Document Interpretation - what a document means - is the greatest challenge when drafting and the subject of many court cases. Our Supreme Court of Canada (SCC) released an important decision Friday 23 July 2021, Corner Brook (City) v Bailey, 2021 SCC 29, confirming its 2014 decision about contract interpretation, Sattva Capital Corp v Creston Moly Corp 2 SCC 633, and whether a special rule of interpretation applies to Releases.
This Bailey decision is important because almost all legal claims settle before trial, and part of the settlement is often a Mutual Release.
Each Party to the lawsuit might state in their Release that they waive all claims they have against the other. But what if there is a future claim involving the same Parties - Does the wording in the old Release apply to this new claim? In this case, Bailey had settled her claim against the City but years later added the City as a third party to a separate lawsuit. The trial judge said the wording of this Release did apply to prevent the new claim filed by Bailey against the City but the Court of Appeal unanimously disagreed and allowed the appeal.
The SCC unanimously stated that the Appeal Court was wrong, the trial judge was right, that its 2014 Sattva decision was the law for contract interpretation, that a Release is a contract, and there are no special rules of interpretation to apply to releases. WeCanHelp@seatoskylaw.com 778-728-0208