Permavent Ltd & Anor v Makin

Clauses 2.11.4 to 2.11.6 of the Settlement Agreement are not unenforceable penalties because the detriment imposed is not out of proportion to the claimants' legitimate business interest in protecting the IP Rights, which are fundamental to their business. The clauses were negotiated at arm's length with legal advice, and the potential harm from breach could reasonably be anticipated to be commensurate with the quantum of the detriment.

Parties: Claimant: Permavent Limited; Claimant: Greenhill Industrial Holdings Limited; Defendant: Stephen John Makin
Jurisdiction: England and Wales
Judgment Date: 02 March 2021
Procedural Posture: Civil / Final Judgment
Outcome: judgment for claimants; counterclaim dismissed
Legal Topics: Penalty Clauses, Settlement Agreements, Patent Ownership, Breach of Contract

Contract Law Intellectual Property Penalty Clauses Settlement Agreements Patent Ownership Breach of Contract

Case Brief

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Parties

Permavent Limited

Claimant

Greenhill Industrial Holdings Limited

Claimant

Stephen John Makin

Defendant

Procedural Posture

Civil / Final Judgment

Legal Issues

1 Whether clauses 2.11.4 to 2.11.6 of the Settlement Agreement are unenforceable penalty clauses
2 Whether the detriment imposed by the Settlement Agreement is out of proportion to the claimants' legitimate business interest

Ratio Decidendi

Court Disposition

judgment for claimants; counterclaim dismissed

Orders

Declaration that Mr Makin is not entitled to further Easy Roof System Payments (ERSP)
Judgment for claimants for £62,870 under clause 2.11.5