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16 William Mitchell Law Review 1105 (1990)


This article examines areas of the law with thin jurisprudences on good faith, and how the Uniform Commercial Code’s (UCC’s) express statutory rules have become an active laboratory of experiments on good faith. Part I discusses the general obligation of good faith under the UCC. Part II lays out and discusses how the specific UCC provisions on good faith serve one or more of the following functions: restrict the exercise of one-sided power in a contract, in order to avoid unfair or unexpected results; restrict the range of possible responses to defective performance or to an unexpected event, in order to salvage the contractual relationship or preserve the parties' negotiating positions; impose a duty to mitigate losses, in order to avoid giving the aggrieved party a windfall beyond the expectations of the contract; and protect the innocent third party buyer or purchaser against claims of the original owner and other claimants. This functional analysis of good faith in the UCC results in clearer definitions of “good faith” in each of the four categories discussed through a determination of the function that good faith serves in each type of situation.

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