Canadian Appeals Monitor Information and Commentary on Upcoming and Recent Appeal Court Decisions

Tag Archives: good faith

The Alberta Court of Appeal clarifies the organizing principle of good faith with style

Posted in Case Comments, Contracts

In Styles v Alberta Investment Management Corporation (“Styles”),[1] the Alberta Court of Appeal provided useful guidance on the application of the organizing principle of good faith in contractual performance, established by the Supreme Court of Canada in its landmark decision Bhasin v Hrynew (“Bhasin”).[2] Since Bhasin, there has been a lack of clarity on how to apply and consider the organizing principle. In Styles, the Alberta Court of Appeal (1) expressly declined to expand the organizing principle to create a “common law duty of reasonable exercise of discretionary contractual powers”, (2) recognized other key … Continue Reading

The Supreme Court of Canada rules that Québec’s farm income stabilization program is not an insurance contract subject to public law rules

Posted in Administrative, Case Comments, Contracts, Supreme Court of Canada

Overview

Two companion decisions of the Supreme Court of Canada were recently released in cases included on our Appeals to Watch in 2016 list, Ferme Vi-Ber inc. v. Financière agricole du Québec, 2016 SCC 34, and Lafortune v. Financière agricole du Québec, 2016 SCC 35.

Both cases involved the interpretation of the same Québec farm producer income stabilization program (the “ASRA Program”) administered by La Financière agricole du Québec (“La Financière), a statutory authority. The appeals focused on whether the ASRA Program should be governed by public administrative law principles or the private rules of contract law.… Continue Reading

Hot Off the Press – Canadian Contractual Interpretation Law 3rd Edition

Posted in Class Actions, Contracts

Canadian_Contractual_Interpretation_Law_Book

Geoff Hall, senior litigator at McCarthy Tétrault, authors the newly published third edition of Canadian Contractual Interpretation Law. The book clearly sets out the principles governing the interpretation of contracts in Canada, particularly in light of the landmark decisions of the Supreme Court of Canada in Sattva and Bhasin.

These two cases – both of which cited the second edition of Mr. Hall’s book, and were successfully argued by litigators from the firm – transformed contractual interpretation in fundamental ways, firstly by recognizing contractual interpretation as a highly fact-driven exercise and secondly by recognizing an organizing principle of … Continue Reading

BC Court of Appeal Rules Bhasin Framework is Distinct from Implication of Contract Terms for Business Efficacy

Posted in Case Comments, Contracts

A few months ago, the Supreme Court of Canada released its decision in Bhasin v Hrynew, a precedent-setting judgment, recognizing a general organizing principle of good faith in contract law.[1] More recently, the BC Court of Appeal in Moulton Contracting Limited v. British Columbia,[2] considered and elaborated upon Justice Cromwell’s discussion in Bhasin about the doctrines of good faith and implied contractual terms for “business efficacy,” clarifying that the two frameworks are distinct and not to be conflated.… Continue Reading

The Ontario Court of Appeal Confirms Scrutiny for Leave in Securities Class Actions

Posted in Case Comments, Class Actions, Securities

At the end of 2005, Ontario legislation came into effect which enabled aggrieved shareholders to bring a statutory action for secondary market misrepresentation against issuers and their directors and officers (and others) without the requirement to establish individual reliance. In order to commence such an action, however, a shareholder must first obtain leave from the Superior Court. Much of the jurisprudence in secondary market securities class actions has been devoted to examining the standard for leave.… Continue Reading

The Second Opinion: Bad Faith Possessor … Take My Land, Please

A Commentary on Recent Legal Developments by the Opinions Group of McCarthy Tétrault LLP

Posted in Features, The Second Opinion

In Dupuy v. Gauthier 2013 QCCA 774, the Quebec Court of Appeal has confirmed that a person who possesses immovable property for 10 years can acquire ownership of it whether or not the possessor knew the property belonged to another.

In the instant case, a shed owned by the defendants, situated on their land, partially encroached on the land of the plaintiff, their neighbour. As a result of deterioration in the relations between the neighbours, the plaintiff sought and obtained in first instance an injunction to have the defendants move or demolish the shed to eliminate the encroachment. The … Continue Reading

SCC Delivers Ground-Breaking Decision in Canadian Contract Law

Posted in Contracts

The Supreme Court of Canada has released a precedent-setting judgment in which it recognized, for the first time, that there is a general organizing principle of good faith in the performance of contracts throughout Canada: Bhasin v. Hrynew, 2014 SCC 71.  The Bhasin case, which was successfully argued by Neil Finkelstein and Brandon Kain of McCarthy Tétrault’s Toronto litigation group, will be very important for Canadian businesses going forward.  As a result of Bhasin, all contracts throughout Canada are now subject to a duty of, at a bare minimum, honest performance, which cannot be excluded by the terms … Continue Reading

This Week at the SCC (23/08/2013)

A Commentary on Recent Legal Developments by the Opinions Group of McCarthy Tétrault LLP

Posted in The SCC Monitor

The Supreme Court of Canada granted leave to appeal this week in one case that is likely to be of significant interest to Canadian businesses and professions.

The decision appealed from is Bhasin v. Hrynew, 2013 ABCA 98, in which the Alberta Court of Appeal held that the corporate defendant was not under a duty of good faith in exercising a right of non-renewal when the term of its evergreen contract with the plaintiff came to an end.  The case will require the Supreme Court to consider when a duty of good faith should be implied in commercial contracts, … Continue Reading

Towards a General Duty of Good Faith Performance of Contractual Obligations – Maybe

Posted in Case Comments

The duty of good faith in contract law: the cautious and inconsistent approach of Canadian courts

Courts in common law Canadian jurisdictions have been reluctant to recognize any general duty to perform contractual obligations in good faith. Such a duty is a central tenet of American law under the Uniform Commercial Code and is a central tenet of Québec civil law, which recognizes a duty of good faith throughout the contracting process. But common law courts in Canada, like their counterparts in England, have been loath to recognize any general duty. They have also been very inconsistent, finding a host … Continue Reading

Lost in Contractual Interpretation: No Agreement at ABCA on Interpretation of Multiple Contracts Within a Single Transaction

Posted in Contracts, Corporate Law, Labour and Employment

In a very recent decision of the ABCA, Benfield Corporate Risk Canada Limited v. Beaufort International Insurance Inc, 2013 ABCA 200, the Court attempted to address a host of interesting contract issues, some with potentially wide implication, such as how to interpret multiple contracts within a single transaction, including the effect of entire agreement clauses and the ability to benefit from a breach of one of the related contracts. Also mentioned are general duties of good faith, the role of fairness and implying terms. However, unique circumstances and a lack of agreement in the Court leaves us, unfortunately, without

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Government Cannot Withhold a Hidden Agenda in its Dealing with the Courts

Posted in Administrative, Case Comments, Procedure, Tax

A case recently decided by the Federal Court of Appeal reiterates the very high standard of good faith to which the Minister of National Revenue (the “Minister”) must be held when dealing with the courts in the context of an ex parte application provided by the Income Tax Act (“ITA”). For example, the Minister cannot ignore and omit to mention internal evidence which it knows weakens its position, or hide ulterior motives.

Context: Third-Party Information Concerning “10-8” Plans

In Canada (National Revenue) v. RBC Life Insurance Company, 2013 FCA 50 (“RBC Life”)[1], the

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The Second Opinion: Good Faith in the Shadow of Contractual Rights

A Commentary on Recent Legal Developments by the Opinions Group of McCarthy Tétrault LLP

Posted in Features, The Second Opinion

Are parties under a duty of good faith in deciding whether to exercise a right of non-renewal when the term of an evergreen contract comes to an end?  In Bhasin v. Hrynew, 2013 ABCA 98, the Alberta Court of Appeal said no, at least where the evergreen clause does not contain an express provision to this effect.  The ruling in Bhasin contains an extensive review of the law in this area, and may well prove to be the most important Alberta case on the duty of contractual good faith since Mesa Operating Ltd. v. Amoco Canada Resources Ltd. Continue Reading