Read in From Statute: Do the Contractual Duties of Honest Performance and Good Faith Exercise of Discretion Apply to Statutory Contract Terms?
Until recently, parties to a contract did not owe any obligations of good faith towards each other in Canadian common law jurisdictions. There was no obligation of good faith in the negotiation process, none in the performance of contractual obligations, and only limited such obligations in contract termination.[1] There was, for example, no obligation not to lie to your contracting party when performing your contractual duties (unless it constituted the tort of civil fraud). The courts explained the contractual relationship as one in which each party is to get the best deal for themselves, using whatever pressure legitimately at . . . [more]