KEY CASES AND PRACTICAL ADVICE ON IMPLYING TERMS IN ENGLISH COMMERCIAL CONTRACT LAW
Indications are that Brexit is unlikely to have a substantive impact on English contract law, which has been largely unaffected by the proliferation of European Union (EU) law and has been developed alongside centuries of commercial activity. It is, therefore, essential that anyone involved in cross-border contract negotiation or commercial dispute resolution remains up-to-date with the latest legal and practical developments under English law.
Several recent key cases suggest that the law on implying terms into commercial contracts is developing apace.
What if a contract does not say what it should?
Whether or not a contract says what or all it should can be fertile ground for a dispute. The issue can be exacerbated by the longevity of many contractual arrangements and the divergence, over time, of parties’ commercial interests. The interpretation and potential implication of contractual terms continue to keep litigators busy, and the case of Bou Simon v. BGC Brokers LLP will be of interest to anyone involved in the negotiation of commercial contracts.
The contract in question expressly stated that Mr Bou-Simon would repay a loan if, within a certain time, he ceased to be a partner in the business. However, in fact, Mr Bou-Simon was only an employee and left the business before ever becoming a partner. As often happens, the contract had been prepared on the basis of the parties’ general understanding and aspirations at the outset of a business arrangement. It had not been tightly and correctly drafted so as to reflect the actual commercial reality.
Jul-Sep 2019 issue