The commercial courts are often instrumental in exposing skulduggery and that was certainly so in one case in which the director of a shipping company was found to have masterminded the scuttling of a merchant vessel with a view to financial gain.
It is essential that contract adjudicators must not only act, but be seen to act, fairly. In one case involving a contract to install a £30 million airport baggage handling system, the High Court ruled that that requirement had not been met.
Contractual deadlines can be very tight and the financial consequences of breaching them are often severe. In one case which underlined the point, a cruise ship operator won Euros 770,000 in damages from a shipyard after a major refurbishment of its flagship was held up for a month, largely due to strike action.
Sharp practices and deceit are sadly not uncommon in commerce – but one Court of Appeal case involving numerous shipments of mis-described crude oil showed that the law can catch up with perpetrators no matter how long after the event the truth emerges.
In an important decision which established that computer software can properly be viewed as ‘goods’, notwithstanding its intangibility, the High Court has awarded substantial compensation to a commercial agent whose client backed out of a promotion deal without notice.
It is a surprisingly common misconception that written contracts only become effective when signatures are appended. One Court of Appeal case, involving a cookware company and the producers of a popular television cooking show, underlined that that is most certainly not the case.
The whole point of commercial arbitrations is to achieve final resolutions with which all parties must abide, whether or not they are happy with the result. The High Court made that point as it considered the unfortunate case of an oil tanker which had been detained at a Venezuelan port for almost 18 months.
Sponsorship deals are commonplace in the sporting world and are underpinned by trade mark licensing agreements. In one important High Court case, a judge has analysed one such agreement by which a sports car manufacturer allowed the use of its name by a financially troubled Formula One racing team.
Brevity is usually to be preferred when drafting commercial agreements and an excess of verbosity can often be the source of intractable disputes. That was certainly so in the case of a £160 million public contract which contained a string of unworkable clauses despite running to several lever arch files.
Commercial arbitrators are often called upon to address thorny jurisdictional issues where all the parties to a dispute, and its subject matter, have nothing at all to do with the UK. That was certainly so in one case involving a lucrative project to redevelop a hotel near Moscow’s Red Square.
The law assumes that experienced businesspeople know what they are doing when it comes to allocating risk. In a case which exemplified that position, the High Court found that a development consortium accepted the risk of asbestos contamination interfering with its plans, even if that eventuality arose through negligence.
Commercial dealings with foreign governments can be lucrative and offer a welcome degree of financial security – but thorny issues of state immunity can arise when contracts do not run smoothly. Exactly that happened in one case in which the Kurdistan Regional Government of Iraq (KRG) claimed immunity against enforcement of a $100 million arbitration award.
Litigating breach of contract disputes is costly and, with outcomes never predictable, compromise on the basis of legal advice is very often the better course. In one case which proved the point, sub-contractors involved in a gas pipeline project sued for £10 million but ended up having to repay almost £2.5 million.
Litigation is expensive and there is sometimes no option but for those involved to rely on third party funding that is available in the marketplace. In a test case concerning such an arrangement, the High Court ruled that a 300 per cent success fee charged by one such funder was recoverable in the context of a commercial arbitration.
Asset freezing orders are an essential tool in commercial litigation, but they can have devastating consequences for those targeted and damages are generally payable if they are improperly obtained. The point was strikingly underlined by one High Court case involving a businessman who won tens of millions of dollars in compensation despite his own dishonest conduct.
The Insurance Act 2015 came into force today. In practical terms, the effect of the Act is to reduce the number of 'technical' defences that can be used by insurance companies to avoid paying out on claims.
Insurance disputes in respect of whether a vehicle is or is not a write-off following an accident are sadly familiar to thousands of motorists. However, one High Court case involving a catastrophic fire on board a ship with an insured value of $12 million showed that such disagreements are not confined to dry land.
Commercial judges in London are no strangers to dealing with the fall-out from fraud and corruption around the world. In one striking case, a judge found that a Russian businessman had ripped off a Latvian bank, of which he was formerly the majority owner, to the tune of about £67 million.
Those at the helm of companies are obliged by law to put their own interests second to those of shareholders. In one case that highlighted the point, a logistics company had launched proceedings against its own former chairman, chief executive and finance director, accusing them of perpetrating $160 million frauds.
Commercial arbitrators have to deal with many very bitter disputes and their rulings, although supposed to be final, are not always greeted with equanimity. In one case, however, the High Court has emphasised that its power to overturn arbitration awards is intended to operate only as a long-stop in extreme cases.
The London riots of 2011 are now but a dim memory for most people, but this week a significant legal decision was reached by the Supreme Court which has significance for any business whose premises are subject to riot damage.
Cooperation between legal systems throughout the civilised world is the bedrock of international law. In one case which proved the point, the Atlantic proved no barrier to High Court enforcement of an American judge’s ruling in a multi-million-pound contract dispute.
Businesses often feel under commercial pressure to grant credit to important clients but one High Court case showed how easy it is for such debts to get out of control. A commodities trading company had agreed to defer payment of part of a favoured customer’s bills but ended up being owed almost $5.3 million.
Contract disputes can sometimes become so intractable that litigation is the only way of achieving finality. In one case, positions became so entrenched that a corporate jet, which lay at the heart of the disagreement, had been grounded for so long that its owner no longer wanted anything more to do with it.
Few industries are more international than insurance and disputes inevitably arise as to the country where disagreements should be resolved. However, one case concerning a catastrophic train crash in America revealed that, at least within Europe, clear rules apply.
The acrimonious termination of commercial contracts can lead to outbreaks of fierce competition and mutual bad-mouthing which affect customers and enter the public domain. That was certainly the case following the end of a franchise agreement in the postal franking machines market.
Contract drafting is an art which should only be undertaken by specialists. The truth of that statement was underlined by a case in which an arbitration clause in a major commercial contract contained references to non-existent ‘UK law’ and ‘UK courts’ as if Britain’s three separate legal systems were one and the same.
Cross-border commercial disputes can often give rise to a risk that conflicting judicial decisions will be reached in different countries under different laws. However, a High Court ruling has underlined that, at least within the European Union (EU), rules are in place to prevent that happening.