implied covenant of good faith and fair dealing


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implied covenant of good faith and fair dealing

n. a general assumption of the law of contracts, that people will act in good faith and deal fairly without breaking their word, using shifty means to avoid obligations, or denying what the other party obviously understood. A lawsuit (or one of the causes of action in a lawsuit) based on the breach of this covenant is often brought when the other party has been claiming technical excuses for breaching the contract or using the specific words of the contract to refuse to perform when the surrounding circumstances or apparent understanding of the parties were to the contrary. Example: an employer fires a long-time employee without cause and says it can fire at whim because the employment contract states the employment is "at will." However, the employee was encouraged to join the company on the basis of retirement plans and other conduct which led him/her to believe the job was permanent barring misconduct or financial downturn. Thus, there could be a breach of the implied covenant, since the surrounding circumstances implied that there would be career-long employment. (See: implied)

References in periodicals archive ?
claiming breach of contract, civil rights violations, breach of the implied covenant of good faith and fair dealing, and declaratory relief in response to city plans to annex the site of a sand-and-gravel mine in Soledad Canyon.
2) However, both Florida and Delaware courts look primarily to the plain language of the contract when resolving these disputes and consistently reject litigants' attempts to use the implied covenant of good faith and fair dealing to rewrite agreements or impose extra-contractual obligations.
Plaintiff asserted a number of causes of action, including breach of the limited partnership agreement, breach of the implied covenant of good faith and fair dealing, breach of fiduciary duty, aiding and abetting breach of fiduciary duty, fraud and conversion.
Plaintiffs assert claims for breach of contract, breach of the implied covenant of good faith and fair dealing, and violation of the New Jersey Consumer Fraud Act ("NJCFA").
24 BREACH OF IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING
Tekmira's amended complaint adds new claims alleging breach of contract, breach of the implied covenant of good faith and fair dealing, tortious interference with contractual relationships, and civil conspiracy.
9) An implied covenant of good faith and fair dealing is also articulated in [section] 205 of the Restatement (Second) of Contracts.
Nash Finch has answered the complaint, denying any additional monies were due to Roundy's; and asserted counterclaims against the latter for, among other things, breach of contract, misrepresentation and breach of the implied covenant of good faith and fair dealing.
A Second Cause of Action in the complaint accuses "breach of implied covenant of good faith and fair dealing against InBev.
the California Court of Appeals held that the executor of the insured's estate could proceed on an action against an insurer for breach of the implied covenant of good faith and fair dealing, because the insurer had breached a fiduciary obligation to its insured when it knowingly settled a claim against the insured for personal injuries in connection with an automobile accident.
A of this Article provides a basic primer on the contractually based implied covenant of good faith and fair dealing and the scholarly controversy surrounding the articulation and formulation of a workable good faith standard.