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ARTICLE · 20 OCTOBER 2025

The Hidden Terms Of Settlement: When Courts Imply A Mutual Release

Miller Thomson
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When parties reach a settlement, they expect finality. But as the British Columbia Court of Appeal (the "Court" or the "Court of Appeal") recently confirmed in Chan v. Chan (2025 BCCA 262)...

CanadaLitigation, Mediation & Arbitration
Cobi Dayan
Cobi Dayan
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When parties reach a settlement, they expect finality. But as the British Columbia Court of Appeal (the "Court" or the "Court of Appeal") recently confirmed in Chan v. Chan (2025 BCCA 262), silence in a settlement agreement can be risky.

The Court found that where a settlement is intended to end a dispute entirely, a mutual release may be implied—even if the parties never put it in writing. The decision underscores a simple but important drafting lesson: if you intend to preserve certain claims or limit the release to one direction, say so expressly. Otherwise, the law may assume you intended to release—and be released from—everything connected to the dispute.

What led to the dispute in Chan v. Chan?

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