CHAPTER 8 - 8-6 BREACH OF COVENANT OF GOOD FAITH AND FAIR DEALING

• Jurisdiction: United States

8-6 Breach of Covenant of Good Faith and Fair Dealing

It is not uncommon for breach of covenant and good faith and fair dealing claims to accompany breach of contract claims. Regarding the covenant of good faith and fair dealing, the Connecticut Appellate Court has held that "[t]o constitute a breach of [the implied covenant of good faith and fair dealing], the acts by which a defendant allegedly impedes the plaintiff's right to receive benefits that he or she reasonably expected to receive under the contract must have been taken in bad faith."¹³² The Landry court further held that:

Bad faith has been defined in our jurisprudence in various ways. "Bad faith in general implies both actual or constructive fraud, or a design to mislead or deceive another, or a neglect or refusal to fulfill some duty or some contractual obligation, not prompted by an honest mistake as to one's rights or duties, but by some interested or sinister motive. . . . Bad faith means more than mere negligence; it involves a dishonest purpose."¹³³

"Absent allegations and evidence of a dishonest purpose or sinister motive, a claim for breach of the implied covenant of good faith and fair dealing is legally insufficient."¹³⁴

In Steinmann v. Boyle, the plaintiff alleged that the defendant attorney breached the covenant of good faith and fair dealing ". . . in that he concealed from the plaintiffs the true status of their interest in the decedent's estate, misrepresented the effectiveness of the will he had drafted, and acted with a conflict of interest with regard to his dual role as the attorney drafting the will and as executor."¹³⁵ In...