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The concept of good faith in development agreements through various case studies and identifies the general principles that apply. English contract law does not recognize a general doctrine of good faith, but it may be implied in certain categories of contracts, such as development agreements, which are considered 'relational contracts'. the implications of good faith in development agreements, the limits of the duty to act in good faith, and the consequences of breaching this duty.
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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.”
return for a fee payable in certain circumstances. The contract contained an express term that: “[i]n all matters relating to this Agreement the parties will act with the utmost good faith towards one another and will act reasonably and prudently at all times.”
Chelsea Barracks with a view to its development. A sale and purchase agreement between the parties imposed an obligation upon both of them to act “in utmost good faith”. Vos J held at [246] that, having regard to the context, the content of this obligation was: “to adhere to the spirit of the contract, which was to seek to obtain planning consent for the maximum Developable Area in the shortest possible time, and to observe reasonable commercial standards of fair dealing, and to be faithful to the agreed common purpose, and to act consistently with the justified expectations of the parties.”
Refusal’. Sainsbury’s initial application to vary the condition was refused. Sainsbury’s wanted to terminate the agreement if it lawfully could and so, thereafter, it refused to appeal or to withdraw and resubmit an application to vary the conditions on the grounds that Planning Counsel had determined that the prospects of success were not sufficient. The club argued that Sainsbury’s reliance on the ‘black letter’ of clause 2.11 was a breach of the duty to act in good faith. Proudman J held that the duty to act in good faith did not mean that Sainsbury’s was obliged to act contrary to a specific provision of the agreement.
JONATHAN UPTON TANFIELD CHAMBERS OCTOBER 2015