stethoscope and gavel

Nevada Law Library

Breach Of Implied Covenant Of Good Faith And Fair Dealing – Contract

In Nevada, the elements for a contract claim of breach of the covenant of good faith and fair dealing are:

1.         Existence of a valid contract;

2.         Every contract in Nevada contains an implied covenant to act in good faith in performance and enforcement of the contract;

3.         Justifiable expectation by the plaintiff to receive certain benefits consistent with the spirit of the agreement;

4.         Defendant performed in a manner that was in violation of or unfaithful to the spirit of the contract (the terms of the contract are complied with in a literal sense, but the spirit of the contract is breached);

5.         Unfaithful actions by the defendant were deliberate; and

6.         Causation and damages.

NRS 104.1304; NRS 104.1201(t); Klein v. Freedom Strategic Partners, LLC, 595 F. Supp. 2d 1152 (D. Nev. 2009); George v. Morton, No. 2:06-CV-112-PMP-GWF, 2007 WL 680788, at *8 (D. Nev. 2007); Nelson v. Heer, 123 Nev. 217, 163 P.3d 420 (2007); Ins. Co. of the W. v. Gibson Title Co., Inc., 2006 WL 1278706 (May 11, 2006); State, University and Community College System v. Sutton, 120 Nev. 972, 989, 103 P.3d 8, 19 (Nev. 2004); Frantz v. Johnson, 116 Nev. 455, 465 n. 4, 999 P.2d 351, 358 n. 4 (2000); Perry v. Jordan, 111 Nev. 943, 900 P.2d 335 (1995); Hilton Hotels Corp. v. Butch Lewis Prod., Inc., 107 Nev. 226, 808 P.2d 919 (1991); A. C. Shaw Constr. v. Washoe County, 105 Nev. 913, 784 P.2d 9 (1989); Bowser v. McDonald’s Corp., 714 F.Supp 839 (SD Tex 1989); NRS 104.1203.