Most disputes between members are resolved with the help of DRC Trading Assistance Staff during the informal mediation process. Some disputes, however, end up in the arbitration, where an arbitrator is appointed to make a final and binding decision.
An arbitrator reaches a determination based on the information presented to them by the parties. The decision summarizes the arbitrator’s review of the statements and evidence provided by the parties. The arbitrator’s award deals with payment of the claim/counterclaim, or dismissal of the claim/counterclaim.
90% of DRC arbitration awards are paid without any conflicts but, there are circumstances where the losing party refuses to pay. The importance of paying an arbitration award is critical. Failure to pay an arbitration award could lead to disciplinary actions against the DRC member in default as well as court enforcement. This could have important implications on your business.
When a binding decision is rendered, the DRC monitors for compliance. If the losing party fails to pay the arbitration award within the provided time, their DRC membership will be automatically terminated, and all DRC members are informed of this event.
Under the Safe Food for Canadians Regulations (SFCR), when the DRC membership of a Canadian corporation is terminated, the company no longer has the authority to buy, sell, import, or export fresh fruits and vegetables inter-provincially and internationally unless otherwise exempted from the regulations. For companies outside Canada, this means that their transactions no longer are covered by DRC.
For a party who has an arbitration award in their favor, if DRC disciplinary measures are not enough to make the loosing party pay the award, this does not mean that there is no further recourse. The next step is to have the arbitration decision and award enforced in the appropriate court of law.
Although DRC will assist the winning party of an arbitration award to gather the necessary information and documents to proceed to enforce the arbitration decision and award, the services of a lawyer are needed to start this process in court. DRC can also provide a list of attorneys that can help with this process.
We recently came across an article from attorney Dylan S. Fisher at Pallett Valo LLP, who has experience dealing with enforcing of arbitration awards in Ontario:
We thought that this article may help to better understand the process of enforcing an arbitration award in court.