- Commercial Court—share purchase breach of warranty—correct measure of loss (Oversea-Chinese Banking Corp Ltd v ING Bank NV)
- What are the practical implications of this judgment?
- What was the background to the decision?
- What did the court decide?
- Case details
Dispute Resolution analysis: Matthew Bradley of 4 New Square analyses the decision of Mrs Justice Moulder in the Commercial Court to dismiss a claim for breach of warranty in a share purchase agreement (SPA). The primary basis for that decision was that the claim as pleaded was unsustainable in law. The claimant, Oversea-Chinese Banking Corp Ltd (OCBC), alleged that its loss was referable to a hypothetical indemnity which it would have negotiated and obtained, but for the breach of warranty, and the amount which could have been claimed under that hypothetical indemnity. This way of putting the loss rendered the claim unsustainable in law. The warranty breached was in the nature of a warranty of quality, and as such the only loss which could be claimed was the diminution in value measure, ie the difference between (i) the true value of the shares and (ii) the value of the shares as warranted. Separately, the court held that neither causation nor a breach of warranty was established in any event. Written by Matthew Bradley, barrister at 4 New Square Chambers.
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