In Welsh v. Heritage Homes of DeLaWarr, 2008 WL 442549 (Del. J.C., February 15, 2008), read here, the chancellery refused to impose the “tie-in” agreement of a contractor as an agreement to agree in the future without final or full conditions. The court found that if the parties had negotiated the open terms that were not in good faith in the LATS, the parties would have reached an agreement on those terms. The Tribunal also found that the good faith agreement required SIGA not to propose substantial changes to the economic conditions previously agreed and included in the LATS. Accordingly, the Tribunal found that SIGA had breached the agreement in good faith and was liable for the full contractual damages, including the benefits that Pharmathene would have obtained if the licensing agreement had been executed in the LATS in accordance with the original economic conditions. Finally, it is essential that the ACT consider all possible outcomes and scenarios if the ACT is terminated prior to the conclusion of the final agreement. These include the description of the provision and liability of all the critical elements of this temporary work, including the following: a recent Delaware case has attracted attention, both for the breach of the duty to bargain in good faith and for the consequences it has in determining the damage caused by that obligation. In the case of Siga Technologies and a second appeal, the parties had entered into a merger agreement containing a provision that, in the event of the merger`s disintegration, the parties negotiate in good faith a licensing agreement (with conditions previously set out in a timetable). The merger did not take place and, as part of the licensing agreement negotiations, Siga Technologies proposed conditions substantially different from those in the prospectus. In the end, the Delaware Supreme Court (in opinions that apply to both Delaware and New York law, at least with respect to the point of restitution) held that such an agreement against an agreement by acts of “bad faith” (in this case by Siga`s suggestion of anti-newspaper terms) could be violated in “the act of being aware of an injustice for the cause of dishonesty or moral purpose.” [T]he ACT is essential that all possible outcomes and scenarios be considered if the ACT is terminated prior to the conclusion of the final agreement.
It will be interesting to see how Delaware legislation evolves in this area. Siga II will likely lead practitioners and parties in Delaware to reconsider the language used in the preliminary agreements, or even to reconsider its use as a whole. If this is not the case, SIGA II warns that a party`s good faith agreement must be taken very seriously. Compare this to the recent decision of the County Chancery Court of Pharmathene, Inc. against SIGA Technologies, Inc., which was summarized here on this blog, which, on the basis of the facts of this case, rejected a motion to dismiss a complaint to enforce an agreement of agreement in the future. While the facts were unusual in this case (and the judgments were highly factual), the case serves as a reminder that explicit agreements in good faith, in good faith, are enforceable, are binding commitments in Delaware and many other states, and that the intent of the parties is the key. In the event of an explicit agreement on consent to the terms defined in accordance with a terminology sheet, the parties cannot propose, in bad faith, clauses that are “substantially different” from those in the terminology sheet.