Good faith as a ‘general organising principle’ of the common law

Abstract

This Note examines two recent landmark decisions of common law courts which qualify good faith as a ‘general organising principle’ of common law. In a judgment of 2015, MSC Mediterranean Shipping Co v Cottonex Anstalt , the English High Court took the age-old discussion as to whether good faith is a general principle of common law to a new level and acknowledged, for the very first time, the existence of an organizing principle of good faith. In that judgment, the High Court referred to a 2014 decision of the Canadian Supreme Court, Bhasin v Hrynew , in which the Court held that good faith contractual performance is a general organizing principle of the common law of contract which underpins and informs more specific rules and doctrines of common law contract law. Both decisions are highly relevant for arbitrators and counsel in international arbitration, given that the general principle of good faith is not only a rule of substantive law, but is also regarded today as a standard for the time- and cost-efficient conduct of the arbitration.