A recent decision from Missouri’s Western District Court of Appeals shines a spotlight on one-sided contracts and those who use clever drafting to deprive others of the benefit of the bargain. In Majestic Milling Company, LLC v. River Valley Ag Exchange, LLC (WD87895, March 17, 2026), River Valley sold Majestic a fixed-price contract for 252,000 bushels of soybeans but delivered fewer than 41,000 bushels. River Valley refused to fulfill their entire obligation due to a rise in the market price of soybeans and asserted they could not be liable for their failure to deliver, pointing to explicit contract language stating its failure to supply soybeans "shall not be deemed a breach."
However, Majestic claimed breach of the duty of good faith and fair dealing, which is implied in every Missouri contract, and thwarted River Valley’s plan. The duty of good faith and fair dealing exists to “prevent opportunistic behavior where one party exploits changing economic conditions to the detriment of the other party.” Rock Port Mkt., Inc. v. Affiliated Foods Midwest Coop., Inc., 532 S.W.3d 180, 188 (Mo. App. W.D. 2017). Indeed, “A party breaches the covenant of food faith and fair dealing if it exercises a judgment conferred by the express terms of the agreement in a manner that evades the spirit of the agreement and denies the other party the expected benefit of the agreement. Rock Port, 532 S.W.3d at 188. Relying on the lower court’s factual findings and credibility determinations, the Western District Court of Appeals held that even though River Valley had not breached any explicit term written in the contract, River Valley’s conduct constituted “opportunistic behavior” that the covenant of good faith and fair dealing seeks to prevent. See Rock Port, 532 S.W.3d at 188. Judgment in Majestic’s favor affirmed.
It takes careful planning and skillful execution to convince a fact finder that conduct explicitly permitted under a contract still gives rise to liability. At Cosgrove Simpson, we have successfully argued breach of the covenant of good faith and fair dealing even in circumstances where the opposing party did not breach the terms written in the agreement.
Stacy Frank and Max Simpson