Contract
Good Faith and Honest Performance
Bhasin and the organising principle.
Bhasin v Hrynew (2014) recognises good faith as an organising principle of Canadian contract law and identifies the duty of honest performance — a contracting party may not lie or knowingly mislead the other about matters directly linked to performance.
The principle underpins (without subsuming) related doctrines: cooperation, exercise of discretionary powers, performance. Subsequent cases (Callow 2020 on termination, Wastech 2021 on discretion) extend the analysis.
Key principles
- Good faith organising principleUnderpins existing doctrines and supports incremental development.
- Duty of honest performanceCannot lie or knowingly mislead about matters linked to performance. Cannot be excluded.
- Not a fiduciary dutyNo duty of loyalty or to subordinate one's own interests.