Self-Represented Litigants, Arbitration and Natural Justice
For years, Courts in BC have observed a general trend towards there being an increasing number of self-represented litigants coming to Court and representing themselves through legal proceedings generally. At the same time, there has been a general increase towards the use of arbitration clauses in commercial contracts.
Briefly, arbitration clauses can require parties to a contract to submit themselves to arbitration in accordance with arbitration legislation in order to resolve any disputes which might arise under their commercial contract. There is considerable debate over the utility and function of arbitration clauses given that they can lead to quicker and cheaper resolution of issues, but can also deny legal rights and remedies otherwise available to parties, including potentially precluding class proceedings (Canada’s equivalent of class action lawsuits).
In the recent case of 0927613 B.C. Ltd. v. 0941187 B.C. Ltd., 2015 BCCA 457 (CanLII), the Court was called upon to examine if the standards of conduct arbitrators should apply to self-represented parties.
The case arose out of a joint venture agreement respecting the development of a townhouse complex and disputes of the joint ventures parties’ respective financial contributions.
One of the joint venture parties, represented by “Ms. K” commenced a court action over the dispute alleging that the other joint venture party, represented by “Mr. S”, was not making his required contributions to the costs of the joint venture. Mr. S responded by obtaining a stay of the Court proceeding due to the parties having an arbitration clause and eventually the parties found themselves in an arbitration. Mr. S did not have legal counsel by the time the arbitration proceeded.
Mr. S refused to participate with the arbitration proceedings or even attend the arbitrations. Eventually the arbitration proceeded without Mr. S attending and Ms. K was successful at the arbitration.
Mr. S appealed the arbitration by arguing that it was decided in error based on, among other things, a failure to observe the rules of natural justice (generally put, the right to a fair hearing). Mr. S provided a number of excuses for his failure or refusal to participate in the arbitration process including language barriers.
The Court of Appeal observed that Mr. S had a history of attempting to frustrate Court proceedings and had a proven history of understanding those proceedings despite any language challenges he might have suffered from. It also found that Mr. S was given every opportunity to present his case on its merits and did not do so.
On natural justice, the Court held at para. 59 that “Natural justice requirements in arbitration have been broadly stated to require the arbitrator to act in good faith (or stated otherwise to be unbiased), fairly listen to both sides, and to give a fair opportunity to those who are parties to make representations, including to correct or to contradict any relevant statement prejudicial to their view.” (citations omitted).
On self-represented litigants engaging in arbitration, the Court held at para. 64 that “There are no special rules of procedure for a self-represented party in an arbitration proceeding beyond the basic procedural requirements for any arbitration: an impartial arbitrator, procedural fairness of notice, and a fair or reasonable opportunity to make submissions and to respond to the other side’s case… [S]elf-represented litigants do not have “some kind of special status” that allows them to ignore rules of procedure.” (citations omitted). Arbitrators have no special obligations to self-represented parties other than those of natural justice (para. 65).
The Court of Appeal followed the same general guidelines for self-represented litigants before the Courts, namely that every litigant is to be given a fair opportunity to present their case, but that requires self-represented parties to be respectful and familiarize themselves with the practices and procedures of the Court (para. 65).
While it can be frustrating for a party represented by counsel to have a self-represented party as an opponent, 0927613 B.C. Ltd. v. 0941187 B.C. Ltd. is a reminder that there are limits to the patience afforded to self-represented parties by the courts and arbitrators. Legal counsel are trained and experienced in preparing and presenting your case fully and effectively. Judges and arbitrators will always appreciate a case that is organized and presented in a manner consistent with the practice and procedures required by the form of proceeding.