The developer attempted to appeal an arbitration decision when no right of appeal existed: court
The Ontario Superior Court of Justice has dismissed a residential developer's application to overturn an arbitration decision under the Ontario New Home Warranties Plan Act, ruling that the arbitration process was fair and within legal bounds.
The developer challenged the arbitration decision, which upheld the findings of Tarion Warranty Corporation, the regulator responsible for administering the act, that defects in one of its homes were chargeable under the warranty. The developer argued that arbitration under the act was mandatory and unfair, but the court found otherwise. The court noted that the Ontario New Home Warranties Plan Act does not prescribe arbitration as the only dispute resolution method, and builders retain the option of judicial review. The developer, an experienced builder, participated in the arbitration voluntarily, was represented by legal counsel, and agreed to a final and binding decision.
The application sought to set aside the arbitration award on four grounds: excess of jurisdiction, procedural unfairness, bias, and failure to provide adequate reasons. The Superior Court found no merit in any of these claims.
On jurisdiction, the court ruled that the arbitrator had acted within the scope of the arbitration agreement. The developer raised concerns about newly introduced defects during arbitration, and the arbitrator addressed these concerns in her decision. The arbitrator also applied the "Builder Bulletins," a standard reference for warranty disputes, which the developer had agreed to follow under the arbitration framework.
The court rejected the procedural fairness argument, finding no improper exclusion of a key employee who later testified as a witness at arbitration. It also found no procedural defect, noting that the arbitrator heard the employee’s testimony, and no one raised objections at the hearing. The court also dismissed the allegation of arbitrator bias, noting the absence of evidence. The developer selected the arbitrator from an approved roster without objection. The fact that she was on the roster did not create a reasonable apprehension of bias.
Regarding the adequacy of reasons, the court determined that the arbitrator's 19-page decision sufficiently explained the reasoning behind the findings. The decision was transparent and addressed all key issues, meeting the legal standard for arbitral awards. The court emphasized that disagreement with the arbitrator's conclusions was not a valid ground for setting aside the ruling.
In its final determination, the court concluded that the developer's application attempted to appeal an arbitration decision when no right of appeal existed. Ultimately, the court dismissed the application since the arbitrator acted within her authority and followed a fair process.
