good faith

Good faith is an intangible and abstract quality with no technical meaning or statutory definition, and it encompasses, among other things, an honest belief, the absence of malice and the absence of design to defraud or to seek an unconscionable advantage, and an individual's personal good faith is concept of his own mind and inner spirit and, therefore, may not conclusively be determined by his protestations alone. Doyle v. Gordon, 158 N.Y.S.2d 248, 259, 260.

Honesty of intention, and freedom from knowledge of circumstances which ought to put the holder upon inquiry. An honest intention to abstain from taking any unconscientious advantage of another, even through technicalities of law, together with absence of all information, notice, or benefit or belief of facts which render transaction unconscientious. In common usage this term is ordinarily used to describe that state of mind denoting honesty of purpose, freedom from intention to defraud, and, generally speaking, means being faithful to one's duty or obligation. Efron v. Kalmanovitz, 249 Cal.App. 187, 57 Cal.Rptr. 248, 251.

See bona fide

Compare bad faith.

Bankruptcy law.

"Good faith" as used in statute requiring debtor to propose Chapter 13 plan in good faith has a meaning consisting of two elements: honesty of purpose and full and complete disclosure of the financial facts of the debtor. Matter of Harper, Bkrtcy.Ga., 11 B.R. 395, 396.

Commercial law.

Honesty in fact in the conduct or transaction concerned. U.C.C. No. 1-201(19). In the case of a merchant, honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade. U.C.C. No. 2-103(lXb).

Insurance law.

"Good faith" required of a liability insurer in determining whether to accept settlement within policy limits implies honesty, fair dealing and full revelation; while "bad faith" implies dishonesty, fraud and concealment. Davy v. Public Nat. Ins. Co., 181 C.A.2d 387, 5 Cal.Rptr. 488, 492