Category: Contract

Dike v Rickman and Another: QBD 22 Nov 2005

The claimant had been given a reference which said that three complaints of sexual harrassment had been made against him which had been dealt with by cautions. He said that the acts complained of did not amount to sexual harassment.
Held: When giving a reference, the requirement was not to use a dictionary or legal definition of a term used, but rather to convey a proper sense of what had happened. That criteria was met and the claim failed.

Citations:

Times 07-Dec-2005

Jurisdiction:

England and Wales

Contract, Negligence

Updated: 12 April 2022; Ref: scu.235774

Picton Jones and Co v Arcadia Developments: 1989

The plaintiff chartered surveyors agreed to act in the purchase of amusement arcades, on the basis that their fees would be payable ‘in the event of ultimate success.’ The work involved applications for gaming licences and planning permissions. The work was successful, but the defendants would not pay the bill, saying the agreement was champertous and therefore unenforceable.
Held: The rule against champertous contracts applies only to work involving litigation, and so the agreement was not champertous. The fact that a professional rule prohibits certain actions does not of itself make such actions unlawful outside that professional context.

Judges:

Judge J

Citations:

[1989] 03 EG 85

Jurisdiction:

England and Wales

Citing:

Considered – Savill Bros v Langman 1898
The court considered whether an agreement was champertous in the context of an application to licensing justices who were not considered to be sitting as a court and before whom there is no contest. . .
Considered – In re Trepca Mines (No 2) CA 1962
Champerty: Lord Denning MR said: ‘The reason why the common law condemns champerty is because of the abuses to which it may give rise. The common law fears that the champertous maintainer might be tempted, for his own personal gain, to inflame the . .
Considered – Wallersteiner v Moir (No 2) CA 1975
The court was asked whether Moir would be entitled to legal aid to bring a derivative action on behalf of a company against its majority shareholder.
Held: A minority shareholder bringing a derivative action on behalf of a company could obtain . .
Cited – Pickering v Sojex Services UK 1982
An agreement by a chartered surveyor to take payment for negotiating a reduction in rateable value conditional upon success was not champertous since no litigation was envisaged. . .
Considered – Trendtex Trading Corporation v Credit Suisse CA 1980
A stay was sought against a bank which had financed a contract and was supporting litigation arising out of it.
Held: Although the liability in crime and tort had been abolished, Section 14(2) of the 1967 Act preserved the law as to the cases . .
Considered – Regina v McFadden and Cunningham 1976
The court was asked whether a professionally improper agreement was thereby illegal also. . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 12 April 2022; Ref: scu.223958

Bem Dis A Turk Ticaret S/A Tr v International Agri Co Ltd; “SELDA”: ComC 31 Oct 1997

The seller had repudiated a CandF contract containing a GAFTA default clause, which did not include any provision allowing the recovery of expenses occasioned by the breach. The buyers made no claim for damages based on the difference between the contract price and the market price or value, presumably because the market had moved in their favour since the original contract was made. They claimed only the expenses occasioned by the repudiation. They recovered them from the arbitrators
Held: The arbitrator’s award was affirmed. At common law the buyer’s remedy for failure to perform a contract of sale of goods is to claim damages for non-delivery. Where there was an available market, the measure of damages is prima facie to be ascertained by the difference between the contract price and the market or current price of the goods at the time or times when they ought to have been delivered.
Held:
Arbitration appeal from Gafta. Construction of default clause 28 in Gafta – Form 100.

Judges:

Clarke J

Citations:

[1998] 1 Lloyd’s Rep 416, Times 13-Dec-1997

Jurisdiction:

England and Wales

Cited by:

Cited – Fleming and Wendeln Gmbh and Co v Sanofi Sa/Ag ComC 20-Mar-2003
The parties concluded a contract for the sale and purchase of 20,000MT up to 30,000MT at Sellers’ option Russian/Ukrainian black sunseed crop 1997. The price was to ‘be fixed for each shipment latest 15 days prior delivery . . In case . .
Cited – Bunge Sa v Nidera Bv SC 1-Jul-2015
The court considered the effect of the default clause in a standard form of contract which is widely used in the grain trade. On 10 June 2010 the respondents, Nidera BV, whom I shall call ‘the buyers’, entered into a contract with the appellants, . .
Lists of cited by and citing cases may be incomplete.

Contract, Arbitration

Updated: 12 April 2022; Ref: scu.220805

Anglo Group Plc, Winther Brown and Co Ltd v Winter Brown and Co Ltd, BML (Office Computers) Ltd, Anglo Group Plc, BML (Office Computers) Ltd: TCC 8 Mar 2000

Contract – Contract for provision of computer services – purchaser contract with finance company – duty of co-operation to be implied in computer contracts – practice – responsibilities of expert witnesses generally – whether computer company liable to purchaser – whether purchaser liable to finance company.
The parties disputed the delivery and quality of a computer system. The buyer complained of many defects and eventually sought to reject the system.
Held: Anglo’s claim succeeded. The court provided updated Ikarian Reefer guidelines for expert witnesses. The court criticised one expert witness for failing to keep separate his role as negotiator and witness. It is normally inappropriate to seek to combine the two.
The court gave Ikarian Reefer guidelines updated to comply with the CPR:
‘1.An expert witness should at all stages in the procedure, on the basis of the evidence as he understands it, provide independent assistance to the court and the parties by way of objective unbiased opinion in relation to matters within his expertise. This applies as much to the initial meetings of experts as to evidence at trial. An expert witness should never assume the role of an advocate.
2. The expert’s evidence should normally be confined to technical matters on which the court will be assisted by receiving an explanation, or to evidence of common professional practice. The expert witness should not give evidence or opinions as to what the expert himself would have done in similar circumstances or otherwise seek to usurp the role of the judge.
3.He should co-operate with the expert of the other party or parties in attempting to narrow the technical issues in dispute at the earliest possible stage of the procedure and to eliminate or place in context any peripheral issues. He should co-operate with the other expert(s) in attending without prejudice meetings as necessary and in seeking to find areas of agreement and to define precisely arrears of disagreement to be set out in the joint statement of experts ordered by the court.
4.The expert evidence presented to the court should be, and be seen to be, the independent product of the expert uninfluenced as to form or content by the exigencies of the litigation.
5.An expert witness should state the facts or assumptions upon which his opinion is based. He should not omit to consider material facts which could detract from his concluded opinion.
6.An expert witness should make it clear when a particular question or issue falls outside his expertise.
7.Where an expert is of the opinion that his conclusions are based on inadequate factual information he should say so explicitly.
8.An expert should be ready to reconsider his opinion, and if appropriate, to change his mind when he has received new information or has considered the opinion of the other expert . He should do so at the earliest opportunity.’

Judges:

Toulmin QC J

Citations:

[2000] EWHC Technology 127, (2000) 144 Sol Jo LB 197

Links:

Bailii

Statutes:

Supply of Goods and Services Act 1982 9

Jurisdiction:

England and Wales

Citing:

Clarified – National Justice Compania Naviera S A v Prudential Assurance Company Ltd (‘The Ikarian Reefer’) 1993
Cresswell J spoke of the nature of the duty owed by expert witnesses: ‘The duties and responsibilities of expert witnesses in civil cases include the following:

1. Expert evidence presented to the Court should be, and should be seen to be, the . .
Cited – Graigola Merthyr Co Ltd v Swansea Corporation CA 1928
The plaintiff mine-owner having had a contract that the neighbouring land owner would not refill its reservoir which would result in its workings being flooded, and that contract having expired, now sought an injunction to prevent the reservoir from . .
Cited – Edwin John Stevens v R J Gullis and David Pile CA 27-Jul-1999
The new Civil Procedure Rules underline the existing duty which an expert owes to the Court as well as to the party which he represents. . .
Cited – Tradition (UK) Ltd, Tradition Bond Brokers Limited, Howard, Harland v Cantor Fitzgerald International ChD 15-Apr-1999
When deciding whether a copying of a computer program was substantial, the test was not whether the program would run without that code. It had to be looked at as a whole allowing for the skill and labour which had gone into different sections of . .
Cited – Cala Homes (South) Ltd and others v Alfred McAlpine Homes East Ltd ChD 6-Jul-1995
The plaintiff alleged that the defendant had copied its house designs after a senior employee involved in creating the designs left and eventually came to work for the defendant. The plaintiff alleged that the copying was flagrant allowing . .
Cited – Cullinane v British ‘Rema’ Manufacturing Co Ltd CA 1954
The court considered the possibility of a claim in breach of contract for damages for both capital loss and loss of profit.
Lord Evershed MR said: ‘It seems to me, as a matter of principle, that the full claim of damages in the form in which . .
Cited – Hong Kong Fir Shipping Co v Kawasaki Kisen Kaisha Ltd CA 20-Dec-1961
The plaintiffs had recently acquired the ship the ‘Hong Kong Fir’ and contracted to charter it to the defendants, but being late in delivering it, the defendants cancelled the charterparty contract. The plaintiffs said the repudiation was wrongful, . .
Cited – Anglia Television v Oliver Reed CA 1971
The television company had agreed with the actor defendant for him to appear in a production. He breached the contract. The company sought both loss of profits and for the expense incurred. The issue before the Court of Appeal was whether such . .
Cited – Lep Air Services v Rolloswin Investments Ltd; Moschi v LEP Air Services HL 1973
The obligation of a guarantor under a contract ‘is not an obligation himself to pay a sum of money to the creditor, but an obligation to see to it that another person, the debtor, does something.’ When a repudiatory breach is accepted by the injured . .
Cited – Branwhite v Worcester Works Finance Ltd HL 1969
A dealer may for some ad hoc purpose be the agent of a finance company. In relation to a purchase of a motor vehicle through a motor dealer, where the prospective purchaser completes an application for hire purchase in the office of the motor . .
Cited – Lease Management Services Ltd v Purnell Secretarial Services Ltd CA 1-Apr-1994
A leasing company adopting the style of a like supplier had to adopt that supplier’s representations. . .
Cited – Sovereign Finance v Silver Crest 1997
. .
Cited – Dunlop Pneumatic Tyre Company Ltd v New Garage and Motor Company Ltd HL 1-Jul-1914
The appellants contracted through an agent to supply tyres. The respondents contracted not to do certain things, and in case of breach concluded: ‘We agree to pay to the Dunlop Pneumatic Tyre Company, Ltd. the sum of 5 l. for each and every tyre, . .
Lists of cited by and citing cases may be incomplete.

Litigation Practice, Contract, Agency

Updated: 12 April 2022; Ref: scu.201803

Barton, Thompson and Co v Stapling Machines Co: CA 1966

Citations:

[1966] 2 All ER 222

Jurisdiction:

England and Wales

Cited by:

Cited – Goker (Ali) v NSW Bank CA 23-May-1990
In the case of a hire purchase agreement, the court has a power to grant relief from forfeiture, but will not normally exercise that power unless there is no real prejudice to the owner of the goods. . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 12 April 2022; Ref: scu.199786

Lipkin Gorman v Karpnale Ltd: CA 1989

A partner in a firm of solicitors stole money from them, and spent it gambling with the defendants. The firm sued also their banker, who had been held to be aware of the defaulting partner’s weaknesses and activities.
Held: The solicitors could not recover from the gambling house. The defendants gave valuable consideration in good faith for the cheques taken by the partner.
A bank will be liable for honouring a cheque drawn by one of the partners in fraud of the others if ‘a reasonable and honest banker [who] knew of the relevant facts would have considered that there was a serious or real possibility, albeit not amounting to a probability, that its customer might be being defrauded . . That at least the customer must establish.’
May LJ said: ‘The money which a customer deposits with a bank becomes the bank’s money, but the bank is prima facie bound to meet its debt when called upon to do so by the customer. The arrangement between some banks of giving references secretly could not displace the rule in Tournier. The bank was in breach of its contract.’
Nicholls LJ said: ‘the chips were not money or money’s-worth; they were mere counters or symbols used for the convenience of all concerned in the gaming. As tokens, the chips indicated that the holder had lodged cash with the club or, when a cheque had been used, had been given credit by the club, to the extent indicated by the tokens. It is as though the customer had been given a series of receipts in respect of the money handed over by him prior to beginning to play. The money was to go to the winners, or be returned to the customer if not spent on gaming. When the customer played at the table he was playing with the money he had brought with him to the casino, just as much as if he had used the banknotes themselves rather than the chips for which he had exchanged the banknotes preparatory to the start of play. I do not believe that this internal, preliminary, preparatory step, of issuing chips for cash, adopted for considerations of practical convenience, can have the effect in law that the club gave valuable consideration for the money it received, when the position in law under the statute is that if money rather than tokens had been used at the table, the club would not have given valuable consideration. I find such a conclusion repugnant to common sense.’
Parker LJ said that the defendants had given good consideration for two reasons. The club supplied chips in exchange for the money. The contract under which the chips were supplied was a separate contract, independent of the contracts under which bets were placed at the club; and the contract for the chips was not avoided as a contract by way of gaming and wagering under section 18 of the Gaming Act 1845. Secondly, although the actual gaming contracts were void under the Act, nevertheless Cass in fact obtained in exchange for the money the chance of winning and of then being paid and so received valuable consideration from the club.

Judges:

Parker LJ, May LJ, Nicholls LJ

Citations:

[1989] 1 WLR 1340

Statutes:

Gaming Act 1845 18

Jurisdiction:

England and Wales

Citing:

At first Instance – Lipkin Gorman (a Firm) v Karpnale Ltd 1987
A partner in the plaintiff firm of solicitors stole money from them and spent it gambling in the defendant’s casino. The plaintiff cought to recover the money from the defendant, saying that as a gambling debt, no consideration had been given. They . .
Cited – Tournier v National Provincial and Union Bank of England CA 1924
The court considered the duty of confidentiality owed by a banker to his client. Bankes LJ said: ‘At the present day I think it may be asserted with confidence that the duty is a legal one arising out of contract, and that the duty is not absolute . .

Cited by:

At CA – Lipkin Gorman (a Firm) v Karpnale Ltd HL 6-Jun-1991
The plaintiff firm of solicitors sought to recover money which had been stolen from them by a partner, and then gambled away with the defendant. He had purchased their gaming chips, and the plaintiff argued that these, being gambling debts, were . .
Cited – Sandra Estelle Fielding v The Royal Bank of Scotland Plc CA 11-Feb-2004
The husband and wife had signed a bank mandate allowing the bank to act upon the authorisation of either of them. The wife complained that the bank should not be able to recover from her any sums expended by the husband.
Held: The mandate . .
Cited – National Westminster Bank plc v Spectrum Plus Limited and others HL 30-Jun-2005
Former HL decision in Siebe Gorman overruled
The company had become insolvent. The bank had a debenture and claimed that its charge over the book debts had become a fixed charge. The preferential creditors said that the charge was a floating charge and that they took priority.
Held: The . .
Mentioned – Turner v Royal Bank of Scotland Plc CA 24-Mar-1998
The plaintiff complained as to the provision of references by his bank. The bank said he had given an implied permission through the bank which had made the request. Later changes in the bankers code of practice would have required explicit written . .
Lists of cited by and citing cases may be incomplete.

Banking, Equity, Contract

Updated: 12 April 2022; Ref: scu.194782

Blacker v Lake and Elliot Ld: HL 1912

A brazing lamp which, by exploding owing to a latent defect, injured a person other than the purchaser of it, and the vendor was held not liable to the party injured. The House considered earlier cases on liability for defectively manufactured goods: ‘The breach of the defendant’s contract with A. to use care and skill in and about the manufacture or repair of an article does not of itself give any cause of action to B. when he is injured by reason of the article proving to be defective.’

Judges:

Lord Sumner

Citations:

(1912) 106 LT 533

Jurisdiction:

England and Wales

Citing:

Cited – Langridge v Levy ExP 1836
A man sold a gun which he knew to be dangerous for the use of the purchaser’s son. The gun exploded in the son’s hands.
Held: The son had a right of action in tort against the gunmaker, but, Parke B said: ‘We should pause before we made a . .
Cited – Winterbottom v Wright 1842
Owing to negligence in the construction of a carriage it broke down. A third party sought damages for injuries which he alleged were due to negligence in the work.
Held: The doctrine of privity of contract precluded actions in tort by third . .
Not followed – George v Skivington 1869
There was an injury to the wife, from a hair wash purchased under a contract of sale with the husband.
Held: The wife had a good cause of action. There was a duty in the vendor to use ordinary care in compounding the article sold, and that . .

Cited by:

Cited – Donoghue (or M’Alister) v Stevenson HL 26-May-1932
Decomposed Snail in Ginger Beer Bottle – Liability
The appellant drank from a bottle of ginger beer manufactured by the defendant. She suffered injury when she found a half decomposed snail in the liquid. The glass was opaque and the snail could not be seen. The drink had been bought for her by a . .
Lists of cited by and citing cases may be incomplete.

Contract, Negligence

Updated: 12 April 2022; Ref: scu.192607

Jewson Limited v Boyhan as Personal Representative of the Estate of Thomas Michael Kelly: CA 28 Jul 2003

The company appealed a finding that it was in breach of the 1979 Act. The deceased had bought boilers from the appellant. They were said not to be satisfactory, in that they were not as energy efficient as they had been described to be.
Held: The purchaser himself had skills to assess what he bought and laid only partial reliance upon the seller’s expertise. The boilers were fit for the purpose in the way in which the purchaser relied upon the seller’s judgement. Equally, there was no breach of the term as to satisfactory quality implied by section 14(2).

Judges:

Lord Justice Clarke Lord Justice Sedley Mr Justice Cresswell

Citations:

[2003] EWCA Civ 1030

Statutes:

Sale of Goods Act 1979 13 14(2) 14(3)

Jurisdiction:

England and Wales

Citing:

Appeal from – Jewson Ltd v Kelly QBD 2-Aug-2002
The claimant sought payment for some boilers. The defendant argued that they were not of a satisfactory quality. The boilers were bought to be installed in new dwellings, but could not be shown to meet the standards advertised.
Held: The goods . .
Cited – Cammell Laird and Co Ltd v Manganese Bronze and Brass Co Ltd HL 1934
Shipbuilders agreed to build two ships to carry heavy liquids. They were to have propellers of special construction and diameter according to certain specifications. One proved unsatisfactory because it caused too much noise.
Held: If the . .
Cited – Christopher Hill Ltd v Ashington Piggeries Ltd HL 1972
Mink farmers had asked a compounder of animal foods to make up mink food to a supplied formula.
Held: There was reliance as to the suitability of the ingredients only.
Lord Diplock said: ‘Unless the Sale of Goods Act 1893 is to be allowed . .
Cited – James Slater and Hamish Slater (A Firm) and Others v Fleming Ltd HL 10-Jul-1996
A term of fitness for purpose was inapplicable where there was an abnormal uncommunicated use: ‘if the buyer’s purpose is insufficiently communicated, the buyer cannot reasonably rely on the seller’s skill and judgment to ensure that the goods . .
Cited – Britvic Soft Drinks Ltd v Messer UK Ltd ChD 2002
Britvic purchased bulk CO2 for the carbonation of various soft and alcoholic drinks from a supplier. The CO2 was manufactured by others. As a result of a breakdown of the manufacturing process, the CO2 contained a concentration of benzene which, . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 12 April 2022; Ref: scu.184859

Amiri Flight Authority v BAE Systems Plc and Another: ComC 20 Nov 2002

Citations:

[2002] EWHC 2481 (Comm)

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

Appeal from – Amiri Flight Authority v BAE Systems Plc CA 17-Oct-2003
The appellant had contracted to purchase maintenance from the defendant of aircraft it had also purchased from them. They sought damages for negligence, saying the defendants had failed to prevent a known risk of corrosion. The defendants argued . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 12 April 2022; Ref: scu.178932

Paige v Webb: CA 26 Jul 2001

The claimant sought rescission of a consent order for specific performance made in an earlier action. The purchasers had not complied simply with the order, but had sought to bring back certain parts of the original contract.
Held: Once an order for specific performance has been made, the matter of how the contract is to be performed lies with the court, not the parties. The consent order itself referred back to the contract, and the remaining conditions still applied. The consent order should not be rescinded on these grounds. The seller had refused to complete without delivering a deed of rectification, nevertheless that would not in the circumstances pose any practical problem.

Judges:

Lord Justice Laws, Lord Justice Mummery, Sir Anthony Evans

Citations:

[2001] EWCA Civ 1220

Statutes:

Land Registration Act 1925 110(2)

Jurisdiction:

England and Wales

Citing:

Cited – Singh v Nazeer 1979
Once an order for specific performance has been made by the court, the parties have put it into the hands of the court as to how the contract is to be carried out. The provisions of the order regulate how the contract is to be carried out. The . .
Lists of cited by and citing cases may be incomplete.

Land, Contract, Litigation Practice, Registered Land

Updated: 12 April 2022; Ref: scu.159907

Ashcourt Rowan Financial Planning Ltd v Hall: QBD 10 May 2013

ARFP sought to enforce post-termination covenants against the defendant, and inter alia an order which would prevent him from working for a competitor for a time. H contended that ARFP were relying on covenants that were already spent and in any case were unreasonable restraints of trade and so unenforceable.

Judges:

Andrew Smith J

Citations:

[2013] EWHC 1185 (QB), [2013] IRLR 637

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. The court particularly considered the severability of a section . .
Lists of cited by and citing cases may be incomplete.

Employment, Contract

Updated: 11 April 2022; Ref: scu.509114

Tillman v Egon Zehnder Ltd: SC 3 Jul 2019

The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. The court particularly considered the severability of a section requiring the former employee to take no interest in a competing company.
Held: The court should set aside the Court of Appeal’s order and should overrule the decision in the Attwood case; and that, although the contractual period of the restraints has expired long ago, it should formally restore the injunction granted by Mann J, subject only to the removal of the words ‘or interested’.

Judges:

Lady Hale, President, Lord Kerr, Lord Wilson, Lord Briggs, Lady Arden

Citations:

[2019] UKSC 32, [2020] AC 154, [2019] ICR 1223, [2019] 3 WLR 245, [2019] WLR(D) 395, [2020] 1 All ER 477, [2019] IRLR 838, [2019] FSR 39, [2019] 2 BCLC 143, UKSC 2017/0182

Links:

Bailii, Bailii Summary, WLRD, SC, SC Summary, SC Summary Video, SC 21 Jan 2019 am Video, SC 2019 Jan 21 pm Video, SC 2019 Jan 22 am video

Jurisdiction:

England and Wales

Citing:

Appeal from – Tillman v Egon Zehnder Ltd CA 21-Jul-2017
Post employment restrictive covenant – unreasonable restraint of trade – six months restriction – not to become shareholder in a competitor.
Held: The injunction against employment and holding the shares was discharged. The Court rejected the . .
At First Instance – Egon Zehnder Ltd v Tillman ChD 23-May-2017
Application for an injunction to enforce an employee restrictive covenant which, if effective, would restrain the defendant from working for a competitor of the claimant for a period of six months from the termination of her employment. Mann J, at . .
Cited – Colgate v Bacheler 1653
The defendant agreed that, if for three years his son worked as a haberdasher in Canterbury or Rochester, he would pay the plaintiff pounds 20. The court held the agreement to be void irrespective of its limitations of time and place because it was . .
Cited – Mitchel v Reynolds 1711
A bond or promise to restrain oneself from trading in a particular place, if made upon a reasonable consideration, is good. (So Davis v Mason, 5 TR 118.) Secus if it be on no reasonable consideration, or to restrain a man from trading at all.
Cited – Scully UK Limited v Lee CA 9-Feb-1998
An employee had covenanted that throughout the year following termination he would not engage in or be ‘otherwise interested in, whether as a shareholder . . employee or . . in any other capacity’ any business, which was defined in terms not limited . .
Cited – National Enterprises Ltd v Racal Communications Ltd 1975
When a court makes an assumption about the law, instead of reaching a focussed determination in relation to it, the decision based upon it does not carry binding authority under the doctrine of precedent . .
Cited – George Hill and Co v Hill 1886
The plaintiff company acquired the meat export business of the defendant, who covenanted not to ‘be in any way concerned or interested in any similar business’ within ten miles of the Royal Exchange. He became an employee of a similar business . .
Cited – Nordenfelt v Maxim Nordenfelt Guns and Ammunition Company HL 1894
Exceptions to Freedom to Trade
The purchaser of the goodwill of a business sought to enforce a covenant in restraint of trade given by the seller.
Held: At common law a restraint of trade is prima facie contrary to public policy and void, unless it can be shown that the . .
Cited – Servais Bouchard v Princes Hall Restaurant CA 1904
A restaurant in Piccadilly had contracted with a supplier of burgundy not to sell burgundy to its customers other than such as it had purchased from the supplier. The restaurant broke the contract
Held: A contract by which defendant Restaurant . .
Cited – Wood v Capita Insurance Services Ltd SC 29-Mar-2017
Construction of term of contract for the sale and purchase of the entire issued share capital of a company.
Held: The appeal was dismissed: ‘the SPA may have become a poor bargain, as it appears that it did not notify the sellers of a warranty . .
Cited – Proactive Sports Management Ltd v Rooney and Others CA 1-Dec-2011
Wayne Rooney set up a company to which he assigned his image rights, in other words his rights to exploit his image by, for example, his indorsement of sports products and by other forms of promotion and sponsorship. His company contracted with the . .
Cited – McPhail v Doulton (on appeal from In re Baden’s Deed Trusts) HL 6-May-1970
The settlor asked whether the test for validity, in point of certainty of objects, is the same for trusts and powers, or whether the test for trusts is more demanding.
Held: The test is the same. The context was a provision, held to be a . .
Cited – Dickson v Pharmaceutical Society of Great Britain HL 1970
The Society was concerned by the extension of the range of non-pharmaceutical goods sold in chemist’s shops and the effect which it might have on the quality and status of the profession, proposed a new rule for inclusion in the code of ethics and . .
Cited – Herbert Morris Ltd v Saxelby HL 1916
For a covenant in restraint of trade to be treated as reasonable in the interests of the parties ‘it must afford no more than adequate protection to the benefit of the party in whose favour it is imposed.’ There is a need for the court to consider . .
Cited – Esso Petroleum Co Ltd v Harper’s Garage (Stourport) Ltd HL 1968
Agreement in Restraint of Trade Unenforceable
The defendant ran two garages under solus agreements with the plaintiffs who complained when the defendants began to purchase petrol from cheaper alternative sources. The House was asked whether the solus agreements were be regarded in law as an . .
Cited – In re Baden’s Deed Trusts CA 1969
The Court by a majority, determined the meaning of a deed of settlement by reference to the validity principle.
Harman LJ said: ‘the court is at liberty, if the considerations on both sides seem evenly balanced, to lean towards that which may . .
Cited – TFS Derivatives Ltd v Morgan QBD 15-Nov-2004
The claimant sought to enforce a post employment restrictive covenant. There was a 6 months’ prohibition, post-termination of employment (less any period of garden leave) on any employment which was competitive with the business of a former . .
Cited – Anglo Continental Educational Group (GB) Ltd v Capital Homes (Southern) Ltd CA 17-Mar-2009
The two parties to this appeal are locked in battle over a contractual provision for a discount in the calculation of the purchase price for two properties.
Arden LJ said: that ‘if the agreement is susceptible of an interpretation which will . .
Cited – Inland Revenue Commissioners v Williams ChD 1969
Megarry J adverted to the need for an even balance when construing a clause in a deed: ‘It is possible that the same approach might be adopted where the scales are tilted only slightly to one side or the other; but plainly it cannot apply where, . .
Cited – Tindall Cobham 1 Ltd and Others v Adda Hotels and Others CA 5-Sep-2014
Tenants had assigned their leases to subsidiary companies as part of a company re-organisation, and now claimed the benefit of the 1995 Act to relieve them from liability under an authorised guarantee agreement. . .
Cited – The Great Estates Group Ltd v Digby CA 13-Oct-2011
The Claimant, an estate agent, considers that it was cut out of its entitlement to commission on the sale of a property in London in the buoyant market of the summer of 2007. By these proceedings it seeks compensation for that loss.
Toulson LJ . .
Cited – Smith v Hancock ChD 23-Apr-1894
The defendant sold his grocery business near Stoke-on-Trent to the claimant and agreed not for the following ten years to carry on or be ‘in any wise interested’ in any similar business operating within five miles of it. The defendant’s wife set up . .
Cited – Gophir Diamond Co v Wood ChD 26-Mar-1902
The ex-employee of a jewellery shop in Regent Street had become a salaried employee of a rival shop in the same street. Swinfen Eady J noted that his covenant had only been not to be ‘interested’ in a similar business; and the judge added that in . .
Cited – David Chesman, Et Ux v Margery Nainby, Widow HL 22-Feb-1727
Miss Nainby traded as a draper from her home in Drury Lane. Prior to her marriage Mrs Chesman became apprenticed to Miss Nainby. Mrs Chesman entered into a bond that, after leaving Miss Nainby’s service, she would not trade as a draper, nor assist . .
Cited – Mason v Provident Clothing and Supply Co Ltd HL 1913
The employee had covenanted not to work for any of the employer’s competitors ‘within 25 miles of London’. The appellate committee held that the employer had failed to establish that the extension of the restraint to the area thus specified was . .
Cited – Nevanas (SV) and Co v Walker and Foreman ChD 11-Dec-1913
In 1908 the plaintiff company agreed to employ the defendant F. as manager of the company at Liverpool for five years from January, 1909, and by clause 7 it was provided that the manager should not for a period of one year after the determination of . .
Cited – Goldsoll v Goldman 1914
. .
Cited – Tradition Financial Services Ltd v Gamberoni and Others QBD 12-Apr-2017
Post-employment restrictions on the employee included a covenant on his part not for six months to ‘undertake, carry on or be employed, engaged or interested in any capacity in . . any business activity’ of a specified character. Among the . .
Cited – Philip William Carney v John Edward Herbert and Others PC 29-Oct-1984
(New South Wales) The security for payment of the price, for which a contract for the sale of shares had provided, was not only a guarantee but also mortgages which were statutorily illegal. The Privy Council indorsed a decision of the Supreme Court . .
Cited – CEF Holdings Ltd and Another v City Electrical Factors Ltd and Others QBD 1-Jun-2012
The claimant sought continuation of interim orders requiring the defendants not to solicit the employment of its workers, and restraining any use of its intellectual property by defendants who had already left.
Held: That for various reasons . .
Overruled – Attwood v Lamont KBD 1920
The claimant carried on business in Kidderminster as a draper, tailor and general outfitter, employed the defendant as a cutter in the tailoring department. The defendant covenanted not at any time thereafter to trade as ‘a tailor, dressmaker, . .
Cited – Attwood v Lamont CA 2-Jan-1920
A court considering whether a restrictive covenant in an employment contract is reasonable, can sever words which render it too broad ‘if the severed parts are independent from one another and can be severed without the severance affecting the . .
Cited – Putsman v Taylor KBD 1927
The plaintiff employed the defendant as manager of his tailoring business at 49 Snow Hill in Birmingham. The defendant covenanted that, following the end of his employment, he would not be employed by a tailor (a) anywhere else on Snow Hill nor (b) . .
Cited – Scorer v Seymour Jones CA 1966
The claimant, an estate agent in Dartmouth, opened a branch in Kingsbridge and employed the defendant to manage it. The defendant’s post-employment covenant was not to set up as an estate agent within five miles either of Kingsbridge or of . .
Cited – T Lucas and Co Ltd v Mitchell CA 1974
The claimant, which manufactured foodstuffs, employed the defendant as a salesman in Manchester. His post-employment covenant was not to deal in goods similar to those manufactured by the claimant nor to solicit orders from, nor to supply, any of . .
Cited – Sadler v Imperial Life Assurance Co of Canada Ltd QBD 1988
The defendant employed the claimant as an insurance agent on commission, to be calculated by reference to premiums paid to the defendant for the first ten years under any policy which he had procured. A clause of the contract stated that, if in . .
Cited – Marshall v NM Financial Management Ltd ChD 10-Jul-1995
A post-termination restriction on an employment was in restraint of trade and ineffective despite a payment having been made for the restriction. The agent was not entitled to any commission after termination under the relevant clause.
Mr . .
Cited – NM Financial Management Limited v Marshall CA 13-Mar-1997
The court considered a provision that a commission agent would be paid commission following the termination of his agency provided that he did not within a year become an independent intermediary or work for a competitor. Here the suspension of . .
Cited – Beckett Investment Management Group Ltd and others v Hall and others CA 28-Jun-2007
The defendants, who had been employed by the claimant as independent financial advisers, covenanted that, for the year immediately following termination of their employment, they would not deal with any of the claimant’s clients with whom they had . .
Cited – Freshasia Foods Ltd v Lu ChD 20-Mar-2019
The Court considered continuation of an interim injunction to enforce a post employment restrictive covenant.
Held: Arnold J ruled that the employer had failed to establish legitimate interests which required the protection of the covenant. He . .
Cited – UK Power Reserve Ltd v Read ChD 2014
The court focussed on whether the effect of the words ‘concerned or interested’ in a post-employment restraint was to preclude the ex-employee from having no more than a passive minority shareholding in a competitor, because, if so, they were . .
Cited – East England Schools CIC (T/A 4Myschools) v Palmer and Another QBD 20-Dec-2013
The claimant company sought to enforce post employment restrictive covenants against the defendants, its former employees. The defendant argued that the increasing use by teachers and schools of social media and the internet means that the employer . .
Cited – Ashcourt Rowan Financial Planning Ltd v Hall QBD 10-May-2013
ARFP sought to enforce post-termination covenants against the defendant, and inter alia an order which would prevent him from working for a competitor for a time. H contended that ARFP were relying on covenants that were already spent and in any . .
Cited – British Reinforced Concrete Engineering Co Ltd v Schelff CA 1921
Younger LJ said: ‘Now the effect of severing by striking out with a blue pencil the obnoxious part of a covenant is not to alter or affect the construction of what is left. That must be construed as if the portion struck out still remained . . ‘ . .
Lists of cited by and citing cases may be incomplete.

Contract, Employment

Updated: 11 April 2022; Ref: scu.639249

Freshasia Foods Ltd v Jing Lu: ChD 4 Jan 2019

The Court granted an interlocutory injunction by way of enforcement of parts of an employee’s non-solicitation post-employment covenant. Treating the inquiry as purely interlocutory, he made only provisional determinations. These were that three aspects of the covenant were unreasonably wide but that, following severance, they should be removed from the remainder. Prompted in part, so it would seem, by the Court of Appeal’s decision against which this present appeal is brought, he conducted a wide-ranging survey of the law of severance of post-employment restraints in which he made a number of valuable observations.

Judges:

Mr Daniel Alexander QC

Citations:

[2018] EWHC 3644 (Ch)

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – Tillman v Egon Zehnder Ltd CA 21-Jul-2017
Post employment restrictive covenant – unreasonable restraint of trade – six months restriction – not to become shareholder in a competitor.
Held: The injunction against employment and holding the shares was discharged. The Court rejected the . .

Cited by:

Interlocutory Injunction – Freshasia Foods Ltd v Lu ChD 20-Mar-2019
The Court considered continuation of an interim injunction to enforce a post employment restrictive covenant.
Held: Arnold J ruled that the employer had failed to establish legitimate interests which required the protection of the covenant. He . .
Lists of cited by and citing cases may be incomplete.

Employment, Contract

Updated: 10 April 2022; Ref: scu.632154

NM Financial Management Limited v Marshall: CA 13 Mar 1997

The court considered a provision that a commission agent would be paid commission following the termination of his agency provided that he did not within a year become an independent intermediary or work for a competitor. Here the suspension of payment was directly related to the agent’s activity after he had ceased to act for the principal, and was held to be in restraint of trade as it could not be justified as in reasonable protection of the principal’s trade interest.
Millett LJ observed: ‘Although the question is described as one of severance it is important to bear in mind that we are not concerned to decide how much of an offending restriction should be struck down. In such a case the question is to what extent can the party who imposed the restriction enforce those parts of it which are not in unreasonable restraint of trade. We are concerned with a very different question, namely, whether the party who has been freed from an invalid restraint of trade can enforce the remainder of the contract without it.’
It was the employee (or agent) who was seeking severance in the Sadler and Marshall cases; and therefore there was no relevance in the public policy reasons for restricting severance when sought by overbearing employers who had required their employees to subscribe to extravagant restraints.

Judges:

Millett LJ

Citations:

[1997] EWCA Civ 1237, [1997] IRLR 449, [1997] 1 WLR 1527, [1997] ICR 1065

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Appeal from – Marshall v NM Financial Management Ltd ChD 10-Jul-1995
A post-termination restriction on an employment was in restraint of trade and ineffective despite a payment having been made for the restriction. The agent was not entitled to any commission after termination under the relevant clause.
Mr . .
Cited – Sadler v Imperial Life Assurance Co of Canada Ltd QBD 1988
The defendant employed the claimant as an insurance agent on commission, to be calculated by reference to premiums paid to the defendant for the first ten years under any policy which he had procured. A clause of the contract stated that, if in . .

Cited by:

Cited – Futter and Another v Revenue and Customs; Pitt v Same SC 9-May-2013
Application of Hastings-Bass Rule
F had created two settlements. Distributions were made, but overlooking the effect of section 2(4) of the 2002 Act, creating a large tax liability. P had taken advice on the investment of the proceeds of a damages claim and created a discretionary . .
Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 10 April 2022; Ref: scu.141633

Workers Trust and Merchant Bank Ltd v Dojap Investments Ltd: PC 22 Feb 1993

(Jamaica) The purchaser at an auction had been obliged under the terms of the auction contract to pay a deposit of 25%. He failed to complete, and the vendor took the deposit by way of forfeit. The standard deposit payable would be 10%. The Court of Appeal of Jamaica ordered the return of the excess above 15%.
Held: A penalty was ‘a contractual provision which requires one party in the event of his breach of the contract to pay or forfeit a sum of money to the other party is unlawful as being a penalty, unless such provision can be justified as being a payment of liquidated damages being a genuine pre-estimate of the loss which the innocent party will incur by reason of the breach. One exception to this general rule is the provision for the payment of a deposit (customarily 10% of the contract price) on the sale of land. ‘ A deposit in excess of 10% of the purchase price (25%) was not properly described as ‘earnest money’ and may be treated rather as a penalty. As such, the whole deposit taken was repayable to the defaulting purchaser.

Judges:

Lords Keith, Jauncey, Donaldson, Browne-Wilkinson, Sir Christopher Slade

Citations:

Gazette 07-Apr-1993, [1993] 2 WLR 702, [1993] 2 All ER 370, [1993] AC 573, [1993] UKPC 7

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – Commissioner of Public Works v Hills PC 24-May-1906
(Cape of Good Hope) A railway construction contract provided that in the event of a breach by the contractor he should forfeit ‘as and for liquidated damages’ certain percentages retained by the Government of the Cape of Good Hope of money payable . .
Considered – Stockloser v Johnson CA 1954
Romer LJ said that, in the absence of pressure or duress, or other vitiating elements, there was no jurisdiction to provide for relief against forfeiture in the event of the purchaser’s default in contracts other than those relating to land.
Cited – Linggi Plantations v Jagatheesan 1972
( Hong Kong Final Court of Appeal – from Malaysia) Lord Hailsham suggested that where, on investigation, the real nature of an initial payment, which was termed a deposit, was shown to be the imposition of a penalty, it might be recovered by the . .

Cited by:

Cited – Cine Bes Filmcilik Ve Yapimcilik and Another v United International Pictures and Others CA 21-Nov-2003
The parties entered into agreements licensing the exclusive distribution of encrypted television channels within Turkey. A clause provided a calculation of damages for a breach amounting to the balance of licence fees due, and other penalties, . .
Cited – MIDILL (97Pl) Ltd v Park Lane Estates Ltd and Another CA 11-Nov-2008
Refusal to return Land Contract Deposit
The court was asked as to whether a seller could retain a deposit paid by the claimant on a sale where contracts had been exchanged but the buyer had proved unable to go ahead.
Held: The appeal against refusal of return of the deposit failed. . .
Cited – Bidaisee v Dorinsa Yusidai Sampath and Others PC 1993
(Trinidad and Tobago) The parties contracted for the sale of a half share of land to the co-owner for TT$2 million. A 10% deposit was paid. A notice to complete was not met. The vendor sold the share to others for more. Arguments as to the validity . .
Cited – Union Eagle Limited v Golden Achievement Limited PC 3-Feb-1997
(Hong Kong) The parties had contracted with each other for the sale of land. Completion was to take place on the appointed day at 5:00pm. A ten per cent deposit had been paid, and time had been made of the essence. The seller sought to rescind the . .
Lists of cited by and citing cases may be incomplete.

Land, Contract

Updated: 10 April 2022; Ref: scu.90608

Wong Mee Wan v Kwan Kin Travel Services Ltd,: PC 24 Jan 1996

(Hong Kong) The plaintiff’s daugfhter purchased an all in package tour of China. Having missed a ferry, they were being taken on a speedboat when it crashed, and she died. The driver was negligent, and the company for having failed to ensure that someone competent drove it.
Held: Where someone contracted to arrange travel for others there was an implied term to use reasonable skill and care in selecting others to provide any part of those services. Where he contracted to provide service he impliedly contracted to carry them out with reasonable care and skill. That obligation would continue even if others provided the actual services. This was a contract for services. The company was liable for having failed to select a competent boatman, and for his lack of care.

Judges:

Lord Slynn of Hadley

Citations:

Gazette 24-Jan-1996, [1996] 1 WLR 38

Jurisdiction:

England and Wales

Contract, Negligence, Consumer

Updated: 10 April 2022; Ref: scu.90581

Whyfe v Michael Cullen and Partners and Others: CA 15 Nov 1993

The inclusion of a trick clause in a draft lease might be an intent to deceive. It was a triable issue as to whether the leases in issue had been obtained by a fraudulent misrepresentation as to their terms.

Citations:

Ind Summary 13-Dec-1993, Times 15-Nov-1993

Jurisdiction:

England and Wales

Torts – Other, Contract

Updated: 10 April 2022; Ref: scu.90480

Vitol Sa v Norelf Ltd (the ‘Santa Clara’): QBD 30 Apr 1993

The parties chartered for delivery of molasses. The ship was not going to be ready for the intended start date and the charterer repudiated the contract in a telex alleging breach of condition. The market was falling rapidly. The sellers did nothing, but later sold the molasses at a substantial loss, and sought the difference. The arbitrator gave the award to the seller. The buyer appealed.
Held: The appeal was dismissed. A failure to perform a contract obligation may be an acceptance of an anticipatory repudiation. Phillips J asked whether an innocent party can ever demonstrate acceptance of repudiation by not performing his own contractual obligations and said: ‘It depends upon the circumstances. Failure to progress an arbitration is a good example of inertia that is likely to be equivocal. But in other types of contractual relationship where the parties are bound to perform specific acts in relation to one another, a failure to perform an act which a party is obliged to perform if the contract remains alive may be very significant. It is not difficult to envisage circumstances in which, if such conduct follows a renunciation, the obvious inference will be that the innocent party is responding to the repudiation by treating the contract as at an end. I do not have to decide whether the failure on the part of [the sellers] to tender to [the buyers] a bill of lading, or any of the subsequent unspecified failures to perform the contract which were apparent to [the buyers], gave clear indication to [the buyers] that, in the view of [the buyers] wrongful action, [the sellers] were treating the contract as at an end. That is a question of fact for the arbitrator. What I have to decide is whether, as a matter of law, mere failure to perform contractual obligations can ever constitute acceptance of an anticipatory repudiation by the other party. In my view, for the reasons that I have given, it can.’
An anticipatory breach was justified by a failure to perform the contract.

Judges:

Phillips J

Citations:

Times 20-May-1993, Gazette 25-Aug-1993, [1994] 4 All ER 109, [1994] 1 WLR 1390

Jurisdiction:

England and Wales

Cited by:

Appeal from – Vitol Sa v Norelf Ltd (‘the Santa Cara’) CA 26-May-1995
The parties agreed to buy and sell molasses to be delivered on the Santa Clara which was set to leave on a certain date. The market was falling, and when the buyer saw that the ship would not be ready in time, it sent a telex saying that this was a . .
At first instance – Vitol Sa v Norelf Ltd HL 10-Jul-1996
(The Santa Clara) The seller was to deliver propane by a ship set to leave on a certain date. The market was falling. The buyer, when it was clear that the ship would be unable to leave on the day fixed, sent a telex to say that the contract was . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 10 April 2022; Ref: scu.90184

Attwood v Small etc: 22 Mar 1838

Citations:

[1838] EngR 515, (1835-40) 6 Cl and Fin 232, (1838) 7 ER 684

Links:

Commonlii

Jurisdiction:

England and Wales

Citing:

See Also – Attwood v Small And Others 8-Nov-1827
. .
See Also – Attwood v Small And Others 9-Aug-1827
An agreement, contained by itself less than 1080 words, but there was in it a stipulation that a clause in a previous agreement, which was duly stamped, should be taken as part of the new agreement.
Held: That although with the clause referred . .
See Also – Attwood v Small 12-Dec-1827
Where a great number of exceptions were taken to an answer, and shortly before the argument the defendant submitted to answer them, in consequence of which, it was urged, that the answer was clearly evasive, and that the ordinary costs were greatly . .
See Also – Small And Others v Attwood And Others 3-May-1828
Amendment of pleadings . .
See Also – Small And Others v Attwood And Others 1-Nov-1832
Where a contract is entered into for the purchase of an estate by certain persons in their own names, but in fact on their own account, and also as agents for other parties, a bill to rescind the contract may be filed in the names of the agents and . .
At HL – Attwood v Small and Others HL 1-Mar-1838
The plaintiffs had bought land including iron mines from the defendants. They sought and were given explicit re-assurances about the mine’s capacity, but these proved false after the plaintiffs had begun to work the mine themselves.
Held: . .

Cited by:

See Also – Attwood v Small 1840
. .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 10 April 2022; Ref: scu.312521

CEF Holdings Ltd and Another v City Electrical Factors Ltd and Others: QBD 1 Jun 2012

The claimant sought continuation of interim orders requiring the defendants not to solicit the employment of its workers, and restraining any use of its intellectual property by defendants who had already left.
Held: That for various reasons the non-competition covenant was in unreasonable restraint of trade. One of his reasons, set out in para 65(i), was that ‘[i]ts width is so great that it prevents any employees from having ‘any interest’ in [a competing] company, such as even owning one share in a publicly-quoted company’.

Judges:

Silber J

Citations:

[2012] EWHC 1524 (QB)

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 10 April 2022; Ref: scu.459900

Attwood v Small: 1840

Citations:

[1840] EngR 125, (1840) 1 Man and G 279, (1840) 133 ER 340

Links:

Commonlii

Jurisdiction:

England and Wales

Citing:

See Also – Attwood v Small And Others 8-Nov-1827
. .
See Also – Attwood v Small And Others 9-Aug-1827
An agreement, contained by itself less than 1080 words, but there was in it a stipulation that a clause in a previous agreement, which was duly stamped, should be taken as part of the new agreement.
Held: That although with the clause referred . .
See Also – Attwood v Small 12-Dec-1827
Where a great number of exceptions were taken to an answer, and shortly before the argument the defendant submitted to answer them, in consequence of which, it was urged, that the answer was clearly evasive, and that the ordinary costs were greatly . .
See Also – Small And Others v Attwood And Others 3-May-1828
Amendment of pleadings . .
See Also – Small And Others v Attwood And Others 1-Nov-1832
Where a contract is entered into for the purchase of an estate by certain persons in their own names, but in fact on their own account, and also as agents for other parties, a bill to rescind the contract may be filed in the names of the agents and . .
See Also – Attwood v Small and Others HL 1-Mar-1838
The plaintiffs had bought land including iron mines from the defendants. They sought and were given explicit re-assurances about the mine’s capacity, but these proved false after the plaintiffs had begun to work the mine themselves.
Held: . .
See Also – Attwood v Small etc 22-Mar-1838
. .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 10 April 2022; Ref: scu.309551

Associated Foreign Exchange Ltd v International Foreign Exchange (UK) Ltd and Another: ChD 26 May 2010

The claimant sought interim injunctions to enforce a restrictive covenant against solicitation of customers in a former employee’s contract. The employee, a FOREX dealer, had been placed on garden leave for three months and then his contract terminated. The contract sought a further twelve months’ restriction.
Held: At trial it was likely to be held that the twelve months’ duration of the non-solicitation clause went beyond what was reasonably necessary for the protection of AFEX’s legitimate interests. Cousins J thought it likely that any period beyond six months would be found objectionable. Also the extension of the covenant to potential customers was unreasonable.

Judges:

Cousins QC J

Citations:

[2010] EWHC 1178 (Ch), [2010] IRLR 964

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – American Cyanamid Co v Ethicon Ltd HL 5-Feb-1975
Interim Injunctions in Patents Cases
The plaintiffs brought proceedings for infringement of their patent. The proceedings were defended. The plaintiffs obtained an interim injunction to prevent the defendants infringing their patent, but they now appealed its discharge by the Court of . .
Cited – Credit Suisse Asset Management Ltd v Armstrong and Others CA 3-Jun-1996
The employer provided fund management services to private clients. The notice periods for the various employees ranged between three and twelve months, but the handbook governing the terms of employment provided that during the respective notice . .
Cited – Lansing Linde v Kerr CA 1991
Staughton LJ held that ‘trade secrets’ embrace information used in a trade, restricted in its dissemination, and the disclosure of which would be liable to cause real or significant harm to the party claiming confidentiality. He considered the . .
Cited – Herbert Morris Ltd v Saxelby HL 1916
For a covenant in restraint of trade to be treated as reasonable in the interests of the parties ‘it must afford no more than adequate protection to the benefit of the party in whose favour it is imposed.’ There is a need for the court to consider . .
Cited – Kores Manufacturing Co Ltd v Kolok Manufacturing Ltd CA 1959
When considering a post employment restrictive covenant on an employee, the court should allow that an employer has a legitimate interest in maintaining a stable and trained workforce. However, even accepting that interest, an employer has no . .
Cited – Stenhouse Australia Ltd v Phillips PC 2-Oct-1973
(Australia) An employer’s claim for protection from competition by a former employee under a restrictive covenant must be based upon the identification of some advantage or asset inherent in the business which can properly be regarded as, in a . .
Cited – Mason v Provident Clothing and Supply Co Ltd HL 1913
The employee had covenanted not to work for any of the employer’s competitors ‘within 25 miles of London’. The appellate committee held that the employer had failed to establish that the extension of the restraint to the area thus specified was . .
Cited – TFS Derivatives Ltd v Morgan QBD 15-Nov-2004
The claimant sought to enforce a post employment restrictive covenant. There was a 6 months’ prohibition, post-termination of employment (less any period of garden leave) on any employment which was competitive with the business of a former . .
Cited – International Consulting Services (UK) Ltd v Hart QBD 26-Jan-2000
The claimant sought damages and an injunction from their former employee, the defendant, saying that he had breached a post-employment restrictive covenant.
Held: The court upheld a 12-month non-solicitation clause. This was however a . .
Cited – Dowden and Pook Ltd v Pook CA 1904
When an employment covenant is unlimited, the covenant cannot be rewritten to limit its territorial extent. . .
Cited – Home Counties Dairies v Skilton CA 1970
In construing an employee’s restrictive covenant, a court should disregard fanciful hypotheses or arguments leading to a reductio ad absurdum. . .
Cited – Dawnay, Day and Co Limited; Wilcourt Investments Limited v D’Alphen; Johnston; Parkman; Cantor Fitzgerald International CA 22-May-1997
The defendants were investment managers who left the plaintiff’s employment to take up posts with a rival. DD issued these proceedings claiming to enforce inter alia contractual undertakings by the defendants not to compete with the business of DDS, . .
Cited – Dairy Crest Ltd v Piggott CA 1989
When considering restrictive covenants in employment cases, courts must not seek to uphold a clause as reasonable only because the same clause was upheld in a different case. It is an error of law. There is no ‘tariff’ of what is reasonable. In this . .
Cited – Gilford Motor Co Ltd v Horne CA 1933
The defendant was the plaintiff’s former managing director. He was bound by a restrictive covenant after he left them. To avoid the covenant, he formed a company and sought to transact his business through it. At first instance, Farwell J had found . .
Cited – M and S Drapers (a Firm) v Reynolds CA 1956
The defendant, a collector salesman entered the employment of a firm of credit drapers at a weekly wage of andpound;10. He brought with him the connection of customers acquired in previous employments. He entered into a restrictive covenant that he . .
Cited – Office Angels Ltd v Rainer-Thomas CA 1991
Reasonability Test of Post Employment Restriction
The court re-stated the principles applicable in testing whether an employee’s restrictive covenant was reasonable: ‘The court cannot say that a covenant in one form affords no more than adequate protection to a covenantee’s relevant legitimate . .
Cited – Basic Solutions Ltd v Sands QBD 23-Jun-2008
The claimant sought injunctions to prevent misuse by former employees of confidential information in their possession and breach of a post employment restrictive covenant.
Held: Eady J said that he could not see, as a matter of general . .
Lists of cited by and citing cases may be incomplete.

Employment, Contract

Updated: 10 April 2022; Ref: scu.416206

Nordenfelt v Maxim Nordenfelt Guns and Ammunition Company: HL 1894

Exceptions to Freedom to Trade

The purchaser of the goodwill of a business sought to enforce a covenant in restraint of trade given by the seller.
Held: At common law a restraint of trade is prima facie contrary to public policy and void, unless it can be shown that the restraint is, in the circumstances of the particular case, reasonable.
Lord Watson said: ‘I think it is now generally conceded that it is to the advantage of the public to allow a trader who has established a lucrative business to dispose of it to a successor by whom it may efficiently be carried on. That object could not be accomplished if, upon the score of public policy, the law reserved to the seller an absolute and indefeasible right to start a rival business the day after he sold. Accordingly it has been determined judicially, that in cases where the purchaser, for his own protection, obtains an obligation restraining the seller from competing with him, within bounds which having regard to the nature of the business are reasonable and are limited in respect of space, the obligation is not obnoxious to public policy, and is therefore capable of being enforced.’
Lord MacNaughten discussed the doctrine of restraint of trade: ‘In the age of Queen Elizabeth all restraints of trade, whatever they were, general or partial, were thought to be contrary to public policy, and therefore void.’ and ‘The true view at the present time I think, is this: The public have an interest in every person’s carrying on his trade freely: so has the individual. All interference with individual liberty of action in trading, and all restraints of trade of themselves, if there is nothing more, are contrary to public policy, and therefore void. That is the general rule. But there are exceptions: restraints of trade and interference with individual liberty of action may be justified by the special circumstances of a particular case. It is a sufficient justification, and indeed it is the only justification, if the restriction is reasonable – reasonable, that is, in reference to the interests of the parties concerned and reasonable in reference to the interests of the public, so framed and so guarded as to afford adequate protection to the party in whose favour it is imposed, while at the same time it is in no way injurious to the public.’

Judges:

Lord Macnaughten, Lord Watson

Citations:

[1894] AC 535, [1893] 1 Ch 630

Jurisdiction:

England and Wales

Citing:

Restated – Mitchel v Reynolds 1711
A bond or promise to restrain oneself from trading in a particular place, if made upon a reasonable consideration, is good. (So Davis v Mason, 5 TR 118.) Secus if it be on no reasonable consideration, or to restrain a man from trading at all.
Appeal from – Maxim Nordenfelt Guns and Ammunition Co v Nordenfelt CA 1893
Bowen LJ said: ‘Rules which rest upon the foundation of public policy, not being rules which belong to the fixed or customary law, are capable, on proper occasion, of expansion or modification’ . .

Cited by:

Cited – Herbert Morris Ltd v Saxelby HL 1916
For a covenant in restraint of trade to be treated as reasonable in the interests of the parties ‘it must afford no more than adequate protection to the benefit of the party in whose favour it is imposed.’ There is a need for the court to consider . .
Cited – Esso Petroleum Co Ltd v Harper’s Garage (Stourport) Ltd HL 1968
Agreement in Restraint of Trade Unenforceable
The defendant ran two garages under solus agreements with the plaintiffs who complained when the defendants began to purchase petrol from cheaper alternative sources. The House was asked whether the solus agreements were be regarded in law as an . .
Cited – Norris v United States of America and others HL 12-Mar-2008
The detainee appealed an order for extradition to the USA, saying that the offence (price-fixing) was not one known to English common law. The USA sought his extradition under the provisions of the Sherman Act.
Held: It was not, and it would . .
Cited – Alec Lobb (Garages) Ltd v Total Oil Ltd CA 1985
The court was asked whether the terms of a lease and lease back amounted to an unconscionable bargain and was unenforceable.
Held: The court affirmed the decision at first instance, but emphasised the need for unconscientious behaviour rather . .
Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.

Employment, Contract

Leading Case

Updated: 10 April 2022; Ref: scu.249228

The Great Estates Group Ltd v Digby: CA 13 Oct 2011

The Claimant, an estate agent, considers that it was cut out of its entitlement to commission on the sale of a property in London in the buoyant market of the summer of 2007. By these proceedings it seeks compensation for that loss.
Toulson LJ explained that, if the contract was ‘capable’ of being read in two ways, the meaning which would result in validity might be upheld ‘even if it is the less natural construction’.

Judges:

Rix, Lloyd, Toulson LJJ

Citations:

[2011] EWCA Civ 1120, [2012] 2 All ER (Comm) 361

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.

Contract, Agency

Updated: 10 April 2022; Ref: scu.445446

Wood v Capita Insurance Services Ltd: SC 29 Mar 2017

Construction of term of contract for the sale and purchase of the entire issued share capital of a company.
Held: The appeal was dismissed: ‘the SPA may have become a poor bargain, as it appears that it did not notify the sellers of a warranty claim within two years of Completion. But it is not the function of the court to improve their bargain.’ The Court of Appeal’s construction of the Contract was correct.
The court when interpreting a contract term must find the objective meaning of the language used. That was not a literalist exercise, parsing the wording and particular clauses, but the court must take the entire contract and, depending on its the nature and formality and the quality of its the drafting, give more or less weight to elements of the wider context in reaching its view as to that objective meaning; that the interpretation of a contract was a unitary exercise and, where there were rival meanings, the court could give weight to the implications of rival constructions by reaching a view as to which construction was more consistent with business common sense; but that, in striking a balance between the indications given by the language and the implications of the competing constructions, the court had to consider the quality of drafting of the clause and also to be alive to the possibility that one side might have agreed to something which, with hindsight, did not serve his interest; that similarly the court should not lose sight of the possibility that the provision might be a negotiated compromise or that the negotiators were unable to agree more precise terms; that that unitary exercise involved a iterative process whereby each suggested interpretation was checked against the provisions of the contract and its commercial consequences were investigated; that when interpreting any contract, textualism and contextualism could be used as tools to ascertain the objective meaning of the language which the parties had chosen to express their agreement, and the extent to which each tool would assist the court in its task would vary according to the circumstances of the particular agreements; that agreements which were sophisticated and complex because they had been negotiated and prepared with the assistance of skilled professionals might be successfully interpreted principally by textual analysis; that the correct interpretation of other contracts, for example those which lacked clarity because of their informality, brevity or the absence of skilled professional assistance, might be achieved by a greater emphasis on considering their factual matrix and the purpose of similar provisions in contracts of the same type; that that approach to contractual interpretation was confirmed by recent case law and the recent history of the common law of contractual interpretation which was one of continuity rather than change.

Judges:

Lord Neuberger, President, Lord Mance, Lord Clarke, Lord Sumption, Lord Hodge

Citations:

[2017] UKSC 24, [2017] 2 WLR 1095, [2017] AC 1173, [2017] CILL 3971, [2017] 4 All ER 615, [2017] WLR(D) 220, 171 Con LR 1, UKSC 2015/0212

Links:

Bailii, Bailii Summary, WLRD, SC, SC Summary, SC Summary Video, SC Video 070217 am

Jurisdiction:

England and Wales

Citing:

Cited – Prenn v Simmonds HL 1971
Backgroun Used to Construe Commercial Contract
Commercial contracts are to be construed in the light of all the background information which could reasonably have been expected to have been available to the parties in order to ascertain what would objectively have been understood to be their . .
Cited – Reardon Smith Line Ltd v Yngvar Hansen-Tangen (The ‘Diana Prosperity’) HL 1976
In construing a contract, three principles can be found. The contextual scene is always relevant. Secondly, what is admissible as a matter of the rules of evidence under this heading is what is arguably relevant, but admissibility is not decisive. . .
Cited – Investors Compensation Scheme Ltd v West Bromwich Building Society HL 19-Jun-1997
Account taken of circumstances wihout ambiguity
The respondent gave advice on home income plans. The individual claimants had assigned their initial claims to the scheme, but later sought also to have their mortgages in favour of the respondent set aside.
Held: Investors having once . .
Cited – Gan Insurance Co Ltd v Tai Ping Insurance Co Ltd CA 3-Jul-2001
A reinsurance contract which contained a clause which provided that no settlement or compromise of a claim could be made or liability admitted by the insured without the prior approval of the reinsurers. The court considered how the discretion to . .
Cited – Sigma Finance Corporation, Re; (in administrative receivership) SC 29-Oct-2009
The court considered how the losses of the insolvent company were to be distributed as between secured creditors and preferential creditors, given the terms of the applicable trust deed.
Held: The court considered the interpretations of the . .
Cited – Rainy Sky Sa and Others v Kookmin Bank SC 2-Nov-2011
Commercial Sense Used to Interpret Contract
The Court was asked as to the role of commercial good sense in the construction of a term in a contract which was open to alternative interpretations.
Held: The appeal succeeded. In such a case the court should adopt the more, rather than the . .
Cited – Arnold v Britton and Others SC 10-Jun-2015
Absurdity did not defeat a clear clause
A standard lease of plots on a caravan park, contained a provision which appeared to increase the rent by 10% in each year. The tenants argued that such a substantial increase could not have been intended.
Held: The tenants’ appeal failed . .
At First Instance – Wood v Sureterm Direct Ltd and Another ComC 14-Oct-2014
Construction of an indemnity provision in an agreement for the sale and purchase of the shares in the First Defendant.
Held: The Court decided a preliminary issue of the interpretation of the indemnity clause holding in effect, that it . .
Appeal from – Wood v Sureterm Direct Ltd and Capita Insurance Services Ltd CA 30-Jul-2015
At issue in this appeal is the true construction of a clause in a sale and purchase agreement in respect of all the shares in a company.
Held: The appeal succeeded. The Court of Appeal declared that Mr Wood’s liability under the indemnity in . .

Cited by:

Cited – MT Hojgaard As v EON Climate and Renewables UK Robin Rigg East Ltd and Another SC 3-Aug-2017
The defendants had requested tenders for the design and construction of an offshore wind farm. The court now considered the situation arising because of inconsistencies between documents in the tender request. The successful tender was based upon an . .
Cited – Lehman Brothers International (Europe) v Exotix Partners Llp ChD 9-Sep-2019
The parties had contracted to trade global depository notes issued by the Peruvian government. Each made mistakes as to their true value, thinking them scraps worth a few thousand dollars, whereas their true value was over $8m. On the defendant . .
Cited – Taurus Petroleum Limited v State Oil Marketing Company of The Ministry of Oil, Republic of Iraq SC 25-Oct-2017
The parties disputed their contract arrangements. It was referred to an arbitration in London, but applying Iraqi law. The respondent failed to meet the award made against it, and the claimant sought to enforce the award here by means of third party . .
Cited – Barnardo’s v Buckinghamshire and Others SC 7-Nov-2018
The Court considered the interpretation of a clause in a pension scheme trust deed which defines the phrase ‘Retail Prices Index’ and which allows the trustees of the pension scheme to adopt a ‘replacement’ of the officially published Retail Prices . .
Cited – The Financial Conduct Authority (FCA) v Arch Insurance (UK) Ltd and Others ComC 15-Sep-2020
Test case to determine issues of principle in relation to policy coverage under various specimen wordings underwritten by the defendants in respect of claims by policyholders to be indemnified for business interruption losses arising in the context . .
Cited – The Financial Conduct Authority and Others v Arch Insurance (UK) Ltd and Others SC 15-Jan-2021
Many businesses, having been ordered to suspend business during the Covid-19 epidemic, sought to claim under business interruption insurance. The claims were rejected by the insurers and the insurers now appealed from a finding that they had been . .
Cited – Green v Petfre (Gibraltar) Ltd (T/A Betfred) QBD 7-Apr-2021
Onerous Contract Terms Unclear – Not Incorporated
The claimant said that he had won a substantial sum on the online gaming platform operated by the defendants, but that they had refused to pay up. The defendants said that there had been a glitch in the game. The court faced a request for summary . .
Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 10 April 2022; Ref: scu.581275

Proactive Sports Management Ltd v Rooney and Others: CA 1 Dec 2011

Wayne Rooney set up a company to which he assigned his image rights, in other words his rights to exploit his image by, for example, his indorsement of sports products and by other forms of promotion and sponsorship. His company contracted with the claimant to act as its agent in negotiating contracts for the exploitation of his image. His company breached the contract and, when sued by the claimant, it contended that the contract fell within the doctrine of restraint of trade. The claimant disputed that it did so but accepted the trial judge’s conclusion that, if it did so, its terms were in unreasonable restraint of trade and unenforceable, albeit that it was entitled to a restitutionary remedy.
Held: Arden LJ, recorded the claimant’s submission that Wayne Rooney’s ‘trade’ was as a footballer and that exploitation of his image rights formed no part of it. She held however that, although his business of exploiting his image rights was ancillary to, and indeed dependent on, his primary occupation of playing football, it fell within the doctrine. The other members of the court agreed. Gross LJ added that Wayne Rooney’s activities on-field and, in exploiting his image rights, off-field were both part of a single trade; and that the court should adopt a ‘broad, practical, rule of reason approach’ to determining the applicability of the doctrine.

Judges:

Arden, Sullivan, Gross LJJ

Citations:

[2011] EWCA Civ 1444

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Appeal from – Proactive Sports Management Ltd v Rooney and Others QBD 15-Jul-2010
. .

Cited by:

Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 10 April 2022; Ref: scu.449382

Herbert Morris Ltd v Saxelby: HL 1916

For a covenant in restraint of trade to be treated as reasonable in the interests of the parties ‘it must afford no more than adequate protection to the benefit of the party in whose favour it is imposed.’ There is a need for the court to consider when determining whether the restraint secured no more than adequate protection to the party in whose favour it was imposed, in each particular case what it is for which and what it is against which protection is required.
Lord Parker could find no case in which a covenant against competition by a servant or apprentice had, as such, ever been upheld by the court. Wherever such covenants had been upheld it had been on the ground, not that the servant or apprentice would, by reason of his employment or training, obtain the skill and knowledge necessary to equip him as a possible competitor in the trade, but that he might obtain such personal knowledge of and influence over the customers of his employer, or such an acquaintance with his employer’s trade secrets as would enable him, if competition were allowed, to take advantage of his employer’s trade connection or utilise information confidentially obtained.
Lord Parker of Waddington said: ‘As I read Lord MacNaughten’s judgment, he was of the opinion that all restraints on trade of themselves, if there is nothing more, are contrary to public policy and therefore void. It is not that such restraints must of themselves necessarily operate to the public injury, but that it is against the policy of the common law to enforce them except in cases where there are special circumstances to justify them. The onus of proving such special circumstances must, of course, rest on the party alleging them.’ However: ‘It is quite different in the case of an employer taking such a covenant from his employee or apprentice. The goodwill of his business is, under the conditions in which we live, necessarily subject to the competition of all persons (including the servant or apprentice) who choose to engage in a similar trade. The employer in such a case is not endeavouring to protect what he has, but to gain a special advantage which he could not otherwise secure. I cannot find any case in which a covenant against competition by a servant or apprentice has, as such, ever been upheld by the court. Whenever such covenants have been upheld it has been on the ground, not that the servant or apprentice would, by reason of his employment or training, obtain the skill and knowledge necessary to equip him as a possible competitor in the trade, but that he might obtain such personal knowledge of and influence over the customers of his employer, or such acquaintance with his employer’s trade secrets as would enable him, if competition were allowed, to take advantage of his employer’s trade connection or utilise information confidentially obtained.’

Judges:

Lord Parker of Waddington

Citations:

[1916] 1 AC 688, [1916-17] All ER 305

Jurisdiction:

England and Wales

Citing:

Cited – Nordenfelt v Maxim Nordenfelt Guns and Ammunition Company HL 1894
Exceptions to Freedom to Trade
The purchaser of the goodwill of a business sought to enforce a covenant in restraint of trade given by the seller.
Held: At common law a restraint of trade is prima facie contrary to public policy and void, unless it can be shown that the . .

Cited by:

Cited – Allan Janes Llp v Johal ChD 23-Feb-2006
The claimant sought to enforce a restrictive covenant against the defendant a former assistant solicitor as to non-competition within a certain distance of the practice for a period of three years. After leaving she had sought to set up partnership . .
Cited – Thomas v Farr Plc and Another CA 20-Feb-2007
The employee, the former chairman of the company, appealed a finding that his contract which restricted his being employed for one year in the same field after termination, was valid and enforceable. The company had provided insurance services to . .
Cited – McEllistrim v Ballymacelligott Co-operative Society HL 1919
The Co-operative had changed its rules to prevent any member from selling (except under heavy penalty) any milk produced by him in a large area of County Kerry to anyone except the Society, and a member could not terminate his membership without the . .
Cited – Esso Petroleum Co Ltd v Harper’s Garage (Stourport) Ltd HL 1968
Agreement in Restraint of Trade Unenforceable
The defendant ran two garages under solus agreements with the plaintiffs who complained when the defendants began to purchase petrol from cheaper alternative sources. The House was asked whether the solus agreements were be regarded in law as an . .
Cited – Living Design (Home Improvements) Ltd for Interim Interdict SCS 19-Feb-1999
The petitioner company sought to enforce a post employment restrictive covenant agreed to by the respondent. He had given notice to leave, and the parties had setteled the departure with an additional restriction. The respondent denied that the . .
Cited – Faccenda Chicken Ltd v Fowler CA 1986
Nature of Confidentiality in Information
The appellant plaintiff company had employed the defendant as sales manager. The contract of employment made no provision restricting use of confidential information. He left to set up in competition. The company now sought to prevent him using . .
Cited – Associated Foreign Exchange Ltd v International Foreign Exchange (UK) Ltd and Another ChD 26-May-2010
The claimant sought interim injunctions to enforce a restrictive covenant against solicitation of customers in a former employee’s contract. The employee, a FOREX dealer, had been placed on garden leave for three months and then his contract . .
Cited – Office Angels Ltd v Rainer-Thomas CA 1991
Reasonability Test of Post Employment Restriction
The court re-stated the principles applicable in testing whether an employee’s restrictive covenant was reasonable: ‘The court cannot say that a covenant in one form affords no more than adequate protection to a covenantee’s relevant legitimate . .
Cited – Lansing Linde v Kerr CA 1991
Staughton LJ held that ‘trade secrets’ embrace information used in a trade, restricted in its dissemination, and the disclosure of which would be liable to cause real or significant harm to the party claiming confidentiality. He considered the . .
Cited – Caterpillar Logistics Services (UK) Ltd v Huesca De Crean QBD 2-Dec-2011
The claimant sought an order to prevent the defendant, a former employee, from misusing its confidential information said to be held by her. Her contract contained no post employment restrictions but did seek to control confidential and other . .
Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.

Employment, Contract

Leading Case

Updated: 10 April 2022; Ref: scu.240024

Servais Bouchard v Princes Hall Restaurant: CA 1904

A restaurant in Piccadilly had contracted with a supplier of burgundy not to sell burgundy to its customers other than such as it had purchased from the supplier. The restaurant broke the contract
Held: A contract by which defendant Restaurant agreed to take all burgundy sold there from the plaintiffs was held not to be void for being in restraint of trade.

Judges:

Sir Richard Henn Collins Mr

Citations:

[1904] 20 TLR 574

Jurisdiction:

England and Wales

Cited by:

Cited – Esso Petroleum Co Ltd v Harper’s Garage (Stourport) Ltd HL 1968
Agreement in Restraint of Trade Unenforceable
The defendant ran two garages under solus agreements with the plaintiffs who complained when the defendants began to purchase petrol from cheaper alternative sources. The House was asked whether the solus agreements were be regarded in law as an . .
Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 10 April 2022; Ref: scu.259689

TFS Derivatives Ltd v Morgan: QBD 15 Nov 2004

The claimant sought to enforce a post employment restrictive covenant. There was a 6 months’ prohibition, post-termination of employment (less any period of garden leave) on any employment which was competitive with the business of a former employer.
Held: When considering a restrictive covenant the court must first decide what it means when properly construed, secondly whether the former employers have a legitimate business interest requiring protection in relation to the employee’s employment, and thirdly once such interests have been established the covenant must be shown to be no wider than is reasonably necessary for the protection of those interests. Even where the covenant is held to be reasonable the court will then finally decide whether, as a matter of discretion, injunctive relief should be granted having regard to its reasonableness at the time of trial. The court cannot blue pencil or sever parts of a restrictive covenant unless that can be done without changing the sense of the contract.

Judges:

Cox J

Citations:

[2004] EWHC 3181 (QB), [2005] IRLR 246

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – Office Angels Ltd v Rainer-Thomas CA 1991
Reasonability Test of Post Employment Restriction
The court re-stated the principles applicable in testing whether an employee’s restrictive covenant was reasonable: ‘The court cannot say that a covenant in one form affords no more than adequate protection to a covenantee’s relevant legitimate . .

Cited by:

Cited – Intercall Conferencing Services Ltd v Steer QBD 15-Mar-2007
The claimant company sought an interim injunction to prevent the defendant, a former employee, from working for a competitor in breach of a clause in his contract and from divulging any confidential information. The defendant said that the . .
Cited – Intercall Conferencing Services Ltd v Steer QBD 15-Mar-2007
The claimant company sought an interim injunction to prevent the defendant, a former employee, from working for a competitor in breach of a clause in his contract and from divulging any confidential information. The defendant said that the . .
Cited – Associated Foreign Exchange Ltd v International Foreign Exchange (UK) Ltd and Another ChD 26-May-2010
The claimant sought interim injunctions to enforce a restrictive covenant against solicitation of customers in a former employee’s contract. The employee, a FOREX dealer, had been placed on garden leave for three months and then his contract . .
Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.

Employment, Contract

Updated: 10 April 2022; Ref: scu.269953

Mitchel v Reynolds: 1711

A bond or promise to restrain oneself from trading in a particular place, if made upon a reasonable consideration, is good. (So Davis v Mason, 5 TR 118.) Secus if it be on no reasonable consideration, or to restrain a man from trading at all.
Lord Macclesfield held
(a) that all restraints of trade were presumed to be bad but that the presumption was rebuttable;
(b) that Judge Hull’s vehemence towards them had been excusable but not his manner of expressing it;
(c) that a restraint of trade throughout England would always be bad (‘for what does it signify to a tradesman in London what another does at Newcastle?’); but
(d) that this baker’s bond, limited to Holborn and to the five years of the assignment, was reasonable and should be enforced.

Judges:

Lord Macclesfield

Citations:

[1711] EngR 38, (1711) 1 P Wms 181, (1711) 24 ER 347

Links:

Commonlii

Jurisdiction:

England and Wales

Cited by:

Restated – Nordenfelt v Maxim Nordenfelt Guns and Ammunition Company HL 1894
Exceptions to Freedom to Trade
The purchaser of the goodwill of a business sought to enforce a covenant in restraint of trade given by the seller.
Held: At common law a restraint of trade is prima facie contrary to public policy and void, unless it can be shown that the . .
Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.

Contract, Commercial

Updated: 10 April 2022; Ref: scu.391698

Anglo Continental Educational Group (GB) Ltd v Capital Homes (Southern) Ltd: CA 17 Mar 2009

The two parties to this appeal are locked in battle over a contractual provision for a discount in the calculation of the purchase price for two properties.
Arden LJ said: that ‘if the agreement is susceptible of an interpretation which will make it enforceable and effective, the court will prefer that interpretation to any interpretation which would result in its being void’

Judges:

Arden, Thomas, Richards LJJ

Citations:

[2009] EWCA Civ 218, [2009] NPC 44, [2009] CP Rep 30, [2009] 12 EG 98

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Appeal from – Anglo Continental Educational Group (GB) Ltd v Capital Homes (Southern) Ltd ChD 2-Jul-2008
The parties disputed the effect of clauses in a contract for the sale of land. . .

Cited by:

Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 10 April 2022; Ref: scu.321826

Proactive Sports Management Ltd v Rooney and Others: QBD 15 Jul 2010

Judges:

Hegarty QC J

Citations:

[2010] EWHC 1807 (QB)

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

Appeal from – Proactive Sports Management Ltd v Rooney and Others CA 1-Dec-2011
Wayne Rooney set up a company to which he assigned his image rights, in other words his rights to exploit his image by, for example, his indorsement of sports products and by other forms of promotion and sponsorship. His company contracted with the . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 10 April 2022; Ref: scu.421007

Egon Zehnder Ltd v Tillman: ChD 23 May 2017

Application for an injunction to enforce an employee restrictive covenant which, if effective, would restrain the defendant from working for a competitor of the claimant for a period of six months from the termination of her employment. Mann J, at first instance, observed that the company regarded Ms Tillman as ‘a bit special’ and that it expected to promote her. It duly promoted her to be a principal in 2006 and to be a partner in 2009. A condition of her becoming a partner was that she should hold shares in the Swiss holding company; and she began to do so. In 2012 she became joint global head of the company’s financial services practice area. The agreement made in 2003 was never replaced in order to reflect her promotions although no doubt a few of its terms, in particular relating to her remuneration, then changed.
Held: The injunction was granted. Mann J so construed the word ‘interested’ in the non-competition covenant as not to prohibit Ms Tillman from holding shares in any of the competing businesses there specified. He therefore had no need to address what he took to be the company’s alternative contention that, together of course with the word ‘or’, the word should be severed and removed from the remainder of the clause; he added however that, although it had not been developed at any length, he did not find that contention appealing.

Judges:

Mann J

Citations:

[2017] EWHC 1278 (Ch), [2017] IRLR 828

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

Appeal from – Tillman v Egon Zehnder Ltd CA 21-Jul-2017
Post employment restrictive covenant – unreasonable restraint of trade – six months restriction – not to become shareholder in a competitor.
Held: The injunction against employment was discharged . .
At First Instance – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
. .
Lists of cited by and citing cases may be incomplete.

Contract, Employment

Updated: 09 April 2022; Ref: scu.588010

Owners of Cargo On K H Enterprise v Owners of Pioneer Container: PC 29 Mar 1994

Owners who were claiming under a bailment must accept the terms of a sub-bailment to which it had agreed. This result is both principled and just. A sub-bailee can only be said for these purposes to have voluntarily taken into his possession the goods of another if he has sufficient notice that a person other than a bailee is interested in the goods so that it can properly be said that (in addition to his duties to the bailee) he has, by taking the goods into his custody, assumed towards that other person the responsibility for the goods which is characteristic of a bailee. This they believe to be the underlying principle.
Where an exclusive jurisdiction clause exists, a party who seeks a stay brought in breach of that agreement to refer disputes to a named forum, will have to show strong cause
Lord Goff asked whether an exclusive jurisdiction clause in a bill of lading issued by a sub-bailee was binding on the cargo owner, and said: ‘Here is a ship, upon which the goods are loaded in a large number of containers; indeed, one container may contain goods belonging to a number of cargo owners. One incident may affect goods owned by several cargo owners, or even (as here) all the cargo owners with goods on board. Common sense and practical convenience combine to demand that all of these claims should be dealt with in one jurisdiction, in accordance with one system of law. If this cannot be achieved, there may be chaos. Much expense may be wasted on litigation in a number of different jurisdictions, as indeed happened in the present case, where there was litigation in eight other countries as well as Hong Kong and Taiwan. There is however no international regime designed to produce a uniformity of jurisdiction and governing law in the case of a multiplicity of claims of this kind. It is scarcely surprising therefore that shipowners seek to achieve uniformity of treatment in respect of all such claims, by clauses designed to impose an exclusive jurisdiction and an agreed governing law . . Within reason, such an attempt must be regarded with a considerable degree of sympathy and understanding . . Their Lordships do not consider that it can possibly be said that the incorporation of such a clause in a bill of lading is per se unreasonable.’

Judges:

Lord Goff

Citations:

Times 29-Mar-1994, Gazette 11-May-1994, [1994] 2 AC 324

Cited by:

Cited – Scottish and Newcastle International Limited v Othon Ghalanos Ltd HL 20-Feb-2008
The defendant challenged a decision that the English court had jurisdiction to hear a claim in contract saying that the appropriate court was in Cyprus. The cargo was taken by ship from Liverpool to Limassol. An English court would only have . .
Cited – Angara Maritime Ltd v Oceanconnect UK Ltd and Another QBD 29-Mar-2010
The court was asked as to the application of Section 25(1) of the Sale of Goods Act 1979 when an unpaid supplier of bunkers to a time charterer claims against the owner of the vessel.
Held: The issue was whether as a matter of fact there was a . .
Lists of cited by and citing cases may be incomplete.

Transport, Commonwealth, Contract, Agency

Updated: 09 April 2022; Ref: scu.84505

Norweb Plc v Dixon: QBD 24 Feb 1995

Electric supply was not made under a contract properly so called, and no offence was committed of harassment for payment. If there is a statutory obligation to enter into a form of agreement the terms of which are laid down, at any rate in their most important respects, there is no contract

Citations:

Times 24-Feb-1995, [1995] 1 WLR 636

Statutes:

Administration of Justice Act 1970 40(1)

Cited by:

Cited – Rowlands v City of Bradford Metropolitan District Council CA 26-Mar-1999
The defendant appealed a finding of the EAT that the claimant had standing to claim discrimination under the Act in the way her application to be a foster mother had been treated.
Held: After the EAT decision in W v Essex, it was clear that . .
Cited – W 1-6 v Essex County Council and Another CA 2-Apr-1998
A Local Authority had a duty of care to a fostering family when allocating children. A child was known to have a history of sexual abuse and was fostered with a family with other children, and no warning had been given.
Foster parents sued the . .
Lists of cited by and citing cases may be incomplete.

Crime, Contract, Utilities

Updated: 09 April 2022; Ref: scu.84362

Montagu Evans v Young: OHCS 19 Sep 2000

In order to use the convention to give a country jurisdiction in a claim involving the payment of money only, it was not enough that the vendor had the option of paying in the UK, or that other parts of the contract might have been performed in the UK. They had to establish that Scotland was the sole place provided by the contract for performance of the particular obligation in issue.

Citations:

Times 19-Sep-2000

Statutes:

Brussels Convention on Enforcement of Judgments in Civil and Commercial Matters 1968

Contract, Jurisdiction

Updated: 09 April 2022; Ref: scu.83806

Manheath Ltd v H J Banks and Co Ltd (Scotland): OHCS 2 Jun 1995

If contract is subject to a suspensive condition, performance is not waivable.

Citations:

Times 02-Jun-1995, 1996 SC 42

Jurisdiction:

Scotland

Cited by:

Cited – Inveresk Plc v Tullis Russell Papermakers Ltd SC 5-May-2010
The parties had undertaken the sale of a business (from I to TR) with part of the consideration to be payable on later calculation of the turnover. The agreement provided for an audit if the parties failed to agree. TR issued a figure. I argued that . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 09 April 2022; Ref: scu.83377

Kelly v Cooper and Another: PC 25 Nov 1992

There was a dispute between a client and an estate agent in Bermuda. The client sued the estate agent for damages for breach of duty in failing to disclose material information to him and for putting himself in a position where his duty and his self-interest conflicted.
Held: It was appropriate to imply a term into the contract to the effect that the agent was entitled to act for other principals selling competing properties and to keep confidential the information obtained from each of those principals, even though that information might well have been material to the client. Estate agents have no general duty to disclose the details of another sale to their client. The existence and scope of the duties of an agent, fiduciary and otherwise, depend on the terms on which they are acting. The court was able to imply into an express contract of agency a term entitling an estate agent to act for numerous other competing principals selling similar properties and to keep confidential information received from each principal. It was known to the principal that the estate agent would be so acting in the course of its business. The effect of the implied term was to modify the normally strict fiduciary duties owed by an agent to the principal not to put himself into a position where his duty and interest conflicted, not to profit from his position (for example, by earning commissions from selling properties for rival principals) and to make disclosure of confidential information to the principal.
Lord Browne-Wilkinson said: ‘In a case where a principal instructs as selling agent for his property or goods a person who to his knowledge acts and intends to act for other principals selling property or goods of the same description, the terms to be implied into such agency contract must differ from those where an agent is not carrying on such general agency business. In the case of estate agents, it is their business to act for numerous principals: where properties are of a similar description, there will be a conflict of interest between the principals each of whom will be concerned to attract potential purchasers to their property rather than that of another. Yet, despite this conflict of interest, estate agents must be free to act for several competing principals otherwise they will be unable to perform their function . . The scope of the fiduciary duties owed by the [estate agent] to the [client] (in particular the alleged duty not to put themselves in a position where their duty and their interest conflicted) are to be defined by the terms of the contract of agency.’

Judges:

Lord Browne-Wilkinson

Citations:

Gazette 25-Nov-1992, [1993] AC 205, [1992] 3 WLR 936, [1993] ANZ Conv R 138

Citing:

Approved – Hospital Products Ltd v United States Surgical Corporation 25-Oct-1984
High Court of Australia – A solicitor’s duty of loyalty to his client’s interest, and his duty to respect his client’s confidences, have their roots in the fiduciary nature of the solicitor-client relationship, but may have to be moulded and . .

Cited by:

Cited – Silven Properties Limited, Chart Enterprises Incorporated v Royal Bank of Scotland Plc, Vooght, Harris CA 21-Oct-2003
The claimants sought damages from mortgagees who had sold their charged properties as receivers. They said they had failed to sell at a proper value. They asked whether the express appointment in the mortgage of receivers as agents of the mortgagor . .
Cited – DEG-Deutsche Investitions und Entwicklungsgesellschaft mbH v Koshy and Other (No 3); Gwembe Valley Development Co Ltd (in receivership) v Same (No 3) CA 28-Jul-2003
The company sought to recover damages from a director who had acted dishonestly, by concealing a financial interest in a different company which had made loans to the claimant company. He replied that the claim was out of time. At first instance the . .
Cited – Parker v Parker ChD 24-Jul-2003
Lord Macclesfield claimed a right to occupy a castle. The owners claimed that he had only a mere tenancy at will. The exact rooms in the castle which had been occupied had varied over time.
Held: The applicant was entitled to reasonable . .
Cited – Prince Jefri Bolkiah v KPMG (A Firm) HL 16-Dec-1998
Conflicts of Duty with former Client
The House was asked as to the duties of the respondent accountants (KPMG). KPMG had information confidential to a former client, the appellant, which might be relevant to instructions which they then accepted from the Brunei Investment Agency, of . .
Cited – Hilton v Barker Booth and Eastwood HL 3-Feb-2005
The claimant had instructed the defendant solicitors to act for him, where he was to contract with another client of the same solicitor in a land development. The solicitor failed to disclose that the other client had convictions for dishonesty, and . .
Cited – Ultraframe (UK) Ltd v Fielding and others ChD 27-Jul-2005
The parties had engaged in a bitter 95 day trial in which allegations of forgery, theft, false accounting, blackmail and arson. A company owning patents and other rights had become insolvent, and the real concern was the destination and ownership of . .
Cited – Burkle Holdings Ltd v Laing TCC 23-Mar-2005
The parties had each instructed the same solicitor, but now disputed the entitlement of the other to see documents held by the solicitor. . .
Cited – Ratiu, Karmel, Regent House Properties Ltd v Conway CA 22-Nov-2005
The claimant sought damages for defamation. The defendant through their company had accused him acting in such a way as to allow a conflict of interest to arise. They said that he had been invited to act on a proposed purchase but had used the . .
Cited – Imageview Management Ltd v Jack CA 13-Feb-2009
The appellant company acted for the respondent footballer in placing him with a football club. The respondent said that he had also taken a payment from the club, nominally for arranging a work permit. The respondent said this was improper. The . .
Cited – Rossetti Marketing Ltd v Diamond Sofa Company Ltd and Another QBD 3-Oct-2011
The claimants sought compensation under the 1993 Rules. The defendants denied that the claimants were agents within the rules, since they also acted as agents for other furniture makers.
Held: Whether a party is a commercial agent within the . .
Lists of cited by and citing cases may be incomplete.

Contract, Agency

Updated: 09 April 2022; Ref: scu.82715

James Slater and Hamish Slater (A Firm) and Others v Fleming Ltd: HL 10 Jul 1996

A term of fitness for purpose was inapplicable where there was an abnormal uncommunicated use: ‘if the buyer’s purpose is insufficiently communicated, the buyer cannot reasonably rely on the seller’s skill and judgment to ensure that the goods answer that purpose.’

Judges:

Lord Steyn

Citations:

Times 10-Jul-1996

Statutes:

Sale of Goods Act 1979 14(3)

Jurisdiction:

England and Wales

Cited by:

Cited – Jewson Limited v Boyhan as Personal Representative of the Estate of Thomas Michael Kelly CA 28-Jul-2003
The company appealed a finding that it was in breach of the 1979 Act. The deceased had bought boilers from the appellant. They were said not to be satisfactory, in that they were not as energy efficient as they had been described to be.
Held: . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 08 April 2022; Ref: scu.82479

Hough v P and O Containers Ltd; Blohm and Voss Holding Ag and Others Third Parties: QBD 6 Apr 1998

Where a contract contained a clear exclusive jurisdiction clause, a proposed defendant had a clear right to insist on the parties using that jurisdiction.

Citations:

Times 06-Apr-1998, Gazette 29-Apr-1998

Statutes:

Brussels Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters 1968 Art 17

Jurisdiction:

England and Wales

Jurisdiction, Contract

Updated: 08 April 2022; Ref: scu.81484

Guildford Borough Council v Valler, Smith and Others: CA 15 Oct 1993

The use of the power of the High Court to commit a contemnor was discretionary but may be exercised for a negligent failure.

Judges:

Staughton LJ

Citations:

Ind Summary 01-Nov-1993, Times 15-Oct-1993, [1994] JPL 734

Jurisdiction:

England and Wales

Citing:

Appeal from – Guildford Borough Council v Valler and Others QBD 18-May-1993
Imprisonment or sequestration of assets was a proper remedy for a deliberate contempt of court. . .

Cited by:

Appealed to – Guildford Borough Council v Valler and Others QBD 18-May-1993
Imprisonment or sequestration of assets was a proper remedy for a deliberate contempt of court. . .
Lists of cited by and citing cases may be incomplete.

Contempt of Court, Contract

Updated: 08 April 2022; Ref: scu.81081

Gulf Bank Ksc v Mitsubishi Heavy Industries Ltd: QBD 24 Aug 1993

A foreign contract was within the purview of Order 11 of the Rules of the Supreme Court. The presence of an indemnity clause which was expressly subject to UK law made the rest of the contract also subject to UK law. The indemnity clause was still part of the contract despite government decree.

Citations:

Gazette 17-Nov-1993, Ind Summary 30-Aug-1993, Times 24-Aug-1993

Litigation Practice, International, Contract

Updated: 08 April 2022; Ref: scu.81090

Grace v Leslie and Godwin Financial Services Ltd: ComC 16 May 1995

Lloyds’ brokers are to keep contract slips as evidence of the policy whilst ever a possibility of a claim exists. A failure to do so can hamper the conduct of the litigation to the detriment of syndicate members, and the broker can be liable to them in contract and in negligence.

Judges:

Clarke J

Citations:

Ind Summary 12-Jun-1995, Times 16-May-1995, [1995] LRLR 472

Jurisdiction:

England and Wales

Cited by:

Cited – Goshawk Dedicated Ltd and others v Tyser and Co Ltd and Another CA 7-Feb-2006
Lloyds underwiters sought inspection of the records of the Lloyd’s brokers.
Held: The documents must be made available at the cost of the underwriters. It was an implied obligation in a market where the brokers retained the records to make the . .
Lists of cited by and citing cases may be incomplete.

Insurance, Negligence, Contract

Updated: 08 April 2022; Ref: scu.80957

Formica Ltd v Export Credits Guarantee Department: ComC 19 Oct 1994

A guarantor was entitled to see documents created by the company in chasing a debt. Procedure – specific discovery – common interest relied upon by applicant for discovery – insurance – documents brought into existence in furtherance of a common interest.

Judges:

Colman J

Citations:

Times 19-Oct-1994

Cited by:

Cited – Regina v Jones (Margaret), Regina v Milling and others HL 29-Mar-2006
Domestic Offence requires Domestic Defence
Each defendant sought to raise by way of defence of their otherwise criminal actions, the fact that they were attempting to prevent the commission by the government of the crime of waging an aggressive war in Iraq, and that their acts were . .
Lists of cited by and citing cases may be incomplete.

Contract, Litigation Practice

Updated: 08 April 2022; Ref: scu.80635

De Balkany v Christie Manson and Woods Ltd: QBD 19 Jan 1995

Over-painting was deemed to be a forgery within the Christie terms and conditions. The exception was excluded. Christie’s was liable under the guarantee it had given. Morison J also considered (obiter) the defendant’s possible liability in tort, and whether they had assumed responsibility for the attribution: ‘I first look at the question generally without reference to the conditions.
The special features of this case are that Christie’s themselves have sole discretion over how they describe a lot. This fact is made known to buyers, in the sense that Christie’s disclose to potential bidders some of the terms on which they are acting for the seller. Christie’s employ skilled personnel who take considerable trouble to satisfy themselves as to the accuracy of the catalogue entries. This is well known. Buyers will know, therefore, that Christie’s have satisfied themselves as to the authenticity of a Lot, and the cataloguing practice which is disclosed, gives considerable latitude for appropriate qualifications where Christie’s are of the opinion that such is called for. The buyer is required to pay a substantial premium to the auctioneer. If the auctioneer assumes no responsibility to him, one might ask what the payment is for. On the other hand, in normal circumstances, a buyer has no reason to believe that an auctioneer has assumed any responsibility to him. The auctioneer is the seller’s agent. The buyer only becomes contractually bound by the conditions when his bid has been accepted.
On balance, and primarily because Christie’s take responsibility for the catalogue description which is an important feature from the buyer’s point of view, and because the buyer pays a premium, I would be inclined to the view that there was an assumption of responsibility such that Christie’s become liable to a buyer for negligent misstatement in the catalogue entries.
Do the Conditions affect this conclusion? Condition 3(a) says that statements in the catalogue are statements of Christie’s opinion. Condition 11(a), under what might be thought to be an inappropriate heading ‘Guarantee’, excludes responsibility for the ‘correctness’ of any such statement but it does not, in terms, exclude responsibility for negligence. Condition 3(c) says that buyers must satisfy themselves as to the opinions expressed in the catalogue. I am, somewhat reluctantly, forced to the conclusion that Christie’s have made it reasonably clear that they have not assumed any responsibility to the buyer for the way in which the statements in the catalogue are prepared.
In my judgment, a buyer at Christie’s, as a buyer at a car auction, must satisfy himself about the goods and cannot, in law, rely upon what Christie’s have said. The only right which a buyer has is that given to him by clause 11(b) where there is a forgery or where Christie’s have been guilty of deceit. I do not regard this conclusion as satisfactory because it means that a buyer has got nothing of substance for his premium.’

Judges:

Morison J

Citations:

Independent 19-Jan-1995, (1997) 16 Tr LR 163

Jurisdiction:

England and Wales

Cited by:

Cited – Morin v Bonhams and Brooks Ltd and Another ComC 18-Mar-2003
Claim for rescission of contract for purchase of Ferrari car at auction after discovery of alteration to odometer.
Jonathan Hirst QC said (after discussing the Christie’s case): ‘Plainly this authority provides substantial ammunition for BandB . .
Cited – Morin v Bonhams and Brooks Limited Bonhams and Brooks S A M CA 18-Dec-2003
The claimant had bought a vintage Ferrari motor car through the defendant auctioneers in Monaco but sought rescission after it appeared that the odometer had been altered. The auction conditions purported to exclude any description of the car. He . .
Cited – Avrora Fine Arts Investment Ltd v Christie, Manson and Woods Ltd ChD 27-Jul-2012
The claimants had bought a painting (Odalisque) through the defendant auctioneers. They now claimed that it had been misattributed to Kustodiev, and claimed in negligence and misrepresentation.
Held: Based on the connoisseurship evidence, the . .
Lists of cited by and citing cases may be incomplete.

Contract, Torts – Other

Updated: 08 April 2022; Ref: scu.79849

Arbuthnot and Others v Feltrim and Others; Deeny and Others v Gooda Walker Ltd and Others: QBD 12 Oct 1993

Lloyds’ names sought damages from their underwriting agents for negligence. The court had to decide as a preliminary issue whether any duty of care arose to the names.
Held: Until 1990, names signed an agreement with a member’s agent who in turn arranged for them to be served by an underwriting agency, who, and again in turn, wrote insurance business on their behalf. Some members combined these two functions and were known as ‘direct’ names, and others were known as ‘indirect’ names. The underwriting agents had absolute discretion as to what business was to be written, and could appoint sub-agents. This very wide discretion and the unlimited liability of names and payments made to underwriters, required the underwriters to exercise a duty to exercise reasonable care and skill. That could only be excluded by the clearest of contracts. Contractual obligations might replace common law duties of care, but in this case these obligations for direct names were identical. For indirect names, the obligation existed in negligence only. This case did not require any extension of the law of negligence. Any delegation to managing agents did not alter the implicit promise to members.

Judges:

Saville J

Citations:

Independent 01-Oct-1993, Times 20-Oct-1993

Jurisdiction:

England and Wales

Cited by:

Appeal from – Arbuthnott v Feltrim; Deeny v Gooda Walker; Henderson v Merrett CA 14-Dec-1993
Underwriters owe a professional duty of care to Lloyds names in underwriting, even though they were acting as agents. . .
Lists of cited by and citing cases may be incomplete.

Contract, Insurance, Professional Negligence

Updated: 08 April 2022; Ref: scu.77854

L’Estrange v F Graucob Limited: CA 1934

The company’s order form contained a clause providing them with complete exemption from liability: ‘Any express or implied, condition, statement of warranty, statutory or otherwise is expressly excluded’.
Held: If a party signs a written contract incorporating standard terms, the party is on its face bound by those terms. That he did not carefully read the contract, did not take advantage of substitution and did not notice others doing it, does not diminish the genuineness of the right, or the potency of his signature.
Scrutton LJ said: ‘When a document containing contractual terms is signed, then, in the absence of fraud, or, I will add, misrepresentation, the party signing it is bound, and it is wholly immaterial whether he has read the document or not.’

Judges:

Scrutton LJ

Citations:

[1934] 2 KB 394, [1934] All ER 16

Jurisdiction:

England and Wales

Cited by:

Cited – BCT Software Solutions Lt v Arnold Laver and Co CA 11-Jul-2002
Whether software licence was for indefinite term or determinate term. . .
Cited – Bankway Properties Ltd v Penfold-Dunsford and Another CA 24-Apr-2001
A grant of an assured tenancy included a clause under which the rent would be increased from pounds 4,680, to pounds 25,000 per year. It was expected that the tenant would be reliant upon Housing Benefit to pay the rent, and that Housing Benefit . .
Cited – George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd CA 29-Sep-1982
The buyer bought 30lbs of cabbage seed, but the seed was not correct, and the crop was worthless. The seed cost pounds 192, but the farmer lost pounds 61,000. The seed supplier appealed the award of the larger amount and interest, saying that their . .
Cited – Autoclenz Ltd v Belcher and Others CA 13-Oct-2009
Car Valeters contracts misdescribed their Duties
The claimants worked cleaning cars for the appellants. They said that as workers they were entitled to holiday pay. The appellant said they were self-employed.
Held: The contract purported to give rights which were not genuine, and the . .
Cited – Autoclenz Ltd v Belcher and Others SC 27-Jul-2011
Car Cleaning nil-hours Contractors were Workers
The company contracted with the claimants to work cleaning cars. The company appealed against a finding that contrary to the explicit provisions of the contracts, they were workers within the Regulations and entitled to holiday pay and associated . .
Cited – UK Mail Ltd v Creasey EAT 26-Sep-2012
EAT JURISDICTIONAL POINTS – Worker, employee or neither
As a matter of construction of the contract, the Claimant was not required to perform work personally since he had an unfettered right to send others, . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 08 April 2022; Ref: scu.224048

Scandinavian Trading Tanker Co AB v Flota Petrolera Ecuatoriana (The Scaptrade): CA 1983

Charterers of a ship sought relief from forfeiture of the charterparty on equitable grounds.
Held: No jurisdiction existed to grant such a relief. In a commercial agreement between commercial parties, the court had no jurisdiction to relieve a party of the consequences of failure to pay or duly to perform some other contractual obligation.
Robert Goff LJ said that ‘It is of the utmost importance in commercial transactions that, if any particular event occurs which may affect the parties’ respective rights under a commercial contract, they should know where they stand. The court should so far as possible desist from placing obstacles in the way of either party ascertaining his legal position, if necessary with the aid of advice from a qualified lawyer, because it may be commercially desirable for action to be taken without delay, action which may be irrevocable and which may have far reaching consequences. It is for this reason, of course, that the English courts have time and again asserted the need for certainty in commercial transactions – for the simple reason that parties to such transactions are entitled to know where they stand, and to act accordingly. In particular, when a ship owner becomes entitled under the terms of his contract, to withdraw a ship from the service of a time charterer, he may well wish to act swiftly and irrevocably. True, his problem may, in a particular case, prove to be capable of solution by entering into a without prejudice agreement with the original time charterer, under which the rate of hire will be made to depend upon a decision, by arbitrators or by a court, whether he was in law entitled to determine the charter. But this is not always possible. He may wish to refix his ship elsewhere as soon as possible, to take advantage of a favourable market. It is no answer to this difficulty that the ship may have cargo aboard at the time, so that her services cannot immediately be made available to another charterer’
Robert Goff LJ continued: ‘For one thing, the ship may not have cargo on board, and for another she can be refixed immediately under a charter to commence at the end of her laden voyage. Nor is it an answer that the parties can immediately apply to arbitrators, or to a court, for a decision, and that both maritime arbitrators and the Commercial Court in this country are prepared to act very quickly at very short notice. For, quite apart from the fact that some delay is inherent in any legal process, if the question to be decided is whether the tribunal is to grant equitable relief, investigation of the relevant circumstances, and the collection of evidence for that purpose, cannot ordinarily be carried out in a very short period of time.’ and ‘The policy which favours certainty in commercial transactions is so antipathetic to the form of equitable intervention invoked by the charterers in the present case that we do not think it would be right to extend the jurisdiction to relieve charterers from the consequences of withdrawal. We consider that the mere existence of such a jurisdiction would constitute an undesirable fetter upon the exercise by parties of their contractual rights under a commercial transaction of this kind. It is not enough to say it will only be exercised in rare cases. For the mere possibility that it may be exercised can produce uncertainty, disputes and litigation, and so prevent parties from knowing where they stand, particularly as the jurisdiction, if available, would be discretionary and there may be doubt whether it could be successfully invoked in any particular case.
For these reasons we hold that we have no equitable jurisdiction to grant equitable relief of the kind asked for by the charterers.’

Judges:

Robert Goff LJ

Citations:

[1983] QB 529

Jurisdiction:

England and Wales

Cited by:

Affirmed – Scandinavian Trading Tanker Co AB v Flota Petrolera Ecuatoriana (The Scaptrade) HL 1983
The House considered giving relief from forfeiture where an owner had justifiably withdrawn his vessel in accordance with the terms of the charter.
Held: A withdrawal clause under a time charter, exercised on the ground of the charterer’s . .
Cited – Golden Strait Corporation v Nippon Yusen Kubishka Kaisha (‘The Golden Victory’) HL 28-Mar-2007
The claimant sought damages for repudiation of a charterparty. The charterpary had been intended to continue until 2005. The charterer repudiated the contract and that repudiation was accepted, but before the arbitrator could set his award, the Iraq . .
Lists of cited by and citing cases may be incomplete.

Damages, Contract

Updated: 08 April 2022; Ref: scu.252492

George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd: HL 1983

A seedsman sought to rely upon an exclusion clause preventing any claim by a purchaser by way of set off against its sales invoices. The House was asked whether a contractual term was ‘fair and reasonable’ within the meaning of section 55 of the Sale of Goods Act 1979.
Held: Where a tribunal applies a standard with a greater or lesser degree of imprecision and takes a number of factors into account, there will be cases in which it will be impossible for a reviewing court to say that the tribunal must have erred in law in deciding the case either way.
Lord Bridge of Harwich said: ‘The decisive factor, however, appears from the evidence of four witnesses called for the appellants, two independent seedsmen, the chairman of the appellant company, and a director of a sister company (both being wholly-owned subsidiaries of the same parent). They said that it had always been their practice, unsuccessfully attempted in the instant case, to negotiate settlements of farmers’ claims for damages in excess of the price of the seeds, if they thought that the claims were ‘genuine’ and ‘justified.’ This evidence indicated a clear recognition by seedsmen in general, and the appellants in particular, that reliance on the limitation of liability imposed by the relevant condition would not be fair or reasonable.’ and ‘There will sometimes be room for a legitimate difference of judicial opinion as to what the answer [under s 11] should be, where it will be impossible to say that one view is demonstrably wrong and the other demonstrably right. It must follow, in my view, that, when asked to review such a decision on appeal, the appellate court should treat the original decision with the utmost respect and refrain from interference with it unless satisfied that it proceeded upon some erroneous principle or was plainly and obviously wrong.’ A decision as to reasonableness is akin to the exercise of a discretion.

Judges:

Lord Bridge of Harwich

Citations:

[1983] 2 AC 803, [1982] 1 All ER 108

Statutes:

Unfair Contract Terms Act 1977 11, Sale of Goods Act 1979 55(4)

Jurisdiction:

England and Wales

Citing:

Appeal from – George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd CA 29-Sep-1982
The buyer bought 30lbs of cabbage seed, but the seed was not correct, and the crop was worthless. The seed cost pounds 192, but the farmer lost pounds 61,000. The seed supplier appealed the award of the larger amount and interest, saying that their . .

Cited by:

Cited – Schenkers Limited v Overland Shoes Limited and Schenkers International Deutschland Gmbh v Overland Shoes Limited CA 12-Feb-1998
A clause in a shipping freight contract using the standard British International Freight Association terms disallowing a set-off was not unreasonable. The clause read ‘The customer shall pay to the company in cash or as otherwise agreed all sums . .
Cited – Watford Electronics Ltd v Sanderson CFL Ltd CA 23-Feb-2001
The plaintiff had contracted to purchase software from the respondent. The system failed to perform, and the defendant sought to rely upon its exclusion and limitation of liability clauses.
Held: It is for the party claiming that a contract . .
Approved – Overseas Medical Supplies Limited v Orient Transport Services Limited CA 20-May-1999
The appellant challenged a finding that it was responsible for the loss of medical equipment being transported from Tehran to the UK, and of failing to insure it as required, the contractual term exempting it from responsibility being an . .
Cited – Regus (UK) Ltd v Epcot Solutions Ltd CA 15-Apr-2008
The appellant had contracted to provide office accomodation to the defendant. The air conditioning did not work and there were other defects. The appellant now challenged a finding of liability and that its contract terms which were said to totally . .
Cited – Bracknell Forest Borough Council v Green and Another CA 20-Mar-2009
The council sought possession of the property saying that the three bedroomed property was underused by the tenant and his sister. The respondents said that it was not too extensive, and that no satisfactory alternative accommodation had been . .
Cited – Cleaver and Others v Schyde Investments Ltd CA 29-Jul-2011
The parties had contracted for the sale of land. The purchaser secured the rescinding of the contract for innocent misrepresentation. A notice of a relevant planning application had not been passed on by the seller’s solicitors. The seller appealed . .
Cited – Hodges v Aegis Defence Services (BVI) Ltd CA 12-Nov-2014
Appeal against dismissal of claim with costs. The claimant was personal representative of her husband’s estate. He had been employed by the defendants to provide support and security escort to US personnel based in Iraq under a contract for . .
Lists of cited by and citing cases may be incomplete.

Contract, Consumer

Updated: 08 April 2022; Ref: scu.185991

Schenkers Limited v Overland Shoes Limited and Schenkers International Deutschland Gmbh v Overland Shoes Limited: CA 12 Feb 1998

A clause in a shipping freight contract using the standard British International Freight Association terms disallowing a set-off was not unreasonable. The clause read ‘The customer shall pay to the company in cash or as otherwise agreed all sums immediately when due, without reduction or deferment on account of any claim, counterclaim or set off’. The plaintiffs had carried goods for the defendants over many years, and where a query had arisen had accepted that money was withheld until the issues was resolved. Included in their duties had been payment of some customs duties. The defendant claimed that they had not made certain reclaims leading to losses, and sought an equitable set off under the 1981 Act.
Held: In the circumstances, the clause satisfied the requirement of reasonableness. ‘The clause was in common use and well known in the trade following comprehensive discussions between reputable and representative bodies mindful of the considerations involved. It reflects a general view as to what is reasonable in the trade concerned. ‘

Judges:

Lord Justice Nourse, Lord Justice Pill And Lord Justice Thorpe

Citations:

Gazette 18-Mar-1998, Times 26-Feb-1998, [1998] EWCA Civ 234

Statutes:

Unfair Contract Terms Act 1977 3, Supreme Court Act 1981 49

Jurisdiction:

England and Wales

Citing:

Cited – Aries Tanker Corp v Total Transport Ltd; The Aries HL 1977
Claims for freight charges are an exception to the general rule that all claims between parties must be resolved in one action. A claim for freight cannot be a claim ‘on the same grounds’ as a counter-claim for loss or damage arising out of the . .
Cited – R W Green Ltd v Cade Bros Farms 1978
Seed potatoes were sold. They were infected with a virus which could not be detected by inspection. The buyers claimed to set off against the cost of the seed potatoes a counter-claim against the sellers for the defective seed. They relied on the . .
Cited – Stewart Gill Ltd v Horatio Myer and Co Ltd CA 1992
The ‘guidelines’ in Schedule 2 are usually regarded as of general application to the question of reasonableness under the 1977 Act. The effect of s13 which deals with exemption clauses, is to apply s3 inter alia to ‘no set off’ clauses. The . .
Cited – The Teno 1977
The court considered the circumstances necessary to establish a right to a set-off in equity: ‘where the cross-claim not only arises out of the same contract as the claim but is so directly connected with it that it would be manifestly unjust to . .
Cited – George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd CA 29-Sep-1982
The buyer bought 30lbs of cabbage seed, but the seed was not correct, and the crop was worthless. The seed cost pounds 192, but the farmer lost pounds 61,000. The seed supplier appealed the award of the larger amount and interest, saying that their . .
Cited – George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd HL 1983
A seedsman sought to rely upon an exclusion clause preventing any claim by a purchaser by way of set off against its sales invoices. The House was asked whether a contractual term was ‘fair and reasonable’ within the meaning of section 55 of the . .
Applied – Singer Co (UK) Ltd v Tees and Hartlepool Port Authority 1988
The court upheld under the 1977 Act a clause which limited a port authority’s liability to andpound;800 per ton of consignment. Other factors were relevant but ‘The way in which the port authority’s general conditions came into being seems to me to . .

Cited by:

Cited – Overseas Medical Supplies Limited v Orient Transport Services Limited CA 20-May-1999
The appellant challenged a finding that it was responsible for the loss of medical equipment being transported from Tehran to the UK, and of failing to insure it as required, the contractual term exempting it from responsibility being an . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 08 April 2022; Ref: scu.143712

George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd: CA 29 Sep 1982

The buyer bought 30lbs of cabbage seed, but the seed was not correct, and the crop was worthless. The seed cost pounds 192, but the farmer lost pounds 61,000. The seed supplier appealed the award of the larger amount and interest, saying that their contract limited their liability to the cost of the seed.
Held: The appeal failed, it would not be fair or reasonable to allow the seed merchants to rely on the clause to limit their liability.
It would not be fair or reasonable to allow seed merchants to rely on a clause limiting their liability for defective seeds. It was relevant that, in the course of dealing, the seed merchants ‘rarely, if ever, invoke the clause’.
Kerr LJ said: ‘the evidence clearly shows that the clause is not relied on ‘to the letter’ in practice, and neither the suppliers nor the farmers expect it to be applied literally. Its existence merely provides a basis for the negotiation of mutually acceptable settlements’.
Oliver LJ said: ‘the question is not whether there are not circumstances in which a clause such as this may be fair and reasonable but whether, in the circumstances, it would be fair and reasonable to allow reliance on it.’
The Canada Steamship guidelines were now to be understood in the context of the 1977 Act.

Judges:

Lord Denning Mr, Kerr LJ , Oliver LJ

Citations:

[1983] 1 All ER 108, [1982] EWCA Civ 5, [1983] 1 All ER 108, [1983] QB 284

Links:

Bailii

Statutes:

Supply of Goods (Implied Terms) Act 1973, Unfair Contract Terms Act 1977 1

Jurisdiction:

England and Wales

Citing:

Cited – George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd CA 29-Sep-1982
The buyer bought 30lbs of cabbage seed, but the seed was not correct, and the crop was worthless. The seed cost pounds 192, but the farmer lost pounds 61,000. The seed supplier appealed the award of the larger amount and interest, saying that their . .
Cited – Photo Production Ltd v Securicor Transport Ltd HL 14-Feb-1980
Interpretation of Exclusion Clauses
The plaintiffs had contracted with the defendants for the provision of a night patrol service for their factory. The perils the parties had in mind were fire and theft. A patrol man deliberately lit a fire which burned down the factory. It was an . .
Cited – Ailsa Craig Fishing Co Ltd v Malvern Fishing Co Ltd HL 26-Nov-1981
Even though a shipowner who had carried cargo on deck was not entitled to rely on the exceptions to liability in his contract, a limitation clause was different and should not be construed by reference to the specially exacting standards applicable . .
Cited – Glynn v Margetson and Co HL 1893
A printed form of bill of lading contained general words of obligation referring to the goods being shipped ‘in and upon the .. Zena, now lying in the port of Malaga, and bound for Liverpool’. Those words were followed by printed words intended ‘to . .
Mentioned – Levison v Patent Steam Carpet Cleaning Co Ltd CA 1977
A valuable Chinese carpet had been taken for cleaning but was lost by the bailee. The bailee said that his liability was limited under the terms of the contract to a particular sum. A fundamental breach is ‘a breach going to the root of the . .
Mentioned – Sze Hai Tong Bank Ltd v Rambler Cycle Co Ltd PC 1959
Lord Denning noted that the exclusion clause at issue ‘on the face of it, could not be more comprehensive’ but declined to interpret it as absolving the shipping company from liability. He said: ‘If such an extreme width were given to the exemption . .
Cited – L’Estrange v F Graucob Limited CA 1934
The company’s order form contained a clause providing them with complete exemption from liability: ‘Any express or implied, condition, statement of warranty, statutory or otherwise is expressly excluded’.
Held: If a party signs a written . .
Cited – London and North Western Railway Co v Neilson HL 1922
Lord Buckmaster said: ‘My Lords, the common law imposes upon the carriers of goods definite and well-known liabilities for the protection of owners. These liabilities are frequently modified by the terms of express contracts, but except to the . .
Cited – Cunard Steamship Co v Buerger HL 1927
Eight cases of textile goods belonging to the respondents had been lost in the course of a voyage aboard the S.S. Verentia, owned by the appellant company, under circumstances which were found to constitute deviation from the provisions of the Bill . .

Cited by:

Cited – Moyna v Secretary of State for Work and Pensions HL 31-Jul-2003
The appellant had applied for and been refused disability living allowance on the basis of being able to carry out certain cooking tasks.
Held: The purpose of the ‘cooking test’ is not to ascertain whether the applicant can survive, or enjoy a . .
Appeal from – George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd HL 1983
A seedsman sought to rely upon an exclusion clause preventing any claim by a purchaser by way of set off against its sales invoices. The House was asked whether a contractual term was ‘fair and reasonable’ within the meaning of section 55 of the . .
Cited – Schenkers Limited v Overland Shoes Limited and Schenkers International Deutschland Gmbh v Overland Shoes Limited CA 12-Feb-1998
A clause in a shipping freight contract using the standard British International Freight Association terms disallowing a set-off was not unreasonable. The clause read ‘The customer shall pay to the company in cash or as otherwise agreed all sums . .
Cited – George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd CA 29-Sep-1982
The buyer bought 30lbs of cabbage seed, but the seed was not correct, and the crop was worthless. The seed cost pounds 192, but the farmer lost pounds 61,000. The seed supplier appealed the award of the larger amount and interest, saying that their . .
Cited – HIH Casualty and General Insurance Limited and others v Chase Manhattan Bank and others HL 20-Feb-2003
The insurance company had paid claims on policies used to underwrite the production of TV films. The re-insurers resisted the claims against them by the insurers on the grounds of non-disclosure by the insured, or in the alternative damages for . .
Cited – Regus (UK) Ltd v Epcot Solutions Ltd CA 15-Apr-2008
The appellant had contracted to provide office accomodation to the defendant. The air conditioning did not work and there were other defects. The appellant now challenged a finding of liability and that its contract terms which were said to totally . .
Cited – Bracknell Forest Borough Council v Green and Another CA 20-Mar-2009
The council sought possession of the property saying that the three bedroomed property was underused by the tenant and his sister. The respondents said that it was not too extensive, and that no satisfactory alternative accommodation had been . .
Lists of cited by and citing cases may be incomplete.

Contract

Leading Case

Updated: 08 April 2022; Ref: scu.262678

HIH Casualty and General Insurance Limited and others v Chase Manhattan Bank and others: HL 20 Feb 2003

The insurance company had paid claims on policies used to underwrite the production of TV films. The re-insurers resisted the claims against them by the insurers on the grounds of non-disclosure by the insured, or in the alternative damages for misrepresentation. The policies were novel and sophisticated contracts and included clauses modifying the duties of disclosure by inclusion of a ‘truth of statement clause’. The clause appeared expressly not to require any representation as to the financial viabillity of the projected films, and to avoid liability for any misrepresentation made to the insurers. In this case the insurers sought to rely upon representations of the insurers themselves.
Held: The clause was intended to excuse a wide range of misrepresentation, but the law, on public policy grounds, does not permit a contracting party to exclude liability for his own fraud in inducing the making of the contract. Express and clear words were needed to avoid the consequences of fraudulent misrepresentation by a party’s agent and ‘it is extraordinarily unlikely that parties to a contract will agree a term which excludes liability for fraud with sufficient clarity to raise squarely the question of whether it should be lawful to do so’. The insurers were entitled to damages or to avoid the contract for fraudulent misrepresentation or fraudulent non-disclosure by the agent. Lord Hoffmann said that discussions about the effect and nature of the precise words used by law lords in either agreeing, entirely agreeing or concurring in the words of others amounted to an exercise which had ‘more in common with reading tea leaves than with legal reasoning’.

Judges:

Lord Bingham of Cornhill, Lord Steyn, Lord Hoffmann, Lord Hobhouse of Woodborough, Lord Scott of Foscote

Citations:

[2003] UKHL 6, [2003] 1 All ER Comm 349, [2003] 2 Lloyd’s Law Reports 61, [2004] ICR 1708, [2003] Lloyds Rep IR 230, [2003] 1 CLC 358

Links:

House of Lords, Bailii

Statutes:

Misrepresentation Act 1967 2(1), Unfair Contract Terms Act 1977

Jurisdiction:

England and Wales

Citing:

Appeal from – HIH Casualty And General Insurance Limited and Others v The Chase Manhattan Bank and Others CA 31-Jul-2001
Parties syndicating finance for a film obtained the security of an insurance which is designed to pay up to the sum insured, if the revenues generated by the film were insufficient to repay the loan finance plus associated expenses. The polices were . .
Cited – Canada Steamship Lines Ltd v The King PC 21-Jan-1952
A lease of a freight shed exonerated the lessor from ‘any claim . . for . . damage . . to . . Goods . . being . . in the said shed’ and requiring the lessee to indemnify the lessor ‘from and against all claims’. The negligent use of an oxy-acetylene . .
Cited – Lazarus Estates Ltd v Beasley CA 1956
There was a privative clause in the 1954 Act. A landlord’s declaration under the Act that work of a specified value, supporting an increase in rent, had been carried out on leased premises, could not be questioned after 28 days of its service on the . .
Cited – Societe Anonyme d’Intermediaries Luxembourgeois v Farex Gie CA 1995
The court considered the duty of disclosure impsed upon an insured: ‘Why should it be a breach of good faith sufficient to deprive the assured of his contract if the agent fails to disclose something which, had the assured known of it, would not . .
Cited – Weir v Bell 1878
‘I think that every person who authorizes another to act for him in the making of any contract, undertakes for the absence of fraud in that person in the execution of the authority given, as much as he undertakes for its absence in himself when he . .
Cited – S Pearson and Son Ltd v Dublin Corporation HL 1907
A clause in a building contract provided that the contractor should satisfy himself as to the dimensions, levels and nature of all existing works. Did this exclude an action based on alleged fraudulent misrepresentations by the council’s engineers . .
Cited – Banque Keyser Ullmann SA v Skandia (UK) Insurance Co Ltd CA 1990
A loan was to be made. An agent of the borrower came to know of the fraudulent nature of the loan, but said nothing.
Held: A failure to disclose a known fraud may itself amount to a misrepresentation, but nondisclosure (whether dishonest or . .
Cited – Pan Atlantic Insurance Co Ltd and Another v Pine Top Insurance Co Ltd HL 27-Jul-1994
The plaintiff had written long term (tail) insurance. The defendant came to re-insure it. On a dispute there were shown greater losses than had been disclosed, and that this had been known to the Plaintiff.
Held: ‘material circumstance’ which . .
Cited – PCW Syndicate v PCW Reinsurers CA 8-Sep-1995
A policy was not avoided by the agent’s failure to disclose his own dishonesty with the principal. In this area there was no difference between the law of Marine Insurance and other insurances. . .
Cited – Blackburn, Low and Co v Vigors HL 1887
There was a condition precedent of full disclosure of material facts in an insurance contract. The duty of an agent to disclose circumstances within his own knowledge to the insurer is independent of the duty of the insured to make disclosure, but: . .
Cited – Hollier v Rambler Motors (AMC) Ltd CA 19-Nov-1971
The plaintiff left his car with the defendant garage for repair. Whilst there it was substantially damaged by fire. The defendant sought to rely upon their terms which would negative liability, saying that the terms had been incorporated by . .
Cited – Ailsa Craig Fishing Co Ltd v Malvern Fishing Co Ltd HL 26-Nov-1981
Even though a shipowner who had carried cargo on deck was not entitled to rely on the exceptions to liability in his contract, a limitation clause was different and should not be construed by reference to the specially exacting standards applicable . .
Cited – Gillespie Bros and Co Ltd v Roy Bowles Transport Ltd CA 1973
The court looked at how it should construe the Canada Steamship guidelines with regard to an exemption clause absolving one party of responsibility for negligence. There was a express reference to negligence by the words ‘save harmless and keep . . . .
Cited – Smith v UMB Chrysler (Scotland) Ltd HL 9-Nov-1977
The principles set out in Canada Steamship apply to ‘clauses which purport to exempt one party to a contract from liability’. The principles should be applied without ‘mechanistic construction’.
Lord Keith of Kinkel said: The tests were . .
Cited – National Westminster Bank v Utrecht-America Finance Company CA 10-May-2001
An agreement between the parties for assignment or novation of a credit agreement, contained a ‘take out’ agreement (‘TOA’). The defendant began proceedings in California to rescind the agreement, and the claimants obtained summary judgement under . .
Cited – George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd CA 29-Sep-1982
The buyer bought 30lbs of cabbage seed, but the seed was not correct, and the crop was worthless. The seed cost pounds 192, but the farmer lost pounds 61,000. The seed supplier appealed the award of the larger amount and interest, saying that their . .
Cited – Toomey v Eagle Star Insurance Co Ltd (No 2) QBD 1995
Applying Canada Steamship Lines Ltd v The King, Colman J said: ‘Notwithstanding the commercial purpose of this transaction, the correct approach, as a matter of construction, is to conclude that in fact the effect of cl (a) is only to exclude the . .
Cited – Toomey v Eagle Star Insurance Co Ltd CA 1994
The word ‘reinsurance’ is often used loosely simply to describe any contract of insurance which is placed by or for the benefit of an insurer, but it should be construed more properly to require the insurance of an insurable interest in the subject . .
Cited – Lee v Jones CCP 1864
Jones had guaranteed to Lee payment of any balance due to them by their agent Packer. Jones sought to set aside the guarantee on ground of fraud by Lee. The fraud alleged was the failure of Lee to disclose that Packer had not properly accounted to . .
Cited – Rivaz v Gerussi Brothers and Co CA 1880
Underwriters were held entitled to avoid insurance policies because of concealment of the undervalue of the insured shipments. Brett LJ said: ‘Here it was not only a concealment, but a fraudulent concealment, for the matter concealed was kept back . .
Cited – Banque Keyser Ullmann SA v Skandia (UK) Insurance Co Ltd HL 1991
Banks had made loans against property which the borrower had said was valuable, and, also insurance policies against any shortfall on the realisation of the property. The borrower was a swindler and the property worthless. The insurers relied upon a . .
Cited – Gluckstein v Barnes; Re Olympia Ltd, ex parte Gluckstein HL 1900
Directors’ hidden profits disclosable
Promoters of a company had acquired a property intending its resale through the sale of shares in the company. In doing so the original directors made a substantial profit which they did not disclose (though it was discoverable). The company became . .
Cited – Brownlie v Campbell; Brownlie v Miller HL 1880
Silence where there is a duty to speak, may amount to a misrepresentation. Lord Blackburn said: ‘where there is a duty or an obligation to speak, and a man in breach of that duty or obligation holds his tongue and does not speak, and does not say . .
Cited – Mackender v Feldia AG CA 1966
A clause provided that an insurance policy should be governed by Belgian law and that ‘any disputes arising thereunder shall be exclusively subject to Belgian jurisdiction.’ The underwriters avoided the contract for non-disclosure of material facts . .
Cited – Blackburn, Low and Co v Vigors CA 1886
Lord Esher MR: ‘This seems to me to be the true doctrine. The freedom from mis-representation or concealment is a condition precedent to the right of the assured to insist on the performance of the contract, so that on a failure of the performance . .
Cited – Heyman v Darwins Limited HL 1942
An arbitration clause will survive a repudiatory breach: ‘I agree with the Lord Chancellor in thinking that the true ground of the decision in Jureidini v National British and Irish Millers Insurance Co Ltd was the narrowness of the field of . .
Cited – Lazarus Estates Ltd v Beasley CA 1956
There was a privative clause in the 1954 Act. A landlord’s declaration under the Act that work of a specified value, supporting an increase in rent, had been carried out on leased premises, could not be questioned after 28 days of its service on the . .

Cited by:

Cited – Dunnachie v Kingston Upon Hull City Council CA 11-Feb-2004
Compensation for non-economic loss brought about by the manner of an unfair dismissal is, on authority and on principle, recoverable. The award of such compensation by the employment tribunal in the present case was not excessive and was adequately . .
Cited – Frans Maas (Uk) Ltd v Samsung Electronics (Uk) Ltd ComC 30-Jun-2004
A large volume of mobile phones were stolen from a warehouse. The owner claimed damages from the bailee. The defendant said that standard terms applied limiting their responsibility to value calculated by weight.
Held: There was a bailment . .
Cited – Saggar v Ministry of Defence EAT 25-May-2004
Three Defence employees sought to bring claims of variously race and sex discrimination against the Ministry. In each case their services were provided almost entirely abroad, and the defendant argued that there was no jurisdiction to hear the case, . .
Cited – Advanced Industrial Technology Corporation Ltd v Bond Street Jewellers Ltd CA 4-Jul-2006
The claimant left a valuable necklace with the defendant jewellers for sale. The jewellers fell into financial difficulties, and the director gave the necklace as security for a loan to the company. The jeweller failed to maintain payments on the . .
Cited – Regus (UK) Ltd v Epcot Solutions Ltd CA 15-Apr-2008
The appellant had contracted to provide office accomodation to the defendant. The air conditioning did not work and there were other defects. The appellant now challenged a finding of liability and that its contract terms which were said to totally . .
Cited – Hayward v Zurich Insurance Company Plc SC 27-Jul-2016
The claimant had won a personal injury case and the matter had been settled with a substantial payout by the appellant insurance company. The company now said that the claimant had grossly exaggerated his injury, and indeed wasfiully recovered at . .
Cited – LB Holdings Intermediate 2 Ltd, The Joint Administrators of v Lehman Brothers International (Europe), The Joint Administrators of and Others SC 17-May-2017
In the course of the insolvent administration of the bank, substantial additional sums were received. Parties appealed against some orders made on the application to court for directions as to what was to be done with the surplus.
Held: The . .
Cited – Takhar v Gracefield Developments Ltd and Others SC 20-Mar-2019
The claimant appellant alleged that properties she owned were transferred to the first defendant under undue influence or other unconscionable conduct by the second and third defendants. The claim was dismissed. Three years later she claimed to set . .
Lists of cited by and citing cases may be incomplete.

Insurance, Media, Contract

Leading Case

Updated: 08 April 2022; Ref: scu.179502

York Glass Co Ltd v Jubb: CA 1925

The vendor sought to enforce a contract. The court had rejected the defendant’s plea first that the vendor knew of his incapacity, and that therefore the contract was void, and that second, the contract should not be enforced in equity because of his incapacity.
Held: The appeal failed. The contract was valid at law because the vendor was unaware of the unsoundness of mind. The contract was not impeachable in equity because the purchaser failed to establish any of the four circumstances on which he relied in order to establish the plea in equity.
Sargant LJ discussed three issues: first, was there a concluded contract apart from lunacy; if so, secondly, was that contract enforceable at law; ‘thirdly, if it was enforceable at law, was there any case for saying that equity would restrain the enforcement of the contract that is to say, is the case one in which, prior to the Judicature Act, a bill would have lain for an injunction to prevent the plaintiff from enforcing his remedies at law?’ There was plainly a concluded contract. In dealing with the second question, whether the contract was enforceable at law, which he held it was, he added:- ‘It is possible a question may arise in some future case, with which we have not to deal at present, whether, in the case of a contract which is not a reasonable one and which is made by an insane person that contract can be enforced, the other person not knowing of the insanity. I have looked through a number of cases and I have not found a single case in which a contract has in fact been binding except where the contract was an ordinary reasonable contract. I do not in any way want to attempt to express my own view on that point because the point has not been argued before us. I only want to guard myself by saying that my mind is entirely open on the question whether the fairness of the bargain is an essential element to the enforceability of the bargain against a person who was in fact a lunatic although not known to be such by the other contracting party.’ As to the third point, the plea in equity, it failed.

Judges:

Sargant LJ

Citations:

(1925) 134 LT Rep 36

Jurisdiction:

England and Wales

Citing:

Appeal from – York Glass Co Ltd v Jubb 1924
The defendant denied liability under contract, after the vendor brought an action against against the committee of his estate as a person of unsound mind. He said that the fact that he was of unsound mind was known to vendor, and later that the . .

Cited by:

Cited – Archer v Cutler 1980
(New Zealand) The purchaser of land sought specific performance of the contract. The vendor and purchaser had been neighbours. The neighbour needed part of the vendor’s land for access.
Held: A contract made by a person of insufficient mental . .
Cited – Hart v O’Connor PC 22-Apr-1985
Effect of insanity on making of contract
(New Zealand) The parties disputed the effect in law of an agreement for the sale of land. The transferor had proved not to be of sound mind.
Held: The validity of a contract entered into by a lunatic who is ostensibly sane is to be judged by . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 08 April 2022; Ref: scu.252449

Behzadi v Shaftsbury Hotels: CA 1992

The court must distinguish between an open contract such as Green v Sevin where no date for completion is fixed by the contract and the more normal case where a completion date is fixed but time is not of the essence of the date specified. In the former case the law implies a term that the contract will be completed within a reasonable time from the date of the contract, and notice fixing a new completion date and making time of the essence of the date cannot be given until there has been an unreasonable delay, because it is only then that a breach of the contract will have occurred. But in the latter case there is a breach directly the date fixed for completion has passed. Overruling earlier English authority and following Australian authorities, a party could serve a notice fixing a new date for completion and making time of the essence of the new date immediately the original date for completion had passed.

Citations:

[1992] Ch 1, [1991] 2 All ER 477, [1991] 2 WLR 1251, [1992] ANZ Conv R 112

Jurisdiction:

England and Wales

Cited by:

Cited – Shawton Engineering Ltd v Dgp International Ltd (T/A Design Group Partnership) and Another CA 18-Nov-2005
There had been a very substantial construction project, in which certain facets of design were sub-contracted and sub-contracted again to the parties. There were substantial delays and a sub-contractor purported to terminate the contract for failing . .
Cited – Dalkia Utilities Services Plc v Celtech International Ltd ComC 27-Jan-2006
The Court was asked to decide (i) which, if either, of the two parties to a 15 year agreement lawfully terminated it; (ii) whether, if one of them did so, it was by giving notice under a contractual termination clause or by way of acceptance of the . .
Cited – Warren and Another v Burns QBD 13-Nov-2014
The boxing manager and boxer each said that the other owed him money.
Held: The contract entitled the claimant to take some share of the boxers earnings but as part of the overall management fee, but as a part of the overall sum and at a share . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 08 April 2022; Ref: scu.237279

Ilyssia Compania Naviera SA v Bamaodah “The Elli 2”: CA 1985

May LJ considered the creation of a contract by implication, saying: ‘no such contract should be implied on the facts of any given case unless it is necessary to do so: necessary, that is to say, in order to give business reality to a transaction and to create enforceable obligations between parties who are dealing with one another in circumstances in which one would expect that business reality and those enforceable obligations to exist.’
As to choice of jurisdiction by choice of law, May LJ considered BP v Hunt, saying that he would not go so far as Kerr J in saying that the fact that the contract was governed by English law was a predominating factor. That factor would have a different weight in different circumstances.
Ackner LJ observed that where exclusive reliance was placed on the contract being governed by English law, the burden of showing that there was good reason justifying service out of the jurisdiction was a particularly heavy one.

Judges:

May LJ, Ackner LJ

Citations:

[1985] 1 Lloyd’s Rep 107

Jurisdiction:

England and Wales

Cited by:

Cited – Sawyer v Atari Interactive Inc ChD 1-Nov-2005
The claimant owned the copyright in several successful computer games. He had granted licenses for the use of the software, which licences were assigned to the defendants. Disputes arose as to the calculation of royalty payments, and the claimant . .
Cited – Novus Aviation Ltd v Onur Air Tasimacilik As CA 27-Feb-2009
The defendant appealed against a refusal to set aside the grant of leave to serve outside the jurisdiction granted to the claimant. Neither party conducted and business in England, and the contract was made in Switzerland, but was expressed to be . .
Lists of cited by and citing cases may be incomplete.

Contract, Jurisdiction

Updated: 08 April 2022; Ref: scu.237264

The Chaparral: CA 1968

A contract conferred exclusive jurisdiction on the English court as a neutral forum. In the context not only of English and other jurisdiction clauses the court held: ‘In the present case the choice of the parties was the English Court, and . . I should myself require strong grounds for saying that one of the parties should not keep his word.’

Judges:

Diplock LJ

Citations:

[1968] 2 Lloyds Rep 158

Jurisdiction:

England and Wales

Cited by:

Cited – BAS Capital Funding Corporation, Deutsche Bank Ag London, Paine Webber Capital Inc, PW Exe Lp, Pw Partners 1999 Lp v Medfinco Limited, Abacus Holdings Limited, Andreas W Gerdes, HTC Inc, etc ChD 25-Jul-2003
The claimants wanted to bring actions in respect of various matters under shareholders agreements in complex international joint ventures. Leave was given to serve English proceedings in Malta, and the claim form and particulars of claim were faxed . .
Lists of cited by and citing cases may be incomplete.

Contract, Jurisdiction

Updated: 08 April 2022; Ref: scu.186473

Seashell Shipping Corporation v Mutualidad de Seguros del Instituto Nacional de Industria (“The Magnum” ex “Tarraco Augusta”): CA 1989

Where the decision as to forum depends upon the construction of the document or documents in one language and the rival courts are, on the one hand, courts whose native language is that of the document and on the other hand, courts whose native language is not that of the document, it is in the interests of the parties and the ends of justice that the true meaning should be ascertained and be decided by the courts whose native language is that of the document.
Parker LJ said: ‘In my view it would be unjust to the plaintiff to prevent him from proceeding in Courts where the result of his bargain would be to produce success and to force him to proceed in Courts where the result would or might be that the defendants escaped from their bargain.’

Judges:

Parker LJ

Citations:

[1989] 1 Lloyds Rep 47

Jurisdiction:

England and Wales

Cited by:

Cited – Sawyer v Atari Interactive Inc ChD 1-Nov-2005
The claimant owned the copyright in several successful computer games. He had granted licenses for the use of the software, which licences were assigned to the defendants. Disputes arose as to the calculation of royalty payments, and the claimant . .
Cited – Amin Rasheed Shipping Corp v Kuwait Insurance Co HL 1983
A claimant must show good reason why service on a foreign defendant should be permitted. This head of jurisdiction was an exorbitant jurisdiction, one which, under general English conflict rules, an English court would not recognise as possessed by . .
Lists of cited by and citing cases may be incomplete.

Jurisdiction, Contract

Updated: 08 April 2022; Ref: scu.237272

Fry v Lane, re Fry, Whittet v Bush: CA 1889

Sales of reversionary interests at considerable undervalues by poor and ignorant persons were set aside. ‘The result of the decisions is that where a purchase is made from a poor and ignorant man at a considerable undervalue, the vendor having no independent advice, a Court of Equity will set aside the transaction. This will be done even in the case of property in possession, and a fortiori if the interest be reversionary. The circumstances of poverty and ignorance of the vendor, and absence of independent advice, throw upon the purchaser, when the transaction is impeached, the onus of proving, in Lord Selborne’s words, that the purchase was `fair, just, and reasonable’.’

Judges:

Kay J

Citations:

(1889) 40 Ch D 312, [1886-90] All ER Rep 1084

Jurisdiction:

England and Wales

Citing:

Appeal from – Fry v Lane QBD 1888
A court should be ready to set aside unconscionable transactions with ‘poor and ignorant persons’ where there had been no independent advice. . .
Cited – Earl of Aylesford v Morris 1873
One party to a contract knew of the other’s insanity.
Held: The contract of a lunatic is voidable not void. ‘Fraud’ in equity does not mean, and nor is it confined to, deceit; ‘it means an unconscientious use of power arising out of the . .

Cited by:

Cited – Portman Building Society v Dusangh and Others CA 19-Apr-2000
The defendant sought to set aside an order for possession under a mortgage.
Held: Where a case was strong enough on its face in terms of conduct and terms, unconscionable conduct could be inferred if there was no explanation offered to . .
Lists of cited by and citing cases may be incomplete.

Contract

Updated: 08 April 2022; Ref: scu.186678

New England Reinsurance Corporation v Messoghios Insurance Co: 1992

Where, on the face of the documents the parties contemplate that, before being bound by a contract, they will execute a written contract the terms of which require careful negotiation, there is a distinction between a party who indicates his agreement to the wording to be contained in the contract and his assent to be bound by the contract itself once drawn up and executed.

Citations:

[1992] 2 Lloyds LR 251

Jurisdiction:

England and Wales

Cited by:

Cited – Sun Life Assurance Company of Canada (A Company Established Pursuant To the Laws of Canada) v CX Reinsurance Company Limited (Formerly CNA Reinsurance Company Ltd) CA 6-Mar-2003
The claimant appealed a refusal to order that a dispute between insurer and re-insurer be referred to arbitration. One party sought to avoid liability under the policy, alleging misrepresentation. Discussions had been undertaking settling a revised . .
Lists of cited by and citing cases may be incomplete.

Insurance, Contract

Updated: 08 April 2022; Ref: scu.179739

Chilton v Saga Holidays Plc: CA 3 Dec 1984

At a trial under the small claims procedure, the registrar had declined to allow the defendant company to dross examine the plaintiff, and the counr court judge had held that decision to be well within the registrar’s discertion under the rules, on the basis that as acting without lawyers, they would be unable to achieve similar cross examinations of the dfenedants.
Held: The appeal succeeded. ‘Informality is all important in these small claims cases provided that the rules of natural justice are observed; and while I have not actually invited Mr. Foskett to defend his application for further and better particulars in this case, they are virtually indefensible. It was an attempt to turn this arbitration into a High Court hearing with detailed requests for information of which there was not the slightest need since they were already set out in a document prepared by the claimant. That is the sort of formality which should be disapproved of without qualification; but cross-examination is quite different. I would set the award aside and reluctantly, because additional costs may be involved, would direct that it be re-heard by a different registrar. ‘

Judges:

Sir John Donaldson MR, Slade, Lloyd LJJ

Citations:

[1984] EWCA Civ 1, [1986] BTLC 11, [1986] 1 All ER 841

Links:

Bailii

Statutes:

County Court Rules 1981

Jurisdiction:

England and Wales

Citing:

Cited – Allen v Allen CA 1894
Lopes LJ said: ‘It appears to us contrary to all rules of evidence, and opposed to natural justice, that the evidence of one party should be received as evidence against another party, without the latter having an opportunity of testing its . .
Lists of cited by and citing cases may be incomplete.

Contract

Leading Case

Updated: 08 April 2022; Ref: scu.258756

Energy Works (Hull) Ltd v MW High Tech Projects Uk Ltd and Others: TCC 24 Sep 2020

Hearing of preliminary issues to determine: i) the legal effect of an assignment by the First Defendant (‘MW’) to the Claimant (‘EWHL’) of MW’s sub-contract with the Part 20 Defendant (‘Outotec’); and ii) whether MW can pursue its claims for contribution against Outotec as direct claims, in respect of accrued rights under the sub-contract, or based on its liability for ‘the same damage’ pursuant to the Civil Liability (Contribution) Act 1978 (‘the 1978 Act’).

Judges:

Mrs Justice O’Farrell DBE

Citations:

[2020] EWHC 2537 (TCC)

Links:

Bailii

Statutes:

Civil Liability (Contribution) Act 1978

Jurisdiction:

England and Wales

Construction, Contract

Updated: 07 April 2022; Ref: scu.655941

Cameron and Another v Hughes Dowdall: SCS 28 Oct 2008

The pursuer sought damages for negligence by his solicitors. They had sold their business, but the solicitors were said to have failed to include in their contracts clauses necessary for their protection. The defenders claimed that the action should fail for want of prosecution. The first intimation of a claim had been given in 1990.
Held: There had been isolated delays, but the most serious delays were associated with legal aid difficulties. There was therefore no inexcusable delay.

Judges:

Morag Wise QC J

Citations:

[2007] ScotCS CSOH – 161

Links:

Bailii

Jurisdiction:

Scotland

Citing:

Cited – Tonner and Another v Reiach and Hall SCS 12-Jun-2007
In order to succeed in a minute asserting want of prosecution, the defender must show (i) that there had been both inordinate and inexcusable delay and (ii) that there was an ‘added element of unfairness . . specific to the particular factual . .
Cited – Assets Co Ltd v Bain’s Trustees 1902
A plea of mora may be sustained in an application for judicial review, but unreasonable delay is not of itself sufficient to found a successful plea: ‘But in order to lead to such a plea receiving effect, there must in my judgment have been . .
Cited – Smith v Golar-Nor Offshore A/S SCS 25-Sep-2007
. .
Cited – Somerville v Scottish Ministers HL 24-Oct-2007
The claimants complained of their segregation while in prison. Several preliminary questions were to be decided: whether damages might be payable for breach of a Convention Right; wheher the act of a prison governor was the act of the executive; . .
Lists of cited by and citing cases may be incomplete.

Professional Negligence, Contract

Updated: 06 April 2022; Ref: scu.277301

Aitken v Standard Life Assurance Ltd: SCS 3 Dec 2008

The pursuer averred that the defendant, his pension provider, had wrongfully reduced its final bonus by ten per cent without notifying him. He sought to imply a term into the contract to provide such an effect, saying that the contract promised an annual update. That promise was to be read to satisfy the purpose for which it was given namely to allow the pursuer to make decisions on his investments.
Held: The claim failed. The contract could not be read to include such a promise. One was not made at the inception of the policy, and later actions could not be used to imply obligations into the concluded contract. There would in any event be difficulty in identifying the extent of such an obligation.

Judges:

Lord Glennie

Citations:

[2008] ScotCS CSOH – 162

Links:

Bailii

Jurisdiction:

Scotland

Citing:

Cited – Pagnan SpA v Feed Products Ltd CA 2-Jan-1987
Contractually Bound – but Further Terms to Agree
The parties had gone ahead with performance of the arrangement between them, but without a formal agreement being in place.
Held: Parties may intend to be bound forthwith even though there are further terms still to be agreed. If they then . .
Cited – Jayaar Impex Limited v Toaken Group Limited 1996
The acceptance of a counter-offer or variation of a contract must be evidenced by ‘the plainest evidence of assent’. . .
Cited – Equitable Life Assurance Society v Hyman HL 20-Jul-2000
The directors of the Society had calculated the final bonuses to be allocated to policyholders in a manner which was found to be contrary to the terms of the policy. The language of the article conferring the power to declare such bonuses contained . .
Cited – Baird Textiles Ltd v Marks and Spencer plc CA 28-Feb-2001
The more embryonic is an oral ‘agreement’, the less likely it is that the parties intended to create legal relations at that stage. For there to be an agreement formed by conduct, there must be a course of dealing from which a contract is . .
Cited – Debenhams Retail Plc v Customs and Excise VDT 3-Jun-2003
VDT CONSIDERATION – Value of supply – Retailer – Payment by credit or debit card – Appellant invites sales of goods and services at shelf price to customer – In-store notices and till slips state that customers . .
Cited – Goshawk Dedicated Ltd and others v Tyser and Co Ltd and Another CA 7-Feb-2006
Lloyds underwiters sought inspection of the records of the Lloyd’s brokers.
Held: The documents must be made available at the cost of the underwriters. It was an implied obligation in a market where the brokers retained the records to make the . .
Cited – Scott v Dawson 1862
. .
Cited – North American and Continental Sales Inc v BEPI (Electronics) Limited 1982
. .
Cited – BP Refinery (Westernport) Pty Ltd v The Shire of Hastings PC 1977
(Victoria) The Board set out the necessary conditions for a clause to be implied into a contract.
Held: Lord Simon of Glaisdale said: ‘Their Lordships do not think it necessary to review exhaustively the authorities on the implication of a . .
Cited – Scally v Southern Health and Social Services Board HL 1991
The plaintiffs were junior doctors employed by the respondents. Their terms had been collectively negotiated, and incorporated the Regulations. During the period of their employment different regulations had given and then taken way their right to . .
Cited – Thomson v Thomas Muir (Waste Management Ltd) 1995
To imply a term into a contract, the court must be persuaded that the contract is unworkable without it. . .
Cited – Cawdor v Cawdor Castle (Tourism) Ltd SCS 31-Jul-2007
. .
Lists of cited by and citing cases may be incomplete.

Financial Services, Contract

Updated: 06 April 2022; Ref: scu.278428

Lehman Brothers Special Financing Inc v National Power Corporation and Another: ComC 12 Mar 2018

‘calculation of Close-out Amount under the 2002 ISDA (International Swaps and Derivatives Association, Inc.) Master Agreement. Is it open to a Determining Party to remake a determination of Close-out Amount? Did the change in wording from ‘reasonably determines in good faith’ in the 1992 ISDA Master Agreement to ‘act in good faith and use commercially reasonable procedures in order to produce a commercially reasonable result’ in the 2002 ISDA Master Agreement have the effect of replacing a requirement for a rational decision with a requirement for an objectively reasonable decision?’

Citations:

[2018] EWHC 487 (Comm), [2018] WLR(D) 157

Links:

Bailii, WLRD

Jurisdiction:

England and Wales

Financial Services, Contract

Updated: 06 April 2022; Ref: scu.606425

Port of Tilbury (London) Ltd v Stora Enso Transport and Distribution Ltd and Another: CA 23 Jan 2009

The court was asked whether the parties’ contract contained a no set-off provision or on the other hand permitted the set-off of a cross-claim pending the determination of the parties’ dispute.

Judges:

Rix LJ, Toulson LJ, Rimer LJ

Citations:

[2009] EWCA Civ 16

Links:

Bailii

Jurisdiction:

England and Wales

Contract

Updated: 05 April 2022; Ref: scu.280135

Hamilton v Papakura District Council and Watercare Services Ltd: PC 28 Feb 2002

(New Zealand) The claimants sought damages. The water authority had put in the water supply herbicides which damaged the crops they sought to grow, and which were watered from the supply. The plants were particularly sensitive to such chemicals.
Held: Dismissing the company’s appeal, the water supplier had a general duty to supply water to accepted standards. The water company had done this. The claimant had failed to show that it had brought its particular needs to the attention of the water company, and a claim in contract failed. The Ashington Piggeries case did not apply because in this case there was one supply of one product. Negligence could not be established without accepting a higher duty to some consumers. No such duty was established. The claims in nuisance, of having allowed the escape of materials brought onto their land, failed because there was no forseeability of this damage.

Judges:

Lord Nicholls of Birkenhead, Lord Hutton, Lord Rodger of Earlsferry, Sir Andrew Leggatt and Sir Kenneth Keith

Citations:

Times 05-Mar-2002, [2002] 3 NZLR 308, [2002] BCL 310, Appeal No 57 of 2000, [2002] UKPC 9

Links:

PC, (1) G.J. Hamilton and ‘ target=’_n’>PC, Bailii, PC

Statutes:

Sale of Goods Act 1893 14

Jurisdiction:

England and Wales

Citing:

Cited – Christopher Hill Ltd v Ashington Piggeries Ltd HL 1972
Mink farmers had asked a compounder of animal foods to make up mink food to a supplied formula.
Held: There was reliance as to the suitability of the ingredients only.
Lord Diplock said: ‘Unless the Sale of Goods Act 1893 is to be allowed . .
Cited – Rylands v Fletcher HL 1868
The defendant had constructed a reservoir to supply water to his mill. Water escaped into nearby disused mineshafts, and in turn flooded the plaintiff’s mine. The defendant appealed a finding that he was liable in damages.
Held: The defendant . .
Lists of cited by and citing cases may be incomplete.

Utilities, Agriculture, Contract, Negligence, Nuisance, Commonwealth

Updated: 05 April 2022; Ref: scu.167739

Tibbs v Tibbs and Another: ChD 22 Oct 2020

Claim, inquiry and account in respect of monies lent plus interest brought by Mr John Tibbs against his brother, Mr Robert Tibbs, and his sister-in-law, Ms Ann Tibbs, who counterclaim for having over paid interest on the loans.

Citations:

[2020] EWHC 2769 (Ch)

Links:

Bailii

Jurisdiction:

England and Wales

Contract

Updated: 05 April 2022; Ref: scu.655204

Gaia Ventures Ltd v Abbeygate Helical (Leisure Plaza) Ltd: ChD 31 Jan 2018

The court was asked whether a developer used ‘reasonable endeavours’ to achieve ‘as soon as reasonably practicable’ the satisfaction of certain conditions upon the fulfilment of which the developer became obliged to make an overage payment of pounds 1.4 million: and if it did not, then whether the overage payment or damages in lieu are payable.

Judges:

Norris J

Citations:

[2018] EWHC 118 (Ch)

Links:

Bailii

Jurisdiction:

England and Wales

Contract, Land

Updated: 04 April 2022; Ref: scu.604191