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The elements of a claim for tortious interference with contract are as follows: (1) the existence of a contract; (2) the defendant's knowledge of the contract; (3) that the defendant intended to cause a breach of that contract; (4) that the defendant's actions did indeed cause a breach; (5) that damages resulted to the ...
?Good faith? has generally been defined as honesty in a person's conduct during the agreement. The obligation to perform in good faith exists even in contracts that expressly allow either party to terminate the contract for any reason. ?Fair dealing? usually requires more than just honesty.
As a component of every contract in Canada, a breach of the principle of good faith gives rise to a claim for breach of contract: Bhasin, supra at para. 106. That is to say, if a party acts in bad faith in the performance of the contract, there is no separate or discrete cause of action for which the party can be sued.
(2) Every contract or duty under this code shall impose an obligation of good faith in its performance or enforcement. "Good faith" shall mean honesty in fact in the conduct or transaction concerned and the observance of reasonable commercial standards of fair dealing.
Typically, courts find that a party breaches this rule when they act in ways that obviously undermine the benefits to the other party from the contract or if one party attempts to sabotage another in performing their end of the agreement.
The duty of good faith includes a duty not to act in bad faith ? meaning a prohibition on conduct which would be regarded as commercially unacceptable by reasonable and honest people but not necessarily dishonest.
Implied covenant of good faith and fair dealing (often simplified to good faith) is a rule used by most courts in the United States that requires every party in a contract to implement the agreement as intended, not using means to undercut the purpose of the transaction.
?Depending on the contractual context, a duty of good faith may be breached by conduct taken in bad faith. This could include conduct which would be regarded as commercially unacceptable to reasonable and honest people, albeit that they would not necessarily regard it as dishonest.?