Beyond Relational Contracts: Implied Good Faith as the Pillar of Contractual Equilibrium in English Contract Law

This article examines the evolving role of good faith in the performance of commercial contracts under English law, advocating for its recognition as an implied duty in all commercial agreements. Drawing on the recognition of good faith in relational contracts, as seen in Yam Seng and subsequent cases, the article argues that English contract law, which has traditionally not recognised an implied duty of good faith in contractual performance, should incorporate such a duty in commercial contracts to better reflect the needs of modern commercial relationships. This duty would help maintain the contractual equilibrium throughout the life of the contract. By offering protection against opportunistic behaviour, the implied duty of good faith is presented as a critical mechanism for preserving the balance of interests and supporting the shared objectives of the contracting parties.