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Q&As
Constructive dismissal test does not require employee to raise a grievance In accordance with the principles set out in Western Excavation (ECC) Ltd v Sharp, in order for there to be a constructive dismissal, the following requirements must be met: • there must be an actual or anticipatory breach of contract by the employer which goes to the root of the contract so as to be sufficiently serious to justify the employee's resignation without notice (such a breach is often described as being 'repudiatory') • the employee must resign in response to the breach • the employee must not delay too long in terminating the contract in response to the employer's breach, otherwise the employee may be regarded as having elected to affirm the contract and will lose the right to treat himself as discharged It is not a legal requirement to raise a grievance in order to claim constructive dismissal. In Tolson v Governing Body of Mixenden Community
Q&As
This answer will therefore discuss the Sale of Goods Act 1979 (SGA 1979) and the Supply of goods and Services Act 1982 (SGSA 1982) only. There are four conditions for a contract to qualify as a contract for the sale of goods under SGA 1979: • the contract must be for goods • the seller must undertake an obligation to transfer property in the goods to the buyer • there must be money consideration payable to the seller, and • there must be a link between the transfer of title and the money consideration, ie the buyer must be paying for the title to the goods In SGA 1979, goods are defined broadly to include: ‘all personal chattels other than things in action and money…. includes emblements, industrial growing crops, and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale [and includes an undivided share in goods;'
NEWS
This week's edition of Arbitration weekly highlights includes: coverage of arbitration-related decisions from England and Wales, Hong Kong, and France, further updates from JAMS, and the establishment of the Construction Arbitration Centre Asia Pacific (CACP); for readers attending Paris Arbitration Week, Delos has also announced a presentation on comparative contract law to be held on 24 March 2026, with speakers including Dr Gustavo Moser of the LexisNexis UK Arbitration team.
PRACTICE NOTES
This Practice Note provides an overview of the rules that apply to credit limits. A borrower will be set a credit limit on the maximum amount of credit which can be drawn down under a running credit agreement such as a credit card. Definition of credit limit A credit limit is used in running-account credit agreements and is the maximum debit balance that, under a credit agreement, is allowed to stand on the account, disregarding any term of the agreement that allows the maximum to be exceeded on a temporary basis. ‘Running-account credit’ is defined in the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, SI 2001/544, art 60L (RAO) and includes credit cards. Credit limits in advertising When a financial promotion indicates a rate of interest or an amount relating to the cost of credit, whether expressed as a sum of money or a proportion of a specified amount, creditors are required to include a representative example, which must include the total amount of credit. See Practice Note: The regulation of consumer credit advertisements—CONC 3—Specific rules for particular types of
Q&As
‘Reasonable’ or ‘best’ endeavours The terms ‘reasonable’, ‘best’ and combinations thereof are terms frequently used to qualify the degree of ‘endeavours’ expected to be exerted by a party when fulfilling a contractual obligation. The precise language chosen may be the result of considerable negotiation, and often represents a compromise where one party has argued that it is not acceptable for it to be placed under an otherwise absolute obligation. None of these terms can be stated with precision, they are best demonstrated by an analysis of the underpinning case law. The Practice Note: Reasonable and best endeavours considers in more detail the distinctions between ‘reasonable’, ‘best’ and ‘all reasonable’ endeavours as well as other variations commonly used in
Q&As
It is relatively common for employers, particularly larger employers and those that are unionised, to pay redundancy payments to redundant employees which are in excess of the statutory minimum under the statutory redundancy payments scheme. If a contract states that an employee is entitled to a redundancy payment which happens to be more than his statutory entitlement, the statutory entitlement will be included within the contractual amount. If the contract states that the employee is entitled to a contractual
Q&As
The right not to be unfairly dismissed is only available to an ‘employee’. For these purposes, ‘employee’ is defined as an individual who has entered into or works under a contract of employment, ie a contract of service or apprenticeship, whether express or implied and whether oral or in writing. The right not to be unfairly dismissed generally only arises when the employee, by the effective date of termination
Q&As
For information: • on career breaks and sabbaticals generally, see Practice Note: Career breaks and sabbaticals • on the right to statutory sick pay (SSP), see Practice Note: Sick pay For information on the right to statutory sick pay (SSP) during a sabbatical (where the employment contract continues but the employee is unpaid), see the section: ‘Continuing contract—right to statutory sick pay’ of Practice Note: Career breaks and sabbaticals. In respect
CHECKLISTS
This Checklist sets out the matters an employer should consider when formulating a career break and/or sabbatical policy, and when considering the arrangements to put in place for such breaks. The terms ‘career break’ and ‘sabbatical’ have no particular legal meaning, and the label given to the break is not determinative of its legal nature. In practice: • the term ‘career break’ is often used to describe a longer period of unpaid leave during which the employment contract may continue, but more often does not, and • the term ‘sabbatical’ is used to describe a shorter period of leave which is often unpaid but might be paid or partly-paid, during which the contract does continue For detailed information on career breaks and sabbaticals generally, see Practice Note Career breaks and sabbaticals. For a sample policy: • for use in relation to longer breaks, where the contract of employment does not continue, see Precedent: Policy—career break (contract terminates) • for use in relation to shorter breaks, where the contract of employment continues, see Precedent: Policy—sabbatical
PRACTICE NOTES
An individual may assume obligations, for example in respect of contracts, covenants, debts, duties and, generally, those obligations will subsist after the individual’s death and may be enforceable against the estate. Although the personal representatives (PRs) were not a party to the arrangements, they should understand their potential liability to avoid litigation (Hambly v Trott (1776) 1 Cowp 371). The effect of this survival of obligations depends on the form of obligations involved. Personal contracts The general rule is that the death of one of the parties to a contract does not discharge the contract. Where the contract is of a personal nature then, unless there has been a breach of the contract prior to the death, the general rule does not apply. For example, an agreement between an employer and employee is determined by the death of either and an artistic agreement is terminated by the death of the author or artist. Even though the contract may be ended, the entitlement to any unpaid and due remuneration earned
PRECEDENTS
[Letter to be printed on company headed paper] [insert date] [insert employee’s address] [INSERT NAME OF COMPANY] SAYE SHARE OPTION SCHEME (THE SCHEME) LETTER OF INVITATION Dear colleague, I am pleased to tell you that all employees who [have [insert number of months of qualifying period] months of service OR have been employed with the group since [insert date from when qualifying period began]] are invited to apply for a [3 OR 5] year option to acquire ordinary shares of (insert nominal value) in [insert name of company] (the Company) under the rules of the Scheme. You are therefore eligible to participate in this operation of the Scheme. Should you wish to participate in the Scheme and apply for an option under the Scheme, you will need to complete the enclosed Application Form. In doing so you will agree to enter into the linked savings contract, the terms of which are set out in the enclosed Prospectus which has been issued by [insert name of bank/building society/authorised European savings institution]. This invitation will remain open from [insert date]
PRACTICE NOTES
The Responsible Actors Scheme (RAS) is a ‘building industry scheme’ for property developers in England. Members of the RAS must enter into a contract with the Department for Levelling Up, Housing and Communities (DLUHC), under which they will be required to identify and remediate, or pay for the remediation of, life-critical fire safety defects in certain residential buildings that they developed or refurbished in England between 1992 and 2022. The RAS was established in July 2023, by the Building Safety (Responsible Actors Scheme and Prohibitions) Regulations 2023, SI 2023/753 (BS(RAS&P) Regs 2023), using powers conferred on the government by the Building Safety Act 2022 (BSA 2022). This Practice Note considers which developers are eligible to join the RAS, what its conditions of membership are, and when membership may be revoked. For information on development and building control prohibitions, which are also a key part of the RAS and may apply to parties in default of their obligations under the BS(RAS&P) Regs 2023, see Practice Note: Responsible Actors Scheme—development and building control prohibitions. In May 2026, the