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International Construction Law Review

INTRODUCTION

HUMPHREY LLOYD DOUGLAS S JONES

It is a tribute to the international character of construction law that there is continuing discussion in some common law circles (England and Wales and some allied jurisdictions) about whether people might not be better off if parties had to observe a “good faith” obligation. Such an obligation stems from Roman law and thus forms part of the heritage of most European and Western systems of law. It seems that it was not until about the first part of the 19th century that the English common law opted to achieve the objectives of the Roman law concept by means of implying terms into contracts and by interpreting contracts in a reasonably commercial way. That approach does not deal with situations which in other systems would be handled by the use of the obligation as a legal duty, independent of any contract or the prospect of a contract, so other techniques have had to be employed for the pre-contract period. However, the acid test is whether there is any practical advantage or disadvantage in having or not having any such concept as part of the legal principles available. Comparisons with other legal systems have some value but in the world of construction it would be exceptional if a person would only have had a remedy if the other party had been subject to a legal obligation of good faith. Hence our first contribution is very interesting as it examines some common law standard forms which make “good faith” or the like an express contractual obligation. It is entitled “Good Faith Clauses in Construction Contracts: Fine Sentiments in Search of Substance” (page 5) and is by Brian Mason, a solicitor with Mallesons Stephen Jaques, Melbourne, Australia, although the article was written when he was with Herbert Smith LLP in London. In it the author sets out to examine how express contractual provisions of good faith or tantamount to good faith might operate in five typical circumstances. He looks at certain well-known construction contracts, mainly in the United Kingdom, which have such provisions. The five situations are: informing and warning; time bars; exercising discretions; duty to co-operate; and “agreements to agree”. Mr Mason points out that, although there is still insufficient material available from the decisions of courts (and arbitrators) to allow a proper understanding of the precise meaning that might be given to such terms, there is nevertheless an important distinction as to whether an obligation of good faith is to be read as a separate overriding obligation or merely an obligation regulating the exercise of a contractual right or obligation, i e., something in the nature of a contractual aid to interpretation. He concludes that, unless the courts are given appropriate opportunities to consider the legal and practical implications of contractual good faith obligetions, they will remain, as his sub-title suggests, fine sentiments in search of substance.
In 2009 the Danish Society of Construction Law, in conjunction with the European Society of Construction Law, held a conference on public

The International Construction Law Review [2011

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