“There was considerable overlap in the arguments made by Optiva seeking to set aside the arbitration award under s. 46 and the arguments seeking leave to appeal that award under s. 45 of the Act. The application judge addressed the application to set aside the award first. His treatment of many of the same issues in the context of the leave to appeal application was considerably briefer.
The application judge described as “without merit” the argument that leave to appeal should be granted on the ground that the arbitrator based his decision on the limitation of liability clause on a legal theory not advanced by the parties. The application judge had addressed and rejected the same argument on the motion to set aside the award earlier in his reasons: Optiva Inc., at paras. 57-64. I have considered that argument in the context of the appeal from the refusal to set aside the arbitrator’s award: see supra, at paras. 51-59.
The application judge also refused to grant leave to appeal on the interpretation of the limitation of liability clause in the contract. He held that this argument did not raise a question of law alone, as required under s. 45 of the Act. In his view, the arbitrator’s interpretation of the relevant clause involved a question of mixed fact and law: see Optiva Inc., at para. 67.
Optiva has a preliminary problem in advancing the submission that the application judge erred in refusing to grant leave to appeal. The refusal to grant leave under s. 45 of the Act is, as a general rule, not appealable to this court. A refusal to grant leave will be appealable if it reflects an erroneous declining of the jurisdiction given to the Superior Court judge to grant leave under s. 45: Denison Mines Ltd. v. Ontario Hydro (2001), 2001 CanLII 5681 (ON CA), 56 O.R. (3d) 181, at paras. 5-8; Ottawa (City) v. Coliseum Inc., 2016 ONCA 363, 398 D.L.R. (4th) 34, at paras. 23-29.
The application judge did not decline to exercise his jurisdiction to determine whether leave to appeal should be granted under s. 45. He refused leave on the merits. He described one argument based on the arbitrator’s alleged reliance on a legal theory not advanced as “without merit”. He referred to the second argument arising out of the interpretation of the limitation of liability provisions in the contract as raising a question of mixed fact and law. Optiva could only obtain leave to appeal on a question of law alone.
Optiva submits that the application judge was wrong in characterizing the contractual issue as one of mixed fact and law. That error, says Optiva, amounts to “an arbitrary decision that is a declination of jurisdiction.”
The rationale underlying restrictions on appeals to this court from the refusal to grant leave to appeal in the Superior Court would be defeated if this court were to engage in an assessment of the merits of the decision refusing leave under the guise of considering whether the court below declined to exercise its jurisdiction. Under the terms of s. 45 of the Act, the question on which leave is given must be a question of law. The characterization of the issue is part of the merits of the leave application. The application judge’s conclusion that the question raised by Optiva involved a question of mixed fact and law, whether right or wrong, was a determination on the merits of Optiva’s application for leave to appeal. That decision is not appealable to this court.”