Tag: Contract Law
-
Restraining the Breach of a Negative Covenant
[Posted by V. Niranjan] It is common knowledge that an injunction is granted only if the applicant satisfies the court on the three-pronged test of prima facie case, irreparable injury and balance of convenience. While there is controversy over the scope of some of these elements, notably prima facie case, and over the relationship between…
-
The Romalpa Clause and Bankruptcy Protection
[Posted by V. Niranjan] To a supplier or, more generally, to any commercial entity involved in the initial stages of a supply chain, protecting itself in the event of the bankruptcy or change in constitution of its principal buyers is a matter of great importance. It is therefore commonplace to find clauses in a contract…
-
Court of Appeal on Concurrent Liability
[Posted by Shantanu Naravane] Earlier this year, the UK Court of Appeal was called on to consider an important question dealing with concurrent liability in contract and tort. The facts in Robinson v. Jones involved the defective construction of a house by a builder, which caused economic loss to the purchaser. However, the contractual remedy…
-
To Indemnify or Not?
[Posted by Umakanth Varottil] One of the key considerations while drafting or negotiating a contract is how to deal with consequences of violation of the contract by one of the parties. There are two possibilities. One is a simple claim for breach of contract. The other is the inclusion of a specific clause for indemnification.…
-
The Supreme Court in BSNL v Reliance: Penalty and Liquidated Damages
[Posted by V. Niranjan] The complexity of the distinction between penalties and liquidated damages in English law is amply borne out by the fact that even McGregor’s remarkably concise and insightful account is forced to begin with a seventeenth century statute (18th edition, ¶¶13.001 onwards). For an elaborate account of the law, interested readers may…
-
Incorporation of Contractual Terms by Reference
[Posted by Shantanu Naravane] Last week, an interesting issue of contractual interpretation fell for the consideration of the United Kingdom Court of Appeals in Malone v. British Airways, [2010] EWCA Civ 1225. The Court was called on to decide circumstances in which terms may be incorporated into a contract from other related agreements or documents,…
-
“Subject to contract” agreements and Good Faith
[Posted by Mihir Naniwadekar] On the issue of when a contract is formed in the case of “subject to contract” agreements, the leading Indian contract law textbook notes that what needs to be determined is, “… whether the formal document is of such a nature that it was the very condition of the contract or…
-
Confidentiality = Non-compete?
[Posted by Umakanth Varottil] In India, there is a fair amount of debate regarding the enforceability of non-compete agreements given Section 27 of the Contract Act that invalidates contracts in restraint of trade. Recent developments in California may throw some further light on the issue. Oracle’s appointment of former HP-CEO Mark Hurd has given rise…
-
“Subject to” Contracts and Agreements “Not Completed”
[Posted by V. Niranjan] “The moral of the story is to agree first and start work later.” So observed Lord Clarke recently, in delivering the unanimous judgment of the United Kingdom Supreme Court in RTS Flexible Systems [“RTS”] v. Molkerei Alois Muller Gmbh [“Muller”]. The judgment considers several questions of law that are of significance…