- Contractual construction in light of the coronavirus (COVID-19) pandemic (Westminster City Council v Sports and Leisure Management)
- What are the practical implications of this case?
- What was the background?
- What did the court decide?
- Case details
Commercial analysis: This case involved a claim under CPR 8 for declaratory relief as to the construction of the terms of a contract for the management of leisure facilities within the Westminster City Council area. The provisions in question concerned the payment of a management fee by the service provider, Sports and Leisure Management (SLM), to Westminster City Council and whether, following the onset of coronavirus (COVID-19) and the loss of revenues, the operation of clauses prescribing the consequences of relevant changes in the law meant that the calculation of that management fee could fall to produce a negative number, such that the council was required to pay SLM a fee. In following the line of authority, Mr Justice Kerr held that the management fee was not intended to and could not, on a proper construction, fall to produce a negative figure such that a ‘reverse management fee’ was payable. Written by Kit Smith, associate at Keidan Harrison LLP.
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