Continuous disclosure and good faith

Abstract

The importance of information during the existence of a commercial relationship is widely accepted. However, the extent to which disclosure of information is mandated, or the mechanism which is used to achieve disclosure of information, depends on the particular legal discipline. Corporate law, for example, attempts to achieve disclosure through the statutory doctrine of continuous disclosure. Contract law provides a different mechanism and courts have historically used good faith to ensure disclosure of information, ultimately leading to the duty to act in utmost good faith. This article provides an overview and analysis of these different mechanisms, and proposes that the concept of good faith could fulfil a valuable, complementary function in the context of continuous disclosure in the corporate law arena. Ultimately, this may contribute to fair dealing towards the investing public by the company and those in control of the company, when complying with the continuous disclosure obligation.