Contract Law Fundamentals Flashcards

Which legal principle prevents a party from resiling from a promise when the other party has reasonably relied on that promise to their detriment, even without a formal contract?

Answer: Promissory estoppel

Promissory estoppel prevents a party from going back on a clear, unambiguous promise when the other party has changed their position in reliance on that promise. It is an equitable doctrine used as a shield, not a sword, in Canadian law.

A subcontractor completes work under an oral contract and the general contractor refuses to pay. The subcontractor may recover under which equitable claim if no contract price was agreed?

Answer: Quantum meruit

Quantum meruit ('as much as is deserved') allows a party who has provided services under a contract where no price was agreed, or where the contract is unenforceable, to recover the reasonable value of the services rendered.

In Canadian construction law, what is the significance of a 'substantial performance' certificate under the CCDC 2 contract?

Answer: It establishes the date from which the lien holdback release period begins to run

In CCDC 2, the certificate of substantial performance establishes the date from which the statutory lien holdback release period begins to run under applicable provincial construction lien legislation.

Which contractual remedy is most appropriate when monetary damages are inadequate to compensate for a breach of contract involving unique property or services?

Answer: Specific performance

Specific performance is an equitable remedy that orders the breaching party to perform their contractual obligations. It is granted where damages are an inadequate remedy — typically involving unique property or specialised services.

When is a contract voidable rather than void in Canadian contract law?

Answer: When one party lacked capacity, or when it was induced by misrepresentation, undue influence, or duress

A voidable contract is valid unless the affected party chooses to void it. It arises when a party lacked full contractual capacity or where consent was obtained by misrepresentation, undue influence, or duress.

Under the CFTA (Canadian Free Trade Agreement), what obligation does a Canadian provincial government have when procuring engineering services above the applicable threshold?

Answer: Conduct an open and transparent competitive procurement accessible to suppliers from all provinces

Under CFTA Chapter 5 (Government Procurement), provincial governments must conduct transparent, non-discriminatory procurement open to qualified suppliers from all Canadian provinces for contracts above the applicable threshold values.