It is a relatively straight forward and well understood concept that at the outset of parties entering into a contract for services, they may choose to have any dispute that arises to be dealt with by alternative dispute resolution (“ADR”), such as an arbitration process, and include a clause in their agreement to that effect. What is perhaps not so straightforward is what recourse a party may have in the event it does not agree with the arbitral award rendered. The type of appeal that may be brought from the decision of an Arbitrator is often very limited, depending on what your Arbitration Agreement says and how that wording interacts with the Arbitration Act of Alberta (the “Act”).

Standard Arbitration Language

The standard form construction contracts provide for both multi-stage alternative dispute resolution and mandatory arbitration, and the standard CCDC language used with respect to arbitral awards provides that: “the final award is final and binding on the parties”. This begs the question – what if we take issue with the Arbitrator’s award? At first glance this language would appear to preclude any right of appeal. But even with this restrictive language there is arguably some room for appeal to the courts.

Whether or not a party can appeal is largely dependent on the basis for the appeal: in other words, is it on a question of law, fact, or mixed fact and law. The distinction is important, because the Act permits an appeal an arbitral award on a question of law if the agreement is silent on that point - but only with leave of the court. On the other hand, if the agreement states the parties may appeal an arbitral award on the basis of a question of law, fact, or mixed fact and law, they can do so without seeking leave.

There is a lack of clarity in the Alberta case law as to whether an Arbitration Agreement requires explicit language setting out the parties’ appeal rights pursuant to the Act, and what that language must look like. Consequently, aside from the standard form contracts, we see many different provisions purporting to limit – or expand – the parties’ right to appeal.

The Arbitration Act

It is helpful to appreciate the wording of the Act, which must be read in tandem with the parties’ agreement in order to determine what a party’s appeal rights are. The Act provides as follows:

Appeal of award

44(1) If the arbitration agreement so provides, a party may appeal an award to the court on a question of law, on a question of fact or on a question of mixed law and fact.

(2) If the arbitration agreement does not provide that the parties may appeal an award to the court on a question of law, a party may, with the permission of the court, appeal an award to the court on a question of law.

(2.1) The court shall grant the permission referred to in subsection (2) only if it is satisfied that

(a) the importance to the parties of the matters at stake in the arbitration justifies an appeal, and
(b) the determination of the question of law at issue will significantly affect the rights of the parties.

(3) Notwithstanding subsections (1) and (2), a party may not appeal an award to the court on a question of law that the parties expressly referred to the arbitral tribunal for decision.

The State of the Law in Alberta

There is a line of case law in Alberta, stemming from a 1998 decision of the Court of Queen’s Bench in Seneviratne v. Seneviratne, 1998 ABQB 289 (Seneviratne) that requires the grounds upon which an appeal of an arbitral award can be brought to be stated in the Arbitration Agreement. In that case, the Arbitration Agreement stated that the parties had the right to appeal “in accordance with s. 44 of the Act”. The court in Seneviratne held that this was not specific enough to permit a party to appeal without leave. The court held that s. 44(1) requires the parties to identify the right of appeal as being either on a question of law, fact, or mixed fact and law. A broad reference to the appeal section, section 44, of the Act is insufficient to create a general right of appeal.

One of the main thrusts of the court’s reasoning in coming to this conclusion, and one that many of the subsequent cases that follow the Seneviratne case hearken back to, is one of the foundational principles underlying the arbitration process and its legislation. That foundational principle is the concept of autonomy (i.e. if the parties have agreed to have their disputes resolved by arbitration, the courts will generally respect that decision and stay out) as reflected in the limits to appeal contained in the Act. The courts have emphasized that parties who deliberately agree at the outset of their contractual relationship to be governed by an ADR process in the event of a dispute, rather than the regular litigation process, should be held to that, and that unless it is explicitly set out in their agreement that they intend to involve the courts, and how/on what grounds, then “the ability to appeal is severely limited”. This principle is followed in several Alberta cases, such as Arnason v. Arnason, 2011 ABQB 393 and Heredity Homes (St. Albert) Ltd. v. Scanga, 2009 ABQB 237.


The takeaway from these cases and the specific wording of the Act is that parties entering into contracts and contemplating ADR as a process for dispute resolution should also turn their minds to the requisite language with respect to appeal rights of any arbitral award issued, in order to ensure that the wording is specific enough to reflect their wishes. For example, the parties may expressly agree to have their disputes resolved by arbitration, but may nevertheless agree that the arbitral decision is subject to appeal to the courts on questions of law, on questions of fact, on questions of mixed law and fact, or all of these grounds. Addressing this question may seem like a tall order at the outset of a contractual relationship, given that at that point no dispute has even occurred, let alone the issuance of an arbitration award and the contemplation of an appeal of one, but it will certainly do the parties well to deal with that at the outset, rather than receiving a nasty surprise about the limits of your arbitral appeal rights when that time comes.

Without more, the standard CCDC language (“the final award is final and binding on the parties”), in the context of the Alberta Arbitration Act, only permits an appeal of an arbitral award on a question of law, and then only with leave of the court. This is a severely limited right of appeal, because construction disputes generally relate to questions of fact, or questions of mixed law and fact. Most construction disputes relate to issues of contract interpretation, which the courts consider to be questions of mixed law and fact. This very limited scope of appeal is in keeping with the principle of autonomy referenced above.

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.