KEIRON PATERSON AGAINST ANGELINE (SCOTLAND) LTD [2021] ScotCS CSOH_101 (12 October 2021)

KEIRON PATERSON AGAINST ANGELINE (SCOTLAND) LTD [2021] ScotCS CSOH_101 (12 October 2021)

The court held that, considering the SPA as a whole, its commercial purpose, and the factual matrix, the adjustment to the Initial Deferred Consideration must include the net current assets of both KPL and ADHL. The literal reading advanced by the defender would produce an arbitrary and commercially nonsensical result, inconsistent with the parties' objective intentions and the structure of the transaction. The court found for the pursuer on the primary ground of interpretation, making it unnecessary to decide the alternative grounds of implied term or rectification.

Citation
[2021] ScotCS CSOH_101
Parties
Pursuer: Keiron David Paterson; Defender: Angelline (Scotland) Limited
Jurisdiction
Scotland
Judgment Date
12 October 2021
Procedural Posture
Commercial Action / Outer House, Court of Session – Opinion on Competing Motions for Decree De Plano
Outcome
Decree de plano for the pursuer on the principal action; defender's counterclaim dismissed.
Legal Topics
Interpretation of Share Purchase Agreements, Rectification, Implied Terms, Adjustment of Consideration, Completion Accounts
Contract Law Commercial Law Interpretation of Share Purchase Agreements Rectification Implied Terms Adjustment of Consideration Completion Accounts

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 2 Authorities cited 11 Party arguments 2 Amounts and remedies 2
Sign in to unlock

Parties

Keiron David Paterson

Pursuer

Angelline (Scotland) Limited

Defender

Procedural Posture

Commercial Action / Outer House, Court of Session – Opinion on Competing Motions for Decree De Plano

Legal Issues

  1. 1 Proper construction of share purchase agreement (SPA) regarding adjustment to Initial Deferred Consideration
  2. 2 Whether the SPA should be rectified or an implied term read in to include net current assets (NCA) of both companies (KPL and ADHL) in the adjustment calculation
  3. 3 Whether the factual matrix and commercial purpose permit departure from the literal wording of the SPA

Ratio Decidendi

The court held that, considering the SPA as a whole, its commercial purpose, and the factual matrix, the adjustment to the Initial Deferred Consideration must include the net current assets of both KPL and ADHL. The literal reading advanced by the defender would produce an arbitrary and commercially nonsensical result, inconsistent with the parties' objective intentions and the structure of the transaction. The court found for the pursuer on the primary ground of interpretation, making it unnecessary to decide the alternative grounds of implied term or rectification.

Court Disposition

Decree de plano for the pursuer on the principal action; defender's counterclaim dismissed.

Orders

  • Declarator granted that the adjustment to the Initial Deferred Consideration includes the net current assets of both KPL and ADHL.
  • Defender ordered to pay the pursuer £341,932.00.