Duhaime's Law Dictionary

Due Diligence Definition:

Reasonable verifications and precautions taken to identify or prevent foreseeable risks.

Related Terms: Diligence

In R v Steinberg, Ontario judge Harris wrote of due diligence used in a statute but without any statutory definition:

"To require the steps taken by the company to absolutely prevent these occurrences under any circumstances whatsoever would go beyond due diligence, and would make the company a virtual insurer against any error. I do not think that was the intention of the legislation; the words all due diligence import an area of precaution sufficient to prevent the foreseeable, but not the unforeseen, the unexpected, the unknown, or the unintended."

due diligenceNote also the words of Justice Bennett in R v Centre Datson Ltd.:

"I think by now that it is trite law that due diligence is synonymous with reasonable diligence, and as well, that the test for reasonableness is a question of fact.

"It is argued that the test is that of a reasonable man. I think the test is somewhat more than this. It is the degree of reasonableness within a specialty where a special skill or knowledge or ability is involved, as in the case for example of surgical malpractice; the test is not that of a reasonable man, but that of a reasonable surgeon.

"Here the test, in my opinion, that must be applied is not that of a reasonable man, but that of a reasonable dealer in new and used cars, with the knowledge, skills and abilities of one who deals in the sale and purchase of automobiles, and in that light we must look at the conduct of the corporate accused to determine whether or not it exercised all due diligence."

This sentiment - that due diligence is not limited to the bland, ordinary reasonable man - is echoed by Justice Greenshields in Scottish Metropolitan Assurance Company, facing a statute which, at §6, referred to an obligation of due diligence, but did not define the term:

"What amounts to due diligence in this §6 is, I suggest, a question of fact. If in any given case the issue was, whether the defendant had exercised due diligence in the doing of something, or whether he failed to be duly diligent, that question would be submitted as a question of fact to a jury. The expression, due diligence, as used in the statute, I would take to be the highest degree of diligence; an extraordinary diligence, or that which a very prudent person would exercise in the care of his own property, or in the management of his own affairs."


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