Disputes Matter — October 2013
Unlike other jurisdictions, England and Wales does not recognise a general implied duty of good faith and fair dealing in contract law. However, recent case law has raised the question as to whether it should.
In Yam Seng Pte Ltd v International Trade Corporation Ltd, the parties entered into an exclusive distribution agreement to sell Manchester United-branded toiletries across south-east Asia. The written contract was sketchy, so when the relationship between the parties broke down Yam Seng argued that the agreement contained an implied obligation to act in good faith, which International Trade Corporation had breached. The High Court agreed.
The judgment is fact specific, but it demonstrates that while a duty of good faith will not be implied into all commercial contracts, there will be cases where this is possible looking at the presumed intention of the parties and the background against which the contract was made (a similar approach to contractual interpretation in any event) and where this is necessary to give business efficacy to a contract…
If you are registered and logged in to the site, click on the link below to read the rest of the Walker Morris briefing. If not, please register or sign in with your details below.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from Walker Morris
News from The Lawyer
Briefings from Walker Morris
Landlords must protect tenants’ deposits and provide tenants with prescribed information, regardless of when the tenancy commenced and when the deposit was received.
In the Yam Seng case, the court was willing to imply a duty of good faith to give business efficacy to a commercial contract. Since that case, the law has been somewhat uncertain.
Analysis from The Lawyer
Which firms are cutting it in this era of slimline rosters, and who are the GC new brooms making clean sweeps? The Lawyer can reveal all
The law school war shows no signs of ending. But we have, perhaps, reached the end of the beginning.