Forum Shopping: Arbitration Provisions And An "Action Against Insurer" Clause

The Ontario Court of Appeal has declared that the proper effect to be given to international insurance agreements containing both an arbitration provision and an "action against insurer" clause is for the Ontario action to be stayed and referred to arbitration.

Rise of the dispute

In Trade Finance Solutions Inc. v. Equinox Global Limited 2018 ONCA 12, the dispute concerned an Ontario company that retained insurance from Equinox Global Limited, an insurer in England. The contract of insurance was issued by Equinox and Lloyd's Underwriters and contained an arbitration provision stipulating that disputes were to be settled in arbitration in England. The policy also contained an action against insurer clause providing that the underwriters were to be designated or