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LSDefine

Simple English definitions for legal terms

duty of good faith

Read a random definition: illusory-transfer doctrine

A quick definition of duty of good faith:

The duty of good faith is a rule that says people who make decisions for a company must do so with honesty and responsibility. They cannot make choices that benefit themselves instead of the company. Breaking this rule can happen if someone ignores their duties, acts for their own benefit, or breaks the law on purpose. Even though shareholders cannot sue for breaking this rule, it can still be a problem if it goes against the duty of loyalty. The Uniform Commercial Code also says that every contract or duty must be done with good faith.

A more thorough explanation:

The duty of good faith is a principle that requires directors and officers of a corporation to act with a conscious regard for their responsibilities as corporate fiduciaries. This means that they must act honestly and in the best interest of the corporation when making decisions.

Examples of violating the duty of good faith include:

  • Intentionally neglecting the usual duties of a director or officer
  • Acting for a purpose other than the benefit of the corporation
  • Intentionally violating the law

For instance, if a director of a company decides to award a contract to a friend's company instead of the one that offers the best value to the corporation, they would be violating the duty of good faith.

It's important to note that there is no private shareholder right of action for a violation of the duty of good faith. However, its violation may also raise a claim under the duty of loyalty.

The Uniform Commercial Code section 1-304 also provides that every contract or duty within the Uniform Commercial Code imposes an obligation of good faith in its performance and enforcement. This means that parties to a contract must act honestly and fairly when performing and enforcing the terms of the contract.

duty of care | duty of loyalty

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babycat
19:51
I love when a Latina is redhead. Like damn bitch u really have it all
19:52
let me check the chart, let me check the chart- that is not readable! off the chart, HOUSTON WE HAVE A PROBLEM!
babycat
19:53
hahahaha
19:54
ok I gotta go, my time derailing the LSD general is over. sowwy! byeee
bye bye bestie
Dkk
19:54
Nah not in my case lol. It's cus you posted in general! That way you could tag me!
19:54
*good ridden!*
Dkk
19:54
Adios!
[] notacat
20:50
Do you guys know if the LSAdmit program is working on your end right now? It's not working on mine
20:53
Anyone here done the Cornell Kira? Was wondering if anyone had any tips 🙏
21:13
@KnowledgeableRitzyWasp: ^^ seeking corn-hell advice
21:15
@babycat: unrelated but every time I saw ur old handle i thought of this lyric: https://youtu.be/V90loMCyxa0?t=34
What does "Hold" mean on the result column?
21:28
@ClockworkBlue: on LSD?
yeah
babycat
21:30
A hold is not exactly a waitlist, but it means they’re waiting to give you a decision later
babycat
21:31
@llama: nice
21:32
@ClockworkBlue: what babycat said, the link reads as the school always initiates the 'hold' status, however [in my case] sometimes applicants ask to be placed on 'hold' pending a score (LSAT, final semester of UG, etc).
21:32
@babycat: just had to get that off my chest.
cornell kira is just about performing well under pressure and having substantive content in your questions
so just try to stay calm and pace your responses so you give good answers during the interview
21:44
so just don't sperg out on camera and ur good?
yeah pretty much, you get some leniency too. they expect you to not be perfect under pressure
babycat
22:09
i’m sleepy :(
go to sleeb
ShiveringCleverFlounder
0:24
Hey guys it all works out, I’m in law school now with a phat scholly just so yall know there’s light at the end of the apps tunnel
Wrong I’m homeless
ShiveringCleverFlounder
0:25
bro what
m10
3:20
Wow, Stanford PhD big brain here. Yikes!: https://x.com/dotkrueger/status/1850698550297899235
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