- In a typical breach-of-contract claim, a plaintiff has to prove that a loss actually happened, generally on a balance of probabilities — meaning it is more likely than not that the loss…
- When a breach deprives a plaintiff of the opportunity to compete for, or obtain, a benefit that depended on an uncertain future event — rather than depriving them of something they were…
- - A breach that prevented a party from submitting a bid or tender in a competitive process - A breach of an agreement to refer business, introduce a counterparty, or facilitate a deal -…
Not every breach of contract costs someone a guaranteed benefit — sometimes it costs them a chance at one. Maybe a breach kept a bidder out of a competition they might have won, or cut short a process that might have led to a bigger deal. When the underlying benefit was never certain in the first place, Ontario courts have developed a distinct way of approaching damages: compensating the plaintiff for the value of the lost chance itself, rather than requiring proof that the outcome would definitely have happened.
This article explains when loss-of-chance reasoning applies in a contract case, how it differs from the ordinary approach to proving damages, and what kind of evidence tends to matter.
The Ordinary Rule: Prove It on a Balance of Probabilities
In a typical breach-of-contract claim, a plaintiff has to prove that a loss actually happened, generally on a balance of probabilities — meaning it is more likely than not that the loss occurred as claimed. If a plaintiff cannot clear that threshold for a particular outcome, they generally cannot recover damages tied to that outcome at all.
That all-or-nothing approach works reasonably well when the underlying question is factual and answerable: did the goods arrive damaged, did the services meet the contract specification, and so on. It works less well when the underlying question depends on how a third party, a market, or an uncertain process would have unfolded if the breach had not happened.
Where the Lost-Chance Approach Comes In
When a breach deprives a plaintiff of the opportunity to compete for, or obtain, a benefit that depended on an uncertain future event — rather than depriving them of something they were already entitled to — courts can take a different approach. Instead of asking whether the outcome would definitely have happened, the court can ask what the plaintiff’s chance of obtaining it was, and what that chance was worth.
| Ordinary damages approach | Loss-of-chance approach |
|---|---|
| Asks whether the outcome would have happened, on balance of probabilities | Asks what the probability of the outcome was, and values that probability |
| All-or-nothing: proven on balance of probabilities, or not compensated | Proportional: damages reflect the estimated likelihood of success |
| Works when the outcome depends on the plaintiff’s own conduct or clear facts | Works when the outcome depended on a third party’s decision or an uncertain process |
| The uncertainty is about whether a loss happened at all | The uncertainty is built into the value of what was lost |
Situations Where This Comes Up
- A breach that prevented a party from submitting a bid or tender in a competitive process
- A breach of an agreement to refer business, introduce a counterparty, or facilitate a deal
- A breach that cut short a sale or negotiation process before it could run its course
- A breach involving a right of first refusal or similar opportunity-based contractual right
In each situation, the plaintiff is not claiming they would definitely have gotten the deal — they are claiming the breach took away their shot at it, and that shot had value.
What Courts Look For
Because a lost-chance claim is inherently about probability rather than certainty, courts look closely at the evidence available to estimate that probability, including:
- How many competitors or realistic alternatives existed
- The plaintiff’s track record or qualifications relative to others in the running
- Any objective indicators of how the process was likely to unfold
- Whether the loss of the chance is more than speculative — courts still require a real, not merely theoretical, chance before awarding anything
A claim built on pure speculation, with no evidence about how likely the outcome actually was, is unlikely to succeed even under this more flexible framework.
Frequently asked questions
Do I need to prove I would have won to claim loss-of-chance damages?
No — that is the point of this approach. You need to show that you had a genuine chance the breach took away, and provide evidence a court can use to estimate how strong that chance was. You do not need to prove the outcome was more likely than not.
How is the dollar value of a lost chance calculated?
Courts generally estimate the value of the underlying benefit, then discount it by the estimated probability that the plaintiff would have obtained it. The details are fact-specific and depend heavily on the evidence available in each case.
Does this idea apply outside of contract law too?
The general concept of valuing a lost chance rather than requiring certainty appears in other areas of Ontario law as well, though the specifics of how and when it applies can differ. A lawyer can advise on whether it fits the facts of your particular claim.
What if there was no realistic chance at all?
If the evidence shows the plaintiff never had a meaningful chance at the benefit, a court is unlikely to award anything under this approach — it compensates for a real, evidenced opportunity, not a hypothetical one.
This is a litigation question
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