In case you missed it, last year the Supreme Court of Canada clarified how releases should be interpreted.
What is release anyway? (and remind me again why I care?)
In a nutshell, a release is where one party agrees not to make claims against another party (e.g., you agree not to sue X if Y happens or vice versa).
If you are relying on a release to protect you from claims or, on the other hand, to not exclude certain claims, then you care how the release is interpreted!
What are the rules of interpretation for a release?
In the case of Corner Brook (City) v. Bailey, 2021 (S.C.C.), the Supreme Court of Canada ruled that “there is no special rule of contractual interpretation that applies only to releases”, “a release is a contract, and the general principles of contractual interpretation apply”, and any previous rules of interpretation have “been subsumed entirely by the approach set out in Sattva [that’s an earlier 2014 SCC decision]” and should be interpreted just like any other contract.
Therefore, to interpret a release you “must read the contract as a whole, giving the words used their ordinary and grammatical meaning, consistent with the surrounding circumstances [which generally includes all objective evidence of knowledge that both parties had or reasonably ought to have had at or before the date of the contract] known to the parties at the time of formation of the contract” (Sattva at para. 47) to determine “the mutual and objective intentions of the parties as expressed in the words of the contract” (Sattva para. 57).
Drafting tips and the dangers of using template release language:
A template release is just that, a standard template which is not customized to your specific situation. A lawyer should draft and/or review any release language you are relying on.
However, as with drafting any contract, it takes two to tango and you should also be sure to provide as much context as possible. For example, if you wish to use the release as a shield to protect yourself from a wide variety of claims, it would typically be drafted with a mix of plain yet specific (expressly listing known possible types of claims) language, followed by some more general all encompassing language to reflect your intentions of a wide scope for the release.
Conclusion:
Per Corner Brook (City) v. Bailey, 2021 (S.C.C.), at para [43], “The ultimate question is whether the claim is of the type of claim to which the release is directed. This will depend on the wording and surrounding circumstances of the release in each case.”, and a well drafted release requires input from both the lawyer and the client.
You can check out the full Corner Brook (City) v. Bailey, 2021 (S.C.C.) decision here: https://decisions.scc-csc.ca/scc-csc/scc-csc/en/item/18962/index.do?msclkid=e1f3b8a1c7c011eca8f0ff90c1bc0a3e