The Supreme Court of Canada released its long-anticipated decision in Wastech Services Ltd v Greater Vancouver Sewerage and Drainage District today, a major decision concerning the scope of the.
not breached. The Greater Vancouver Sewerage and
Drainage District (
Metro ) and Wastech
Services Ltd. (
Wastech ) entered into a
long-term contract for the removal and transportation of waste to
three disposal sites. The contract gave Metro absolute
discretion to allocate waste between the sites and provided
that Wastech would be paid a different rate depending on the site.
In 2011, Metro reallocated waste in a way that resulted in
Wastech s not achieving a cost/revenue target identified in the
contract. The Court held that this reallocation did not breach
Metro s duty to exercise its contractual discretion in good
faith because it was consistent with the purposes for which the
Introduction
Arbitration has long been valued as an entirely voluntary
process. In an ideal international commercial arbitration equally
sided parties may freely decide to arbitrate as well as agree on
innumerable options of how exactly possible disputes shall be
resolved: institution or ad hoc arbitration, seat and language of
arbitration, venues and means of proceedings, number and
description of arbitrators, allocation of costs, etc.
Enjoying such procedural freedom, parties frequently decide that
one party saves the option to refer disputes either to arbitration
or to state court whilst the other party is entitled to bring the
disputes exclusively to state court.