Executive Summary: Key Legal and Evidentiary Issues

• Dispute centered on enforceability of arbitration clause in Sivitilli’s employment contract following his termination.

• PesoRama challenged arbitration due to alleged invalidity of the contract and procedural unfairness under s. 6(c) of the Arbitration Act.

• Court found no permission to appeal was needed for the s. 6(c) issue but denied leave under s. 47(1)(b), citing settled law.

• Chambers justice ruled arbitration agreement was at least arguably operative and that validity questions were for arbitrator to decide.

• Mr. Sivitilli allowed to discontinue oppression claim unconditionally; arbitration could proceed for employment-related matters.

• Appeal dismissed as proceedings were not duplicative and no unfairness under s. 6(c) was established.

Background facts and procedural history

Edward Sivitilli, former CEO and director of PesoRama Inc., was dismissed from his position on August 16, 2021. His employment was governed by a written agreement dated September 1, 2018, amended on June 18, 2020, and approved by the Board on August 28, 2020. The contract included an arbitration clause for resolving disputes arising from his employment.

Following failed discussions regarding arbitration, Mr. Sivitilli filed a statement of claim on November 2, 2021, alleging oppressive and dishonest conduct. On December 1, 2021, his injunction application to block PesoRama’s AGM was dismissed. PesoRama filed a statement of defence and counterclaim on December 13, 2021.

On January 5, 2022, Mr. Sivitilli filed a Notice of Arbitration. PesoRama sought to enjoin the arbitration on January 20, 2022, arguing the arbitration clause was invalid and the arbitration would duplicate the court proceedings.

Policy terms and contractual clauses at issue

The chambers justice referenced clause 23.1 of the employment agreement, which stated that “any dispute between the parties regarding the construction, effect, rates, duties, liabilities, or any other matter in any way connected with or arising out of the subject matter of the agreement” must be submitted to a single arbitrator. Despite PesoRama’s claim that the agreement was not executed or that Mr. Sivitilli was an independent contractor, the chambers justice found that PesoRama’s own termination letter referred to “employment” and reminded Mr. Sivitilli of his contractual obligations, supporting the clause’s prima facie enforceability.

Decisions of the lower court and Court of Appeal (2024 ABCA 249 and 2025 ABCA 56)

Justice Neufeld at the Court of King’s Bench granted Mr. Sivitilli leave to discontinue his court claim unconditionally and permitted arbitration to proceed. He denied PesoRama’s application to enjoin arbitration, holding that whether the agreement was operative was a question of mixed fact and law for the arbitrator, citing Dell Computer Corp. v Union des consommateurs and EPCOR Power LP v Petrobank Energy and Resources Ltd.

PesoRama appealed, raising two main grounds:

• Under s. 47(1)(b), arguing the arbitration clause was invalid or had ceased to exist.

• Under s. 6(c), asserting arbitration would be manifestly unfair and duplicative.

In 2024 ABCA 249, Justice Hawkes allowed late filing but denied permission to appeal under s. 47(1)(b), finding the law was settled and further appeal would not serve broader legal interest. He ruled that no permission was required under s. 6(c), citing Schafer v Schafer, 2023 ABCA 117, and relevant provisions of the Judicature Act and Rules of Court.

In 2025 ABCA 56, the Alberta Court of Appeal dismissed PesoRama’s appeal. The Court found the chambers justice had discretion to determine whether proceedings were duplicative and that he had reasonably concluded they were not. The oppression claim concerned shareholder-related matters, while arbitration addressed employment disputes.

The Court rejected PesoRama’s argument, based on RH20 North America Inc v Bergmann, that Mr. Sivitilli waived arbitration by pursuing litigation. The chambers justice’s finding that the two proceedings were not duplicative precluded any finding of waiver or abandonment of arbitration rights.

Conclusion

The appeal was dismissed. Arbitration was found to be an appropriate and enforceable forum for resolving Mr. Sivitilli’s employment claims. The decisions emphasized limited judicial intervention in arbitration matters, particularly under s. 6(c) and s. 47 of the Arbitration Act, and deferred to the chambers justice’s factual findings that the arbitration clause remained operable and the proceedings were distinct.