GreenBuild Contractors enters into a contract with EcoHomes to construct a series of environmentally friendly homes. The contract requires GreenBuild to use specific eco-friendly materials and adhere to sustainable building practices. Midway through the project, GreenBuild begins substituting the agreed-upon materials with cheaper alternatives without informing EcoHomes. EcoHomes discovers the substitutions and incurs additional costs to rectify the issues. EcoHomes sues GreenBuild for breach of contract. Did GreenBuild violate the obligation of good faith and fair dealing? Why or why not?
Yes, GreenBuild failed to use the specified materials and did not inform EcoHomes, breaching the duty of good faith and fair dealing.
No, GreenBuild provided the required number of homes, fulfilling their contractual obligation.
No, because GreenBuild acted in the best interest of cost-saving for both parties.
Yes, but only if EcoHomes can prove that the substitutions were of lesser quality.
GreenBuild violated the obligation of good faith and fair dealing by unilaterally substituting the specified materials without informing EcoHomes. This action undermines the trust inherent in the contract and prevents EcoHomes from receiving the agreed-upon benefits, constituting a breach of the duty to act fairly and honestly.
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