Breach of Good Faith and Fair Dealing

  • Jan 19 2014
  • Gilleon Law Firm, APC

The cause of action for breach of the implied covenant of good faith and fair dealing lets a person recover damages when the other side unfairly interferes with a contract. Jury Instruction CACI 325 says, “In every contract or agreement there is an implied promise of good faith and fair dealing. This means that each party will not do anything to unfairly interfere with the right of any other party to receive the benefits of the contract.”

Let’s say you have contracted with online advertising company, let’s call them (a fictitious name), which is doing a great job for a while, and always provided you with a local rep who handles all day to day issues, and makes sure his employer,, is performing the contract. Then, let’s say merges with a slash and cut company who suddenly fires your rep (and all local reps), and then has a person from New Jersey email you and tell you he’s your “account manager,” not telling you his actual and only job is to get you to renew the contract (in other words, he is not your representative and instead his job is solely to paint a rosy picture, which is inconsistent with there being any problems).

Let’s say that simultaneous to “the merger” and your rep (and all other local reps) being suddenly fired, the quality of service plummets and now there’s nobody but a salesman on the East Coast with an attitude to handle your concerns. Let’s assume you learn that in addition to the massive layoff of local reps, then stops supporting SEO (one of its main jobs) and also starts slashing costs by getting cheaper people to write your blogs.

Finally, let’s say that when you complain, they refuse to fix anything unless you sign up for another year. The issue is whether this creates a cause of action to recover damages for the lost revenue between the time of the merger and the time you are finally able to extricate yourself from the nightmare has become.

The answer is: let the jury decide.

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