Court of Appeal Addresses Releases in Recent Decision

In Huma v. Mississauga Hospital, 2020 ONCA 644, the Court of Appeal upheld a motion to enforce a settlement against three plaintiffs who were self-represented at the time of the settlement.

One of the issues addressed by the Court of Appeal is the requirement to provide a release upon settlement. The Court noted that a settlement implies a promise to furnish a release unless there is a contractual agreement to the contrary.

However, this implied obligation only requires a release to obtain the terms to which the parties have agreed. An undertaking to keep the terms of the settlement confidential or an acknowledgement or waiver of independent legal advice are not part of the implied obligation. If a party wants these terms included in a release, it must explicitly say so during settlement negotiations.

That being said, the Court of Appeal stated that the proffering of overly broad releases does not negate the exist of a settlement, where there is no evidence that the settlement agreement was conditional on the parties being released obtaining a release with those and only those proposed provisions.

Further, a party proffering an overly broad release does not repudiate a settlement unless, after discussion, the party refuses to proceed without the requested release being signed.

In summary, if a party wants specific terms included in a release, including a confidentiality agreement, such terms must be discussed during settlement negotiations.