Arbitration is like Judge Judy, only without the cameras or the audience. That is how I like to describe it. Essentially, arbitration is a private court. The parties appoint an arbitrator tasked with deciding to conclude the matter once and for all.
While the arbitration process has plenty of benefits - particularly compared to a backlogged court system, which is not exactly chock-full o’ judges with “condo knowledge” – there are drawbacks to it as well. Arbitration is intended to keep the details and outcome of an issue confidential, and those involved in the dispute tend to see this as advantageous. However, this denies others in similar circumstances access to the guidance of a decision-maker’s past deliberation. Lost is the value of precedent – aid from what came before. This is all to say that, for those embroiled in a conflict at hand, arbitration offers a huge help, but it does not allow the parties to pay it forward.
Arbitration can be required at law, by contract, or by choice. It tends to be viewed favourably within Ontario’s condominium communities and applies to a wide variety of disputes. A subject matter expert’s flexibility, efficiency and involvement in addressing a conflict is appreciated. So much so that sometimes we get confused. Sometimes, we view arbitration as the end game. To be clear, arbitration is not the end game. Arbitration is the last resort.
Time after time, when conflict in condominium settings has been analyzed, the results have been the same. The best way to address condo disputes is through collaboration. Working together to resolve issues is the organic forum fit for the fuss of condo conflict. That tongue twister aside, the concept is simple: mediate to work through differences. Figure it out. After all, working together is the neighbourly thing to do.
It is only when those entrenched in condominium conflict are incapable of helping themselves - even with the assistance of a mediator - that arbitration is needed. Arbitration comes around once the opportunity to influence the outcome directly is blown, as those in conflict have fumbled the chance to embrace creative, practical and sustainable solutions for themselves. Arbitration is where parties go when they fail to handle their own business and need an outsider to impose an outcome on them.
Of course, when that happens, each party involved in the dispute points the finger at others as wholly responsible for the mediation’s failure. It makes sense to get more adversarial around such details at that point, as arbitration is an adversarial process. There will be a winner and a loser. Often with significant cost consequences. Arbitration is not cheap, but what is that old proverb again? Cheap, Fast or Good – you can only have two of the three. Yes, Dr. Martin Barne’s “Iron Triangle” applies to arbitration.
Given the many misconceptions around arbitration, it can be helpful to chart the process early on, even if it is not ultimately needed. Collaborative mediation has added benefit when the arbitrator’s identity and process are known or considered, ensuring that everyone is working in reality. It can avoid games or stall tactics available if the path to arbitration is unclear or absent. Failing this, there is also the risk of having to go to court to appoint an arbitrator–a counterintuitive and delay–ridden step. Even though it is adversarial, the arbitration process can go much more smoothly if all involved work together to agree on their path and process, or at least the identity of the decision-maker and a way forward in selecting them. This is often easier to do before collaboration attempts fail.
On some occasions, it may be appropriate or desired for the mediator themselves to switch hats and become the arbitrator if a collaborative effort does not resolve each and every issue in dispute. Yet, even if the arbitrator is a different person altogether, it can still be helpful to identify them early on – to have this ready if it is needed and to allow proposed mediation settlement terms to be considered with a clear understanding of what arbitration would look like (and cost). While success in addressing a condominium dispute does not require the engagement of an arbitrator, it can be helpful to have the option there if needed.
Marc Bhalla, LL.M., is a mediator, arbitrator and educator who has served Ontario’s condominium community since 2002. Marc earned a Master of Laws in Dispute Resolution from Osgoode Hall Law School, where he is now faculty. Marc holds the most senior designation offered to mediators and arbitrators in Canada - the “chartered” designations of the ADR Institute of Canada.
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