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Introduction
Australia has not yet committed itself to a definitive principle of good faith in contract law. Unlike the legal systems in Europe and the United States, Australia does not demand an explicit legal prerequisite of good faith to form a contract.[1] Decisions in different jurisdictions have however considered the validity of the values identified in the doctrine of good faith within contract law, such as loyalty, honesty and cooperation. Good faith is valuable because it provides confidence in the formation of contracts between two parties. However there are conflicting views and criticisms of the doctrine of good faith.
The “pragmatic theory of cooperation” [2] underlines the effectiveness of the common law system and emphasizes that there is not a need for a clearly defined doctrine of good faith. Economic theory (the “repugnancy thesis of self interest”) goes further and criticizes the ability the doctrine holds to oppressively “constrains the pursuit of......

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Approximate Word Count: 8790
Approximate Pages: 36 (250 words per double-spaced page)

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