Common Contracts
1 similar Good Faith Agreement contracts
Good faith in english contract lawGood Faith Agreement • June 28th, 2021
Parties often expressly agree to act in good faith when entering into contractual arrangements with each other, partly because there is no general doctrine of good faith in English law. This allows for flexibility and for parties to both pursue their own self-interest and to construct the wording of the contract in a such a way that it creates a duty of good faith. An express duty of good faith has been summarised by the High Court as being an obligation to “adhere to the spirit of the contract, to observe reasonable commercial standards of fair dealing, to be faithful to the agreed common purpose, and to act consistently with the justified expectations of the other party”. The courts have also suggested that bad faith is an essential ingredient of a breach of good faith. Implied terms, such as the duty to act honestly and to act rationally, influence the way in which contracts are interpreted and enforced in practice. “A thread runs through our contract law that effect must be given t
