Interpretation

All is fair (value) in love and war … and minority shareholder acquisitions

Aaron Jones

“Fair value” means the value of the shares on a sale between a willing buyer and a willing seller, discounted to reflect the fact that shares represent a minority holding (Re Euro Accessories Ltd). Monaghan, the minority shareholder, claimed he was entitled to a pro rata proportion of the total value of company’s issued share Read More

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Change in law can reduce management fee to zero: the sport straw

Khush Kotecha

A change in law provision engaged by the Covid-19 pandemic can reduce the management fee payable to zero: Westminster City Council v Sports and Leisure Management. A management company were awarded a 10 year contract in 2016 to provide sport and leisure facilities to a Council. The contract was modelled on similar ones used by Read More

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The ABCs of default

Charlotte Page

In ABC v Network Rail, the Court of Appeal confirmed that “default” simply means a failure to comply with contractual obligations where the context does not call for an alternative construction. ABC was contracted to upgrade a Network Rail power supply. It was entitled to payment under a “total costs” provision, where Network Rail could Read More

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Judge hadn’t erred by referring to pre-contractual negotiations

Aashna Agarwal

The Court of Appeal has briefly considered the old chestnut of the admissibility of pre-contractual negotiations as an aid to interpreting an agreement: Morris Homes v Cheshire West and Chester Council. Morris and the Council had entered into an agreement under which Morris had to pay the Council a percentage of its sales revenue in Read More

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A waste of energy? Assignment, novation and contribution

Claudia Barry

In Energy Works v MW High Tech Projects the court examined the distinction between assignment and novation, and considered whether “damage” was the “same” for the purposes of the Civil Liability (Contribution) Act 1978. Energy Works, the purchaser, and MW High Tech, the main contractor, signed an EPC contract relating to a “fluidised bed gasification Read More

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MAE the MAC return? COVID-19 and Material Adverse Effect

Elizabeth Wall

Last week a judgment on preliminary issues was handed down in Travelport v WEX, the first Covid-related Material Adverse Effect, or MAE, dispute to come before the English courts. The judge found in favour of the buyer, and interpreted “industry” widely (as the entire B2B payments industry, rather than “travel payments industry”) for the purpose Read More

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When is it unreasonable to withhold consent?

Jason Rix

In Apache North Sea v Ineos, the court considered a provision that a party must “not unreasonably withhold its consent”. Apache wanted to amend part of an agreement with Ineos for transporting and processing hydrocarbons. It asked for Ineos’ consent to do so. Ineos said it would agree if Apache changed a tariff under the agreement. Read More

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Hunting goodwill – what does it mean and was it excluded?

Aladdin Benali

In Primus v Triumph, the Court of Appeal looked at whether claims brought by Triumph were claims “in respect of lost goodwill” and so excluded under a share purchase agreement. We covered the first instance decision, offering a case study in breach of warranty claims, last April. By way of summary, having bought shares in Read More

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Still sanctioned: “in order to comply with any mandatory provision of law”

Jason Rix

The  Court of Appeal has confirmed that a provision in an English law facility agreement stating that the borrower would not be in default if “…sums were not paid in order to comply with any mandatory provision of law…” allowed the borrower to avoid making payments where to do so might breach U.S. federal law Read More

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What does “prior to Completion” mean?

Jason Rix

In Gwynt Y Mor Ofto the court found that an indemnity in a sale and purchase agreement for loss “prior to Completion” meant the 6-day period between signing and completion. Accordingly, it did not cover corrosion in sub-sea cables dating back months or years. The defendants sold to the claimants the business of owning, maintaining and Read More

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