parole evidence rule:
ambiguity in the agreement: see pacific gas, see katrina, see pierless
good faith.
sju law review article on good faith
centronics v. genicom
buyer has put a generous amount into escrow to cover the fair value of the property
patterson v. meyerhofer
is it bad faith that meyerhofer is participating in the auction?
the court says meyerhofer impeded on the other party's ability to perform on the contract and so that was not good faith
making bad faith because you are then competing with your should have been business partner at the auction
patterson was reward what he would have made in profit had the contract been performed.
meyerhofer is clearly engaged in bad faith
market street assoc. v. frey
court's position here is a subjective position on bad faith, that the defendant exercised bad faith in not disclosing the computational error and oversight to a provisional clause in the contract.
when a contract is silent on a certain issue, the court assumes hypotheticals about what the parties knew and agreed on to fill the gaps
in market street, the defendants are taking unfair advantage but it's not as clearly and formulaically bad faith
suppose ge had lost its copy of the lease? did market street assoc. have the responsibility to furnish them with a new copy? yes, so that both sides can ensure assent and no ambiguity during the agreement. it's sort of an implicit agreement through the course of a relationship. however, it's guaranteed that you will get a copy of the contract in discovery!
interesting side note at contractsprof's blog on market street assoc.
good faith in contract performance
neumiller farms v. cornett
refusing delivery of chips on the grounds that they were dissatisfactory. but actually, it seems it was a way for avoiding the rising price of potatoes...
can you do that? why did the court determine bad faith?
it's clear that these goods were conforming, and to say that they weren't conforming was bad faith
satisfaction clause in the contract, and that may have inspired comments that
bad faith may up the remedy and satisfy punitive damages
billman v. hensel
the billmans had an agreement contingent on getting financing. the billmans didn't put enough good faith effort into getting financing. stopped payment on a $1k check. but this isn't a typical case; here there's a lack of "honesty in fact" when the billmans say they can't get the money, and in determining the price
feld v. levy
bread crumbs requirements agreement, and the levys are losing money.
stopped making the crumbs without giving notice, but are happy to turn the machines back on for a penny more a crumb.
can they do that? no. if it's going to put the business as a whole in danger, that's not trivial but the agreement does have a six-month clause and it's built in for the protection of the parties.
roth steel v. sharon steel: inflation environment so price of steel is going up and then there's a shortage. sharon sells steel to roth, and asks for a contract modification on the grounds that there's no raw steel available. under duress/coersion, roth agrees to take a lower price. but subsequently, roth learns that sharon has been selling the steel at a higher premium to other customers. therefore, it wants to enforce the original contract because they only renegotiated because sharon misrepresented the facts. the court determines that there was lack of good faith.
nb - you don't need new consideration under the UCC
zapatha v. dairy mart, inc.
hillesland
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