Good faith is one of those phrases often bandied about in the negotiation of commercial contracts and, when a party is asked for an assurance it will exercise its rights in good faith, it is sometimes difficult to refuse. But if such an obligation is not included, will it be implied anyway? Or if it is included, what effect will it have?
Some guidance can be found in the recent contrasting and very different cases of Yam Seng PTE Ltd v International Trade Corporation Ltd [2013] a decision of the High Court and Mid Essex Hospital Services NHS Trust v Compass [2013] a decision of the Court of Appeal.
The first decision concerned a distributor agreement in which the distributor was granted the exclusive right to distribute certain fragrances bearing the brand name “Manchester United” in various countries.
Download the full article here: Good Faith and Commercial Contracts Sept 2013