can prepare the ground for contract cancellation. According to Article 1116 of the
Code, deception is cited as a cause for cancellation of a contract.
Is good faith alien to the common law? This certainly is a myth. The concept has
repeatedly been treated as a legal requirement and not merely as an interpretational
tool to appreciate the purpose of the contract. The opinion of Dillion CJ that went on
to influence Leggatt, J’s decisions later, clearly showed that good faith was much
more than a legal requirement; it was a norm that lay at the heart of any contract in
common law itself.
In many civil law systems, and perhaps in most legal systems outside the common law
world, the law of obligations recognises and enforces an overriding principle that in making
and carrying out contracts, parties should act in good faith. This does not simply mean that
they should not deceive each other, a principle which any legal system must recognise; its
effect is perhaps most aptly conveyed by such metaphorical colloquialisms as ‘playing fair’,
‘coming clean’ or ‘putting one’s cards face upwards on the table’. It is in essence a principle
of fair open dealing . . . English law has, characteristically, committed itself to no such
overriding principle but has developed piecemeal solutions in response to demonstrated
problems of unfairness.
16
In the United States, section 1-304 of the Uniform Commercial Code indicates
that “[e]very contract or duty within [the Uniform Commercial Code] imposes an
obligation of good faith in its performance and enforcement.” However, the application of good faith may not be unfathomable or overriding here as in the French
Civil Code. US scholars have concluded that the Uniform Commercial Code
17
(“UCC”) and Restatement (Second) of contracts do not impose good faith obligations if a contract is not made, and most [U.S.] courts have refused to imply good
faith obligations in pre-contractual negotiations.
18 Good faith is at times not
employed as a litmus test but as a filter to eliminate undesirable ingredients such
as in the so-called “excluder” analysis. Summers
19 claimed that good faith was an
“excluder”; that it served to exclude a wide range of heterogeneous forms of bad
faith.
20 These abstractions of the term “good faith” have led scholars, legislators and
judges to interpret “good faith” in a way that attaches numerous connotations to its
application. The excluder analysis of good faith “excludes a variety of types of
conduct characterized as involving “bad faith” because they violate community
standards of decency, fairness or reasonableness.
21 In contrast, in the practice
16 Dillion CJ in Interfoto Picture Library Ltd v. Stiletto Visual Programmes Ltd. [1989] 1 QB 433.
17 Burton (1994), pp. 126–156.
18 Ibid.
19 Summers (1968), pp. 195–267.
20 “That is, it was not appropriately formulable in terms of some general positive meaning-through
the specification of a set of necessary and sufficient conditions, for example; rather, it functioned as
an excluder to rule out a wide range of heterogeneous forms of bad faith”, Summers (1968),
pp. 195–267.
21 RESTATEMENT (SECOND) OF CONTRACTS § 205 (1981). Also see The Restatement
(Second) of Contracts (Restatement) states that, “[e]very contract imposes upon each party a duty
of good faith and fair dealing in its performance and its enforcement,”. The Uniform Commercial
Good Faith in Maritime Law Contracts
119
Code, deception is cited as a cause for cancellation of a contract.
Is good faith alien to the common law? This certainly is a myth. The concept has
repeatedly been treated as a legal requirement and not merely as an interpretational
tool to appreciate the purpose of the contract. The opinion of Dillion CJ that went on
to influence Leggatt, J’s decisions later, clearly showed that good faith was much
more than a legal requirement; it was a norm that lay at the heart of any contract in
common law itself.
In many civil law systems, and perhaps in most legal systems outside the common law
world, the law of obligations recognises and enforces an overriding principle that in making
and carrying out contracts, parties should act in good faith. This does not simply mean that
they should not deceive each other, a principle which any legal system must recognise; its
effect is perhaps most aptly conveyed by such metaphorical colloquialisms as ‘playing fair’,
‘coming clean’ or ‘putting one’s cards face upwards on the table’. It is in essence a principle
of fair open dealing . . . English law has, characteristically, committed itself to no such
overriding principle but has developed piecemeal solutions in response to demonstrated
problems of unfairness.
16
In the United States, section 1-304 of the Uniform Commercial Code indicates
that “[e]very contract or duty within [the Uniform Commercial Code] imposes an
obligation of good faith in its performance and enforcement.” However, the application of good faith may not be unfathomable or overriding here as in the French
Civil Code. US scholars have concluded that the Uniform Commercial Code
17
(“UCC”) and Restatement (Second) of contracts do not impose good faith obligations if a contract is not made, and most [U.S.] courts have refused to imply good
faith obligations in pre-contractual negotiations.
18 Good faith is at times not
employed as a litmus test but as a filter to eliminate undesirable ingredients such
as in the so-called “excluder” analysis. Summers
19 claimed that good faith was an
“excluder”; that it served to exclude a wide range of heterogeneous forms of bad
faith.
20 These abstractions of the term “good faith” have led scholars, legislators and
judges to interpret “good faith” in a way that attaches numerous connotations to its
application. The excluder analysis of good faith “excludes a variety of types of
conduct characterized as involving “bad faith” because they violate community
standards of decency, fairness or reasonableness.
21 In contrast, in the practice
16 Dillion CJ in Interfoto Picture Library Ltd v. Stiletto Visual Programmes Ltd. [1989] 1 QB 433.
17 Burton (1994), pp. 126–156.
18 Ibid.
19 Summers (1968), pp. 195–267.
20 “That is, it was not appropriately formulable in terms of some general positive meaning-through
the specification of a set of necessary and sufficient conditions, for example; rather, it functioned as
an excluder to rule out a wide range of heterogeneous forms of bad faith”, Summers (1968),
pp. 195–267.
21 RESTATEMENT (SECOND) OF CONTRACTS § 205 (1981). Also see The Restatement
(Second) of Contracts (Restatement) states that, “[e]very contract imposes upon each party a duty
of good faith and fair dealing in its performance and its enforcement,”. The Uniform Commercial
Good Faith in Maritime Law Contracts
119