iSOFT Group Plc v Misys Holdings Ltd. & Anor [2002] EWHC 2094 (Ch) (16 October 2002)

iSOFT Group Plc v Misys Holdings Ltd. & Anor [2002] EWHC 2094 (Ch) (16 October 2002)

Clause 11.4.2 required Misys to make an offer to iSOFT for the Target Business at fair market value and on fair and reasonable terms, and such offer must be capable of acceptance so as to give rise to a binding contract. The clause is sufficiently certain to be specifically enforced, and the court can supply machinery to determine fair market value and fair and reasonable terms if the parties cannot agree. The obligation is enforceable and not void for uncertainty.

Citation
[2002] EWHC 2094 (Ch)
Parties
Claimant: iSOFT Group plc; Defendant: Misys Holdings Limited; Defendant: Misys plc
Jurisdiction
England and Wales
Judgment Date
16 October 2002
Procedural Posture
Commercial Contract Dispute / High Court (chancery Division) Trial Judgment
Outcome
Claim allowed in part; declaration granted as to enforceability of clause 11.4.2; directions for further determination of fair market value and terms if not agreed.
Legal Topics
Certainty of Contractual Terms, Specific Performance, Restrictive Covenants, Sale of Business, Enforceability of Agreements, Restraint of Trade
Contract Law Commercial Law Certainty of Contractual Terms Specific Performance Restrictive Covenants Sale of Business Enforceability of Agreements Restraint of Trade

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Parties

iSOFT Group plc

Claimant

Misys Holdings Limited

Defendant

Misys plc

Defendant

Procedural Posture

Commercial Contract Dispute / High Court (chancery Division) Trial Judgment

Legal Issues

  1. 1 Whether clause 11.4.2 of the ACT Sale Agreement required Misys to make an offer capable of acceptance for the sale of the Target Business to iSOFT
  2. 2 Whether the clause is sufficiently certain to be specifically enforced
  3. 3 Whether the court can supply machinery to determine fair market value and fair and reasonable terms

Ratio Decidendi

Clause 11.4.2 required Misys to make an offer to iSOFT for the Target Business at fair market value and on fair and reasonable terms, and such offer must be capable of acceptance so as to give rise to a binding contract. The clause is sufficiently certain to be specifically enforced, and the court can supply machinery to determine fair market value and fair and reasonable terms if the parties cannot agree. The obligation is enforceable and not void for uncertainty.

Court Disposition

Claim allowed in part; declaration granted as to enforceability of clause 11.4.2; directions for further determination of fair market value and terms if not agreed.

Orders

  • Declaration that Misys is obliged to make an offer to iSOFT for the Target Business at fair market value and on fair and reasonable terms, such offer to be capable of acceptance.
  • If the parties cannot agree fair market value or terms, the court will determine them or supply appropriate machinery.