Considered to be faster and cheaper than civil courts, arbitration is becoming increasingly popular to resolve disputes in a timely and cost-effective manner. Arbitration is the best-known mode of conflict resolution.
In mediation, parties are free to participate in the process and the mediator has the role of a guide. In arbitration, the arbitrator is responsible for determining if and how the guarantee applies and for rendering a decision to which the parties must comply.
Arbitration is the mechanism provided to contest a decision of the administrator (Garantie de construction résidentielle, GCR) when the parties appeal directly to an arbitrator or when they have not reached an agreement through negotiation or mediation.
You or the contractor can appeal directly to an arbitrator in the event of disagreement with a decision of the administrator or in the event of partial success or failure of mediation.
Arbitration is akin to trial before a judge in several ways, given its contentious nature. The arbitrator, like the judge, is an impartial third party. An arbitrator’s purpose is to analyze the evidence submitted. He must make an arbitration decision based on the evidence and the representations of the parties.
In summary, arbitration, as opposed to the ordinary court of law, is a mode of dispute resolution that includes a multitude of advantages for both parties:
Arbitration is put forward by the Regulation on the guarantee plan for new residential buildings for disputes arising from the application of the Residential Guarantee Plan, in certain circumstances you can also assert your rights before a court of common law.
When and how to request arbitration?
The request for arbitration must be made by registered mail within 30 days of receipt of the administrator's decision or of receipt of the mediator's notice of the total or partial failure of mediation. Note that you do not need to wait for this notice from the mediator to request arbitration.
To request arbitration, you must:
1. Send your arbitration request to one of the four arbitration bodies authorized by the Régie du bâtiment du Québec. They are empowered to choose an arbitrator from a list of bodies previously drawn up and submitted to the Régie du bâtiment du Québec.
2. Send a copy of your arbitration request to the administrator and the contractor, even if the arbitration body has the obligation to inform them.
Once your request is received, the arbitration body will send you documents to inform you of the progress of the arbitration process.
For the arbitration process, being informed is not enough. You need to be thoroughly prepared. As arbitration is a form of dispute resolution akin to a private trial, each party must state and prove their claims. Your role will be to collect all documents, photos or writings, to demonstrate that the Guarantee Plan must apply, and provide adequate coverage to restore your home.
Should you hire a lawyer?
It is obvious that arbitration requires resources such as time and money. That is why before answering this question, you should try to determine the value of your claim in relation to the arbitration costs.
Please note that the presence of a lawyer is not mandatory. However, being represented by a lawyer can lighten your preparation work and increase the chances of your appeal being successful. Also, if you ask a legal professional to advise or represent you, you must also consider professional costs in addition to other costs (i.e. research, documents, expertise) which are added for the preparation of the arbitration or at the hearing.
Who bears the costs?
If in mediation, the costs are shared between the parties regardless of the outcome, whereas in arbitration the parties share the costs according to the decision and the role of each party.
When the contractor is the plaintiff, costs are shared equally between the administrator and the contractor regardless of the decision. You will not have to pay anything.
When you are the plaintiff, you will have nothing to pay if the decision is partially or entirely favorable to you.
When you are the plaintiff and you are unsuccessful on any point of your claim, the arbitrator will settle the costs of the arbitration at his discretion. This is the only situation where you may be liable for these charges.
The arbitration decision is final without appeal
As a rule, an arbitration decision, whether favorable or unfavorable, is final and cannot be appealed. Therefore, from the time an arbitration decision is made, the parties have no choice but to comply with it.
In certain exceptional situations (i.e. grave error), you can ask the Superior Court of Quebec to review the arbitrator's decision. This is a fairly complex procedure for which we recommend you consult a lawyer.