Contracts
In New York, which of the following represents an 'implied covenant' that courts will read into most real estate contracts?
AA right to terminate the contract for any reason within 30 days
BA covenant of good faith and fair dealing — requiring each party to act in good faith in performing their contractual obligations✓ Correct
CA right of first refusal on any future sale
DA warranty that the property will appreciate in value
Explanation
New York courts recognize an implied covenant of good faith and fair dealing in all contracts, including real estate contracts. This covenant requires each party to act in good faith in performing their contractual obligations and not to act in a way that deprives the other party of the benefits they contracted for.
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