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ARTICLE · 06 FEBRUARY 2024

Ismail v First York Holdings Inc

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Ontario Court of Appeal confirms doctrine of separability cannot save an arbitration agreement contained in a contract that was void from the beginning and never legally binding.

CanadaLitigation, Mediation & Arbitration
Gowling WLG
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Ontario Court of Appeal confirms doctrine of separability cannot save an arbitration agreement contained in a contract that was void from the beginning and never legally binding.

Facts

Mr. Ismail and Mr. Abied began doing business together through First York Global Holdings Inc. (FYGH). They entered into two share purchase agreements with arbitration clauses. Mr. Ismail appointed Mr. Abied as his attorney with authority to sign agreements on his behalf. Three agreements were signed and executed by Mr. Abied on behalf of both parties:

  1. A FYGH Purchase of Business Agreement (the FYGH Purchase Agreement).
  2. A Shareholders' Agreement regarding the purchase by Mr. Ismail of 20 per cent of the shares of FYGH.

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