CLOUT
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Agreements containing both an arbitration clause and a right to sue will still be subject to article 8 MAL, depending on the particular agreement.

Mind Star was a licensee of a product which it sub-licensed to Samsung. The sub-licensing agreement contained an arbitration clause and also a clause providing Mind Star with the right to sue should Samsung fail to perform any of its obligations. Mind Star claimed that Samsung had fundamentally breached the agreement and that Mind Star was entitled to claim damages. The parties agreed that the arbitration clause in the agreement qualified as an arbitration agreement pursuant to article 7 MAL as enacted by the International Commercial Arbitration Act, Revised Statutes of Ontario, 1990, c.1.9.

The court concluded that the right to sue did not qualify the duty to arbitrate. Even disputes concerning the clause creating the right to sue were subject to arbitration. The court found this "consistent with the requirement that the arbitrator will, in the first instance, determine its own jurisdiction, and the scope of its authority." The arbitration clause was operative and as such article 8 MAL required that the parties be referred to arbitration.

Additional Information published in later CLOUT issue (on "9 February 2000"):

Abstract published in English: [1995] Model Arbitration Law Quarterly Reports, Vol. 1, issue 3, 87

Text of the court decision published in English: [1995] Model Arbitration Law Quarterly Reports, Vol. 1, issue 3, 90

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