Teesside Power Holdings Ltd v Electrabel International Holdings BV & Anor

Teesside Power Holdings Ltd v Electrabel International Holdings BV & Anor

Clause 6.2 of the tax deed does not oblige the buyer to pay to the covenantors the amount of interest paid to the company by HMRC on tax repayments. The language of the clause, the structure of the deed, and the express treatment of interest in other clauses indicate that interest is not included in the obligation...

Source-derived case information.

Parties
Claimant: Teesside Power Holdings Limited; Defendant: Electrabel International Holdings B.V.; Defendant: GDF International SAS
Jurisdiction
England and Wales
Judgment Date
20 January 2012
Procedural Posture
Commercial Contractual Dispute / Judgment on Preliminary Issue
Outcome
Claim dismissed on the preliminary issue
Legal Topics
Interpretation of Contract Terms, Tax Deeds, Share Purchase Agreements, Interest on Tax Repayments
Contract Law Commercial Law Interpretation of Contract Terms Tax Deeds Share Purchase Agreements Interest on Tax Repayments

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Parties

Teesside Power Holdings Limited

Claimant

Electrabel International Holdings B.V.

Defendant

GDF International SAS

Defendant

Procedural Posture

Commercial Contractual Dispute / Judgment on Preliminary Issue

Legal Issues

  1. 1 Whether the obligation under clause 6.2 of the tax deed includes an obligation to pay the covenantors the amount of interest paid to the company by HMRC

Ratio Decidendi

Clause 6.2 of the tax deed does not oblige the buyer to pay to the covenantors the amount of interest paid to the company by HMRC on tax repayments. The language of the clause, the structure of the deed, and the express treatment of interest in other clauses indicate that interest is not included in the obligation under clause 6.2. There was no consensus or implied term to that effect.

Court Disposition

Claim dismissed on the preliminary issue

Orders

  • There is no obligation on the buyer under clause 6.2 to pay the covenantors the amount of interest paid to the company by HMRC.
  • All consequential matters to be dealt with at a later hearing if not agreed.