Commercial contracts—renunciation, affirmation, and guarantees (Chugga Chugg v Privinvest)
Commercial analysis: The High Court ruled against Privinvest in a dispute over a parent company guarantee relating to a luxury yacht construction contract. The case provides valuable guidance on contract renunciation, affirmation and interpretation of guarantee clauses. The court held that discussions about potential termination did not constitute a 'clear and unequivocal' renunciation, that subsequent conduct affirmed the contract, and that a claim admitted in German insolvency remained 'contested' for guarantee enforcement purposes. The judgment offers practical insights into how commercial negotiations and conduct affect contractual rights and obligations in high-value commercial relationships. Written by Katie Chandler, Partner, Head of Disputes & Investigations UK and Natalia Faekova (senior associate) at Taylor Wessing LLP.