TRG UPDATE - May 2021

Welcome to the latest issue of the TRG Update.

Unfortunately, our annual English Commercial Contract Law – Hot Topics event in conjunction with World Commerce & Contracting (formerly the IACCM) has had to be rescheduled and it is likely that it will go ahead this autumn, possibly in September.

The first session will cover issues of contractual performance and responsibilities including contract formation, representations v warranties, time of the essence, best / reasonable endeavours, withholding consent.

The second session will focus on the impact of Brexit on contract drafting as well as the latest cases on relational contracts and duties of good faith.

The third session will focus on liability caps, exclusions, indemnities and liquidated damages / penalty provisions.

Further details on exact dates and booking arrangements will follow nearer the time.

In this edition we feature, as usual, 4 recently decided cases. However, it is probably no exaggeration to say that two of them represent possibly the most significant decisions of recent years in terms of their potential impact on contract drafting and the rights and remedies available to contracting parties:

Limitation of liability equivalent to price paid held unreasonable.
Interpreting indemnities.
An unenforceable penalty?
The broad (and unintended?) effect of a loss of profit exclusion.

An archive of previous cases featured in our Updates is available here.

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Limitation of liability equivalent to ‘price paid’ held unreasonable

B A Kitchen Components v Jowat (High Court) [2021]

This case, once again, places a large number of liability limitation clauses in serious doubt regarding their enforceability and is something of a departure from recent decisions on this topic. The existence of insurance has again been elevated to be a key factor in determining the reasonableness of a limitation clause ... More>>>

Interpreting indemnities

GYM PLC v GYM Offshore Wind Farm (High Court) [2020]

Indemnities seem to be extremely fashionable but, as this case demonstrates, great care needs to be taken with their drafting, particularly given that the courts will look to interpret them restrictively if there is any ambiguity as to their scope ... More>>>

An unenforceable penalty?

Permavent v Makin (High Court) [2021]

It is a long-established principle of English law that a provision which constitutes a ‘penalty’ is unenforceable. However, over recent years the courts have gradually chipped away at that principle and this case is the most recent example of the extent to which the courts have been prepared to uphold clauses which would almost certainly have previously qualified as a penalty ... More>>>

The broad (and unintended?) effect of a loss of profit exclusion

CIS v IBM (High Court) [2021]

Exclusions of liability for ‘loss of profit’ are routine and, historically at least, relatively uncontentious. Sellers / service providers typically included the exclusion and buyers were happy to accept it on the basis that its impact was thought to be limited. That may have changed completely as the result of this decision... More>>>

This email is intended as general information only and not as legal advice. If you require any advice, please contact us.

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TRG Updates contain practical summaries of important legal developments in commercial contract law, including information technology and related areas.

TRG BRIEFings are brief ‘alerts’ to key contract, technology and intellectual property related legal issues and developments.

TRG law specialises exclusively in the drafting, negotiation and interpretation of technology, outsourcing and commercial contracts.

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