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  • Writer's pictureMartin B DeBellefeuille

Arbitration: Rules, Costs, and Contractual Clauses

WHAT ARE THE RULES THAT APPLY TO ARBITRATION?

The parties can determine, in their arbitration agreement, the rules that best suit their needs. They can adopt those provided by the Institut de médiation et d'arbitrage du Québec (IMAQ), which reflect the highest practical, ethical, and professional standards in arbitration. In the absence of such a choice, the rules provided by the Code of Civil Procedure of Quebec, and the Civil Code of Quebec for the arbitration agreement, apply by operation of law.


WHEN AND HOW TO RESORT TO ARBITRATION?

More and more contracts contain a clause providing for mandatory arbitration, to the exclusion of the courts. Such a clause typically specifies the applicable rules, as well as the identity or method of appointment of the arbitrator (or arbitrators) who will hear the case.


To the extent that the dispute falls within the scope of this clause, it must necessarily be submitted to arbitration. Any judge who might be seized of such a dispute should decline jurisdiction and refer it to the arbitration process.


When parties are embroiled in a dispute, one of them may take the initiative to suggest resorting to arbitration, even in the absence of a clause to that effect in the contract that binds them. Due to the voluntary nature of the process, it is essential for each party to agree to proceed with arbitration.


It can be useful to gather information before making a decision. You can contact an arbitrator of your choice, or the IMAQ, to obtain more information about arbitration and its procedure.


WHAT ARE THE COSTS OF ARBITRATION?


The arbitrator's fees vary from one professional to another, depending on their experience and expertise. It can be an hourly rate, or a rate per day or half-day. Most arbitrators charge for the time spent drafting their decision, based on an hourly rate. Unless otherwise agreed, the arbitrator's fees and arbitration costs (e.g., travel, room rental) are divided equally between the parties.

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