Just Another Contract – SCC Says No Special Rules Apply To Releases

On July 23, 2021, the Supreme Court of Canada released its decision in Corner Brook (City) v. Bailey, 2021 SCC 29, providing clarity to the manner in which release agreements must be interpreted. It held the language of release agreements, like all other contracts, must be read in the context of the whole agreement and in light of the knowledge of the parties at the time of signing. It specifically overruled the historical rule in London and South Western Railway v. Blackmore (1870), L.R. 4 H.L. 610, which said the general words in a release are limited to the facts that were specifically in the minds of the parties at the time the release was given (the "Blackmore Rule"). 

As per Corner Brook, the Blackmore Rule has now been overtaken by the general principles of contract law set out in Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53. Sattva, which marked a significant change in the jurisprudence, decided that contractual interpretation was no longer a