Dear all,
On a quick read of the decision, the UKSC have completely dodged any of the wider consideration issues raised by MWB and decided the case solely on the basis of the no oral modification clause being effective.
Whilst the decision appears to be sensible on the NOM front, a real shame that the UKSC didn’t take up the opportunity to tackle consideration. Lord Sumption at [18] says this:
"That makes it unnecessary to deal with consideration. It is also, I think, undesirable to do so. The issue is a difficult one. The only consideration which MWB can be said to have been given for accepting a less advantageous schedule of payments
was (i) the prospect that the payments were more likely to be made if they were loaded onto the back end of the contract term, and (ii) the fact that MWB would be less likely to have the premises left vacant on its hands while it sought a new licensee. These
were both expectations of practical value, but neither was a contractual entitlement. In
Williams v Roffey Bros & Nicholls (Contractors) Ltd
[1991] 1 QB 1, the Court of Appeal held that an expectation of commercial advantage was good consideration. The problem about this was that practical expectation of benefit was the very thing which the House of Lords held not to be adequate consideration
in Foakes v Beer (1884) 9 App Cas 605: see in particular p 622 per Lord Blackburn. There are arguable points of distinction, although the arguments are somewhat forced. A differently constituted Court of Appeal
made these points in In re Selectmove Ltd
[1995] 1 WLR 474, and declined to follow
Williams v Roffey. The reality is that any decision on this point is likely to involve a re-examination of the decision in
Foakes v Beer. It is probably ripe for re- examination. But if it is to be overruled or its effect substantially modified, it should be before an enlarged panel of the court and in a case where the decision
would be more than obiter dictum”
Fans of the illegality saga in the UKSC will be familiar to this type of reasoning. And given how infrequently the doctrine of consideration comes before the HL/UKSC, what a wasted opportunity.
Happy reading!
All best,
Judith
Judith Skillen
Teaching Fellow
The Dickson Poon School of Law
King’s College London
London, WC2R 2LS
-1.15 SHEW
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