After the parties submitted disputes to arbitration, collateral disputes arose about the pace and conduct of the arbitration. This Appeal related to those collateral issues. The Respondent to the arbitration had issued an Originating Application and obtained ex parte Orders appointing arbitrators under the International Commercial Arbitration Act RSA 2000, c 1-5, consolidating two arbitrations, and validating service of the Originating Application. The Appellant had unsuccessfully applied to set those Orders aside, and appealed that Decision to the Court of Appeal.

The Appellant argued that service of the Originating Application in Korea was deficient because, while it was served in accordance with the Hague Convention, the Order validating service of the Originating Application had been granted before service had actually been effected, and because an Order for service ex juris had not been obtained.

The Majority explained that service of a commencement document outside of Alberta and Canada is governed by Rules 11.25(2) and 11.26. Under Rule 11.25(2), there must be a real and substantial connection to Alberta, the Court must have permitted service outside of Canada, and the person served with the commencement document must have also been served with a copy of the Order permitting service outside of Canada. Under Rule 11.26(1), a document may be served outside of Alberta by a method provided for in the Rules, in accordance with the Hague Convention, or in accordance with the law of the jurisdiction in which service occurs. With respect to the real and substantial connection test, the Majority explained that Rule 11.25(3) sets out presumptions of a “real and substantial connection”, and that Rule 11.27 permits the Court to validate irregular methods of service. In addition to there being a “real and substantial connection” to Alberta, the Applicant is also expected to show a “good arguable case” for Alberta to have jurisdiction over the matter.

Here, the Chambers Judge had determined that it need not consider international service ex juris if the Court already has jurisdiction over the Defendant, but the Majority disagreed. It held that “the Plaintiff’s mere assertion that the [C]ourt has jurisdiction […] does not justify non-compliance with the threshold requirements” in the Rules for service outside of Canada. The Respondent argued that service ex juris should retroactively be ordered because the irregularity could be cured. However, the Majority held that “the deficiencies in the service are substantive, and would preclude the exercise of such discretion” to fix the contravention. As such, the Majority allowed the Appeal, and set aside the Orders.

Lastly, the Majority noted that pursuant to Rule 14.88(1), there is a presumption that the successful party is entitled to Costs of the Appeal. However, here, the Appellant suffered no prejudice, and appeared to simply be delaying the arbitration by using technical arguments. As such, it did not award Costs to either party.

Justice Wakeling, concurring in result, queried whether any contravention could be cured by Rule 1.5, which contains a “general curative provision”, or Rule 11.27, which permits validation of service not in compliance with the Rules. Justice Wakeling held that the Respondents failed to comply with Rule 11.25(2)(b), and further explained that the contravention could not be cured. Rule 1.5 could not be relied upon because it does not apply to irregular methods and manners of service. Rule 11.3 could also not be relied on as the parties had not contractually agreed to a mode of service. Rule 11.27, which does apply to the manner of service, could similarly not be relied upon by the Respondents because it refers to service in a “manner” not specified by the Rules, but in this case, the Respondent’s failure to obtain an Order did not have to do with the “manner” of service.