I had the opportunity to collaborate with members of the Young Canadian Arbitration Practitioners (YCAP) on a significant research project titled Arbitration Costs in Canada.

My role involved analyzing survey data, presenting our findings, and drafting the initial report, which addresses a central question in arbitration: “How much will it cost?” For many clients, this question is crucial when they weigh arbitration as a dispute resolution option—often followed by, “And if I win, how much of the arbitration costs can I recover?”

The report offers a comprehensive view of typical costs associated with arbitration in Canada, with insights drawn from a variety of cases. Here’s an overview of what we found, and for those interested in a more detailed breakdown, the full report is available here.

What the Report Covers:

One of the report’s core insights is how costs are typically allocated and recovered in arbitration cases, with findings that illuminate trends and inform strategic considerations for both claimants and respondents:

Costs Claims Relative to Main Claims: In most surveyed cases, the costs claimed were kept within a reasonable proportion—generally 10% or less of the main claim’s value. This data point highlights an important consideration for parties assessing potential arbitration costs.

Overall Costs Recovery Patterns: A clear pattern emerged for parties with decisive wins, who recovered around 80% of their claimed costs on average. Even when outcomes were mixed, parties were able to recover an average of 60%, underscoring that, despite the variability in costs awards, substantial recovery is possible even in complex cases with split outcomes.

Success Rates and Costs Recovery: Claimants who succeeded in their main claims generally achieved higher rates of costs recovery, sometimes averaging up to three-quarters of their claimed costs. Even in cases of mixed outcomes, they made material recoveries. By contrast, respondents with mixed success recovered costs only infrequently, though those who fully defended claims successfully recouped over half of their costs on average.

Domestic vs. International Arbitrations: Costs claims in international arbitration cases tend to be higher than in domestic cases, yet recovery percentages tend to be lower.

Institutional vs. Ad Hoc Arbitration: While the data does not provide a definitive trend between ad hoc and institutional arbitration.

Common Rationales for Costs Awards: When deciding costs awards, tribunals often referenced the outcome of the main claim and the common norm that the losing party should bear the winning party’s costs. Interestingly, while conduct related to settlement was considered, arguments based on a party’s refusal to mediate did not appear as a factor in any cases within our surveyed sample.

Our findings not only offer valuable benchmarks but also shed light on strategic factors that counsel and clients might consider when preparing for arbitration. Understanding these dynamics can help parties make more informed decisions about pursuing and structuring their claims, especially in relation to costs recovery strategies.

Closing
Collaborating with such experienced arbitration practitioners on this report was both an honour and an invaluable experience. Reflecting on our findings, I’m reminded of the critical role that reliable expertise plays in navigating complex cases. At Prime Valuation Advisors, we bring this same dedication to clarity and rigour to each of our engagements, empowering clients with trusted, actionable insights.

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