Canada: Outside The Private Arbitration Box: Ontario Arbitrator Orders Public Hearing

An Ontario arbitrator recently ordered an arbitration proceeding under the provincial Arbitration Act be held in public. This is an unusual outcome given that arbitrations are generally understood as being a private alternative to public court proceedings. While the decision underscores that private arbitrators do have discretion to order public hearings, the result turns largely on the nature of this particular arbitration.


This ongoing arbitration is between two applicants, the Association of Municipalities of Ontario and the City of Toronto, and the respondent Stewardship Ontario. At issue is the amount of funding in 2014 for Ontario's blue box program, which is a waste diversion program that operates in over 200 municipalities. Stewardship Ontario is a non-profit organization financed by the industries that are the brand owners or first importers of products and packaging materials managed under the blue box program. Provincial law requires that municipalities cover 50 per cent of the program costs, while the private sector (through Stewardship Ontario) is responsible for the remaining 50 per cent. The private-sector share for 2014 was estimated to be between C$95 and C$117 million.

The applicants sought a public arbitration hearing on two grounds. First, they argued that section 2(b) of the Charter of Rights and Freedoms was engaged such that the "open court" principle applied. Second, they argued that if the Charter did not apply, the arbitrator nevertheless had the discretionary power to open the proceedings to the public. The respondent agreed that the final decision could be public, but took the position that an open hearing could undermine the benefits of a private process.


The decision was released on March 24, 2014.

On the first issue, the arbitrator concluded that the Charter was not engaged because he was not a governmental entity and was not exercising governmental or statutory authority.

On the second issue, the arbitrator noted that case law on the private nature of arbitration was "sparse" and that the Arbitration Act was silent on the issue. Ultimately, his review of the authorities led him to assume – without conclusively deciding – that an arbitration process established by contract and held pursuant to the Arbitration Act is presumptively private unless the parties have agreed otherwise. In support of this presumption, he cited English and Australian case law, as well as rules of the London Court of International Arbitration and International Chamber of Commerce, amongst other major institutional dispute resolution bodies.

The arbitrator noted that the presumption in favour of a private arbitration was rebuttable. He identified four factors to be considered in deciding whether an arbitrator should exercise his or her discretion to rebut the presumption and to order a public hearing. The factors include:

  • the nature of the dispute;
  • the impact on the proceedings of the presence of the public and the media;
  • any negative effect on the parties; and
  • whether there is a legitimate public interest to be served.

After considering these factors, the arbitrator concluded that "an open and transparent hearing in this case will serve the public interest and will not detract from the parties' ability to achieve a fair and just result." In so doing, he noted, among other things, that the arbitration concerned a "potentially significant amount of taxpayer money."


The blue box arbitration decision is one of the few cases to directly consider the private nature of arbitration in Canada. The decision signals that arbitrators acting under the Ontario Arbitration Act (and presumably other parallel provincial statutes) do possess the discretion to order public hearings. That said, it can be expected that they will operate from the baseline presumption that arbitration proceedings are private unless otherwise agreed by the parties.

A public hearing order will be inappropriate in most cases, especially in "private" disputes where there is no apparent public interest. The reach of the blue box arbitration decision is limited, as is signalled by the arbitrator's explicit caveat that the case was "not a typical commercial arbitration" carried out under the Arbitration Act. The dispute also differed from a conventional arbitration in that there was no formal arbitration agreement between the parties and the dispute resolution process was established through statute.

Although dependent on its facts, the decision highlights the need for parties wishing to ensure that their arbitration remains private to set out their explicit agreement to that effect in the arbitration agreement and in the terms of reference of the arbitrator. This is particularly advisable if one or more of the parties to the arbitration is a public entity.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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