Last Updated: August 23 2026
Is disgorgement available in Ontario when someone profits from a wrongdoing without causing a direct loss?
VP Legal Services & Notary can help you understand when a court may order disgorgement, which is a restitutionary remedy aimed at preventing a wrongdoer from keeping ill-gotten gains rather than simply making a victim whole. In Ontario civil claims, disgorgement may be available under the “profiting from wrong” approach if there is an underlying legal wrong and the ordinary damages remedy is inadequate, as discussed in Pharmascience Inc. v. Novartis Pharmaceuticals Canada Inc., 2020 ONSC 6534. In practice, it often arises where there is a breach of fiduciary duty or breach of trust, but it may be granted in exceptional cases involving crimes, breach of contract, or tort, and “corresponding deprivation” can be shown by linking the wrongful act to the defendant’s gain being made possible. For a quick fit-check of your facts and evidence, call (437) 286-1499 to book a brief consult with a paralegal and notary at VP Legal Services & Notary in Ontario.
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Is There a Type of Legal Compensation Available From a Wrongdoer Who Profits From a Wrongdoing?
When a Wrongdoer Benefits or Profits From a Wrongdoing, the Victim of the Wrongdoing May Claim Disgorgement of the Benefits or Profits From the Wrongdoer.
Note: Please contact VP Legal Services & Notary by phone at: (437) 286-1499 to discuss any specific questions that you may have.
Understanding Disgorgement Remedy Principles Involving Restitution For Wrongdoings Resulting In Ill Gotten Gains
There are some circumstances in which a wrongdoer receives a benefit or profit from the wrongdoing and yet the victim is without a corresponding harm or loss. Generally, under legal principles akin to no harm, no foul concepts, a legitimate lawsuit permits compensation for the loss or harm suffered by the victim; however, in some circumstances it is proper to claim disgorgement of benefits or profits received by the wrongdoer.
The Law
The availability of the remedy of disgorgement was well explained within the case of Pharmascience Inc. v. Novartis Pharmaceuticals Canada Inc., et al, 2020 ONSC 6534, wherein it was said:
[19] Under the “profiting from wrong” theory of unjust enrichment, disgorgement may be available if the defendant has committed “an underlying legal wrong against a plaintiff, and the ordinary damages remedy for the underlying wrong is inadequate”. As the Court of Appeal noted, disgorgement in these cases is typically reserved for when there has been a breach of fiduciary duty or a breach of trust. However, in exceptional cases, disgorgement as a restitutionary remedy can also be granted where the “underlying legal wrong” is a crime or a breach of contract or a tort.[6] In cases premised on “profiting from wrong”, the concept of “corresponding deprivation” takes on a slightly different meaning. A plaintiff may be able to prove a corresponding loss by showing that the defendant’s gain was “made possible” by the defendant’s wrongful act towards the plaintiff rather than proving a direct or indirect transfer of wealth.[7]
Explained Principles
There may be circumstances where a person commits a criminal fraud or a civil fraud, among other wrongs, without causing harm or loss to the wronged person and yet benefits or profits arise in favour of the wrongdoer. The law, applied by the courts, seeking to discourage and deter wrongful conduct, may order that the benefits or profits be disgorged from the wrongdoer and provided to the victim. In this way the remedy of disgorgement ensures that the wrongdoer fails to benefit or profit from the wrongdoing and is, presumably, discouraged and deterred from engaging in wrongful conduct.
Summary Comment
Disgorgement is a form of restitution rather than compensation whereas disgorgement is applied in law as a matter of fairness rather than as a means for making whole the losses or harms of a victim.
NOTE: A significant volume of online queries, such as “lawyers nearby” or “top lawyer in,” frequently indicates a desire for prompt, competent legal assistance rather than a certain job title. In Ontario, the same Law Society that governs lawyers also regulates licensed paralegals, granting them the authority to represent clients in specified litigation cases. Core functions of this role include advocacy, legal assessment, and procedural expertise. VP Legal Services & Notary provides legal representation within its permitted scope, focusing on strategic positioning, evidence preparation, and persuasive advocacy to attain efficient and positive outcomes for clients.
