G4S Cash Centres (UK) Ltd v Clydesdale Bank Plc [2011] ScotCS CSIH_48 (22 July 2011)

G4S Cash Centres (UK) Ltd v Clydesdale Bank Plc [2011] ScotCS CSIH_48 (22 July 2011)

Clause 2.2 provides for a mandatory review of service fees after the seventh anniversary, which may include benchmarking but is not constrained by the absolute discretion provision in part 13. The review can result in an increase or decrease in fees, and disputes are to be resolved under clause 12, including referral to the courts. The contract is enforceable and not merely an agreement to agree.

Citation
[2011] ScotCS CSIH_48
Parties
Pursuers and Respondents: G4S Cash Centres (UK) Ltd; Defenders and Reclaimers: Clydesdale Bank plc
Jurisdiction
Scotland
Judgment Date
22 July 2011
Procedural Posture
Commercial Action (reclaiming Motion) / Appeal (inner House, Court of Session)
Outcome
Reclaiming motion refused; interlocutor of the Lord Ordinary adhered to.
Legal Topics
Contract Interpretation, Service Fee Determination, Benchmarking Clauses, Dispute Resolution
Contract Law Commercial Law Contract Interpretation Service Fee Determination Benchmarking Clauses Dispute Resolution

Case Brief

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Parties

G4S Cash Centres (UK) Ltd

Pursuers and Respondents

Clydesdale Bank plc

Defenders and Reclaimers

Procedural Posture

Commercial Action (reclaiming Motion) / Appeal (inner House, Court of Session)

Legal Issues

  1. 1 Whether clause 2.2 of the contract makes any increase in service fees after the seventh anniversary subject to the defender's absolute discretion
  2. 2 Whether the benchmarking provisions in part 13 of the schedule apply to the clause 2.2 review
  3. 3 Whether the contract results in an unenforceable agreement to agree

Ratio Decidendi

Clause 2.2 provides for a mandatory review of service fees after the seventh anniversary, which may include benchmarking but is not constrained by the absolute discretion provision in part 13. The review can result in an increase or decrease in fees, and disputes are to be resolved under clause 12, including referral to the courts. The contract is enforceable and not merely an agreement to agree.

Court Disposition

Reclaiming motion refused; interlocutor of the Lord Ordinary adhered to.

Orders

  • Declarator granted that clause 2.2 does not make any increase in service fees after the seventh anniversary subject to the defender's absolute discretion.
  • Reclaimers' plea-in-laws repelled.