Home > West's Encyclopedia of American Law > Good Faith

Honesty; a sincere intention to deal fairly with others.

Good faith is an abstract and comprehensive term that encompasses a sincere belief or motive without any malice or the desire to defraud others. It derives from the translation of the Latin term bona fide, and courts use the two terms interchangeably.

The term good faith is used in many areas of the law but has special significance in COMMERCIAL LAW. A good faith purchaser for value is protected by the UNIFORM COMMERCIAL CODE, which every state has adopted. Under sections 1-201(9) and 2-403 of the code, a merchant may keep possession of goods that were bought from a seller who did not have title to the goods, if the merchant can show he or she was a good faith purchaser for value. To meet this...