Tag

Drafting Stuff

Court backs clawback clause

July 2018 Where a clause in a business contract is badly worded, judges will generally try to reach a decision as to what it intended to say. They would prefer to do this than to rule that the clause is meaningless and should be ignored completely. After all, presumably the parties to the contract meant it to mean something, otherwise they wouldn’t have put the clause in...

Meaning of ‘good faith’

28/6/18 Whilst it might make things a bit less commercially certain, my personal preference would be to insert a general duty of good faith into any contract. You can then rely on the English courts’ sense of fair play as to what this means. As with anything else, the case law on this (ie the law set out by a succession of cases in courts over time) will keep developing. The most important case law is set out by the Supreme Court and below that the Court of Appeal, because precedents they set have to be followed by lower courts. Cases at the Commercial Court are less important, but still help to set the tone...

What has good faith to do with a legal business contract?

28/6/18 English law has traditionally favoured the ability of businesspeople to negotiate whatever contracts they want in pursuance of their commercial interests, even if they manage to get the wording of the contract done in such a way as allows them to shaft the other guy. The argument is that it is better to have a contract which gives commercial certainty even if it might be unfair or has loopholes which can be abused...

The importance of checking your contracts

12/6/18 3 related articles here...Whilst it’s nice to be able to put a written business contract away in a drawer once it’s been negotiated and signed, a few recent cases highlight the importance of making sure you carefully read and follow any procedures they may provide for.

How discretionary is a discretion?

March 2018 In this recent case, Watson was a director of a company which provided services to Watchfinder, which trades luxury pre-owned watches. Watchfinder granted Watson an option to buy shares in it. The option said that ‘The Option may only be exercised with the consent of a majority of the board of directors of the Company’ (ie Watchfinder). Watchfinder said that this meant that the board had an unconditional right to veto the exercise of the option. What did the court say?...

Unfair contract terms – or not

Jan 2018 A syndicate of lenders used an industry standard facility agreement provided by the Loan Market Association (‘LMA’) with a borrower (a Nigerian oil explorer and producer). Some of the terms were changed by negotiation. One that wasn’t was a clause saying that the borrower had no right of set off against amounts claimed by the lenders. Things went wrong and the borrower wanted to set off claims it had against the lenders against the monies the lenders wanted to recover. ..

Drafting: A pedantic article about commas

March 2016 Years ago, legal documents didn’t have much punctuation, and they didn’t use commas and stops, let alone colons, to draft things. I’ve no idea how they managed. More recently (like, in the last century or so) things have changed and punctuation has become important. So, how important are commas? Some commas aren’t really needed and are just a matter of style and you can do without them (like when I wrote ‘like, in the last century or so’, above, (or when I wrote ‘century or so’, above’ above…), or when I wrote ‘so, how important are commas’ above) (brackets can be quite important too). Others are rather important. There are rules as to how to read commas (and the lack of them), but they can be rather grey. Confusion over commas (and the lack of them) is now probably the biggest cause of dispute over the interpretation of contracts. A recent case is a good example...