Karim & Anor v Wemyss

Karim & Anor v Wemyss

The seller was not entitled to claim more than the WIP schedule amount absent justification. The seller breached warranties and made actionable misrepresentations regarding profit. The buyer was entitled to damages for breach of warranty, calculated as the difference in value attributable to the profit shortfall, and to a reasonable sum for management time. The judge's approach to insurance premium increases and management time was partially incorrect and adjusted on appeal.

Parties
Appellant: Sameer Karim; Appellant: Douglas Wemyss Solicitors; Respondent: Douglas Macduff Wemyss
Jurisdiction
England and Wales
Judgment Date
28 January 2016
Procedural Posture
Civil Appeal / Appeal From High Court (mercantile Court)
Outcome
Appeal allowed in part; judgment varied.
Legal Topics
Breach of Warranty, Misrepresentation, Damages, Sale of Business, Professional Indemnity Insurance, Burden of Proof
Contract Law Tort Law Commercial Law Breach of Warranty Misrepresentation Damages Sale of Business Professional Indemnity Insurance +1 more

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Parties

Sameer Karim

Appellant

Douglas Wemyss Solicitors

Appellant

Douglas Macduff Wemyss

Respondent

Procedural Posture

Civil Appeal / Appeal From High Court (mercantile Court)

Legal Issues

  1. 1 Whether the seller was entitled to claim more than the WIP schedule amount under the SPA
  2. 2 Whether the seller breached warranties and made actionable misrepresentations regarding turnover and profit
  3. 3 Proper measure of damages for breach of warranty and misrepresentation

Ratio Decidendi

The seller was not entitled to claim more than the WIP schedule amount absent justification. The seller breached warranties and made actionable misrepresentations regarding profit. The buyer was entitled to damages for breach of warranty, calculated as the difference in value attributable to the profit shortfall, and to a reasonable sum for management time. The judge's approach to insurance premium increases and management time was partially incorrect and adjusted on appeal.

Court Disposition

Appeal allowed in part; judgment varied.

Orders

  • Reduce amount awarded to Mr Wemyss by £12,783 on the claim.
  • Award Mr Karim £15,000 for breach of warranty.