Evidence in a Commercial Arbitration in Ontario

The arbitration clause decides where a commercial dispute will be heard. It rarely says how the facts are to be proved. An arbitration seated in Ontario is conducted under the Arbitration Act, 1991, S.O. 1991, c. 17 (the “Act”), which leaves the procedure to the tribunal and, in one short section, lets it admit evidence that a court would exclude, and under the Evidence Act, R.S.O. 1990, c. E.23 (the “Evidence Act”), which applies by its s. 2 to “all actions and other matters whatsoever respecting which the Legislature has jurisdiction.” Between the two statutes sits a body of Ontario case law on hearsay, business records, adverse inferences and cross-examination that was written for the courtroom and is applied, with adjustments, in the hearing room, where it decides the weight of the evidence rather than its admission. Parties who treat an arbitration as an informal exchange of documents are surprised by that law, usually when the award explains why their evidence was given no weight.

This article sets out that law as it applies to a commercial arbitration under the Act. It covers the framework the Act supplies, including the evidence provisions of the Statutory Powers Procedure Act that s. 21 of the Act brings into every arbitration, the place of the Evidence Act before an arbitrator, hearsay, business records, electronic records, copies and handwriting, the witness who is not called, cross-examination on a written witness statement and the rule in Browne v. Dunn (1893), 6 R. 67 (H.L.), summaries of voluminous records and the witness who refuses to answer. It does not deal with family arbitrations or with international commercial arbitrations, which are governed by the International Commercial Arbitration Act, 2017, S.O. 2017, c. 2, Sched. 5.

The framework the Act supplies

The Act gives the tribunal control of the procedure and, in one section, its rule of evidence. Section 20(1) provides that “[t]he arbitral tribunal may determine the procedure to be followed in the arbitration, in accordance with this Act.” The limit on that power is s. 19, under which the parties “shall be treated equally and fairly” and “[e]ach party shall be given an opportunity to present a case and to respond to the other parties’ cases.” Section 19 is enforced through s. 46. An award made in breach of it may be set aside under paragraph 6 of s. 46(1), which applies where the applicant “was not treated equally and fairly, was not given an opportunity to present a case or to respond to another party’s case.”

Section 21 is the evidence provision, and it is short. “Sections 14, 15 and 16 (protection of witnesses, evidence at hearings, notice of facts and opinions) of the Statutory Powers Procedure Act apply to the arbitration, with necessary modifications.” Section 15(1) of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22 (the “SPPA”), provides that a tribunal “may admit as evidence at a hearing, whether or not given or proven under oath or affirmation or admissible as evidence in a court, (a) any oral testimony; and (b) any document or other thing, relevant to the subject-matter of the proceeding and may act on such evidence, but the tribunal may exclude anything unduly repetitious.” The limits are in s. 15(2) and (3). Nothing is admissible “that would be inadmissible in a court by reason of any privilege under the law of evidence” or “that is inadmissible by the statute under which the proceeding arises or any other statute,” and nothing in s. 15(1) overrides an Act “expressly limiting the extent to or purposes for which” evidence may be admitted or used. A copy may be admitted where the tribunal is satisfied of its authenticity (s. 15(4)). Section 14(1) deems every witness at the hearing to have objected to answering on the ground that the answer may tend to criminate the witness or establish civil liability, and provides that “no answer given by a witness at a hearing shall be used or be receivable in evidence against the witness in any trial or other proceeding against him or her thereafter taking place, other than a prosecution for perjury in giving such evidence.” Section 16 lets the tribunal take notice of facts that may be judicially noticed and of “generally recognized scientific or technical facts, information or opinions within its scientific or specialized knowledge.” Section 21 is not among the provisions that s. 3 of the Act makes mandatory, so the parties may vary or exclude it by agreement, and an arbitration agreement or a procedural order that adopts the rules of evidence applied in the Superior Court does exactly that.

The sections that follow supply the skeleton of the hearing. The parties deliver statements of their positions, which “shall indicate the facts supporting their positions, the points at issue and the relief sought,” and “may submit with their statements the documents they consider relevant” (s. 25(2) and (3)). They must comply, “subject to any legal objection,” with the tribunal’s directions, including directions to “submit to examination on oath or affirmation with respect to the dispute” and to “produce records and documents that are in their possession or power,” and the court may enforce such a direction “as if it were a similar direction made by the court in an action” (s. 25(6) and (7)). The tribunal may decide the case on documents alone, but it “shall hold a hearing if a party requests it” (s. 26(1)). Everything a party gives the tribunal must be communicated to the other parties, and the tribunal must communicate “any expert reports or other documents on which it may rely in making a decision” (s. 26(3) and (4)). A party who “fails to appear at a hearing or to produce documentary evidence” faces an award “on the evidence before” the tribunal unless the party “offers a satisfactory explanation” (s. 27(3)). The tribunal may appoint its own expert, who may be required to attend a hearing at which the parties question the expert and call their own (s. 28).

Section 29 is the witness provision. A party may serve a person with a notice, issued by the tribunal, “requiring the person to attend and give evidence at the arbitration at the time and place named in the notice,” and the notice “has the same effect as a notice in a court proceeding requiring a witness to attend at a hearing or produce documents” (s. 29(1) and (2)). The tribunal may administer an oath or affirmation and require a witness to testify under it (s. 29(3)), and the court may, on the application of a party or of the tribunal, “make orders and give directions with respect to the taking of evidence for an arbitration as if it were a court proceeding” (s. 29(4)). Section 30 sets the outer limit. No person may be compelled “to produce information, property or documents or to give evidence in an arbitration that the person could not be compelled to produce or give in a court proceeding,” which is the provision that carries solicitor-client privilege, litigation privilege and settlement privilege into the hearing room intact.

Two (2) features of the statute deserve emphasis. The first is that the oath before an arbitrator is a real oath. The Criminal Code, R.S.C. 1985, c. C-46, treats a proceeding “before an arbitrator or umpire” as a “judicial proceeding” (s. 118), and a witness who, with intent to mislead, makes a false statement under an oath the tribunal is authorized to administer commits perjury under s. 131 in the same way as a witness at trial. The second is the form the Act’s rule of evidence takes. Alberta’s Arbitration Act, R.S.A. 2000, c. A-43, provides in s. 21(1) that the tribunal “is not bound by the rules of evidence or any other law applicable to judicial proceedings and has power to determine the admissibility, relevance and weight of any evidence.” Ontario reaches a similar place by a different route, by borrowing the admissibility rule written for administrative tribunals, and the difference is more than drafting. The SPPA rule is permissive, since the tribunal “may” admit. It preserves privilege and statutory exclusions in terms. It says nothing about weight, which is left to the tribunal’s judgment on the whole of the evidence. The consequence, developed in the next section, is that the rules of evidence applied in the Superior Court stop being conditions of admission before an arbitrator and become the measure of what the evidence is worth.

The Evidence Act before an arbitrator

Section 2 of the Evidence Act provides that the Act “applies to all actions and other matters whatsoever respecting which the Legislature has jurisdiction.” An arbitration conducted under a provincial statute, between parties in Ontario, about a contract governed by Ontario law, is such a matter, and the provisions of the Evidence Act are available in it. What s. 21 of the Act changes is their function. Before a court, the rules of evidence decide what comes in. Before an arbitrator with the s. 15(1) power, relevant evidence comes in unless it is privileged or a statute excludes it, and the rules decide what the evidence is worth. The Evidence Act’s facilitative provisions, including the business records rule, the provisions on electronic records, copies and handwriting, and the sections on cross-examination on prior statements, remain the instruments by which evidence is proved and tested, and they are the measure the tribunal applies in deciding weight.

It is our position that the practical rule before an Ontario arbitrator, where the parties have not agreed otherwise, is as follows. Relevant evidence is received, hearsay included, unless it is privileged or excluded by statute. The objection that a court would have excluded it goes to weight. The weight is decided in the award, on the whole of the record, by the reasoning the courts apply at the admissibility stage, including the principled approach to hearsay and the business records criteria. Two (2) decisions show the courts holding arbitrators to that rule from both directions. In York Region Standard Condominium Corp. No. 1311 v. Star Woodworking Ltd., 2026 ONSC 2381 (“York Region”), an application to set aside a commercial award, the court examined how the arbitrator had dealt with evidence that was “based largely on hearsay or bald allegations without direct evidence” and upheld the award because the parties “had a fair opportunity to call and cross-examine opposing witnesses” and the arbitrator’s treatment of the evidence was within the range of acceptable outcomes (¶¶ 34-43). In Farmer v. Farmer, 2021 ONSC 5913 (“Farmer”), an appeal from a family arbitration in which the arbitrator had excluded one side’s hearsay and admitted the other’s, Finlayson J. set out the law of hearsay at ¶¶ 171-193 for “the judge (or arbitrator)” and faulted the arbitrator for ruling on the evidence without a voir dire and before the evidence was complete (¶¶ 194-196). The lesson of the two decisions together is that the discretion under s. 15(1) is exercised through the ordinary law of evidence rather than in place of it.

Parties can change the default by agreement, in either direction. An arbitration agreement may adopt the rules of evidence applied in the Superior Court, and institutional rules and procedural orders frequently give the tribunal an express power to determine the admissibility, relevance, materiality and weight of evidence, as the IBA Rules on the Taking of Evidence in International Arbitration, which parties to domestic arbitrations often adopt as guidelines, do in Article 9. Whichever rule governs admission, the rules of evidence remain the measure of weight. The hearsay statement that a court would exclude is the statement an arbitrator will discount, for the same reasons, and the party who proves its case as it would have to in court loses nothing by doing so. The party who relies on the informality of the process takes a risk that the award will describe.

Hearsay before an arbitrator

Hearsay is an out-of-court statement tendered for the truth of its contents, and in court it is presumptively inadmissible (R. v. Bradshaw, 2017 SCC 35 (“Bradshaw”) at ¶ 1). Before an arbitrator the presumption is displaced by s. 21 of the Act and s. 15(1) of the SPPA, and the hearsay rule does its work at the stage of weight. The analysis is the same one, and it is worth setting out, because a closing submission that walks through it is the most effective answer to a case built on hearsay. The rule applies as much to a witness statement that repeats what someone else said as it does to a document. In commercial arbitrations the common examples are the email from a former employee describing events, the accountant’s covering letter, the consultant’s report and the officer’s statement that “I was advised by” a person who will not testify. The first question in every case is whether the evidence is hearsay at all, because a statement tendered to prove that it was made, or to explain what the witness then did, is not hearsay, and misguided objections of that kind are common (R. v. Khelawon, 2006 SCC 57 (“Khelawon”) at ¶¶ 56-58).

In court, hearsay may be received under a traditional exception, such as the business records provision discussed below, or under the principled exception, where the party tendering it establishes necessity and threshold reliability on a balance of probabilities (Khelawon at ¶¶ 42 and 47; Bradshaw at ¶ 23). Threshold reliability may be procedural, where adequate substitutes for cross-examination exist, including an oath, a recording or an earlier cross-examination, or substantive, where the circumstances in which the statement was made and the corroborating evidence show it to be trustworthy, and the two may work in tandem (Bradshaw at ¶¶ 27-32). Corroborative evidence counts only if it goes to the truthfulness or accuracy of the material aspects of the statement and rules out, on a balance of probabilities, the alternative explanations for it, including speculative ones (Bradshaw at ¶¶ 44 and 57). Only threshold reliability is decided at the admissibility stage in court. Ultimate reliability, which is the weight the evidence receives, is decided at the end on the whole of the record, and before an arbitrator the two inquiries merge into one, conducted in the award.

Farmer is the decision that applies this framework to an arbitrator, and what it adds is procedural. The arbitrator there had excluded hearsay without a voir dire and had intervened before the evidence was complete, and the court treated both as errors (¶¶ 194-196). A commercial tribunal that receives contested evidence under s. 15(1), hears the whole of the record and then rules on weight in the award is doing what the court in Farmer expected and what s. 21 contemplates, and in a hearing measured in days the provisional ruling is the only form of voir dire the schedule allows. The objecting party loses nothing by that course if it makes its objection on the record and returns to it in closing submissions.

York Region shows what happens to hearsay that is received. The arbitrator heard an oppression claim on affidavits and cross-examinations. The claimants’ evidence on the contested transactions was “based largely on hearsay or bald allegations without direct evidence,” and the arbitrator noted that “[n]o one was summonsed who could have been subject to cross-examination or shed direct light” on them. The arbitrator received the evidence, weighed it against the respondents’ direct evidence and found it rebutted, and the court declined to set the award aside (¶¶ 34-43). The case cuts both ways and should be read for both. Hearsay received by an arbitrator under the Act is weighed rather than ignored, and an award that weighs it stands. A party whose case is hearsay without documents, and who did not summons the person with direct knowledge, will usually lose on weight.

The practical rule that follows is simple. Prove each contested fact by a witness who perceived it or by a document that qualifies under an exception, and treat a hearsay account as a supplement to that proof rather than as a substitute for it. Where the only evidence of a fact is what a person who will not testify told the witness, the statement should identify that person, the occasion and the reason the witness believed what was said, because those are the circumstances the tribunal weighs (Farmer at ¶ 188). Necessity is the weaker limb of the principled exception where the declarant could have been summonsed under s. 29 of the Act and was not.

Business records under section 35 of the Evidence Act

Most of the documents in a commercial arbitration are hearsay in the strict sense. An invoice asserts that work was done and a price charged, a ledger entry asserts that money moved and an email reports what its author saw. Section 35 of the Evidence Act is the provision that admits them in court, and before an arbitrator it remains the best route in, because a record that satisfies the section carries the presumption of reliability that comes with it and the section’s criteria are the measure the tribunal applies in deciding weight. Under s. 35(2), “[a]ny writing or record made of any act, transaction, occurrence or event is admissible as evidence of such act, transaction, occurrence or event if made in the usual and ordinary course of any business and if it was in the usual and ordinary course of such business to make such writing or record at the time of such act, transaction, occurrence or event or within a reasonable time thereafter.” “Business” is defined to include “every kind of business, profession, occupation, calling, operation or activity, whether carried on for profit or otherwise,” and “record” to include “any information that is recorded or stored by means of any device” (s. 35(1)). The section does not apply “unless the party tendering the writing or record has given at least seven days notice of the party’s intention to all other parties in the action,” and the other parties are entitled to inspect the record within five (5) days of asking (s. 35(3)). Before a tribunal with the s. 15(1) power the notice is a condition of the section’s own route rather than of admission, but a party who serves it gives the tribunal the statutory ground for the record and the other side its chance to inspect, and loses nothing by doing so. Under s. 35(4), “[t]he circumstances of the making of such a writing or record, including lack of personal knowledge by the maker, may be shown to affect its weight, but such circumstances do not affect its admissibility.”

The Ontario courts state the requirements in a settled form. In Atlas Dewatering Corp. v. Harvie Construction Inc., 2024 ONSC 1775 (“Atlas Dewatering”), Healey J. adopted the eight (8) requirements drawn from R. v. Felderhof, 2005 ONCJ 406, stating them as follows, “a. a record made on some regular basis, routinely, systematically; b. of an act, transaction, occurrence or event; c. and not of opinion, diagnosis, impression, history, summary or recommendation; d. made in the usual and ordinary course of business; e. it was in the usual and ordinary course of such business to make such record; f. pursuant to a business duty; g. at the time of such act or within a reasonable time; and h. where the record contains hearsay both the maker and informant must be acting in the usual and ordinary course of business” (¶ 212). Her Honour added the principles drawn from Setak Computer Services Corp. v. Burroughs Business Machines Ltd. (1977), 15 O.R. (2d) 750 (H.C.J.), including that documents “created pursuant to a regular business duty, are presumed to be reliable” and that mere possession of a document by a party “does not cloak the document with proof of the truth of its contents” (¶ 213). She then admitted time and material sheets and invoices without calling the people who filled them in, on evidence that they “were prepared routinely” and were “used to prepare the formal invoices,” finding “no reason that arises from the evidence for those record keepers to be motivated to fabricate” (¶¶ 214-216).

The Divisional Court dismissed the appeal in Harvie Construction Inc. v. Atlas Dewatering Corp., 2025 ONSC 4672 (“Harvie”), and its reasons contain the sentence against which every objection to a business record should be measured. “The whole point of the ‘business records’ exception to the hearsay principle is that the ‘maker of the record’ need not testify to them,” and the tendering party “must satisfy the test set out in the Evidence Act” instead (¶ 14). The court noted that the trial judge had assessed the reliability of the documents “on the basis of the totality of the evidence before her” and had decided “the weight to be afforded records, as provided in s. 35(4)” (¶ 13).

Three (3) limits on the section are important in practice. First, s. 35 admits records of an “act, transaction, occurrence or event” and does not admit opinion, which is requirement (c) in Felderhof. The accountant’s covering letter that characterizes the entries is not a business record even if the ledger it accompanies is. Second, a record made for the arbitration is not made in the ordinary course of business. The schedule prepared by a party’s employee after the dispute arose, the explanatory email written in answer to counsel’s questions and the chronology assembled for the hearing are not business records, whatever the quality of the records they summarize, and they go in, if at all, as the witness’s own evidence or under the principled exception. Third, where the record contains information supplied by someone other than its maker, requirement (h) asks whether both were acting in the ordinary course of business. The invoice that records hours reported by a supervisor qualifies, because reporting hours is part of the supervisor’s business. The invoice that records what a customer said about a competitor does not.

What the section does for a party who uses it properly is considerable. A commercial case can be proved in large part from the other side’s own records, obtained on production and tendered under s. 35, and the party who made those records is poorly placed to attack them. Section 35(4) sends the maker’s lack of personal knowledge to weight, and the “totality of the evidence” approach approved in Harvie allows the tribunal to test a record against the other records and the oral evidence rather than against the maker’s testimony alone.

Electronic records, copies and handwriting

Nearly every record in a modern commercial dispute is electronic, and s. 34.1 of the Evidence Act governs its authentication and the best evidence rule without modifying the hearsay rules (s. 34.1(2)). The party introducing an electronic record “has the burden of proving its authenticity by evidence capable of supporting a finding that the electronic record is what the person claims it to be” (s. 34.1(4)). The best evidence rule “is satisfied on proof of the integrity of the electronic record,” which may be proved by evidence of the integrity of the system in which it was recorded or stored, and a printout that has been “manifestly or consistently acted on, relied upon, or used as the record” is itself the record for that purpose (s. 34.1(5), (5.1) and (6)). The integrity of the system is presumed, in the absence of evidence to the contrary, on evidence that it was operating properly at the material times, or “if it is established that the electronic record was recorded or stored by a party to the proceeding who is adverse in interest to the party seeking to introduce it,” or where a person who is not a party recorded it in the ordinary course of business (s. 34.1(7)). Those matters may be established by affidavit, and the deponent may be cross-examined as of right by an adverse party (s. 34.1(9) and (10)).

The presumption in s. 34.1(7)(b) is the one commercial litigants should notice. Accounting records kept in a system the opposing party controlled, emails sent from the opposing party’s own accounts and messages exported from the opposing party’s devices are records “recorded or stored by a party to the proceeding who is adverse in interest,” and the party who kept them is the last party in a position to dispute their integrity.

Section 55 deals with copies. A party who intends to prove “the original of a telegram, letter, shipping bill, bill of lading, delivery order, receipt, account or other written instrument used in business or other transactions” may give notice, “ten days at least before the trial or other proceeding,” that it intends to prove the contents by a copy, naming a time and place for inspection. The copy is then sufficient evidence of the contents unless the other party gives notice, within four (4) days after the time named for inspection, that it disputes the correctness or genuineness of the copy and requires proof of the original (s. 55(1) and (2)). Section 57 permits the comparison of a disputed writing “with a writing proved to the satisfaction of the court to be genuine” by a witness, and the writings and the witness’s evidence may be submitted “as evidence of the genuineness or otherwise of the writing in dispute.” A handwritten note of disputed authorship can therefore be proved by comparison with signatures and writings that are admitted to be genuine, and by the evidence of a person familiar with the author’s hand, without an expert. Section 33 adds that a copy of an entry in the books of a bank that is not a party is, on the proof the section specifies, evidence of the entry and of the transactions it records (s. 33(2) and (3)).

The notices under ss. 35(3) and 55(1) are counted from “the trial or other proceeding.” Before an arbitrator, s. 15(4) of the SPPA allows a copy to be admitted once the tribunal is satisfied of its authenticity, so the s. 55 notice is a convenience rather than a condition, but it remains the simplest way to settle authenticity before the hearing. The procedural order should fix the dates on which both notices are to be served. Where it does not, the safe course is to serve them well inside the statutory periods counted from the first day of the hearing, and the simplest course is to serve them with the document brief.

The witness who is not called

An arbitration is decided on the evidence the parties choose to call, and the choice not to call a witness has consequences that the Act and the case law both supply. The Act’s answer is s. 29. A party who needs the evidence of a person in the other camp may serve a notice issued by the tribunal, with the same effect as a summons in a court proceeding, and may ask the court under s. 29(4) for orders “with respect to the taking of evidence for an arbitration as if it were a court proceeding.” The case law’s answer is the adverse inference, and its limits are stricter than most parties assume.

The test is the one the Court of Appeal stated in Parris v. Laidley, 2012 ONCA 755 at ¶ 2, as quoted in Watter v. McMaster University, 2025 ONSC 4930 (Div. Ct.) at ¶ 72. “Drawing an adverse inference from a failure to produce evidence is discretionary. The inference should not be drawn unless it is warranted in all the circumstances. What is required is a case-specific inquiry into the circumstances including, but not only, whether there was a legitimate explanation for failing to call the witness, whether the witness was within the exclusive control of the party against whom the adverse inference is sought to be drawn, or equally available to both parties, and whether the witness has key evidence to provide or is the best person to provide the evidence in issue.” The Divisional Court restated the test as three (3) conditions in Association of Professional Engineers of Ontario v. Rew, 2020 ONSC 6018 at ¶ 92; namely, that the witness was within the exclusive control of the party against whom the inference is sought, that the failure to call the witness is unexplained, and that the witness had key evidence.

Each of the conditions has consequences. Where either party could have called the witness, the inference is not available against one of them. In Woods v. Jackiewicz, 2020 ONCA 458 at ¶ 27, the Court of Appeal upheld a refusal to instruct a jury on the inference because “[e]ither party could have called that evidence if they thought it was important.” In an arbitration, where s. 29 puts the summons in either party’s hands, that answer will be available more often than at trial, and the party who complains that a witness was not called will be asked why it did not summons the witness itself. A plausible explanation for not calling the witness defeats the inference, and the explanation need not be strong. In Ibrahimova v. Cavanagh, 2026 ONCA 573 at ¶¶ 85-87, the trial judge’s view that a witness from another institution “would not be favourably disposed to the [respondents] or under their control” was “a plausible explanation for why the respondents had not called such witnesses and was a sufficient basis for the trial judge to decline to draw an inference,” and his observation that the defence had not called such a witness either was a comment on the state of the evidence rather than a reversal of the onus. In Delrina Corp. v. Triolet Systems Inc. (2002), 58 O.R. (3d) 339 (C.A.) (“Delrina”), Morden J.A., quoting Sopinka, described the two (2) forms of the inference, that the absent witness’s evidence “would be contrary to the party’s case, or at least would not support it,” the trial judge having drawn “the milder of the two” (¶ 67), and held that an undertaking not to call the witness “would have been a logical explanation which would have prevented the adverse inference from being drawn” (¶ 78).

The party seeking the inference must also say what inference it wants. In Watt v. TD Insurance, 2022 ONSC 1514 (Div. Ct.) at ¶ 15, the argument failed because the appellant did not “identify precisely what adverse inference should have been drawn, what evidence would have been given had they been called to testify, and how such an inference may have affected the result,” and in Enofe v. Capreit Limited Partnership, 2020 ONSC 7113 (Div. Ct.) at ¶¶ 15 and 22, the same court noted that a party who learns that a witness will not be called may summons the witness itself, and that the inference is not drawn in the abstract. Nor is the inference a substitute for production. In Amtim Capital Inc. v. Appliance Recycling Centers of America, 2024 ONCA 225 at ¶¶ 12, 19-20 and 25, the Court of Appeal upheld a trial judge who refused to infer from a party’s failure to call its accountants that its financial summaries were unreliable, because the other side had not pursued the production remedies available to it, and added that a party which rests its case “on the potential use of an adverse inference” must “bear the consequences of its strategic choice.”

In arbitration the equivalent remedies are the direction to produce under s. 25(6) and the summons under s. 29, and a party who has them and does not use them will find the tribunal unreceptive to the inference. The award in York Region is the illustration. The claimants’ case rested on hearsay and on allegations without direct evidence, “[n]o one was summonsed who could have been subject to cross-examination,” and the claim failed on weight without any inference being drawn at all. A party whose own witness has the key evidence should therefore call the witness or explain the absence in evidence, because silence invites the milder inference described in Delrina even where the stricter one is unavailable. A party who needs the other side’s witness should summons the witness under s. 29 rather than rely on the inference, which is discretionary, requires exclusive control and will not be drawn against a party with a plausible explanation.

Cross-examination on written statements and the rule in Browne v. Dunn

The Act does not say how evidence in chief is to be given, and commercial tribunals usually direct that it be given in writing, by witness statement or affidavit delivered before the hearing, with the witness attending for cross-examination. The witness’s account is then fixed before the hearing starts, each side knows the other’s evidence in full and the documents are in a common brief. Two (2) provisions of the Evidence Act and one (1) rule of the common law govern what follows.

Under s. 20, a witness “may be cross-examined as to previous statements made by him or her in writing, or reduced into writing, relative to the matter in question, without the writing being shown to the witness,” but if the cross-examiner intends to contradict the witness by the writing, the witness’s attention must first “be called to those parts of the writing that are to be used for the purpose of so contradicting the witness.” Under s. 21, where a witness cross-examined on a prior oral statement inconsistent with the present testimony “does not distinctly admit” making it, proof may be given that the witness did, but “the circumstances of the supposed statement sufficient to designate the particular occasion shall be mentioned to the witness and the witness shall be asked whether or not he or she did make such statement.” Both sections are directions about fairness to the witness, and both are engaged in most commercial arbitrations, where the prior statements are emails, text messages and earlier affidavits.

The common law rule is the rule in Browne v. Dunn, which “creates an obligation to give a witness, called by the opposite side, an opportunity to explain evidence which the cross-examiner intends to later use to impeach the testimony or credibility of the witness” (Curley v. Taafe, 2019 ONCA 368 (“Curley”) at ¶ 27). The rule is about surprise. It “prevents the ‘ambush’ of a witness by not giving him an opportunity to state his position with respect to later evidence which contradicts him on an essential matter,” and its application “is generally restricted to situations where a party cross-examining a witness called by the opposite side is planning on adducing contradictory evidence to impeach the witness’s credibility” (Yan v. Nadarajah, 2017 ONCA 196 (“Yan”) at ¶ 15).

Where the evidence in chief is written and exchanged in advance, the rule is engaged far less often than parties argue. In Yan the contradictory evidence used to impeach the appellants “came in the form of the appellants’ own affidavits,” at the start of the cross-examination they had been asked “whether there was anything in their affidavits that was incorrect or needed to be changed” and had declined to change anything, and “there was no element of the kind of unfairness or surprise that the rule in Browne v. Dunn protects against” (¶ 16). In Combined Air Mechanical Services Inc. v. Flesch, 2011 ONCA 764 at ¶¶ 119-120, a fraud finding made on a record of affidavits and cross-examinations was upheld against the complaint that the rule had been misapplied, because the party “knew the case against him and was aware of the allegations against him” and “had ample opportunity to respond to those allegations, and indeed endeavoured to do so both in his lengthy affidavits and in cross-examinations on those affidavits,” and the summary judgment against him in that action was affirmed in Hryniak v. Mauldin, 2014 SCC 7. In Deokaran v. Law Society of Ontario, 2023 ONSC 1702 (Div. Ct.) at ¶ 35, the Divisional Court upheld an appeal panel’s conclusion that the rule does not apply where the party being impeached “has had full notice beforehand that there is an intention to impeach credibility of [the] story.”

The rule still has force where it applies, and the consequences of ignoring it are real. A tribunal that finds a breach may take it into account in assessing the witness’s credibility and the weight of the contradicting evidence, or may allow the witness to be recalled (Curley at ¶ 31). In Urbancorp Toronto Management Inc. (Re), 2019 ONCA 757 at ¶¶ 69-70, the Court of Appeal described a motion judge who was “not prepared to make a credibility finding” against a party whose witness “was not confronted with the document on cross-examination to enable him to explain any apparent inconsistency,” and the party that held the document lost the finding it had sought. The practical rule for the cross-examiner is to put every document and every prior statement on which the closing will rely to the witness whose evidence it contradicts, and to put the opposing theory in terms, because the cost of asking one more question is low and the cost of an unasked question can be the finding itself. The cross-examiner’s opening question, whether anything in the statement is incorrect or needs to be changed, is the question that foreclosed the complaint in Yan, and it costs nothing. The tribunal’s power to award costs under s. 54 of the Act is wide enough to reflect the quality of a party’s evidence, and in Yan costs on the higher scale were upheld because the losing party “tendered misleading evidence” (¶ 26).

Summaries of voluminous records

The reconciliation of invoices against time records, of bank statements against ledgers or of deliveries against purchase orders, over months or years, is the kind of exercise a tribunal cannot be asked to perform from the exhibits, and the law permits a summary. In R. v. Scheel (1978), 42 C.C.C. (2d) 31 (Ont. C.A.) (“Scheel”), the Court of Appeal held that summaries “based on evidence which had been properly admitted, were admissible to assist the jury in understanding the entire picture represented by voluminous documentary evidence,” their usefulness depending “entirely … upon the acceptance by the jury of the proof of the facts upon which the summaries were based” (¶ 13). The court adopted the rule that “a summary of books and records is admissible, provided cross-examination is allowed and the original records are available” (¶ 16), and held that the summaries did not offend the best evidence rule “since the documents which were the primary source of the summaries were in evidence” (¶ 18).

The Divisional Court’s reasons in Harvie show the same approach in a civil case. The trial judge had before her Scott Schedules prepared by the parties, the work recorded in the impugned documents “was the subject-matter of extensive evidence,” often “on an item-by-item basis,” and she could “assess the accuracy of these business records independently from the totality of the evidence before her, as she was entitled to do” (¶ 14).

The form of the summary decides its weight. It should be a schedule that carries, for every line, the identifier of the source document in the record, so that any cell can be checked against the exhibit in the hands of the witness. It should be adopted by a witness who has checked it and can explain the arithmetic, and it should be described to the tribunal as a summary and nothing more. A figure in a witness statement without its working is argument, and a summary that departs from the records behind it is worse than no summary, because the departure will be found in cross-examination and the rest of the schedule will be doubted with it.

The witness who refuses to answer

A witness in a commercial arbitration will sometimes be asked a question the answer to which could expose the witness to civil liability or to prosecution. In court the rule is in s. 9 of the Evidence Act. A witness “shall not be excused from answering any question upon the ground that the answer may tend to criminate the witness or may tend to establish his or her liability to a civil proceeding at the instance of the Crown or of any person or to a prosecution under any Act of the Legislature” (s. 9(1)), and an answer given after an objection on that ground “shall not be used or receivable in evidence against him or her in any civil proceeding or in any proceeding under any Act of the Legislature” (s. 9(2)). The Divisional Court summarized the two (2) subsections in Hogg v. Ontario Securities Commission, 2025 ONSC 6214 (Div. Ct.) (“Hogg”) at ¶ 56. In court the protection depends on the objection being taken. Before an arbitrator the objection is taken by statute. Section 14(1) of the SPPA, applied by s. 21 of the Act, deems a witness at the hearing “to have objected to answer any question asked him or her upon the ground that the answer may tend to criminate him or her or may tend to establish his or her liability to civil proceedings at the instance of the Crown, or of any person,” and provides that no answer given at the hearing “shall be used or be receivable in evidence against the witness in any trial or other proceeding against him or her thereafter taking place, other than a prosecution for perjury in giving such evidence.”

The point is important in arbitrations arising from allegations of fraud, misappropriation or breach of fiduciary duty, where the same facts could ground a criminal complaint or a claim by a third party. Three (3) consequences follow. First, the witness must answer. The deemed objection is the price of the compulsion rather than a licence to refuse, and a party who refuses a tribunal’s direction to submit to examination faces the court’s enforcement of the direction under s. 25(7) and an award on the evidence before the tribunal under s. 27(3). Second, the witness need not object question by question to earn the protection, which s. 14(1) confers on every answer given at the hearing, although counsel will often state the objection on the record so that the transcript shows it. Third, the protection operates in later proceedings against the witness. Within the arbitration in which the answer is given, the tribunal weighs it with the rest of the evidence, in the same way that Hogg holds a regulatory hearing to be no separate proceeding from the investigation in which the answers were compelled (¶¶ 60 and 74). A party who hopes to use the arbitration transcript against the witness in a later action, or to hand it to the police, should know that s. 14(1) stands in the way.

Section 30 of the Act and s. 15(2)(a) of the SPPA supply the other limit. A person cannot be compelled to produce documents or give evidence in an arbitration “that the person could not be compelled to produce or give in a court proceeding,” nothing is admissible “that would be inadmissible in a court by reason of any privilege under the law of evidence,” and a direction under s. 25(6) is expressly “subject to any legal objection.” Privilege, whether solicitor-client, litigation or settlement privilege, is therefore as complete before the tribunal as before the court.

Practical considerations

The evidentiary questions in this article are decided, in most arbitrations, by the procedural order made at the first case conference, and the party who comes to that conference with a position on each of them gains an advantage that lasts to the award. The order should say whether the s. 21 default governs or the parties have agreed to the rules of evidence applied in the Superior Court. It should say how evidence in chief will be given and when the statements will be exchanged. It should fix the dates for the notices under ss. 35(3) and 55(1) of the Evidence Act, or dispense with them on terms. It should provide that the authenticity of the documents in the common brief is admitted unless challenged by a stated date, that objections are to be made in writing before the hearing, and that the tribunal will receive contested evidence subject to the objection and rule on weight in the award. It should deal with the witnesses who will be summonsed under s. 29 and with any application to the court under s. 29(4).

Before the hearing, the work is in the documents. Every contested fact should be traced to a witness who perceived it or to a record that qualifies under s. 33, s. 34.1 or s. 35, and the record’s path into evidence should be written down. Witness statements should identify the source of the witness’s knowledge of each fact, because a statement that does so can be weighed and a statement that does not will be read as hearsay of unknown provenance. The decision whether to summons a witness in the other camp should be made early, because the adverse inference is a poor substitute for the evidence and the court’s assistance under s. 29(4) takes time. At the hearing, the party objecting to hearsay should object on the record, let the evidence in subject to the objection and return to the objection in closing, walking through necessity and reliability for each contested statement, and the cross-examiner should put every contradicting document and the opposing theory to the witness. Every witness should be reminded, before giving evidence, that the oath before an arbitrator is an oath in a judicial proceeding within the meaning of the Criminal Code, and that s. 14 of the SPPA protects the answers in any later proceeding against the witness.

How we can help

Grigoras Law acts as counsel in commercial arbitrations seated in Toronto, in shareholder, partnership, contract and fraud disputes, and in the court proceedings that surround them, including stay motions under s. 7 of the Act, applications under s. 29(4) for the court’s assistance in taking evidence, and applications to enforce or set aside the award. Much of the work in an arbitration is the evidence, and the decisions described in this article are the ones we make with clients at the first case conference and in the months before the hearing. Our arbitration practice and our commercial litigation practice are described on the pages linked here. Our earlier article on arbitrating a shareholder dispute in Ontario deals with the stay motion and the arbitrator’s remedial powers, and our page on civil fraud covers the claims in which the evidence questions discussed above arise most often.

This article is general information about the law of Ontario as of October 2026 and is not legal advice. The rules of evidence that apply in a particular arbitration depend on the arbitration agreement, the rules the parties have adopted and the tribunal’s procedural orders, and the authorities cited should be read in full before they are relied on.