Requiring Arbitrators To "Strictly Enforce" An Agreement Does Not Limit Their Jurisdiction To Interpret It

Applications to set aside international arbitral awards often raise a familiar tension. As no appeal on the merits is allowed in such cases, the applicant will often claim the arbitral tribunal exceeded its jurisdiction by not applying the terms of the contract or that it failed to give adequate reasons for its award. The respondent will often answer that the application is an appeal in disguise. Courts must exercise their limited supervisory role to limit jurisdiction and preserve procedural fairness while protecting the core advantages of arbitration, including expert decision-making, finality and efficiency.

In a recent Ontario decision arising from the long running Aroma franchise dispute, the applicant seized on a clause in the franchise agreement providing that the "arbitrator shall be bound by, and shall strictly enforce the terms of this Agreement and shall not limit, expand or otherwise modify its terms".¹ It argued that the arbitrator's decision was a