In a unanimous seven-judge decision issued on November 13, 2014, the Supreme Court of Canada established a new general principle of law that requires parties to perform their contractual obligations honestly.
Until this decision, the duty of good faith in performance of contractual obligations has been generally established in the common law, but the duty might have been perceived as being of limited application. It was mainly implicated where a contracting party was granted a power of discretion, or in certain relationships where a power imbalance existed between parties (e.g., employer-employee), or where it seemed equitable to ensure that contracting parties did not act in a manner that defeated the objectives of their agreement.
Read the full article here: Honesty is the ........... LAW- January 9-2015
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