If the reasons and the result are accepted across common law Canada, the case will have transformed the law of contracts.  I acknowledge a possible bias — I think that I can take some credit for the result and reasons — but the decision is worth celebrating.  Its most significant practical effect is likely to be in the law of employment where it has become increasingly hard for employers, even with legal advice, to manage their relations with their non-unionized employees.

 

In much of common law Canada, Ontario and the provinces to its west, the exact problem in Foakes v. Beer has been largely dealt with by statute.  The legislation does not deal with every problem of the part payment of a debt, but there are now comparatively few cases in that context.

 

Bauman C.J.B.C.’s wide exploration of the academic literature is very impressive; he refers to authors from around the world, including members of the ODG.

 

I am particularly pleased that the phrase, “going-transaction adjustment” may now pass into common use, as may the goal of the law of contracts, stated as the need to protect the parties’ reasonable expectations.

 

Angela Swan

 

 

While everyone is still talking about the UKSC judgment in MWB, where the Court’s decision was not particularly helpful with respect to the issue of consideration in variations of contracts, it is worth mentioning that in Canada, the British Columbia Court of Appeal came down with a very interesting decision on the topic (where it did not shy away from the issue)on May 18^th in Rosas v. Toca 2018 BCCA 191 (https://www.canlii.org/en/bc/bcca/doc/2018/2018bcca191/2018bcca191.html)

 

The BC Court of Appeal endorsed the obiter by Justice Robertson in the New Brunswick Court of Appeal decision of Nav Canada (2008) stating that, “The time has come to reform the doctrine of consideration as it applies in this context [variations of existing contracts], and modify the pre-existing duty rule…When parties to a contract agree to vary its terms, the variation should be enforceable without fresh consideration, absent duress, unconscionability, or other public policy concerns…[A] lack of fresh consideration will no longer be determinative.  In this way, the legitimate expectations of the parties can be protected.  To do otherwise would be to let the doctrine of consideration work an injustice.” [para 4, repeated in para 183]. 

 

Definitely worth a read!

 

Rosalie Jukier