Three things are generally required for a contract to be legally enforceable: an offer, acceptance of the offer, and an exchange of something of value (or “consideration”) between the parties to the contract. Consideration need not be an exchange of money, and courts will generally not inquire whether the consideration is adequate. Nominal consideration may […]
Category Archives: Contract Disputes
The Doctrine of Part Performance in Land Agreements
Under Ontario’s Statute of Frauds, verbal agreements respecting land are deemed unenforceable. As the Superior Court of Justice commented in Van, et al. v. Qureshi, et al., the statute’s purpose was to prevent “fraudulent allegations of promises that had never been made, by requiring a formality in certain classes of agreement.” The Ontario Court of […]
Can A Franchisee Rescind A Franchise Agreement For Deficient Disclosure?
In Ontario, franchise agreements are subject to the requirements of the Arthur Wishart Act (Franchise Disclosure), 2000 (the “Act”). The Act imposes a “duty of fair dealing” on the parties to such an agreement and grants franchisees the right to form an organization of franchisees. One of the most significant aspects of the Act is […]
The Legal Effect of Requiring Payment of a Criminal Rate of Interest in a Contract
Section 347 of the Criminal Code makes it a criminal offence for someone to enter into an agreement or arrangement to receive interest at a “criminal rate” or to receive a payment or partial payment of interest at that rate. In turn, a “criminal rate” is “an effective annual rate of interest calculated in accordance […]
The Parol Evidence Rule and Contractual Interpretation
Litigation involving contracts often hinges on the interpretation to be given to one or more terms of the contract. Parties will typically advocate for a particular interpretation. Sometimes, a question arises about whether and to what extent a party can introduce evidence substantiating that interpretation. Among other things, that question may involve the application of […]
Staying Court Proceedings in the Context of International Commercial Arbitrations
It is very common for commercial contracts to include clauses requiring parties to submit disputes to arbitration. Despite this, when an actual dispute arises, a party may wish to pursue court proceedings, in which case a court may have to decide whether to stay those proceedings and allow the dispute to proceed through arbitration. In […]
What Does “Best Efforts” Mean?
Businesses that agree to carry out their contractual obligations using “best efforts” may wonder what standard that phrase imposes on them. The words have a lengthy judicial history, and the issue recently arose again in the Superior Court of Justice decision of 2271047 Ontario Ltd. v. Window City Industries Inc. In 2010, Window City Industries […]
The Defence of Non Est Factum
When debtors are sued for amounts owing under a contract, it is not unusual for them to plead the defence of non est factum. This often serves as a defence of last resort. However, it is a difficult defence to argue successfully as it only applies in a relatively narrow set of circumstances. In this […]
A Review of the Law of Quantum Meruit
Sometimes, a party may provide services to another, expecting a contract to be signed between them, only to find that the contract never comes to fruition. Alternatively, a party may provide services to another outside the scope of their contract or following the contract’s expiration. In such situations, the question arises of whether the party […]
A Review of the “Indoor Management Rule”
It is common for businesses to have long-term relationships with particular individuals. Still, when someone new comes into the picture, a business may have questions about the level of authority that person has. This issue can sometimes arise in the context of contracts between parties. When can a business assume that the individual they are […]