Costs After Arbitration in Canadian Family Law: Heine v Worsfold

Insights from Heine v Worsfold, 2025 ABKB 650

The Alberta Court of King’s Bench recently released a costs ruling in Heine v Worsfold, 2025 ABKB 650, following an unsuccessful attempt to overturn an arbitration award issued in a mediation arbitration (“med-arb”) process. This decision offers important guidance for separating families who choose mediation arbitration, particularly on when courts will intervene and how costs may be awarded.

Below, we break down what happened in the case, why the challenge to the arbitral award failed, and the broader lessons for Canadian families considering med-arb.

Background: What Led to the Decision?

The parties participated in a mediation arbitration process, a private dispute resolution model commonly used in family law. In mediation arbitration, the arbitrator first works with the parties to try to resolve their dispute through mediation. If settlement is not reached, the arbitrator then issues a binding arbitration award.

In this case, the mediation phase resulted in a consent arbitration award, meaning the parties agreed to its terms at the conclusion of mediation. That award was later formalized through arbitration.

Despite having consented to the award, Mr. Heine applied to the court to have it set aside. He argued that the award should not stand due to alleged disclosure deficiencies and allegations of fraud.

Earlier in 2025, the Court of King’s Bench dismissed the application to set aside the award. The court found that the statutory requirements under Alberta’s Arbitration Act had not been met. The decision in Heine v Worsfold, 2025 ABKB 650 addresses the costs consequences flowing from that failed challenge.

Why the Applicant Tried to Set Aside the Arbitration Award

Under Alberta’s Arbitration Act, an arbitral award can only be set aside on specific, limited grounds, including:

• procedural unfairness or a violation of natural justice,
• the arbitrator acting outside their jurisdiction,
• corruption or fraud, or;
• certain categories of legal errors.

The applicant argued that the arbitrator had made errors that justified court intervention. However, the court concluded that the arbitration process was conducted properly, the arbitrator acted within their authority, and none of the statutory criteria for setting aside the award were established.

The judge confirmed that arbitration is intended to be final, and courts will not step in just because a party disagrees with the outcome.

The Court’s Costs Analysis in Heine v Worsfold

After dismissing the challenge to the arbitration award, the court turned to costs. In family law matters, Alberta courts generally begin with the presumption that the successful party is entitled to costs. Costs serve several purposes: promoting fairness, discouraging unnecessary litigation, and reinforcing respect for final decisions.

In this case, the court held:

• The respondent was clearly the successful party,
• The application to set aside the award was not grounded in the legal test under the Arbitration Act, and;
• There was no reason to depart from the usual rule that the unsuccessful party pays costs.

As a result, the applicant was ordered to pay the respondent’s legal costs. The decision confirms that courts may impose real cost consequences when parties pursue challenges without a solid legal basis.

Why Timing and Legal Grounding Matter in Arbitration Challenges

This decision reinforces two important principles:

1. Challenges Must Be Prompt - Arbitration challenges are subject to strict timelines. Delaying action or raising issues late in the process can weaken a party’s position and affect how costs are assessed.
2. Challenges Must Be Legally Supported - Courts require more than disagreement with an arbitrator’s conclusion. There must be a clear and articulable legal basis — such as a breach of procedural fairness or jurisdictional error — supported by evidence.

Parties who initiate challenges without meeting these statutory thresholds risk costs awards against them.

What Families Can Learn from Heine v Worsfold

Families considering mediation arbitration should take several lessons from Heine v Worsfold:

1. Mediation Arbitration Awards Are Designed to Be Final

When you enter a med-arb agreement, you are committing to accept the arbitrator’s final decision if mediation fails. Courts intervene only in exceptional situations.

2. The Court Will Not Re-Litigate the Case

Judges will not re-litigate disclosure or evidentiary issues that were known at the time of arbitration and could have been pursued within that framework.

3. Costs Can Be Significant

Unsuccessful challenges can result in meaningful costs awards, especially when the legal grounds for review are weak or unfounded.

4. Legal Advice Makes a Difference

Before challenging an arbitral award, parties should seek legal advice to determine whether the issue truly meets the statutory requirements for court intervention.

What This Means for Mediation Arbitration in Canada

Heine v Worsfold reflects a broader national trend in family law. Courts across Canada continue to support the integrity, efficiency, and finality of alternative dispute resolution, including mediation arbitration.

For families, this means that med-arb can be an effective and efficient way to resolve disputes. But only when parties enter the process with a clear understanding of its binding nature and the limited scope for court intervention.

At Richmond Tymchuk Family Law, we help clients assess whether mediation, arbitration, or litigation is the right path for their circumstances, and we provide clear guidance at every stage of the process.

If you have questions about med-arb or challenging an arbitration award, we’re here to help.