Opinion ID: 170014
Heading Depth: 2
Heading Rank: 5

Heading: Good Faith and Fair Dealing in Tort.

Text: While the contract itself is governed by Tennessee law, Wyoming also recognizes a tort action for breach of contractual good faith. So far Wyoming has found this duty as a tort only in rare and exceptional circumstances, such as first-party insurance contracts and long-term employment contracts. Roussalis v. Wyo. Med. Ctr., Inc., 4 P.3d 209, 256 (Wyo.2000). However, the Wyoming Supreme Court has not said that insurance and employment are the outer limits of the tort. Instead, the tort could exist in other special relationship[s] of trust and reliance. Wilder v. Cody Country Chamber of Commerce, 868 P.2d 211, 221 (Wyo.1994). Th[e] driving rationale for tort liability is a long term contract that has inequality of bargaining power. Roussalis, 4 P.3d at 256. See also State Farm Mut. Auto. Ins. Co. v. Shrader, 882 P.2d 813, 825 (Wyo.1994) (A recovery in tort for breach of the duty of good faith and fair dealing is premised upon the existence of a special relationship created by the unequal bargaining power that an insurer has over an insured.). Whether the Hospital's and Healthcare Realty's relationship is the kind of special relationship envisioned by the Wyoming tort is a close question. The Hospital relied on Healthcare Realty for advice about what management scheme would be most financially viable, and their contract explicitly recognized the long-term relationship and mutual obligations of the parties. Furthermore, their relationship was one of unequal information because of Healthcare Realty's joint role as consultant and business partner. Unequal information generally amounts to unequal bargaining power. See generally Roger B. Myerson, Two-Person Bargaining Problems with Incomplete Information, 52 Econometrica 461 (1984). However, the Operating Agreement explicitly disavows a number of relationships between the parties that might approximate the ones deemed special under Wyoming lawemployer-employee, principal-agent, etc. Further, the Hospital is not an economically unsophisticated party. The employment and insurance contexts suggest that the tort should be limited to long-term relationships of greatly unequal resources or unequal legal sophistication. Given the Wyoming Supreme Court's elaboration of the tort so far, we will not extend the tort to a case of mere unequal information between the parties.