Open AccessHonour Among Businesspeople: The Duty of Good Faith and Contracts in the Energy Sector
Author(s) -
Brandon Kain,
Craig Spurn,
Sean O'Neill,
Justin H. Nasseri
Publication year - 2016
Publication title -
alberta law review
Language(s) - English
Resource type - Journals
eISSN - 1925-8356
pISSN - 0002-4821
DOI - 10.29173/alr406
Subject(s) - duty , supreme court , good faith , honour , faith , law , law and economics , political science , economics , business , theology , philosophy
The recognition of a “duty of good faith” was a contentious issue for Canadian courts for many years, despite its recognition in other jurisdictions. In 2014, the Supreme Court of Canada recognized that parties to a contract have a duty to perform all contractual obligations in good faith. This article explores the history behind the “duty of good faith,” the consequences of the Supreme Court’s decision, and the impacts of the decision. This article also examines the effects of the decision as they relate to contracts fashioned in the energy sector, specifically in relation to rights of first refusal (ROFRs), authorizations for expenditure, and accounting and remittance of production sales proceeds.