Case number: 33
Article number: model arbitration law / 8
Thessaurs issue:
Country of decision: Canada
Year of decision: 1992
Type of decision: Judicial decision

Case 33: MAL 8
Canada: Federal Court of Appeal (Marceau, Desjardins and D‚cary JJ.A.) 29 May 1992
Ruhrkohle Handel Inter GMBH and National Steel Corp. et al. v. Fednav Ltd. and Federal Pacific (Liberia) Ltd. and Federal
Calumet (The)
Published in English and French: 3 Federal Court Reports 1992, 98
Commented on by Tetley in [1993] Lloyd's Maritime and Commercial Law Quarterly, 238

In order for the court to grant a stay of proceedings pursuant to article 8 MAL, the party requesting the stay must satisfy the
court that the request was made in a timely fashion and that the request was made to the court, not just to the other party.

The parties entered into a charter-party which contained an arbitration clause. The charter-party was subsequently breached.
The appellants asked the respondents for an extension of time to "commence suit and/or arbitration". The respondents granted
an extension of time to commence arbitration only. The appellants filed a statement of claim for damages which made no
mention of arbitration. The respondents filed a statement of defence and counterclaim, and requested a stay of proceedings.
Both the Senior Prothonotary and the Trial Division refused the appellants' request that the action be stayed. The appellants
appealed.

The court found that while article 8 MAL which is enacted by the Commercial Arbitration Act, Revised Statutes of Canada
1985, c.C-34.6 requires the court to grant a stay of proceedings and refer the matter to arbitration, such an order is not made
as of right. Certain conditions must first be met. The party seeking such an order must demonstrate that a request for
arbitration was made in a timely fashion (not later than when submitting their first statement on the substance of the dispute).
The court noted that the request for arbitration required in article 8 MAL is a request to the court, not just to the other party.
No such request was made to the court here and, therefore, no stay was granted.