Good Faith in Civil Law Systems – A Legal-Economic Analysis

Abstract

2011s-74 Good Faith in Civil Law Systems-A Legal-Economic Analysis Ejan Mackaay CIRANO Le CIRANO est un organisme sans but lucratif constitué en vertu de la Loi des compagnies du Québec. Le financement de son infrastructure et de ses activités de recherche provient des cotisations de ses organisations-membres, d'une subvention d'infrastructure du Ministère du Développement économique et régional et de la Recherche, de même que des subventions et mandats obtenus par ses équipes de recherche. CIRANO is a private non-profit organization incorporated under the Québec Companies Act. Its infrastructure and research activities are funded through fees paid by member organizations, an infrastructure grant from the Ministère du Développement économique et régional et de la Recherche, and grants and research mandates obtained by its research teams.

Encyclopedia of Law and Economics

“…Finally, in line with the legal reasoning, Mackaay (2011) argues that good faith is a last resort tool for preventing opportunism. The author states that there are various anti-opportunism concepts in the law, but when none of these concepts manage to prevent opportunism, the judge will use the good faith principle.…”

“…Opportunistic behavior could even incentivize parties to take strict precautions, such as foregoing a contemplated contract altogether. If many contractors were to choose this option, this could destroy entire markets (Mackaay 2011). Muris (1981) defines opportunism as behavior which is contrary to the other party's understanding of their contracteven if not necessarily against the implied terms of the contractand which leads to a wealth transfer from the other party to the performer.…”

Between freedom of contract and the principle of good faith: An inside view on the reform of private law of Kazakhstan

“…These principles contributed to the development of social relations, ideas about the free expression of the will of the individual on the basis of contracts concluded with other persons. Almost all the systems of law of countries that identify themselves with the Civil law contain one or more provisions on good faith (Mackaay, 2011).…”

“…As Mackaay notes, it was the English lawyers who resisted this doctrine most of all. Unlike the US law, where good faith is recognized in the pre-contractual legal relations, English law has treated this institution critically (Mackaay, 2011). For example, the right of the court to challenge the terms of the consumer contract ex post under the aegis of the fight against unfair contract terms was recognized in England only in the early 1990s and then only under the pressure JANUS.NET, e-journal of International Relations e-ISSN: 1647-7251 Vol.…”

The Evolution of Property Law in Taiwan

“…Traditionally, good-faith party is protected in property law, but the law and economic literature has started to distinguish between good-faith (without fault) and innocence (or negligently good-faith) (Landes and Posner 1996;Mackaay 2012;Sterk 2012;Chang 2013b). Innocent, or negligently good-faith, parties are those who could have known certain facts had they expended some costs in verification, and the expected benefit of verification is higher than the cost.…”