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Dec 21, 2020 · In Callow, the Supreme Court of Canada held that: Parties to a contract have a duty of honest performance, as the Court first recognized six years ago in Bhasin v. Hrynew. [2] This duty “applies to the performance of all contracts and, by extension, to all contractual obligations and rights”. [3] Further, parties are “not free to exclude ...
Dec 11, 2014 · The Court noted that the duty honesty could be relaxed by the parties through agreement, so long as they respect its minimum core requirements, and any modification would need to be in express terms. The Court chose to adopt a flexible approach with respect to the organizing principle of good faith, which recognizes the importance of the general principle without displacing existing ...
In Bhasin v Hrynew, [1] a unanimous Supreme Court of Canada recognized that good faith contractual performance is a general organizing principle of Canadian common law, and that parties to a contract are under a duty to act honestly in the performance of their contractual obligations. The case is the first time our highest court has examined ...
The duty of honest performance underpins all contractual rights and obligations. Eight of nine judges of the Supreme Court (Côté J. dissenting) allowed the appeal and found in favour of Callow. Baycrest breached its duty of honest performance by deliberately misleading Callow about Baycrest’s decision to terminate the winter contract.
Rather, the duty requires “a minimum standard of honesty in contractual performance”. The court indicated that the “precise content of honest performance will vary with context” and suggested that in some circumstances parties would be free to relax the requirements of the doctrine so long as they respect its minimum core requirements.
The duty of honest performance requires that no contractual right, including a right of termination, be exercised dishonestly and thus, contrary to the doctrine of good faith. Measure of damages: A breach of the duty of honest performance will attract damages according to the ordinary contractual measure. The ordinary measure awards contractual ...
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Duty of honesty derived from the good faith “principle” Having introduced the concept of a “general organizing principle”, the Court proceeded to establish its immediate implications, in terms of legal rights and obligations that should be recognized as part of the contemporary common law of Canada. This is where the duty of honesty ...
