good-faith dispute
Definition
A good-faith dispute is a genuine, honest disagreement between two parties where both sides sincerely believe they are in the right. It is not a made-up excuse to avoid paying a bill or fulfilling an obligation, but rather a real difference of opinion about what was owed, promised, or delivered.
Example
If a contractor bills you $10,000 for work you believe was only worth $7,000 because they left the job unfinished, your refusal to pay the full amount would likely qualify as a good-faith dispute.
Watch Out
Courts take a hard look at whether a dispute is truly genuine, so if you withhold payment or refuse a contract obligation without solid reasoning to back you up, a judge may rule that you acted in bad faith and hit you with extra penalties.
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This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.