“A declaratory judgment is “a formal statement by a court pronouncing upon the existence or non-existence of a legal state of affairs”: Zamir & Woolf, The Declaratory Judgment, 3rd ed. (London: Sweet & Maxwell, 2002) at para. 1.02. Courts have jurisdiction to grant declaratory relief under their inherent jurisdiction and pursuant to s. 97 of the Courts of Justice Act, R.S.O. 1990, c. C.43. The nature of the relief was articulated in detail by the Supreme Court of Canada in Solosky v. R., [1980] 1 S.C.R. 821 (S.C.C.). There, Dickson J. said at pp. 830-832:
Declaratory relief is a remedy neither constrained by form nor bounded by substantive content, which avails persons sharing a legal relationship, in respect of which a ‘real issue’ concerning the relative interests of each has been raised and falls to be determined.
The principles which guide the court in exercising jurisdiction to grant declarations have been stated time and again. In the early case of Russian Commercial and Industrial Bank v. British Bank for Foreign Trade Ltd, [[1921], 2A.C. 438] in which parties to a contract sought assistance in construing it, the Court affirmed that declarations can be granted where real, rather than fictitious or academic, issues are raised. Lord Dunedin set out this test (at p. 448):
The question must be a real and not a theoretical question, the person raising it must have a real interest to raise it; he must be able to secure a proper contradictor, that is to say, someone presently existing who has a true interest to oppose the declaration sought.
In Pyx Granite Co. Ltd. v. Ministry of Housing and Local Government, [[1958 1 Q.B. 554], (rev’d [1960] A.C. 260, on other grounds), Lord Denning described the declaration in these general terms (p. 571):
.. if a substantial question exists which one person has a real interest to raise, and the other to oppose, then the court has a discretion to resolve it by a declaration, which it will exercise if there is good reason for so doing.
. . .
As Hudson suggests in his article, “Declaratory Judgments in Theoretical Cases: The Reality of the Dispute” (1977), 3 Dal.L.J. 706:
The declaratory action is discretionary and the two factors which will influence the court in the exercise of its discretion are the utility of the remedy, if granted, and whether, if it is granted, it will settle the questions at issue between the parties.”