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ARTICLE · 23 JUNE 2021

Arbitrations And Receiverships: Do They Need To Be Legally Distant? - Case Study: Petrowest Corporation V. Peace River Hydro Partner

McCague Borlack LLP
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A receiver can sue on a contract yet disclaim the contract's arbitration clause, determined the BCCA in Petrowest Corporation v. Peace River Hydro Partners 2020 BCCA 339.

CanadaLitigation, Mediation & Arbitration
Howard Borlack
Howard Borlack
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A receiver can sue on a contract yet disclaim the contract's arbitration clause, determined the BCCA in Petrowest Corporation v. Peace River Hydro Partners 2020 BCCA 339. The defendants applied for an order to stay an action brought against them by the receiver for Petrowest, pursuant to section 15 of the BC Arbitration Act ("the Act"). The defendants appealed the chambers judge's decision that despite section 15 of the Act being engaged, section 138 of the Bankruptcy and Insolvency Act ("BIA") empowered her with discretion to avoid operation of section 15 on the grounds that significant cost and delay would unfairly occur.

The Facts
The receiver was appointed with the task of collecting amounts allegedly owed to Petrowest by the appellants under various agreements that were subject to mandatory arbitration. Section 15 of the Act allows a party to apply to stay a legal proceeding on the basis that the agreement was subject to mandatory arbitration, and a court

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