Delaware Business Litigation Report

Court Of Chancery Continues To Explain Bad Faith

Stewart v. BF Bolthouse Holdco LLC, C.A. 8119-VCP (August 30, 2013)

The interplay between fiduciary duties and contractual obligations is often hard to understand.  Add to that the task of explaining the duty to act in good faith and deal fairly and the law is even more confusing. This decision does a good job of cutting through that problem to explain: (1) when a complaint alleges enough facts to state a claim for acting in bad faith, (2) when contractual obligations take the place of fiduciary duties, and (3) when the obligation to act fairly is not superseded by contract.

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