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Contract
NOTESContract is a central topic in our common law legal system. Many free-standing substantial legal topics in this website are contract-based [eg. business topics (such as insurance, franchise and sale of goods), landlord and tenant (both commercial and residential), employment, private international law and more.
SUBJECTS
ADHESION CONTRACTS
Contract Cases - Adhesion Contracts
AGREEMENTS TO AGREE
Contract Cases - Agreements to Agree
ALTERNATIVE DISPUTE RESOLUTION CLAUSE
Contract Cases - Alternative Dispute Resolution (ADR)
ANNULMENT CLAUSE
Contract Cases - Annulment Clause
AMENDMENT
Contract Cases - Amendment
APPEAL
An appellate 'standard of review' (SOR) is an interpretative principle that applies to a legal review (ie. an appeal or a judicial review) of a prior legal procedure such as a trial or a hearing. For contract law it is presumed that the 'basic' contract is a 'custom' contract, that is - one negotiated in good faith between the parties - as opposed to a 'standard form' contract such as a car rental, a phone contract, a bank mortgage and similar. These latter are also called 'contracts of adhesion' and they are essentially 'take it or leave it' contracts.
For these basic, 'custom' contracts the appellate SOR is that of 'palpable and overriding error' (POE), which requires that fact-findings of the lower tribunal/court will be accepted as made unless they have been made with 'palpable and overriding error' (this is also call 'deference'). While POE is the basic SOR for contracts, exceptions do apply which allow a higher standard, that of 'correctness'. Correctness does not require deference to the lower body, but rather allows the reviewing body (typically a court) to decide the subject issue itself, using their own experience and knowledge. The two main 'correctness' exceptions are for standard form contracts or where there is an 'extricable error of law'.
General
Contract Cases - Appeals - SOR - General (Custom)
Exceptions
Contract Cases - Appeals - SOR - Exceptions - General
Contract Cases - Appeals - SOR - Exceptions - Standard Contracts
Contract Cases - Appeals - SOR - Exceptions - Extricable Legal Questions
Contract Cases - Appeals - SOR - Exceptions to Exceptions
Supreme Court of Canada
Contract Cases - Appeals - SOR - Corner Brook (SCC, 2021)
Contract Cases - Appeals - SOR - Earthco (SCC, 2024)
ARBITRATION CLAUSE
Contract Cases - Arbitration
ASSIGNMENT CLAUSE
Contract Cases - Assignment
BARTER
Contract Cases - Barter
COLLECTIVE AGREEMENTS
Contract Cases - Collective Agreements
CONDITIONS
Contract Cases - Conditions
CONSIDERATION
Contract Cases - Consideration
CONTRIBUTORY FAULT
Contract Cases - Contributory Fault
COURT-ORDERED CLAUSES
Contract Cases - Terms Conditional on Court Order
DISCLAIMERS
Contract Cases - Disclaimers
DISCRETIONARY TERMS CLAUSE
Contract Cases - Discretionary Terms
DURESS
Contract Cases - Duress
DUTY OF GOOD FAITH
The duty of good faith (DGF) is new at 2014 [Bhasin v Hrynew (SCC)]. It is not - apparently - a doctrine, but an 'organizing principle' [Bhasin (para 64)] which the court characterizes as stating "in general terms a requirement of justice from which more specific legal doctrines may be derived". As such, it comprises several (and we're expecting more) sub-categories (which I will refer to collectively as 'the duties'). Of these - the 'duty of honest performance' is the most prominent currently, which is the expectation that "parties generally must perform their contractual duties honestly and reasonably and not capriciously or arbitrarily" [Bhasin, para 63]. There are other 'duties' (see the 'other' DGF link), but they are weakly articulated at present.
The 'duty of good faith' was intentionally planted by the SCC to grow over time. Some present DGF features are:- the doctrine of good faith is a 'general doctrine of contract law', not an implied contractual term in each contractual situation [High Tower Homes Corporation v. Stevens (Ont CA, 2014)];
- not all contracts are subject to the duty of good faith [Atlantic Lottery Corp. Inc. v. Babstock (SCC, 2020), para 65];
- parties can 'contract-out' of the duties;
- 'bad faith' and 'good faith' are not mutually exclusive [Quebec (Attorney General) v. Pekuakamiulnuatsh Takuhikan (SCC, 2024), para 110], and the relationship between is uncertain;
- fiduciary duties are 'higher' (ie. more onerous on the one who bears them) than the duty of good faith.
General
Contract Cases - Duty of Good Faith - General
Nature of the Duty of Good Faith
Contract Cases - Duty of Good Faith - Nature
Contract Cases - Duty of Good Faith versus Fiduciary Duty
The Individual 'Duties'
Contract Cases - Duty of Good Faith - Duty of Honesty
Contract Cases - Duty of Good Faith - Duty of Honest Discretion
Contract Cases - Duty of Good Faith - Other 'Duties'
Principles
Contract Cases - Duty of Good Faith - Discretion
Contract Cases - Duty of Good Faith - Negotiation
Contract Cases - Duty of Good Faith - Statutory
Remedy
Contract Cases - Duty of Good Faith - Remedy
Supreme Court of Canada
Contract Cases - Duty of Good Faith - Bhasin v Hrynew (SCC, 2014)
Contract Cases - Duty of Good Faith - CM Callow v Zollinger (SCC, 2020)
Contract Cases - Duty of Good Faith - Atlantic Lottery Corp. Inc. v. Babstock (SCC, 2020)
Contract Cases - Duty of Good Faith - Wastech Services Ltd. v. Greater Vancouver Sewerage and Drainage District (SCC, 2021)
Contract Cases - Duty of Good Faith - Ponce v. Société d’investissements Rhéaume ltée (SCC, 2023)
Contract Cases - Duty of Good Faith - Quebec (Attorney General) v. Pekuakamiulnuatsh Takuhikan (SCC, 2024)
ELECTIONS
Contract Cases - Elections
EMPLOYMENT
See the Employment topic.
ENTIRE AGREEMENT CLAUSE
Contract Cases - Entire Agreement Clause
FAIRNESS
Contract Cases - A Duty of Fairness?
FORCE MAJEURE CLAUSE
Contract Cases - Force Majeure
FORMATION
Contract Cases - Formation
FRUSTRATION
Contract Cases - Frustration
Frustrated Contracts Act (s.1-3)
FUNDAMENTAL BREACH
Contract Cases - Fundamental Breach
GUARANTEES
Terminology
'Guarantee': the contract.
'Guarantor' (also 'surety'): the party guaranteeing the debt or obligation.
'Obligor' (also 'debtor' or 'principal'): the party incurring the primary debt or obligation.
'Creditor' (also 'obligee'): the party granting/holding the primary debt or obligation.
General
Contract Cases - Guarantee - Nature
Contract Cases - Guarantee - Interpretation
Contract Cases - Guarantee - Contrasting Doctrine
Principles
Contract Cases - Guarantee - Change in Obligation
Contract Cases - Guarantee - Breach by Obligor
Contract Cases - Guarantee - Breach by Creditor
Contract Cases - Guarantee - Co-guarantors
Contract Cases - Guarantee - Termination
Contract Cases - Guarantee - Continuing Guarantee
Contract Cases - Guarantee - Subrogation
Contract Cases - Guarantee - Limitation
Remedy
Contract Cases - Guarantee - Remedy
ILLEGALITY AND SEVERANCE
Contract Cases - Illegality and Severance (+)
INTERNATIONAL SALES CONVENTION ACT
Contract Cases - International Sales Convention Act (ISCA)
International Sales Conventions Act (all)
INTERPRETATION OF CONTRACTS
Like most legal topics, 'contracts' has 'interpretation' sub-topic. These are essentially preliminary legal presumptions that apply in certain specific contractual situations. As a matter of interest, the similar presumptions apply in the appeal context where 'standards of review' perform the same presumptive function, as presumptions of deference to the trial court's original fact-findings [which see above: /appeal/SOR].
General
Contract Cases - Interpretation - General (pre-Sattva)
Contract Cases - Interpretation - General (post-Sattva)
Contract Cases - Interpretation - General (post-2020)
Supreme Court of Canada
Contract Cases - Interpretation - Sattva Capital (SCC, 2014)
Contract Cases - Interpretation - Earthco (SCC, 2024)
Principles
Contract Cases - Interpretation - Written Contracts
Contract Cases - Interpretation - Common Sense
Contract Cases - Interpretation - Surrounding Circumstances
Contract Cases - Interpretation - Statutory Interpretation
Contract Cases - Interpretation - Contextual
Contract Cases - Interpretation - Ambiguity
Contract Cases - Interpretation - Contra Proferentum
Contract Cases - Interpretation - Objective Factors Only
Contract Cases - Interpretation - Commercial Principles
Contract Cases - Interpretation - Read Wholistically
Contract Cases - Interpretation - Officious Bystander
Contract Cases - Interpretation - Presumption of Consistent Expression
Specific Factors
Contract Cases - Interpretation - Pre-Contract Negotiation
Contract Cases - Interpretation - Inconsistent Terms
Contract Cases - Interpretation - Priority of Terms Reconciliation
Contract Cases - Interpretation - Post-Execution Conduct
Specific Situations
Contract Cases - Interpretation - Multiple Related Contracts
Contract Cases - Interpretation - Oral Contracts
Contract Cases - Interpretation - Corporate Documents
Evidence
Contract Cases - Interpretation - Parole Evidence (Extrinsic Evidence)
Remedies
Contract Cases - Interpretation - Implied Terms (+)
IRREVOCABLE DIRECTION CLAUSE
Contract Cases - Irrevocable Direction
JOINT VENTURE
Contract Cases - Joint Venture
LIABILITY ALLOCATION
Contract Cases - Liability Allocation
LOANS
See the Money Lending topic.
MEANING OF SPECIFIC CONTRACT TERMS
Contract Cases - Specific Term - "Final and Binding"
Contract Cases - Specific Term - "Warranty"
Contract Cases - Specific Term - "Condition"
Contract Cases - Specific Term - "Profit"
Contract Cases - Specific Term - "Sufficiently Given"
MISTAKE AND RECTIFICATION
Contract Cases - Mistake and Rectification (+) [see also: Equity - Rectification]
NON-ARM'S LENGTH
Contract Cases - Non-Arm's Length
OFFERS
Contract Cases - Offers
OPTION CLAUSE
Contract Cases - Options
PENALTY CLAUSE
Contract Cases - Penalty Clauses
PERPETUITIES
Contract Cases - Perpetuities
PRIVITY
Contract Cases - Privity
RELIEF FROM FORFEITURE
Relief from Forfeiture [cross-linked from 'Relief from Forfeiture']
REMEDIES
Contract Cases - Disgorgement
Contract Cases - Specific Performance
Contract Cases - Damages
Most damage cases for contract are located at the general Damages sidebar topics.
REPUDIATION, ANTICIPATORY
Contract Cases - Repudiation, Anticipatory (+)
RESCISSION
Contract Cases - Rescission
RESTRAINT OF TRADE
Contract Cases - Restraint of Trade (+)
RIGHT OF FIRST REFUSAL CLAUSE
Contract Cases - Right of First Refusal
SALE OF GOODS ACTGeneral
Contract Cases - SOGA - General
Acceptance
Contract Cases - SOGA - Acceptance [s.34]
Acceptance by Buyer [Sale of Goods Act, s.34 (Ont)]
'Agreement to Sell', Meaning [Sale of Goods Act, s.2(1-4) (Ont)]
Auctions [Sale of Goods Act, s.56 (Ont)]
Capacity [Sale of Goods Act, s.3(1-2) (Ont)]
Conditions [Sale of Goods Act, s.12(1-3) (Ont)]
Conflict of Laws, with SOGA [Sale of Goods Act, s.57(1-3) (Ont)]
Contracting-Out
Contract Cases - SOGA - Contracting-Out [s.53]
Contracting-Out, of SOGA [Sale of Goods Act, s.53 (Ont)]
Definitions and interpretation [Sale of Goods Act, s.1 (Ont)]
Deliverable State, definition [Sale of Goods Act, s.1(4) (Ont)]
Delivery [Sale of Goods Act, s.1(1),28-32 (Ont)]
Document of Title, Definition [Sale of Goods Act, s.1(1) (Ont)]
Duties of Seller and Buyer [Sale of Goods Act, s.26-27 (Ont)]
Examination by Buyer [Sale of Goods Act, s.33 (Ont)]
Goods, Definition [Sale of Goods Act, s.1(1) (Ont)]
Goods Subject of Sale [Sale of Goods Act, s.6(1-3) (Ont)]
Good Faith, definition [Sale of Goods Act, s.1(2) (Ont)]
Implied Conditions and Warranties
Contract Cases - SOGA - Implied General
Contract Cases - SOGA - Implied General [s.13]
Implied Conditions and Warranties, General [Sale of Goods Act, s.13 (Ont)]
Contract Cases - SOGA - Implied Description [s.14]
Implied Condition, by Description [Sale of Goods Act, s.14 (Ont)]
Contract Cases - SOGA - Implied Fitness [s.15]
Implied Condition and Warranties, as to Quality and Fitness [Sale of Goods Act, s.15 (Ont)]
Impossibility [Sale of Goods Act, s.12(4) (Ont)]
Insolvency, definition [Sale of Goods Act, s.1(3) (Ont)]
Manner Contract Made [Sale of Goods Act, s.4 (Ont)]
Perished Goods [Sale of Goods Act, s.7-8 (Ont)]
Price [Sale of Goods Act, s.9(1-2) (Ont)]
Price on Valuation [Sale of Goods Act, s.10(1-2) (Ont)]
Property, Definition [Sale of Goods Act, s.1(1) (Ont)]
Property, When Passes, When (Various Circumstances) [Sale of Goods Act, s.18-20 (Ont)]
Quality of Goods, Definition [Sale of Goods Act, s.1(1) (Ont)]
Refusal by Buyer [Sale of Goods Act, s.35-36 (Ont)]
Remedies, by Action [Sale of Goods Act, s.55 (Ont)]
Remedies of Buyer [Sale of Goods Act, s.49,51-52 (Ont)]
Remedies of Seller [Sale of Goods Act, s.47-48,52 (Ont)]
Remedies, Specific Performance [Sale of Goods Act, s.50 (Ont)]
Risk, When Passes [Sale of Goods Act, s.21 (Ont)]
'Sale of Goods Contract', Meaning [Sale of Goods Act, s.1(1),2(1-4) (Ont)]
Sample, Sale by [Sale of Goods Act, s.16 (Ont)]
Unascertained Goods [Sale of Goods Act, s.17 (Ont)]
Time [Sale of Goods Act, s.11 (Ont)]
Time, is Matter of Fact [Sale of Goods Act, s.54 (Ont)]
Transit of Goods [Sale of Goods Act, s.43-44 (Ont)]
Unauthorized Sale [Sale of Goods Act, s.22-25 (Ont)]
Unpaid Seller, Lien and Other Rights [Sale of Goods Act, s.37-42,45-46 (Ont)]
Warranties [Sale of Goods Act, s.1(1),12(1-3) (Ont)]
SETTLEMENTS AND RELEASES
Contract Cases - Settlements and Releases (+)
SHAM CONTRACTS
Contract Cases - Sham Contracts
STIPULATED REMEDY CLAUSE
Contract Cases - 'Stipulated Remedy Clause'
STATUTES, CONTRACTING OUT OF
Contract Cases - Contracting Out of Statutes
STATUTES OF FRAUDS
Contract Cases - Statute of Frauds
SUCCESSOR CLAUSES
Contract Cases - Successor Clauses
TENDERING
Contract Cases - Tender (Bidding)
Contract Cases - Tender (Performance)
TILDEN v CLENDENNING
Contract Cases - Tilden v Clendenning
TIME
Contract Cases - Interpretation - Time
Contract Cases - Time is of the Essence
Contract Cases - Interpretation - 'Time Speaking'
TORT, SUING CONCURRENTLY
Contract Cases - Suing in Contract and Tort Concurrently
UNCONSCIONABILITY
Contract Cases - Unconscionability (+) [the Unconscionable Transactions Relief Act (UTRA) specifically addresses unconscionability and loans: see the 'Consumer' topic]
UNDERTAKINGS
Contract Cases - Undertakings
UNILATERAL v BILATERAL CONTRACTS
Contract Cases - Unilateral versus Bilateral
VESTED STATUTORY RIGHTS
Contract Cases - Vested Statutory Rights
WAIVER
Contract Cases - Waiver
HOME STATUTESFor website planning purposes, all proclaimed statutes (both Ontario and Federal) are 'home-located' with a single topic, the below statutes are the 'home statutes' for the Contract topic.
Ontario
Frustrated Contracts Act [fully subject allocated 22 May 2025]
International Sales Conventions Act [fully subject allocated 10 June 2025]
Sale of Goods Act [fully subject allocated 10 June 2025]
Statute of Frauds
SIMON'S POLITICS and CONTRACT
CONTRACT - WORKING. need to statreg-split (locally and foreign) all the home statutes
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