“Good faith” as one of the ethical rules has found an important position in contract law. In many countries, good faith is regarded as a mandatory rule to be respected in formation, performance and interpretation of contracts. Good faith is a fundamental principle in almost all civil law countries. This article deals only with good faith in formation of contract. The duty to observe good faith begins from negotiations and pre-contractual relations. In this article, the position of good faith in formation of contract in English and Iranian legal systems will be reviewed. We conclude that unlike civil law countries, the observance of good faith in formation of contract is not regarded as a general rule in common law of England and Iranian law.
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