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A recent decision by the Ontario Court of Appeal reinforcing the validity of arbitration decisions in family law cases sends a clear signal that the courts will respect the private mediation and arbitration process, says Toronto family lawyer Kenneth Younie.
In its decision in Grosman v. Cookson, the Ontario Court of Appeal found that courts don’t have jurisdiction to vary spousal support terms when a separation agreement includes an exclusive arbitration provision. Read Law Times Story
“I was pleased to see that the Court of Appeal’s decision held the parties to the terms of their separation agreement. As long as the agreement was negotiated in an unimpeachable fashion (i.e. with full disclosure and with independent legal advice), the court should enforce all of the terms of the agreement between the parties,” says Younie, an associate with MacDonald & Partners.
This case, says Younie, is particularly important for lawyers whose practice includes mediation and arbitration.
“A clear signal has been sent that the courts will respect the private mediation and arbitration process. This case was somewhat unusual as it dealt with the requirement of a party seeking a refraining order against the Family Responsibility Office to have to commence a motion to change the underlying support order within 20 days of receiving the refraining order. The Court of Appeal appeared to make clear in the decision that commencing a private arbitration process would also satisfy this requirement. To my knowledge, this issue had not been dealt with previously,” he adds.
Parties and their lawyers must realize the importance of the dispute resolution mechanisms that are included in separation agreements, says Younie, as often parties will agree to standard wording mandating mediation and/or arbitration in the event of a future dispute without fully realizing the consequences of the terms.
“In my own practice, I usually advise my clients not to agree to such terms unless they have actually used the mediation and/or arbitration to resolve their issues in the first place. If the parties have no experience dealing with the mediation/arbitration process they should not agree to such terms in a separation agreement unless they have considered the process very carefully with counsel. When a dispute arises in the future, it may be that the best option for a particular party would be to use the courts to resolve the dispute. This decision makes clear that the option of turning to the courts will not be available to those who have agreed to resolve disputes by way of mediation/arbitration,” he explains.
While Younie says the Court of Appeal has released a clear and succinct decision in this case in which it has respected the agreement that was reached between the parties, he adds that it seems that too often the courts will overlook agreements reached by the parties, even when those agreements were negotiated unimpeachably, in order to reach a “fair” result.
However, he says, true fairness comes from predictability.
“Parties must be able to depend upon the courts to enforce agreements that were negotiated unimpeachably. This is a truly “fair” result,” he adds.