McMullen Group Holdings Ltd v Harwood [2011] ScotCS CSOH_132 (12 August 2011)

McMullen Group Holdings Ltd v Harwood [2011] ScotCS CSOH_132 (12 August 2011)

Generalised assertions of substantial compliance are irrelevant where actual compliance with contractual notice provisions is lacking; however, waiver and personal bar averments are not so fundamentally irrelevant as to be excluded from probation at this stage. Clause 5.9 is a condition precedent to enforcement of indemnities. Negligent misrepresentation is excluded by clause 5.4.1. Fraud must be pleaded with adequate specification. Paragraph 13.2 of Part 7 of the Schedule does not bar claims if proceedings are commenced within six months of service of written particulars.

Citation
[2011] ScotCS CSOH_132
Parties
Pursuer: McMullen Group Holdings Ltd; Defender: John Harwood
Jurisdiction
Scotland
Judgment Date
12 August 2011
Procedural Posture
Commercial Contract Dispute / Debate on Relevancy and Exclusion of Averments Before Proof
Outcome
Partial exclusion of averments; proof before answer allowed on waiver and personal bar; negligent misrepresentation case excluded; fraud claim allowed subject to further specification.
Legal Topics
Share Purchase Agreement, Warranties, Indemnities, Notice Requirements, Waiver, Personal Bar, Fraudulent Misrepresentation, Negligent Misrepresentation
Contract Law Commercial Law Share Purchase Agreement Warranties Indemnities Notice Requirements Waiver Personal Bar +2 more

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Parties

McMullen Group Holdings Ltd

Pursuer

John Harwood

Defender

Procedural Posture

Commercial Contract Dispute / Debate on Relevancy and Exclusion of Averments Before Proof

Legal Issues

  1. 1 Are the pursuer's averments regarding notice, waiver, and personal bar relevant and sufficient under the SPA?
  2. 2 Is clause 5.9 a condition precedent to enforcement of indemnities?
  3. 3 Does paragraph 13.2 of Part 7 of the Schedule bar claims not raised within six months of written particulars?

Ratio Decidendi

Generalised assertions of substantial compliance are irrelevant where actual compliance with contractual notice provisions is lacking; however, waiver and personal bar averments are not so fundamentally irrelevant as to be excluded from probation at this stage. Clause 5.9 is a condition precedent to enforcement of indemnities. Negligent misrepresentation is excluded by clause 5.4.1. Fraud must be pleaded with adequate specification. Paragraph 13.2 of Part 7 of the Schedule does not bar claims if proceedings are commenced within six months of service of written particulars.

Court Disposition

Partial exclusion of averments; proof before answer allowed on waiver and personal bar; negligent misrepresentation case excluded; fraud claim allowed subject to further specification.

Orders

  • Articles 5-8 and 11-18 of condescendence excluded from probation for failure to comply with notice requirements.
  • Negligent misrepresentation averments in article 14 excluded as irrelevant.