Workshop 401

The Duty of Good Faith in Contractual Relations: Don’t be a Jerk 

Sponsored by  miller thomson logo the canadian bar association

We operate our lives and businesses bound by a series of contracts. In addition to the black and white text of a contract, there have been recent developments in the law recognizing an organizing principle of good faith that governs all contracts and gives rise to a number of duties on the parties, including (1) a duty of cooperation between the parties to achieve the objects of the contract; (2) a duty to exercise contractual discretion in good faith; (3) a duty not to evade contractual obligations in bad faith; and (4) a duty of honest performance. Some of those duties have been explored in the case law, while others have yet to be.

This session will look at what these new duties means for your role as in-house counsel, including:

  • When are duties of good faith engaged?
  • Is there an obligation on parties to disclose information against their self-interest?
  • An outright lie is certainly a breach of the duty of honest performance, but what about the failure disclose intentions or to correct misleading impressions?
  • How do you manage the duty of good faith in exercising of unfettered or absolute discretion under a contract?