Alberta Court Warns: Parties Ignore Arbitration Agreements At Their Peril

A recent decision of an Alberta court in Lafarge Canada Inc. v Edmonton (City) confirms that a party choosing to commence an action in the face of a valid agreement to arbitrate runs the risk of being left without a remedy. In Lafarge, the court struck Lafarge's claims because the limitation period expired before Lafarge had commenced its claims in the proper forum – arbitration rather than litigation. The court confirmed that commencing litigation when arbitration is the proper forum does not stop the limitation period clock from running, noting that parties must abide by their agreement to arbitrate. The court also said that it was too late to commence arbitration now that the limitation period had expired; it was unmoved by Lafarge's plea that it would be left without a remedy despite its allegation that the defendant had unduly delayed bringing the motion to strike the action. The court held that the expiry of the limitation period was determinative because its