On
The Court declined jurisdiction to hear the application to certify a class action in favour of the alternative dispute resolution process.
Background Facts
In order to recover business interruption losses due to the COVID-19 pandemic, the petitioner, 9369-1426
The Court's Judgment
Exclusion of the Court's Jurisdiction
In its reasoning, the Court considered article 3148 of the Civil Code of
The Validity of the Arbitration Clause
The Court then held that the dispute resolution clause contained in the Policy constituted a complete undertaking to arbitrate2 since it was unconditional, mandatory, final and binding, as opposed to purely optional.
Bâton Rouge argued that, in light of other provisions in the Policy, the dispute resolution clause appeared ambiguous or was otherwise in conflict with the mandatory language of the policy. Specifically, Bâton Rouge asserted that because the Policy contained a clause establishing the jurisdiction of the courts in the court districts of the insured was evidence of the dispute resolution clause's ambiguity.
The Court dismissed these arguments and held that the clause was clear and unambiguous. The Court found that a choice of district clause does not conflict with, and can coexist with a dispute resolution clause. Consequently, the Court ruled that the dispute resolution clause was valid and applicable.
Application of the Arbitration Clause
The Court also dismissed Bâton Rouge's argument that the claim was outside the scope of the mediator's or arbitrator's jurisdiction. The fact that the application was one that sought authorization to institute a class action was considered to be of no substantive relevance. Further, the mere fact that the action was based on the allegation that
Of note, the Court held that Bâton Rouge's argument to the effect that a dismissal of the application would mean that each insured person would have to proceed by way of the lengthy and costly dispute resolution process was insufficient to overcome a valid dispute resolution clause.
Conclusion
The Court declined jurisdiction and dismissed Bâton Rouge's motion for authorization to exercise a class action, confirming that the mediator and arbitrator to be appointed was competent to act in the matter raised by Bâton Rouge on its own behalf against
The decision confirms that disputes arising from insurance policies can be subject to arbitration to the exclusion of courts where the policy contains a valid arbitration clause, even in cases of an application to have a class action authorized. At the time of posting, the decision is under appeal before the
Footnotes
1.2021 QCCS 47.
2. Under
3. A notice of appeal was filed on
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