Mark D. Andrews

The appellant waste contractor alleged that the respondent municipal district breached a contractual duty of good faith by reallocating waste from a more distant disposal facility to a closer one, thereby preventing the appellant from achieving its target operating profit ratio for 2011.

The majority held that the duty to exercise contractual discretion in good faith requires exercise of discretion in a manner connected to the purposes for which the discretion was granted, and that exercising it unreasonably — meaning in a manner unconnected to those purposes — constitutes a breach.

The majority found that the respondent's reallocation was guided by legitimate objectives of maximizing efficiency and minimizing costs, and was therefore not unreasonable.

The concurring minority agreed the appeal should be dismissed, emphasizing that the standard of review was correctness given the statutory right of appeal, and that good faith cannot be used to create unbargained-for obligations.

The appeal was unanimously dismissed with costs.

Three Eritrean workers alleged they were conscripted into forced labour at a mine in Eritrea owned by Canadian corporation Nevsun Resources Ltd. and subjected to violent, cruel, inhuman and degrading treatment.

The workers commenced proceedings in British Columbia seeking damages for breaches of customary international law prohibitions against forced labour, slavery, cruel, inhuman or degrading treatment, and crimes against humanity, as well as domestic torts.

Nevsun brought a motion to strike the pleadings on the basis of the act of state doctrine and on the basis that the customary international law claims had no reasonable prospect of success.

The majority (Abella J., Wagner C.J., Karakatsanis, Gascon and Martin JJ.) dismissed the appeal, holding that the act of state doctrine does not form part of Canadian common law and that it was not plain and obvious that the customary international law claims were bound to fail.

Brown and Rowe JJ. dissented in part, agreeing on the act of state doctrine but concluding the customary international law claims were bound to fail.

Côté J. (Moldaver J. concurring) dissented in full, holding the claims were not justiciable because they required a determination that Eritrea had violated international law.