Canada / 04 October 2004 / Canada, Court of Appeal for British Columbia / Powerex Corp. v. Alcan Inc. / CA32159
| Country | Canada |
| Court | Canada, Court of Appeal for British Columbia |
| Date | 04 October 2004 |
| Parties | Powerex Corp. v. Alcan Inc. |
| Case number | CA32159 |
| Applicable NYC Provisions | II | II(3) |
| Source |
2004 BCCA 504 | online: CanLII |
| Languages | English |
| Summary | Powerex Corp. ("Powerex") and Alcan Inc. ("Alcan") concluded a contract for the supply of power. Although Alcan contracted with a subcontractor, it remained fully liable for the performance of the contract, limited to an amount of $100,000,000. When the subcontractor went bankrupt and Alcan was no longer able to perform its duties under the contract, Powerex commenced arbitration in Oregon, U.S., against Alcan and was awarded the maximum liability amount of $100,000,000. Alcan started annulment proceedings with a United States magistrate, then a Federal District Court judge in Oregon, and eventually at the United States Court of Appeals for the Ninth Circuit. At the same time, Powerex sought enforcement of the award in Canada before the Supreme Court of British Columbia. Upon an application by Alcan, the Supreme Court of British Columbia suspended the enforcement proceedings as long as the annulment proceedings were pending with the U.S. magistrate and the Federal District Court judge. Upon a further application by Alcan, the Supreme Court of British Columbia decided to stay the enforcement proceedings while annulment proceedings were pending in the US Court of Appeals for the Ninth Circuit. The Supreme Court of British Columbia held that Alcan nonetheless had to make a security payment in the amount of $100,000,000, and that Powerex had the right to make use of this money as long as they provided security for the amount taken out of this trust. Alcan appealed this ruling to the British Columbia Court of Appeal, contending that the Supreme Court of British Columbia had exceeded its competence rooted in Article VI of the Foreign Arbitral Awards Act (which directly incorporates and whose wording is equivalent to Article VI NYC). The British Columbia Court of Appeal granted Alcan leave to appeal the part of the Supreme Court suspension order that allowed Powerex to receive payment of the award and spend this money in exchange for posting security for its repayment. In the Court of Appeal’s opinion, the appeal raised a question of general importance because the Supreme Court’s decision was the first decision interpreting these provisions implementing the NYC in British Columbia. The Court of Appeal considered that the Supreme Court took an unprecedentedly liberal approach in interpreting the wording of Article VI NYC, and this would have “mark[ed] a departure from international jurisprudence in a field where order and predictability are desirable”. The British Columbia Court of Appeal, however, denied Alcan's request to stay execution on the Supreme Court's order on the grounds that it had the authority to order that a security payment be made. |
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Attachment (1)
 Original Language Adobe Acrobat PDF |
