The latest contract cases coming out of 2015

8 April 2016

It’s in its seventh year now – I do an annual update at the beginning of each year looking at the major cases in Contract Law, and how they should influence what we draft, or how we negotiate – whether entering into a deal, or perhaps re-negotiating when things have gone wrong.

Many people like the slides because they are so rich in content – so I am happy to upload them for you to enjoy.

Take a look here.

Even better – see you at the talk next year. Email if you want details of how to attend.

Synopsis:

  • it is getting easier for the courts to find that the parties have entered into a contract without their knowing it – signature is not necessary, and even where you haven’t complied with the requirements set out in the draft for making a binding contract (such as formal exchange of copies)
  • the same applies to variations – even where the contract provides that variations have to be formally signed off, the courts seem ready to accept email exchanges as making binding variations
  • some cases have come out demonstrating the unusual doctrine of “estoppel by convention” – one possible consequence of doing one thing when the contract says something completely different
  • the Supreme Court has once again laid down the law on implied terms – the basic rule (still) is: if you haven’t provided for it in your contract, the court won’t imply a term for your benefit later
  • the courts are still considering orders of precedence in contracts: the trend seems to be that the courts are happy to ignore them: this raises the question of what their real value is
  • “good faith” is till troubling the courts: be careful when you use this expression and try to avoid using it as some overarching obligation in contracts – the risk is that you are creating confusion, not certainty
  • the law of contractual discretions is seeing some changes: the Supreme Court has recently provided that, at least in employment contracts, the standard for exercising a discretion is more demanding
  • the law of limitations and exclusions of liablity is seeing an upheaval in the approach of the courts: gone are the old rules where a court would strain to find that they did not apply, in with the new approach which is to uphold the bargain reached by the parties
  • in line with their increasingly common usage, cases are emerging on indemnities: the basic lesson is to be careful what you wish for – indemnities will be applied according to their meaning, so careful drafting is called for
  • perhaps the biggest upheaval was the Supreme Court’s decision on “penalties” – taking in such things as liquidated damages and service credits: basically, the law is unchanged but the Supreme Court has, in a long and confusing judgment, essentially said that law will uphold bargains according to their letter unless the “penalty” is extortionate
  • termination continues to cause problems for those trying to terminate contracts – you have to be really, really sure of your grounds before seeking to terminate for breach

Enjoy the slides – email me if you have any questions.