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Wood v Capita Insurance Services Ltd [2017] UKSC 24

By Oxbridge Law TeamUpdated 04/01/2024 07:17

Judgement for the case Wood v Capita Insurance Services Ltd

Table Of Contents

KEY POINTS

  • It is the duty of the court to determine the true and objective meaning of the language that the parties have used to express their agreement. This is not simply a matter of looking at the exact words used in a particular clause in isolation, but involves considering the entire contract as a whole.
  • In cases where there are multiple possible meanings of a clause, the court can consider the implications of each meaning to determine which is more in line with business common sense.
  • However, when balancing the language of the clause and the implications of each interpretation, the court must also take into account the quality of the drafting of the clause.

FACTS

  • Appellant Capita Insurance Services Limited (“Capita”) entered into an agreement with Respondent Wood for the purchase of the entire issued share capital of Sureterm Direct Limited, a company that offers motor insurance for classic cars.
  • After the purchase, it was discovered that the Sureterm’s telephone operators had misled customers to make a sale, and compensation was paid to affected customers.
  • Clause 7.11 of the agreement between Capita and the respondent was an indemnity clause that required the respondent to pay Capita for losses suffered as a result of mis-selling of insurance products prior to the completion of the sale.
  • Capita brought a claim against the respondent under clause 7.11, but the respondent argued that it did not apply in this case because there was no claim or complaint by the Company's customers to the FSA or another public authority.

COMMENTARY

  • Depending on the context, formality, and quality of drafting of the contract, the court may give greater or lesser weight to different aspects of the broader context in order to arrive at an understanding of the objective meaning of the contract.
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Contract Law Notes
1,511 total pages
754 purchased

From the AuthorContract law notes fully updated for recent exams at Oxf...