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Tell Me No Lies – The New Duty of Honesty in Contractual Performance
There has been a flood of commentary and discussion since the Supreme Court of Canada (“SCC” or the “Court”) decision in Bhasin v. Hrynew, 2014 SCC 71 (“Bhasin”) was issued on November 13th.
The reasons the case has garnered so much attention from practicing lawyers and legal academics, are twofold:
• The Court created a new duty of honesty in contractual performance; and
• The Court articulated an organizing principle in relation to good faith in contract law more generally, namely that parties must perform their contractual duties honestly and reasonably and not capriciously or arbitrarily.