The court ordered an acquittal for Randy Leigh Roy, who was convicted in 2006 over a crash in which his passenger, Mark Harrington, was killed.
The 2004 crash occurred north of Kamloops, B.C., in fog and poor visibility when Roy turned off a back road into the path of an oncoming tractor-trailer.
Roy was convicted at trial by a judge alone. He was given a 12-month conditional sentence for dangerous driving and a 14-day intermittent sentence for driving while prohibited. The second charge was not part of the Supreme Court appeal.
The British Columbia Court of Appeal upheld the verdict.
But in its 7-0 ruling, the Supreme Court said the trial judge erred in looking at what constitutes dangerous driving.
Justice Thomas Cromwell said the crash resulted more from a momentary lapse than from dangerous driving.
Roy was left with no memory of the accident or the events immediately beforehand and could offer no explanation at trial.
Writing for his fellow justices, Cromwell said there was no evidence to suggest that Roy's driving leading up to the turn onto the highway was anything other than normal and prudent.
"In my view, the appellant's decision to pull onto the highway is consistent with simple misjudgment of speed and distance in difficult conditions and poor visibility," he wrote.
"The record here discloses a single and momentary error in judgment with tragic consequences. It does not support a reasonable inference that the appellant displayed a marked departure from the standard of care expected of a reasonable person in the same circumstances so as to justify conviction for the serious criminal offence of dangerous driving causing death."