United Mexican States v Burr 2021 ONCA 64 Court of Appeal for Ontario Docket: M51771 (C68571) - 02 February 2021
Country
Year
2021
Summary
[1] The application judge dismissed the application by the United Mexican States ("Mexico") to set aside an arbitral tribunal's "Partial Award". Mexico appealed. The moving parties, who were the respondents in the application below, move to quash Mexico's appeal. For the reasons that follow, I would quash the appeal.
A. Background
[2] The North American Free Trade Agreement gives investors the right to seek damages for the failure of a party (Canada, Mexico, or the United States of America) to honour a treaty commitment. The moving parties are thirty-nine USA nationals who brought claims individually and on behalf of seven Mexican companies totalling some USD$100 million to compensate for losses allegedly caused by Mexico's closure of the casinos they had been operating in that country.
[3] The arbitral tribunal was constituted under c. 11 of NAFTA on February 14, 2017. On April 4, 2017 the tribunal bifurcated the proceedings into a jurisdiction phase and a merits and damages phase. The jurisdiction phase was heard over five days in May 2018.
[4] A majority of the tribunal determined that the tribunal had jurisdiction over all but one of the moving parties' claims. Mexico applied to the Superior Court of Justice to set aside the tribunal's decision under s. 11 of the International Commercial Arbitration Act, 2017, S.O. 2017, c. 2, Sch. 5 ("ICAA") and arts. 16 and 34 of the UNCITRAL Model Law on International Commercial Arbitration, adopted by the United Nations Commission on International Trade Law on June 21, 1985, as amended on July 7, 2006 (the "Model Law"). The Model Law has the force of law in Ontario under s. 5 of the ICAA, subject to any modifications set out in the Act. The legislation specified that the Ontario Superior Court of Justice is the court with jurisdiction to review the decision of the arbitral tribunal.
[5] The application judge dismissed the application, holding that Mexico had "not discharged its burden of proof of establishing that the Tribunal was incorrect in its conclusion that it had jurisdiction over all but one of the claims before it".
B. The Issue
[6] The issue before this panel is whether the application judge's ruling can be appealed to this court.
[7] Whether the appeal should be quashed depends upon whether Mexico's application is governed only by art. 16(3) of the Model Law, which would prohibit an appeal of the application judge's decision, or if it is also governed by art. 34 of the Model Law, which would permit an appeal.
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