Specialized arbitration procedure for disputes arising between the members of CIRO and their clients

APPLICATION

1. Any claim relating to a securities transaction by and between a member of CIRO and one of its clients in the Province of Québec, shall qualify for arbitration if all facts relevant to the claim occurred subsequent to January 1st, 1996.
2. The specialized procedure is applicable to qualifying disputes, as defined in Section 1, subject to the following terms and conditions:
   1. that the client consents thereto if the dispute relates to a claim for an amount, equal to or less than $500,000 including a cross-claim but excluding interest and arbitration fees;
   2. that both parties agree thereto that if the facts giving rise to the dispute have occurred in part, both prior to and subsequent to January 1st, 1996, and the disputed amount is equal to or less than $500,000 including a cross-claim but excluding interest and arbitration fees.
3. A claim not qualifying may nevertheless proceed under this specialized procedure if both parties agree.

DELAYS AND NOTICES

4. The delays referred to in the provisions of the GCAR are reduced to seven (7) days with respect to the application of the specialized procedure.
5. A notice under the specialized procedure shall be conveyed by the Centre by telephone to a party, its agent or its authorized representative. The notice is deemed to have been received on the day the telephone communication was made. The notice by telephone is subsequently confirmed in writing, or by any rapid means, which allows for proof of receipt.

ARBITRATION NOTICE

6. The party who intends to submit a dispute for arbitration shall so advise the Centre in writing. The notice must include:
   1. the parties' names, occupations and addresses or those of their agents or authorized representatives, as the case may be;
   2. a summary statement of the matter of the dispute and, if applicable, the amount of the claim resulting from it;
   3. the documents and information which clearly establish the facts as well as the parties’ consent, if required. The arbitration is submitted to the Centre as at the date of receipt of the notice.
7. The Centre shall verify the qualification of the application in accordance with the requirements of the specialized procedure. In addition, it shall ensure that the parties have attempted to directly negotiate a settlement of the dispute.
8. If the application qualifies, then the Centre shall so advise the parties and shall send them a request for advanced fees. The defendant has seven (7) days to file a reply to the arbitration notice and its cross-claim, if necessary.

APPOINTMENT OF THE ARBITRATOR

9. The dispute is submitted to one single arbitrator.
   1. The Centre shall advise the parties as to available arbitrators. The parties shall have five (5) days from receipt of such information to agree on the selection of arbitrator.
   2. If the parties fail to agree, the Centre shall appoint and confirm an arbitrator from the list of arbitrators specialized in securities.

ARBITRATION PROCEEDINGS

10. The arbitrator shall set the time and location of the arbitration proceedings, after consulting with the parties. He shall select the most practical solution involving the least expense as possible, and shall so notify the Centre.
11. The Centre shall give at least seven (7) days prior notice of the hearing date.
12. Subject to the arbitrator’s consent, the parties may, by mutual agreement, forego oral arguments and present their claims and arguments in writing only. If the parties cannot agree on the conduct of the written procedure, the procedure shall be oral.
    1. The parties and the arbitrator may agree that the arbitration shall proceed entirely by telephone conference.
13. At the outset of the arbitration proceedings, the arbitrator shall explain the arbitration procedure to the parties. He shall apply the rules of law, except if the parties mutually agree that his role should be that of the amiable compositor. He shall verify the parties’ agreement with respect to:
    1. The applicable rules of evidence;
    2. The number of lay and expert witnesses which shall be heard and the equitable distribution of hearing time.
14. In addition, the arbitrator may, at his sole initiative or at a party’s request, render a decision with respect to any issue which would not have been raised, nor have been the object of an agreement between the parties. It is equally possible for the parties to complete their statement of claims, and if the arbitration tribunal agrees thereto, make any modification or revision to the notice of arbitration, the reply, the cross claim and the reply of the cross-claim.

THE ARBITRATION AWARD

15. The arbitrator shall render an award in writing, stating the grounds on which it is based, and sign it. The award must be rendered in a maximum delay of sixty (60) days from the receipt of the file by the arbitrator, and at the latest, three (3) days after the hearings have terminated, or in the event that oral arguments have been foregone, three (3) days after the date on which the arbitrator received the documents.
    1. This delay may be modified by agreement of the parties or, in extraordinary circumstances, by the Centre, on notice to the parties with the reason(s) for the modification.
16. The Centre shall provide the parties with the award.
    1. The Centre may contemplate withholding delivery of the award if its fees or those of the arbitrator remain outstanding

LEGAL COSTS AND ARBITRATION FEES

17. The plaintiff shall include with his arbitration application, expenses related to the opening of a file, non-refundable but deductible from his share of the arbitration fees.
    1. The plaintiff shall elect whether or not the Arbitrator:
       1. may, in his discretion, award legal costs against a party or;
       2. may not award legal costs against a party, unless he finds that the party concerned has acted in a manner that may be characterized as unfair, vexatious, improper, in bad faith, or has unnecessarily and unreasonably prolonged the proceedings.
    2. This election shall be made by giving notice thereof to the defendant and to the Center, by no later than the conclusion of the pre-hearing . The election, once made, may not be revoked unilaterally by the plaintiff.  In the absence of such an election being made, the election in subsection (ii) shall apply.
18. The arbitrator shall distribute the arbitration fees equally between the parties, except for the special fees which shall be settled by one party only. Exceptionally and if the circumstances so justify, the arbitrator may modify the distribution of the arbitration fees.

TARIFF for the specialized arbitration procedure for disputes arising between the members of CIRO and their clients

THE CENTRE'S ADMINISTRATIVE FEES

19. $450.00* of which $200.00 represents the fees to open a file, non-refundable, payable by the plaintiff when the arbitration file is transmitted, and deductible from his share of the fees (Section 17 of the Specialized Procedure).
20. For a dispute relating to a claim for an amount equal or less than $3,000.00, including the cross-claim but excluding interest and arbitration fees:
    1. $200.00 to open a file, non-refundable, payable by the plaintiff when the arbitration file is transmitted, and deductible from his share of the fees (Section 17 Specialized procedure).

ARBITRATOR'S FEES

21. An hourly rate of $350.00 is applicable for every hour the arbitrator spent on file.
22. The travel and living expenses of an arbitrator are not included.

THE CENTRE'S RELATED FEES

23. The costs for rental of a courtroom are $150.00 based on a hearing duration of four hours. If additional time is necessary, additional rent shall be requested according to the additional time required. The costs for faxes, messenger services and long-distance calls are not included.

SPECIAL FEES

24. Fees for the postponement of the hearing
    1. These  fees are payable by the party who, after having given its consent to proceed at a specified date, requests that a new date be set for the hearing. The fees are $100.00.

DISTRIBUTION OF THE ARBITRATION COSTS

25. In equal shares between the parties (Section 18 Specialized Procedure) unless a contrary decision is taken by the arbitrator. The special fees are payable by the party responsible for them.

* Increased from $400.00 to $450.00 as of November 3, 1999.

Specialized Arbitration Procedures as amended January 2011