Commercial Disputes Weekly – Issue 18916 January 2024

Contract Interpretation – Lease
The claimant exercised three options to extend leases. The defendant landlord asserted that the claimant had repudiated the contracts by failing to pay the deposits by midnight on the day it exercised the options. The court held that the deposits were due by midnight on the day of exercise of the options and therefore no term could be implied for payment within a reasonable time. However, time for payment of the deposits was not a condition of the contract both as a question of interpretation of the options and because the case was outside the ordinary run of cases by being deposits upon exercise of options, rather than upon the sale and purchase of land. As a result, non-payment of the deposits was not a repudiatory breach of the contract. A letter from the claimant’s solicitors that required the defendant to perform the contract by transferring the interest under the leases did not demonstrate any intention of the claimant to abandon or refuse to perform the sale contracts. The options were therefore validly exercised.
IAA Vehicle Services Ltd v HBC Ltd [2024] EWHC 1 (Ch), 5 January 2024

Adjudication
A dispute arose in relation to sums due under a contract to supply and install kitchens in a building development project. Following non-payment by the defendant, the claimant referred the dispute to adjudication to determine on a ‘smash and grab’ basis or in the alternative, as a true value adjudication. The adjudicator decided in favour of the claimant but only on the true value application. On enforcement, the judge rejected the defendant’s argument that the claimant had referred two disputes. There was in substance only one application for a sum due. It was not unique for such issues to be combined within one referral as alternative outcomes. Further, the adjudicator had not exceeded his jurisdiction by deciding on the true value of the payment. This alternative argument had clearly been set out in the adjudication referral. Summary judgment was awarded in the claimant’s favour.
Bellway Homes Limited v Surgo Construction Limited [2024] EWHC 10 (TCC), 27 November 2023

Damages – Misrepresentation
The claimant sought damages from the defendant bank for fraudulent misrepresentations set out in a letter signed and stamped by its former corporate banking relationship manager, that potential investors had free funds to invest £20m in a new product which the first claimant was developing called FibreWater. The fact of the misrepresentations was admitted but liability was not. The court concluded that the courts of England and Wales had jurisdiction as although some of the facts arose in Taiwan, there was no evidence that the claim was manifestly more closely connected with Taiwan. The bank was held liable for its employee’s misrepresentation, even though it was clearly outside any authority given to him by the bank. The claimant was awarded damages because there was evidence of reliance on the misrepresentations, which were a substantial cause of the claimed losses.
Vegesentials Limited and Fibre Water Limited v The Shanghai Commercial & Savings Bank Limited (a company incorporated in Taiwan) [2024] EWHC 7 (Ch), 5 January 2024

Should you wish to discuss any of these cases in further detail, please speak with a member of our London dispute resolution team below, or your regular contact at Watson Farley & Williams: