Barratt & Ors v Treatt Plc

Barratt & Ors v Treatt Plc

The Earn-out Notice dated 17 February 2012 was not valid because it did not use the basis for calculation required by the SPA, namely audited accounts for the specified period, and this non-compliance was substantive and fatal to validity.

Source-derived case information.

Parties
Claimant: Wayne Barratt; Claimant: Campbell Walter; Claimant: Brian Hill; Claimant: Andrew Walter; Defendant: Treatt PLC
Jurisdiction
England and Wales
Judgment Date
15 November 2013
Procedural Posture
Commercial Dispute / Judgment
Outcome
Declaration that the Earn-out Notice dated 17 February 2012 was not valid under clause 3.2 of the SPA.
Legal Topics
Validity of Contractual Notices, Earn Out Provisions, Interpretation of Sale and Purchase Agreements, Expert Determination Clauses
Contract Law Commercial Law Validity of Contractual Notices Earn Out Provisions Interpretation of Sale and Purchase Agreements Expert Determination Clauses

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Parties

Wayne Barratt

Claimant

Campbell Walter

Claimant

Brian Hill

Claimant

Andrew Walter

Claimant

Treatt PLC

Defendant

Procedural Posture

Commercial Dispute / Judgment

Legal Issues

  1. 1 Whether the Earn-out Notice dated 17 February 2012 was validly served under the SPA
  2. 2 Whether the Earn-out Notice complied with the requirements of the SPA for calculation and detail

Ratio Decidendi

The Earn-out Notice dated 17 February 2012 was not valid because it did not use the basis for calculation required by the SPA, namely audited accounts for the specified period, and this non-compliance was substantive and fatal to validity.

Court Disposition

Declaration that the Earn-out Notice dated 17 February 2012 was not valid under clause 3.2 of the SPA.

Orders

  • Dispute as to the amount of the Earn-out to be determined by an independent accountant under clause 3.5 of the SPA.
  • Stay of Sellers’ claim for damages for breach of clause 6 of the SPA continues until after expert determination.