What remedies do I have if someone breaches a confidentiality clause in our contract in Ontario?
A confidentiality clause (or non-disclosure provision in a broader commercial contract) is enforceable in Ontario and its breach entitles the injured party to damages, and potentially an injunction to stop further disclosure.
Damages for breach of a confidentiality clause must be proven. Courts award compensation for losses that flow directly from the unauthorized disclosure — lost business, competitive harm, reputational damage. Where monetary loss is hard to quantify, courts may consider a "reasonable royalty" or negotiated-price measure of what the parties would have agreed to for a legitimate use of the information.
An injunction is often the most important remedy, because confidential information once disclosed may spread further. Courts can grant interim injunctions to prevent ongoing or threatened disclosure while litigation proceeds. The same three-part test applies: a serious issue, irreparable harm, and a favourable balance of convenience.
Ontario law also protects trade secrets through the equitable doctrine of breach of confidence independently of any contractual clause. This means even without a written confidentiality agreement, deliberate misuse of genuinely confidential information shared in confidence may be actionable.
As with NDA breaches, move quickly: preserve evidence, document the disclosure, and consult a litigation lawyer about emergency relief before the information spreads further.
Key takeaways
- Breach of a confidentiality clause is a contract breach — damages and injunctions are available.
- Injunctions are often the priority remedy before further disclosure can occur.
- Proof of loss is required for damages; "reasonable royalty" can fill gaps in some cases.
- Trade secret protection exists under equity even without a written clause.