TJH And Sons Consultancy Ltd v CPP Group Plc

TJH And Sons Consultancy Ltd v CPP Group Plc

Once the calculation of the additional fee under clause 5.1(a) of the consultancy agreement has been carried out applying the principles of the Regional Directors’ Bonus Scheme, CPP has no discretion to withhold payment. The relevant criteria are level of service and regional performance only, and group performance or a general discretion to withhold payment are not incorporated into the agreement.

Parties
Appellant: TJH AND SONS CONSULTANCY LIMITED; Respondent: CPP GROUP PLC
Jurisdiction
England and Wales
Judgment Date
02 February 2017
Procedural Posture
Civil Appeal / Appeal From First Instance Judgment
Outcome
appeal allowed in part
Legal Topics
Interpretation of Contracts, Incorporation by Reference, Consultancy Agreements, Discretionary Payments
Contract Law Commercial Law Interpretation of Contracts Incorporation by Reference Consultancy Agreements Discretionary Payments

Case Brief

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Parties

TJH AND SONS CONSULTANCY LIMITED

Appellant

CPP GROUP PLC

Respondent

Procedural Posture

Civil Appeal / Appeal From First Instance Judgment

Legal Issues

  1. 1 Whether clause 5.1(a) of the consultancy agreement confers a discretion on CPP to withhold payment of an additional fee
  2. 2 Whether the calculation of the additional fee under clause 5.1(a) is a discretionary or mandatory exercise
  3. 3 Whether group performance is a relevant criterion under the consultancy agreement

Ratio Decidendi

Once the calculation of the additional fee under clause 5.1(a) of the consultancy agreement has been carried out applying the principles of the Regional Directors’ Bonus Scheme, CPP has no discretion to withhold payment. The relevant criteria are level of service and regional performance only, and group performance or a general discretion to withhold payment are not incorporated into the agreement.

Court Disposition

appeal allowed in part

Orders

  • CPP to pay TJH £39,600 for 2012 and £33,000 for 2013, totaling £72,600
  • Ancillary consequences to follow as appropriate