NDA & Confidentiality
Agreement Lawyer.
NDAs drafted, reviewed, and negotiated for Toronto businesses, on a flat fee. Deal NDAs, investor and hiring NDAs, and the confidentiality clauses inside your other contracts.
· Reviewed by Jonathan Kleiman, J.D.
Ontario Bar
250+ reviews
consultation
What is an NDA?
A non-disclosure agreement (NDA) is a contract that stops one or both parties from disclosing or misusing confidential information they receive. It's also called a confidentiality agreement, and it's usually the first document signed in a deal, an investor conversation, a hire, or an outsourcing arrangement.
NDAs protect trade secrets, customer lists, pricing, financial data, business plans, source code, and processes: anything that gives a business an edge because competitors don't have it.
When you need an NDA
- Before sharing information with a potential partner or investor: protect your data while you negotiate
- When buying or selling a business: both sides open their books during due diligence
- When hiring employees or contractors: confidentiality that continues after the relationship ends
- When outsourcing work: developers, agencies, manufacturers, and freelancers who see how you operate
- When entering a joint venture or partnership: information flowing both ways
One-way or mutual?
A one-way (unilateral) NDA protects only the party disclosing information. It fits hiring, outsourcing, and a buyer looking at a seller's business. A mutual (bilateral) NDA protects both sides and fits joint ventures, partnerships, and deals where each party shares something sensitive.
Read a "mutual" NDA closely. Some templates use mutual language in the definitions and then give only one party the right to an injunction, an indemnity, or a say in what counts as confidential.
Business deal NDAs: the clauses that matter
Most NDA advice online is written for employers. A deal NDA between two businesses turns on different clauses:
- Purpose. The information can be used only to evaluate or carry out the named transaction. Without a purpose clause, an NDA restricts disclosure but not use.
- Representatives. Who on the other side can see the information: employees, lenders, accountants, and lawyers who need it, bound by the same terms, with the recipient responsible if they leak it.
- Exclusions. Information that's already public, already known to the recipient, received from someone else lawfully, or developed independently isn't confidential. These four carve-outs are standard and their absence is a warning sign.
- Residuals. A clause letting the recipient use whatever its people remember unaided. It's common in technology NDAs and quietly guts the protection, so a disclosing party should resist it.
- Term and survival. How long the obligation lasts, and whether trade secrets get longer protection than ordinary information.
- Return or destruction. What happens to the material when talks end, with a sensible carve-out for automatic backups and copies the recipient must keep by law.
- Non-solicitation and standstill riders. Acquisition NDAs often add a promise not to poach employees or, for a public company, not to buy shares. These are restrictive covenants, not confidentiality terms, and need their own scrutiny.
- Governing law and forum. Ontario law and Ontario courts. A template from a US parent that sends disputes to Delaware or New York can make the NDA too expensive to enforce.
Been sent an NDA? What to check before you sign
Here are four clauses that turn up in template NDAs, with what to look for in each:
No exclusions at all, and it reaches back to everything said before signing. Ask for the four standard carve-outs and, if the information is going to be specific, for it to be marked or confirmed in writing.
A non-compete hiding inside an NDA. Between businesses it has to be reasonable to be enforced. If the recipient is an employee, it's void under the Employment Standards Act unless an exception applies. Either way it doesn't belong in a confidentiality agreement, so strike it or ask why it's there.
Fair for real trade secrets, not for a price list. Split it: a fixed term for ordinary information and protection for trade secrets for as long as they stay secret.
For two Ontario businesses, this is a cost problem dressed up as boilerplate. Ask for Ontario law and Toronto courts.
Need an NDA drafted or reviewed?
Free 30-minute consultation. Flat fee quoted before any work starts.
What an NDA can't do
- Make public information confidential. Once something is genuinely public, an NDA can't pull it back.
- Override a legal duty to disclose. A court order, a subpoena, or a legal requirement to report to a regulator takes priority. A good NDA says how the recipient must handle that: notice where it's allowed, and disclosing only what's required.
- Act as an employee non-compete. Calling a non-compete a confidentiality term doesn't save it from the Employment Standards Act ban.
- Guarantee an injunction. A clause saying the parties agree to an injunction helps, but the court still decides whether to grant one.
Common NDA mistakes
- Using a generic template. Free templates are written for no one in particular. They may miss the information you actually need to protect and include terms that don't work in Ontario.
- Defining confidential information too broadly. An NDA that covers "all information" makes it hard to prove what was covered. The definition needs to be precise enough for a court to apply.
- One term for everything. Ten years for routine information invites a fight; two years for a trade secret gives it away.
- Signing in the wrong name. The company should be the party, not the owner personally, unless that's the deal.
- Not signing one at all. Sensitive information shared on a handshake leaves far fewer options if it's misused.
If someone breaches your NDA
Preserve the evidence, send a demand letter, and decide early whether you need money or a court order. Most NDA breaches that reach a small or mid-sized business are about lost customers or a copied product, and the remedy is damages.
If the loss is $50,000 or less, Jonathan can pursue it in Small Claims Court, where you can waive anything over the limit to stay there. If you need an order stopping ongoing use or disclosure, that's an injunction in the Superior Court, and Jonathan refers it to trusted litigation counsel. Don't wait: Ontario's basic limitation period for a breach of contract claim is generally two years from when the breach was discovered. For how contract claims are run, see the contract disputes page.
The value of an NDA isn't the paper. It's whether you can enforce it when it matters. A template gives you the paper.
How Jonathan helps: what's included and what's not
NDA work is done on a flat fee, quoted before anything starts.
Included
- Free 30-minute consultation
- Drafting one-way or mutual NDAs for your business
- Review of an NDA you've been sent, with a marked-up version and a short note on what to push back on
- Negotiating changes with the other side or its lawyer
- Confidentiality clauses inside commercial contracts, contractor agreements, and employment agreements
- Demand letters when an NDA has been breached
- Small Claims Court claims for breach, up to $50,000
Not included
- Injunctions and other Superior Court proceedings, which are referred to trusted litigation counsel
- Patents, trademarks, and other IP registrations
- Advice on foreign law where a template is governed by it
Call 416-554-1639 or book a free consultation.
FAQs.
Common questions about NDAs and confidentiality agreements in Ontario.
What is an NDA?
A non-disclosure agreement, also called a confidentiality agreement, is a contract that stops one or both parties from disclosing or misusing confidential information they receive. It's the usual first document in a deal, an investor conversation, a hire, or an outsourcing arrangement.
What is the difference between a one-way and a mutual NDA?
A one-way NDA protects only the disclosing party's information. A mutual NDA protects both sides and fits when information flows both ways, such as a joint venture or a business sale. Check that a mutual NDA is mutual in substance too: some templates call themselves mutual but give only one side the remedies.
Is an NDA enforceable in Ontario?
Yes, if it's a proper contract and clearly defines what's confidential. Courts look for a definition precise enough to tell what was covered, sensible exclusions, and a duration that fits the information. An NDA that covers everything forever is harder to enforce, not easier.
How long should an NDA last?
Match the term to the information. Ordinary business information is often protected for a fixed term of a few years. Genuine trade secrets can be protected for as long as they stay secret. One term for everything usually ends up too short for the trade secrets or too long for the rest.
Can an NDA include a non-compete?
It can, but it's a different kind of clause and gets judged differently. Between two businesses, a non-compete must be reasonable to be enforced. With an employee, a non-compete is void under Ontario's Employment Standards Act unless an exception applies. A non-compete buried in an NDA is one of the first things to look for before signing.
Does an NDA need to be notarized or witnessed in Ontario?
No. A signed NDA is an ordinary contract, and electronic signatures are generally fine. What matters is that the right legal entity signs it, usually the company and not its owner personally, and that each side keeps a copy of the final signed version.
What can I do if someone breaches my NDA?
Preserve the evidence first, then send a demand letter. If the loss is money and $50,000 or less, Small Claims Court is an option, and Jonathan handles those claims. If you need a court order to stop ongoing use or disclosure, that's an injunction in the Superior Court, and Jonathan refers it to trusted litigation counsel.
How much does an NDA cost?
Jonathan drafts and reviews NDAs on a flat fee, quoted before any work starts. The fee depends on whether it's a review of a document you've been sent or a custom draft, and on how much negotiation the deal needs. The first 30-minute consultation is free.
Protect your confidential information.
A properly drafted NDA from a Toronto business lawyer. Flat-fee pricing. Free 30-minute consultation.