Implied-in-law "good Faith" Terms
Many contracts include "satisfaction clauses", in which a promisor can refuse to pay if he isn't subjectively satisfied with the promisee's performance. Strictly speaking, this is an illusory promise, since the promisor has no actual legal burden to pay if he chooses not to. However, courts will generally imply in law that the promisor must act in good faith and reject the deal only if he is genuinely dissatisfied. As another example, if a contract promises a promisee a certain percentage of the proceeds of a promisor's business activities, this is illusory, since the promisor doesn't have to do anything: any percentage of zero is zero. However, courts may find that the promisor made an implied promise to use reasonable efforts to try to make money, and cite him for breach of contract if he does absolutely nothing. The U.C.C. in contracts exclusive to both sides requires "best efforts" in such contracts. This is either read to be the same as a good faith effort, but is seen by some courts as a higher duty.
Read more about this topic: Illusory Promise
Famous quotes containing the words faith and/or terms:
“For by superior energies; more strict
Affiance in each other; faith more firm
In their unhallowed principles, the bad
Have fairly earned a victory o’er the weak,
The vacillating, inconsistent good.”
—William Wordsworth (1770–1850)
“We must conclude that it is not only a particular political ideology that has failed, but the idea that men and women could ever define themselves in terms that exclude their spiritual needs.”
—Salman Rushdie (b. 1948)