Legal Definitions - bad faith

Definition: Bad faith refers to dishonesty or fraud in a transaction. It means that someone is not acting honestly or fairly in a situation where they have a duty to do so. This can include a dishonest belief or purpose, untrustworthy performance of duties, neglect of fair dealing standards, or a fraudulent intent. It is often related to a breach of the obligation inherent in all contracts to deal with the other parties in good faith and with fair dealing.

• A car salesman who sells a car that they know is defective without telling the buyer is acting in bad faith.
• An insurance company that denies a legitimate claim without a valid reason is acting in bad faith.
• A landlord who refuses to make necessary repairs to a rental property is acting in bad faith.

These examples illustrate how bad faith can occur in different situations. In each case, someone is not acting honestly or fairly, and is not fulfilling their obligations to the other party. This can lead to legal consequences and damages for the party who was harmed by the bad faith behavior.