Source: All England Reporter
Publisher Citation: [2013] All ER (D) 164 (Mar)
Neutral Citation: [2013] EWCA Civ 185
Court: Court of Appeal, Civil Division

Lord Justice Rix, Lord Justice Rimer and Mrs Justice Baron

Representation Michael J Booth QC (instructed by Follett Stock LLP) for the claimant.
  Ian Clarke (instructed by Rubric Lois King Solicitors, Edgbaston) For the defendants.
Judgment Dates: 15 March 2013


Contract - Warranty - Breach - Claimant purchasing majority shareholding in company from defendants - Negotiations for sale being conducted on basis target company entering into contract with National Health Service - NHS contract being entered into after share purchase agreement - Company failing to meet milestones in NHS contract - Company going into administration - Claimant seeking damages - Judge allowing claim but finding warranty in share purchase agreement regarding performance of agreements not being breached - Claimant appealing - Whether NHS contract being included within meaning of warranty.

The Case

Contract Warranty. The defendants had been shareholders in a company which was intending to enter into an agreement with the NHS. The claimant bought 60% of the issued share capital in the company prior to it entering into the NHS contract. The company was unable to meet the requirement of the NHS contract and went into administration shortly after. The Court of Appeal, Civil Division, allowed the claimant's appeal against a finding that the defendants had not breached a warranty in the share purchase agreement. The judge had erred in finding that the NHS contract had not been covered by the terms of the warranty and he had failed to ask himself the correct question in assessing whether, if the NHS contract was covered by the warranty, the warranty had been breached.

Practice Areas

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