An independent contractor was engaged under a six-month Independent Consulting Agreement to provide technological consulting services for a Canadian Tire project.
The contractor disclosed a dated criminal record before commencing work and complied with security checks.
When the security report revealed the criminal record, Canadian Tire requested the contractor's replacement.
The company terminated the engagement one month into the contract under a termination clause allowing termination at the company's sole discretion.
The contractor sued for breach of contract, claiming six months' remuneration.
The motion judge awarded full damages plus costs, finding the company breached its duty of good faith performance.
The Court of Appeal affirmed the judgment, holding that although the termination clause was facially unfettered, it was subject to an implied obligation of good faith performance, and the contractor was entitled to damages for the unexpired term of the fixed-term contract with no duty to mitigate.
