbitration are modified ;
- The Rules concerning International Commercial Arbitration are adopted ;
- A sole law based on the UNCITRAL* Model Law and the New York Convention is implemented.
* (United Nations Convention on International Trade Law).
Previously, here, near home, litigation or disputes were decided by a peer, generally a person known for his wisdom, for his qualities of integrity and impartiality, and renowned as an expert in his field of practice. That peer, after (or without) hearing each party, used his knowledge and experience in his field to decide the dispute and often... by doing so without even having read the contract, the « law of the parties », that bonded contractually those parties.
This arbitration, which was almost always ignoring the rules of law and the rules of evidence, often resulted in judgments in equity and/or erratic whose main characteristic was to frustrate one or the other or both parties.
The disadvantages of that process were the uncertainty and anxiety of not being able to rely on established rules to try to analyze the rights and obligations of each party right from the birth of a dispute as to who might be right under these rules of law.
Hence the bad publicity to arbitration that still remains lasting here, even today.
Since the reform, arbitration has gradually judicialized to become the equivalent of a trial before the State Courts of Justice. This evolution is neither the fact of lawyers nor the fact of arbitrators. It is the Courts of Common Law and particularly the Court of Appeal of Québec who instigated this transformation, in conformity with the rules concerning commercial arbitration.
Today, conventional arbitration comprises many advantages that you did not even think about !