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The Lay of the Land DEVELOPMENTS IN CANADIAN REAL PROPERTY LAW

Tag Archives: good faith

BCSC Considers the Organizing Principle of Good Faith in the Context of Lawyer’s Approval Clauses

Posted in Litigation

Introduction

In 2014, the Supreme Court of Canada in Bhasin v. Hrynew[1] formally recognized the “organizing principle of good faith” in Canadian contract law. Since then, many Canadian courts have had occasion to interpret and apply this principle in the context of real estate transactions. A recent decision of the B.C. Supreme Court, Zhang v. Amaral-Gurgel,[2] adds to this line of authority, offering insight into the application of the principle of good faith in the context of lawyer’s approval clauses.… Continue Reading

Bhasin Two Years On: The Impact of Bhasin v. Hrynew on the Practice of Canadian Commercial Real Estate Law

Posted in Commercial

Edited and approved by Ben Leith

In 2014, the Supreme Court of Canada in Bhasin v. Hrynew (“Bhasin”) established good faith contractual performance as a general organizing principle of the common law of contract and created a specific duty of honesty in contractual performance – ultimately, imposing a stand-alone duty of good faith. Despite Justice Cromwell’s repeated assertions that the judgement in Bhasin was an incremental step in the common law, Canadian legal scholars and prominent Canadian law firms dubbed it a “landmark” decision that would transform the manner in which business parties performed their contractual obligations.… Continue Reading

What does the duty of good faith REALLY mean?

Posted in Commercial, Policy

Since the Supreme Court decision in Bhasin v Hrynew[1], which firmly established a duty of good faith in contractual relations, the exact contours of that duty have been a fairly open question. In a recent Ontario Superior Court case, 2336574 Ontario Inc. v 1559586 Ontario Inc.[2], the court examined what that duty looks like in a one-off real estate transaction between sophisticated commercial parties.… Continue Reading

Charlie and the Foosball Table: A Lesson in Good Faith and ROFR

Posted in Litigation, Policy, Residential

On a recent hot summer-like day, my neighbours’ pre-school boy, Charlie (pseudonym), sauntered over the front lawn in his pajamas to peek into my garage. Charlie had his gaze fixed on the foosball table, once a crown jewel of my college days and now just collecting dust in a corner. Charlie asked in the sweetest manner “can I play with that”? Normally, this would not be an issue. However, in an attempt to preserve all of Charlie’s limbs until at least adolescence, I replied that he could play only after I had vacated the menacing and precariously-balanced machines surrounding the … Continue Reading

The Binding Non-Binding Letter of Intent

Posted in Commercial, Policy

Proposed parties to a transaction often enter into a letter of intent to reflect the basic terms of the deal. These letters are usually expressed to be non-binding (with the exception of the confidentiality and exclusive dealing provision). The parties then begin negotiating definitive binding agreements. An unintended consequence of the activities taken during the negotiating period can turn the non-binding letter of intent into a binding agreement. … Continue Reading

SCC Delivers Ground-Breaking Decision in Canadian Contract Law.

Posted in Litigation

The following post on the Canadian Appeals Monitor blog written by Neil Finkelstein and Brandon Kain on November 14, 2014, may be of interest to readers of this blog:

SCC Delivers Ground-Breaking Decision in Canadian Contract Law

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 … Continue Reading