English law does not recognise the principle of good faith in contracts but now a High Court judge has said it鈥檚 about time that it does
The NEC Engineering & Construction main contract has a core base line 鈥済ood faith鈥� clause. 鈥淭he employer, the contractor, the project manager and the supervisor shall act as stated in this contract and in a spirit of mutual trust and co-operation.鈥� Good job it does, because under English law, there is no legal principle of good faith in contract law. Here is what a very senior judge, Lord Bingham, said 25 years ago: 鈥淚n 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.
Make no bones about it; there is deep traditional English hostility towards a doctrine of good faith being automatically injected into your contract
This does not simply mean that they should not deceive each other 鈥� ; its effect is perhaps most aptly conveyed by such metaphorical colloquialisms as 鈥榩laying fair鈥�, 鈥榗oming clean鈥� or 鈥榩utting one鈥檚 cards face upwards on the table鈥�. 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 鈥