Does the doctrine of good faith and fair dealing apply to fraud?

California, United States of America


The following excerpt is from Hunter v. Up-Right, Inc., 26 Cal.Rptr.2d 8, 6 Cal.4th 1174, 864 P.2d 88 (Cal. 1993):

Consequently, while the duty to treat a party with whom one enters into contract in good faith can be seen as only a contractual duty, the obligation [6 Cal.4th 1189] to refrain from committing fraud is a duty imposed by society to govern commercial and other human relationships, regardless of whether those relationships are contractual. And, unlike the tortious breach of the covenant of good faith and fair dealing, the tort of fraud has never depended on the existence of a "special relationship" between the tortfeasor and the tort victim. As this court stated over 100 years ago: " 'It may safely be averred that all deceitful practices in depriving or endeavoring to deprive another of his known right by means of some artful device or plan, contrary to the rules of common honesty, is fraud.' " (Newman v. Smith (1888) 77 Cal. 22, 26, 18 P. 791.) Nothing in Foley alters the availability of a fraud action when a plaintiff is the victim of such deceitful practices.

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