Tuesday, March 12, 2013

The doctrine of privity of contract is of considerably diminished force in Canada as a continuing principle of contract law

[79]       It is important to note at the outset that the doctrine of privity of contract is of considerably diminished force in Canada as a continuing principle of contract law.  It has been subject to a wealth of repeated academic and judicial criticism, leading to frequent calls for law reform in Canada and elsewhere.  See for example, London Drugs, at pp. 418-26; Fraser River Pile & Dredge Ltd. v. Can-Dive Services Ltd., [1999] 3 S.C.R. 108, at para. 26; McCamus, at pp. 296-301.  Indeed, several Commonwealth jurisdictions have abrogated the privity doctrine entirely, or in specific contexts, by statute.  In other instances, the reach of the doctrine has been "significantly undermined by a growing list of exceptions to the rule": McCamus, at p. 299.  See also Angela Swan and Jakub Adamski,Canadian Contract Law, 3rd ed. (Markham: LexisNexus Canada Inc., 2012) at p. 229.  Several of the leading cases cited by the parties on this appeal afford abundant evidence of the relaxation of the ambit of the doctrine in particular cases.  Thus, while the doctrine survives in Canada, it persists only in weakened form.


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