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ARTICLE · 05 MARCH 2026

Getting Good Faith Right: The BCCA's Guidance In Dhanesar v. Pandher

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In Dhanesar v. Pandher, 2026 BCCA 63, the British Columbia Court of Appeal (the BCCA) allowed an appeal, finding that the trial judge erred by applying incorrect legal principles...

CanadaLitigation, Mediation & Arbitration
Rajit Mittal
Rajit Mittal
Sky Shin
Sky Shin
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In Dhanesar v. Pandher, 2026 BCCA 63, the British Columbia Court of Appeal (the BCCA) allowed an appeal, finding that the trial judge erred by applying incorrect legal principles in interpreting the contract and analyzing the duty of good faith.1

This case illustrates the importance of correctly applying the common law duty of good faith when assessing the exercise of contractual discretion. The BCCA clarified that this duty operates as a general doctrine, distinct from the principles of contractual interpretation, and that discretion must be exercised in a consistent manner with the purpose for which it was conferred.

Background

In January 2022, the Respondents began constructing a four-bedroom, four-bathroom house on a bare-land strata property they owned in Abbotsford, British Columbia (the Property). The Appellant was the prospective purchaser of the Property.2

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