Case number: 9
Article number: model arbitration law / 8
Thessaurs issue:
Country of decision: Canada
Year of decision: 1987
Type of decision: Judicial decision

Case 9: MAL 8
Canada: Federal Court of Canada, Trial Division (Denault, J.) 2 November 1987
Coopers and Lybrand Limited (Trustee) for BC Navigation S.A. (Bankrupt)
v. Canpotex Shipping Services Limited
Published in English: 16 Federal Trial Reporter, 79

Where a valid arbitration agreement exists and a party requests a transfer of the dispute to the arbitration tribunal at the first
opportunity, article 8 MAL obliges the court to refer the matter to arbitration.

The charter-party agreement executed by the parties contained an arbitration clause. After Coopers and Lybrand commenced
an action against the Canpotex in court, Canpotex filed a conditional appearance objecting to the jurisdiction of the court and
sought a stay of proceedings in order to allow the objection to be made. Canpotex also sought an order pursuant to section
50(1)(b) of the Federal Court Act seeking a stay of proceedings.

The court granted Canpotex's motion. Pursuant to article 8 of the Model Law, which is enacted by the Commercial Arbitration
Act, R.S.C.1985, c.C-34.6, the court was obliged to refer the matter to arbitration. A valid arbitration agreement existed and
Canpotex had requested a transfer of the dispute to the arbitration tribunal at the first opportunity. In the alternative, the court
would have granted a stay pursuant to section 50 of the Federal Court Act.