CLOUT
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This case involved an appeal against the decision on Case 28, in which the court of first instance had refused to grant a stay of court proceedings declaring the arbitration agreement between BWV, Saskferco, UHDE and others void under both article 8(1) MAL and s. 99(1) of the Builder's Lien Act (B.L.A.). BWV, a subcontractor in a Saskatchevan construction project with head offices in Canada, had filed a builder's lien against the project and sued Saskferco, UHDE, contractors with head offices in Germany, and others under B.L.A..

The issue before the Court of Appeal was whether the arbitration agreement, which was contained in the subcontract between BWV, Saskferco and UHDE, conflicted with B.L.A. and was thus void. The Court of Appeal found that a builders' lien action was not the only method available to determine the amount of money owed in relation to contracts where liens have arisen and that there was no inconsistency between an arbitration agreement and the builders' lien legislation. The Court of Appeal reversed the decision of the court of first instance, stayed the court proceedings and referred the matter to arbitration.

The Court of Appeal considered the question whether to stay the proceedings with regard to sub-subcontractors of BWV who had also filed builder's liens against the project. It was found that, as there was no evidence that the sub-subcontracts incorporated the arbitration agreement, the sub-subcontractors were "third parties" with regard to the dispute between BWV, Saskferco and UHDE. Referring to the United States practice in domestic construction matters to stay third-party actions pending arbitration, the Court of Appeal ordered that the actions by sub-subcontractors be stayed pending the above arbitration, to avoid the problem of multiple concurrent proceedings. A member of the Court of Appeal disagreed with the scope for residual judicial discretion in staying applications set out in Gulf Canada Resources Ltd. v. Arochem International Ltd. (Case 31).

Additional Information published in later CLOUT issue (on "9 February 2000"):

Abstract published in English: [1998] Model Arbitration Law Quarterly Reports, Vol. 3, issue 1, 59

Text of the court decision published in English: [1998] Model Arbitration Law Quarterly Reports, Vol. 3, issue 1, 63

This case is cited inCase 179 and Case 183.

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