‘Material’ makes a difference—the hurdle for establishing a material breach (RiverRock European Capital Partners LLP v Harnack)

Table of contents

• What are the practical implications of this case?
• What was the background?
• What did the court decide?
• Case details

Article summary

Commercial analysis: In this High Court decision, the claimant was denied relief on the basis that, while certain events might have constituted breaches of contract, none were material. The court considered the existing case law on the construction of ‘material breach’ and, consistent with that case law, examined the factual context and the significance (or otherwise) of the alleged breaches. The decision is a reminder that a materiality threshold can make a real difference, including in determining whether rights to terminate or obtain financial recovery are available. It also provides a helpful illustration of the fact-sensitive exercise the court will carry out to assess whether any alleged breach has been ‘material’, including where there appear to have been collateral reasons driving a party’s assertion of a material breach. Written by Jonathan Kelly, senior associate at Freshfields Bruckhaus Deringer LLP.