MICHAEL SOFAER v. ARRAL PACIFIC MANAGEMENT LTD AND OTHERS

MICHAEL SOFAER v. ARRAL PACIFIC MANAGEMENT LTD AND OTHERS

The court held that the historical background and the proposed implied terms fell within established principles allowing background evidence for interpretation of commercial contracts; an entire agreement clause did not preclude the plaintiff from pleading and arguing for implied terms. Consequently the proposed reamendments were permitted and an order nisi was made in the terms sought.

Citation
MICHAEL SOFAER v. ARRAL PACIFIC MANAGEMENT LTD AND OTHERS
Parties
Plaintiff: Michael Sofaer; 1st Defendant: Arral Pacific Management Ltd.; 2nd Defendant: Sofaer Capital Inc.; 3rd Defendant: Arral Associates (H.K.) Ltd.
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
17 January 1995
Case Number
HCCL86/1993
Procedural Posture
Commercial List Contract Dispute (stock Purchase Agreement) / Interlocutory Application to Re Amend Points of Claim
Outcome
Re-amendments allowed; order nisi made
Legal Topics
Implied Terms, Entire Agreement Clause, Construction of Contract, Amendment of Pleadings, Admissibility of Background Evidence
Source Language
EN
Contract Law Commercial Law Civil Procedure Implied Terms Entire Agreement Clause Construction of Contract Amendment of Pleadings Admissibility of Background Evidence

Case Brief

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Parties

Michael Sofaer

Plaintiff

Arral Pacific Management Ltd.

1st Defendant

Sofaer Capital Inc.

2nd Defendant

Arral Associates (H.K.) Ltd.

3rd Defendant

Procedural Posture

Commercial List Contract Dispute (stock Purchase Agreement) / Interlocutory Application to Re Amend Points of Claim

Legal Issues

  1. 1 Whether the plaintiff may re-amend points of claim to plead background facts and implied terms
  2. 2 Whether implied terms to cooperate and not to frustrate completion of a share purchase agreement can be pleaded
  3. 3 Whether an 'entire agreement' clause bars admitting background extrinsic evidence or implying terms

Ratio Decidendi

The court held that the historical background and the proposed implied terms fell within established principles allowing background evidence for interpretation of commercial contracts; an entire agreement clause did not preclude the plaintiff from pleading and arguing for implied terms. Consequently the proposed reamendments were permitted and an order nisi was made in the terms sought.

Court Disposition

Re-amendments allowed; order nisi made

Orders

  • Order nisi in terms of paragraphs 1, 2, 3, 8 and 9 of the plaintiff's summons
  • Application fit for two counsel