jeffrey j

3.68: Court options to deal with significant deficiencies

Case Summary

The Applicant, TransAlta Generation Partnership (“TransAlta”), was a party to a power purchase arrangement (“PPA”) with Enmax Energy Corporation (“Enmax”). TransAlta made a force majeure claim pursuant to the PPA and the Respondent, the Balancing Pool, made certain payments to TransAlta to compensate it for the capacity payments that Enmax was relieved of paying due to the force majeure. The Balancing Pool then challenged the validity of the force majeure claim and formally disputed the claim according to the dispute resolution clauses of the PPA. TransAlta took the position that the Balancing Pool could not initiate arbitration and refused to appoint an arbitrator. Enmax took no position on the force majeure claim.

The Balancing Pool filed an Originating Application seeking to have the Court appoint an arbitrator, and TransAlta filed the current Application to strike the Originating Application under Rule 3.86. Justice Jeffrey cited Rule 3.68 but did not discuss the test under Rule 3.68. Instead, His Lordship reviewed the relevant legislation and the wording of the PPA and concluded that the Balancing Pool had a right to initiate the dispute resolution procedure in the PPA in the circumstances and, as a result, dismissed TransAlta’s Application to strike the Balancing Pool’s Originating Application pursuant to Rule 3.68.

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