Utmost Good Faith in UK Law

Leading Cases
  • Bell v Lever Bros Ltd
    • House of Lords
    • 15 Dic 1931

    There are certain contracts expressed by the law to be contracts of the utmost good faith where material facts must be disclosed; if not the contract is voidable. Apart from special fiduciary relationships contracts for partnership and contracts of insurance are the leading instances. In such cases the duty does not arise out of contract; the duty of a person proposing an insurance arises before a contract is made; so of an intending partner.

  • Strive Shipping Corpn v Hellenic Mutual War Risks Association (Bermuda) Ltd
    • Queen's Bench Division (Commercial Court)
    • 25 Mar 2002

    The breach of that duty by the insurers would be so unconscionable as to disentitle the insurers from invoking the equitable jurisdiction of the court to avoid the contract on the grounds of non-disclosure by the assured.

  • Manifest Shipping Company Ltd v Uni-Polaris Shipping Company Ltd (Star Sea)
    • House of Lords
    • 18 Ene 2001

    In my view the idea of good faith in the context of insurance contracts reflects the degrees of openness required of the parties in the various stages of their relationship. It is reasonable to expect a very high degree of openness at the stage of the formation of the contract, but there is no justification for requiring that degree necessarily to continue once the contract has been made.

  • Banque Financiere de la Cite S.A. (formerly Banque Keyser Ullmann S.A.) v Westgate Insurance Company Ltd (formerly Hodge General & Mercantile Company Ltd); Banque Keyser Ullmann S.A. v Skandia (U.K.) Insurance Company Ltd
    • Court of Appeal (Civil Division)
    • 28 Jul 1988

    In our judgment, the duty falling upon the insurer must at least extend to disclosing all facts known to him which are material either to the nature of the risk sought to be covered or the recoverability of a claim under the policy which a prudent insured would take into account in deciding whether or not to place the risk for which he seeks cover with that insurer.

    We do not think that the nature of the contract as one of the utmost good faith can be used as a platform to establish a common law duty of care. Parliament has provided that in the case of marine insurance the consequence of a failure to disclose a material fact, and by inference the only consequence, is that the contract may be avoided. It is not suggested that the consequences in non-marine insurance should be different.

  • CPC Group Ltd v Qatari Diar Real Estate Investment Company
    • Chancery Division
    • 25 Jun 2010

  • R v Coutts (Graham James)
    • House of Lords
    • 19 Jul 2006

    I am persuaded that this is an unworkable test to apply to a jury trial. There is no reliable means by which an appellate court can, on so particular a basis, measure whether or how a jury may react to an unnatural limitation of the choices put before it. One is entitled to assume that juries go about their task in the utmost good faith, but the concern is with sub-conscious as well as conscious reactions.

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  • Insurance Act 2015
    • UK Non-devolved
    • 1 de Enero de 2015
    ...... a matter of expectation or belief is made in good faith. . (4) The disclosure required is as ... avoid the contract on the ground that the utmost good faith has not been observed by the other ......
  • Marine Insurance Act 1906
    • UK Non-devolved
    • 1 de Enero de 1906
    ......   . ( a . ) Any ship goods or other moveables are exposed to. maritime ... insurance is a contract based upon the utmost good faith, and, if the utmost good faith be not ......
  • Consumer Insurance (Disclosure and Representations) Act 2012
    • England & Wales
    • 1 de Enero de 2012
    ...... consumer insurance contract is one of the utmost good faith is modified to the extent required by ......
  • Insurance Brokers Registration Council (Code of Conduct) Approval Order 1978
    • UK Non-devolved
    • 1 de Enero de 1978
    ...... at all times conduct their business with utmost good faith and integrity. B. Insurance brokers ......
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Books & Journal Articles
  • The Insurance Act 2015: Rebalancing the Interests of Insurer and Assured
    • Núm. 78-6, Noviembre 2015
    • The Modern Law Review
    The Insurance Act 2015 is the first piece of legislation since the eighteenth century to seek to lay down new principles governing the formation and operation of insurance contracts. Exactly 250 ye...
    ...... the routinely-cited principle of utmost good faith in insurance law in Carter v Boehm ......
  • Reconstructing Insurance Law: The Law Commissions' Consultation Paper
    • Núm. 71-1, Enero 2008
    • The Modern Law Review
    In July 2007 the English and Scottish Law Commissions published the consultation paper Insurance Law – Non‐disclosure and Breach of Warranty (hereafter LCCP) which sets out in detail the Commission...
    ...... reference to the key areas of utmost good faith, warranties and agency . Thi s ......
  • The Journey of Good Faith: Where Does It belong in General Contract Law?
    • Núm. 9-1, Enero 2019
    • Southampton Student Law Review
    • Elizabeth Barrett
    • University of Southampton
    • 64-91
    This piece considers the doctrine of good faith and its existence in contract law which began with Lord Mansfield’s judgment in Carter v Boehm. Then, reconsiders the general contract law approach i...
    ......8 Thus, illustrating the basis of an utmost good faith requiremen t in insurance was to protect the trust and confidence of the contract upon which performance is relyin g on. ......
  • The Duty of Pre-Contractual Disclosure in English Insurance Law: Past and Future - Does the Law Need to be Changed?
    • Núm. 5-1, Enero 2015
    • Southampton Student Law Review
    • Laura Reeves
    • University of Southampton
    • 1-14
    Currently UK insurance law as a whole is subject to reform and change. One particularly interesting change surrounds the duty of pre-contractual disclosure. Royal Assent has been given to the Insur...
    ...... much earlier than the UK, in which bears a good comparison as to how well the new rules ...: pre -contractual disclosure, utmost good faith, Insurance Act 2015, ......
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Law Firm Commentaries
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