In this month’s roundup of legal news, Sophie Brookes and Debbie Shaw assess rulings on contracts in DD Classics, informal novation of contract in Gama Aviation and implications of National Security and Investment Act
Contractual right to terminate: use it or lose it
In DD Classics Ltd v Chen [2022] EWHC 1404 (Comm) the High Court explained that unless a contractual right to terminate was exercised within a reasonable timeframe, that right would be lost and any associated breach considered waived.
The facts
An individual had agreed to sell a Ferrari to a company for €3.2m. A contract was signed on 24 March 2021 which provided that the sales price was due immediately on the contract being signed and would be paid within five business days.
The contract contained a right of termination for the seller as follows: ‘If the buyer does not meet its payment obligations…within five business days after the due date, the seller is entitled to withdraw from this contract.’
