All claims, demands, disputes, controversies, disputes or misunderstandings between the parties or between the parties or other persons related thereto arising out of or under this Agreement shall be the subject of and determined by arbitration proceedings. In its defence, the Seller requested a stay of the action under subsection 7(1) of the Ontario Arbitration Act (the « Act »). Arbitration is a binding procedure in which the parties to a dispute (either themselves or through their lawyers) submit the dispute to a neutral arbitrator for resolution. A binding agreement to submit disputes to arbitration is reached when the buyer and seller initiate the « arbitration of disputes » provision in most residential real estate sales contracts. With the dispute settlement agreement, the parties waive their right to have the dispute dealt with in court before a jury. Once an arbitrator`s decision has been rendered, it is generally not objectionable and is immediately subject to full application of the law. The Court explained that, in order to prove that a standard arbitration agreement is unscrupulous and therefore invalid, the Court must ascert whether the transaction as a whole deviates sufficiently from Community standards of commercial morality for it to be annulled. While the existence of a standard contract and unequal bargaining power are not unusual, they do not make an arbitration clause contained in the standard form agreement ruthless. In a recent appeal of a court order that rejected the application of an arbitration agreement after the parties had been in dispute for two years, the Supreme Court`s Appeal Division rejected arguments that the arbitration clause was narrow. Gatta v. Gatta, Docket No A-3161-11T (App. Div. 26 October 2012).
Since the subject matter of the dispute was also the subject of the contract, the arbitration agreement was enforceable despite the delay in the application of the law. For the lump sum indemnification clause of a sales contract to take effect, it must be initiated by both the buyer and the seller. In order for increased deposits to be subject to the scheme, it is also necessary to sign a separate compensation form, which is provided for by law. The claimant argued that the language « resulting from or on the basis of this agreement » was much narrower than in other cases where arbitration agreements were widely interpreted. In these cases, the arbitration agreement included disputes « arising out of or related to it », which the claimant claimed were much broader. The Appeal Division reversed this application and rejected the Claimant`s argument. Mediation is a non-binding procedure in which the parties to the dispute meet with a professionally trained and experienced mediator, who helps them resolve their dispute by negotiating a mutually acceptable solution. The result of successful mediation is a written settlement agreement which, if properly prepared and signed by all parties to the dispute, should be legally enforceable. The settlement agreement is a document that should be reviewed by a qualified real estate lawyer, as its scope may infringe important legal rights. If mediation is unsuccessful, the parties are free to pursue other forms of dispute resolution, such as arbitration or disputes.
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