Arbitration-FAQ

The arbitration process usually begins with a preliminary meeting, often conducted by phone by the arbitration organization, where a claimant and a respondent go over the disputed issues, discuss any documents and possible witnesses, set a timeline and choose the arbitrator.

Once an arbitrator is chosen by the parties, there may be more exchanges of information, and then the date of the arbitration itself will be set. The arbitration can take place in person, by phone or video conference. The parties may also decide to present arguments in writing only.

Unless both sides have chosen to present their arguments in writing only, at the arbitration hearing, the arbitrator will ask the parties to lay out their case. The arbitrator may also ask either side questions based on what has been presented. They will then consider all evidence and testimony and make a legally binding decision.

In some cases, an arbitrator may even help both sides come to an agreement, or settlement, before a decision in the arbitration case is reached.

The arbitration process can be used in cases where a client of an investment dealer regulated by CIRO decides to proceed through arbitration to resolve a dispute with their investment advisor or firm seeking compensation for a financial loss.

Remember, the first step for clients in seeking compensation is to make a written complaint directly to the investment advisor and their firm. Under the CIRO Rules, they must provide clients with a substantive response to the complaint within 90 days.

If the client is not satisfied with the firm’s substantive response, they can choose from a number of options, including arbitration.

Yes, there is a cost to arbitration, but arbitration is usually a quicker and less expensive than going to court, which can be both a very long and expensive process.

Arbitration fees typically include:

• a filing fee
• arbitrator’s hourly fees and travel costs
• hearing room fees
• videoconferencing fees and
• other administrative fees.

These costs are usually split equally between both sides.

Claimants can also decide ahead of time if they want the arbitrator to award costs, in which case the losing side pays the other side’s legal costs.

There are also costs of a lawyer or paralegal, however claimants can choose to represent themselves. It is important to know, however, that investment firms are typically represented by lawyers.

Claimants may be required to pay a deposit as an advance of arbitration costs at the commencement of and during the arbitration proceeding. At the end of arbitration, they will receive back any unexpended balance. For more information and an estimate on costs of the arbitration process, you can contact one of the two organizations designated by CIRO to conduct arbitrations:

• ADR Chambers (for all of Canada except Quebec)
• Canadian Commercial Arbitration Centre (for Quebec residents only)

Yes, you may contact the Investor Protection Clinic at Osgoode Hall Law School.

Through the CIRO Arbitration Program, arbitrators can award up to $500,000, and under the CIRO Rules, investment firms must comply with arbitration decisions.

It is up to the client to decide whether to take their claim to arbitration. If they choose arbitration, under the CIRO Rules, their investment firm is obliged to take part. The firm must also comply with the arbitration decision.

Only CIRO regulated investment firms can participate in arbitration. Individual advisors cannot be named in a claim. They may nonetheless participate in the process on behalf of the firm.

CIRO Rules state that if a client chooses arbitration to resolve the dispute, their investment firm must take part and must comply with the arbitrator’s eventual decision. CIRO oversees the operation of the Arbitration Program and publishes statistics. CIRO itself does not conduct the arbitrations. Instead, it has designated two independent organizations that administer the arbitration process and supply independent arbitrators:

• ADR Chambers (for all of Canada except Quebec)
• Canadian Commercial Arbitration Centre (for Quebec residents only)

Once you have chosen to resolve your claim through arbitration, it is up to you to contact one of the two independent organizations designated by CIRO to conduct arbitrations:

• ADR Chambers (for all of Canada except Quebec)
• Canadian Commercial Arbitration Centre (for Quebec residents only)

If you have questions about how to proceed however, you can contact CIRO’s Complaints and Inquiries team (1-877-442-4322 or [email protected]).

Timelines for arbitration may vary depending on complexity of issues. But it is usually a much quicker and less expensive than going to court, which can be a very long process.

Yes. There may be legal time limits beyond which a claimant could lose their right to pursue some or all of their claims. It is important to consult a statute of limitations in the claimant’s province of residence and a lawyer to determine the appropriate time limits.

Both parties should prepare all documentation that could be relevant and material to the issues in dispute. Common documents exchanged by the parties may include, for example, account agreements and other account opening documents, KYC (or Know Your Client) forms, account statements, notes and records of conversations, emails and other correspondence showing client instructions and confirmations received from the investment advisor. An arbitrator may help the parties determine what documents need to be produced and may even order a party to produce relevant documents.

For more information on how the arbitration process works and what you may need, you can contact one of the two independent organizations designated by CIRO to conduct arbitrations:

• ADR Chambers (for all of Canada except Quebec)
• Canadian Commercial Arbitration Centre (for Quebec residents only)

You can also contact CIRO’s Complaints and Inquiries team for more general information (1-877-442-4322 or [email protected]).

Yes, like in court, parties can call witnesses as well as experts to present their case. To prove your case, you can ask questions and take your witnesses to any documents you have to present your case. Given the specialized expertise of a chosen arbitrator, you should assess whether you need an expert as it will most likely increase your costs.

Unless both sides have chosen to present their arguments in writing only, at the arbitration hearing, the arbitrator will ask the parties to lay out their case, will listen to both sides and may ask either side questions. They will then consider all evidence and testimony and make a legally binding decision.

If you decide to proceed in-person, your arbitration hearing will proceed in the province of your residence. With consent of both sides and the arbitrator, the hearing may also proceed by videoconference or in writing.

No. Unless both sides agree otherwise, in arbitration, all hearings, meetings, and communications, including the arbitrator’s final decision, are confidential between the parties involved and the arbitrator.