The Doctrine of Contractual Absolution

Abstract

The absence of a knowledge requirement is a novel and astonishing feature of unconscionability in Canada, and one that calls for scholarly reflection. In other jurisdictions and formerly in Canada, unconscionability required that the benefiting party knew or at least should have known that its counterpart was impaired in the making of the contract. Such knowledge established a minimum level of wrongdoing, so that even without more active exploitation, it was unconscionable as an “unconscientious abuse of power.” But following the Supreme Court decision in Uber Technologies Inc. v. Heller (2020), Canadian contract law rejects this conventional approach. It does not require exploitation to relieve improvidence by the vulnerable. It is argued here that this does not reflect the notion of unconscionability, and is better understood rather as a novel doctrine of contractual absolution. This article analyzes the important implications of this maverick doctrine for the law, the market, and fundamental assumptions about the nature of contractual obligation.