The duty of good faith in Franchise agreements

By Mark Abell, Victoria Hobbs


This article considers how the duty of good faith impacts on the on-going relationship between franchisor and franchisee in the civil and common law traditions. The concept of good faith is firmly established in the civil law jurisdictions of the EU, particularly in German and French law, but it manifests itself in different forms in each of them. In English law, the idea that good faith is not part of business-to-business contracting is now outdated. Recent English case law confirms that an implied concept of good faith is steadily gaining recognition as a legally binding concept during the performance phase of contracts particularly long term relational agreements such as franchise agreements.

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This article was originally published by the International Journal of Franchising Law, vol.11