'...However, current law stops well short of imposing a duty to negotiate in good faith. Rather, these developments would appear to favor the acceptance of a duty not to negotiate in bad faith. Further, the application of equitable estoppel in appropriate situations would appear to be an appropriate mechanism for the basis of developing a good faith doctrine. ' --Jane Edwards
'Once one uses the external standard of reasonableness the reference to honest men adds little.' --Johan Steyn
English law generally involves 'adopting an external standard given life by using the concept of the reasonable man' . The commercial advantage of this approach as Johan Steyn seen is that it 'promotes certainty and predictability in the resolution of contractual disputes' . My paper is going to cite the case 'Waltons v Maher'(1988) to examine how this approach is actually in accordance with the legal principle of 'good faith', in other words how this principle endeavors to ensure the reasonable expectations of the contractual parties being satisfied.
The simple facts regarding the case 'Waltons v Maher (1988) are: two parties were negotiating the lease of Maher's land to Waltons, an agreement was reached and a contract had been drawn up and signed by Maher. Waltons had, via their laywers, indicated that the contracts were either exchanged or about to be exchanged. Walton, however, then withdrew from the negotiation. By that stage, Maher completed almost half of the construction. The majority of decision in 'Waltons v Maher (1988) by the High Court was based on the modern doctrine of estoppel.
As the Court of Appeal pointed out, estoppel requires a promise to have been made by the person against whom estoppel is alleged. There must also be an existing relationship between the promisor and the promisee. In this case,