Introduction This Practice Note discusses the rule against penalties and how it applies to interest rates in commercial contracts, including a discussion of the late payment legislation in the UK. The Commercial Payments Bill was introduced to Parliament in May 2026 and is likely to have a significant impact on contractual payment provisions, interest on late payments, invoice dispute mechanisms, increased reporting on payment practices and increased powers of the Small Business Commissioner. For more information, see below and News Analysis: Commercial Payments Bill: practical implications for commercial lawyers and Practice Note: Commercial—horizon scanner. As part of the freedom of contract in business to business contracts, parties can prescribe the consequences of a breach of contract. Whether the courts will uphold those provisions in a given factual setting is a different matter. Where the parties choose to do so, those consequences are commonly an obligation to make a payment of an agreed sum. The sum may be a fixed amount or determined by reference to a formula. Penalty interest rates are an example of the latter. A

This Practice Note considers the requirement for there to be a false statement of fact for an actionable misrepresentation. For details of the other key ingredients for a misrepresentation claim, see Practice Notes: • Misrepresentation—what is inducement? • Misrepresentation—falsity (fraudulent, innocent or negligent misrepresentation) For guidance on the closely related claim for deceit, see Practice Note: The tort of deceit—required elements. Key elements of an actionable misrepresentation The key elements of an actionable misrepresentation are: • the statement relied on by the representee was a statement of fact made to them by or on behalf of the representor • the statement was intended by the representor to induce the representee to enter into the contract • the statement actually induced the representee to enter into the contract • the statement had the character of a representation • the representation was false Additionally, where damages are claimed (in addition or alternatively to rescission), the representee must establish that the misrepresentation caused them to suffer loss. (See Practice Note: Misrepresentation—damages

As set out in The economic torts—overview, the law makes provision to protect a person’s trade or business from acts which are considered to be unacceptable. For guidance on claims for: • procuring a breach of contract, see Practice Note: The tort of procuring a breach of contract • intentional violation of rights in a judgment debt, see Practice Note: The Marex tort (interference with a judgment debt) • conspiracy (both by lawful and unlawful means), see Practice Note: Civil conspiracy claims (economic tort) • economic duress, see Practice Note: Economic duress—undue influence—tort of intimidation Civil claims involving fraud and dishonesty often rely on pleading one or more of the economic torts, on which see Practice Note: Civil fraud—causes of action (heads of claim). What is the tort of unlawful interference? Causing loss by unlawful means exists where the defendant interferes with an economic interest of the claimant by unlawful means, the object and intention of which is to cause loss to the claimant and loss is caused to them (OBG v Allan,

This Precedent is an adaptable Word template, which can be saved, downloaded or printed from this link: Completion statement—sale of property This Precedent is a template simple completion statement, which can be adapted for a sale of freehold or leasehold land (whether with vacant possession or subject to leases). It includes provisions for the purchase price and deposit, additional fixed sums, apportionments and late completion. It is intended as a starting point and should be tailored for the specific transaction. It is not intended for use on the grant of a lease. Read the contract Before preparing a completion statement, read the contract carefully to ascertain: • any fixed sums that the buyer must pay to the seller on completion in addition to the purchase price—eg sums to be paid for chattels, fixtures, arrears, capital allowances etc • any fixed sums that the seller must pay/allow to the buyer on completion, eg deposit, a retention sum, a rental top up payment to cover an outstanding rent free period etc • any sums that must be apportioned (and paid/allowed) between the buyer and the seller

The Construction case tracker is a list of key judgments from 2021 and 2022 considered relevant to construction lawyers, with cases listed in reverse chronological order. For previous years, see the 2020, 2019, 2018, 2017, 2016 and 2015 archives. Public procurement cases are listed in the UK public procurement case tracker and the EU public procurement case tracker. Key upcoming appeal cases are listed in the Construction horizon scanner (Appeal cases). Judgment date Case Topic News Analysis Summary 18 Feb 2022 Struthers v Davies (trading as ‘Alastair Davies Building’) and another [2022] EWHC 333 DefectsTerminationContract law Homeowners succeed in defects claim against contractor (Struthers v Davies) The TCC found that the defendant building contractor was in repudiatory breach of contract, and awarded the claimant homeowners damages for defective works and losses consequent on termination. The court rejected the defendant’s arguments that the claimants’ attempt to terminate the contract was unlawful, and that certain remedial works carried out by the claimants had been unnecessary. 17 Feb 2022 The Scottish Ministers v Scot Roads Partnership

Introduction This Precedent can be used where an employer wishes to make a deduction from an employee’s wages. The accompanying guidance notes provide instructions on the legal requirements and best practices to ensure compliance with Irish employment law. When are deductions permitted? Where an employer wishes to make a deduction from an employee’s wages, the employee must consent to this in writing or it must be required by law. Section 5(1) of the Payment of Wages Act 1991 (Ireland) (PWA 1991 (IRL)) states: • 5.—(1) An employer shall not make a deduction from the wages of an employee (or receive any payment from an employee) unless— • (a) the deduction (or payment) is required or authorised to be made by virtue of any statute or any instrument made under statute, • (b) the deduction (or payment) is required or authorised to be made by virtue of a term of the employee's contract of employment included in the contract before, and in force at the time of, the deduction or payment, or • (c) in the case of a deduction, the employee

This Practice Note provides an introduction to cumulative impact claims and considers how multiple variations instructed on a construction project may effect the contractor’s ability to progress the unchanged work and cause a loss of productivity, the court’s and tribunals’ approach to such claims, the potential impact of contractual provisions on such claims, how and when to quantify claims and practical tips on how to succeed in a cumulative impact claim. What is a cumulative impact claim? Variations on construction projects are extremely common and occur for many reasons, for example, where a contract is signed prior to the design or scope of works being finalised, where the employer wants to make changes on the project as building work progresses, where there are inconsistencies in the contract documents that require resolution, or unforeseen physical conditions on site which need to be addressed. The direct impact of variations, in terms of the cost to carry out the varied work and the effect on work connected to the change is usually straightforward to ascertain. However, on large and complex projects,

Interaction with the additional State pension Before 6 April 2016, there were two levels of State pension provision: • the basic State pension—this was a flat rate broadly based on the amount of National Insurance Contributions (NICs) a person paid or was treated as having paid, and • the additional State pension known as the State Second Pension (S2P)—as its name indicated, it was a pension paid on top of the basic State pension. It was related to an individual's earnings. Note that prior to April 2002, the additional State pension was known as the State Earnings Related Pension Scheme (SERPS) Before 6 April 2016, pension schemes could either 'contract in' or 'contract out' of the additional State pension. If a pension scheme was 'contracted-in' to the additional State pension, members would receive the additional State Pension on top of their basic State pension (depending on their earnings). If a pension scheme was 'contracted-out' of the additional State pension, scheme members would not receive the additional State pension. In exchange: • the scheme had to

[ On letterhead of the Investor ] Strictly private and confidential [insert company name] [insert company address] [insert Founder names] [insert contact address of Founders] (Founders) Date: [insert date] SUBJECT TO CONTRACT Dear Directors and Founders, Proposed investment in [insert name and registered number of company] (Company) 1 Introduction 1.1 Further to our recent discussions, this letter sets out the principal terms and conditions upon and subject to which we have agreed to make a further investment in the Company (Proposed Investment). 1.2 The terms in this letter are not exhaustive and, with the exception of this paragraph 1.2 and paragraphs 8, 9, 10 and 11, are subject to contract and not intended to be legally binding on the parties. No party to this letter shall be legally bound to proceed with the Proposed Investment unless and until a formal written subscription [and shareholders’] agreement is entered into. 2 Equity 2.1 The Investor will subscribe for additional institutional equity as follows: Class of shares Number of shares Nominal Value per share Subscription Price (per share) Institutional loan notes (amount) [Preferred Shares] [insert

What is novation? Novation is the transfer of one party’s rights and obligations under a contract to a third party and comprises the original contract being extinguished and replaced with a new one, under which the same acts and obligations (perhaps with some agreed modifications) are to be performed, but with a change to one of the original parties. See Practice Note: Novation in construction projects. In certain situations, an employer may seek to novate part only of a consultant’s original appointment. Why might a party only want to novate part of an appointment? Construction projects sometimes commence with insufficient thought being given to how best to structure the contractual relationships between the various team members. This may be because appointments must be entered into quickly, in order to allow work to commence or because legal advice on the subject has not yet been obtained. This may result in a consultant entering into one appointment under which it will perform several different roles eg to provide design services as well as

An option agreement is a contract for sale and must comply with the requirements of section 2 of the Law of Property (Miscellaneous Provisions) Act 1989. This means that it must: • be in writing • contain or incorporate all of the terms expressly agreed by the parties, and • be signed by or on behalf of the parties The trigger notice, however, is simply the activation of the option and so is not a contract for sale itself. Consequently, the trigger notice does not need to be signed by both parties. Exercising the option Call option agreements are strictly construed and the option may lapse if the option holder does not exercise it correctly. Time limits The option will usually specify that the grantee must exercise it within a specified period of time—for further guidance, see Practice Note: Option agreements—land—the need for a long-stop date. If the option is not exercised within that time then it will lapse, because time is of the essence: this will be implied even if it is not expressly stated. The option holder

THIS PRACTICE NOTE APPLIES TO OCCUPATIONAL AND PERSONAL PENSION SCHEMES Automatic statutory transfer of terms and conditions of employment In a private sector outsourcing, employees transferring to a Supplier must be employed on the same terms after the transfer as applied before the transfer in accordance with the Transfer of Undertakings (Protection of Employment) Regulations 2006, SI 2006/246 (TUPE), but subject to a pensions exception. What benefits fall within the pensions exception? TUPE (which is derived from EU law) provides that a Supplier will not take on: • the obligations and liabilities of the outsourcing Customer which arise under or in connection with so much of a contract of employment or collective agreement as relates to an occupational pension scheme (as defined in section 1 of the Pension Schemes Act 1993 (PSA 1993)), or • any rights, powers, duties or liabilities under or in connection with any such contract or agreement and relating to such a scheme The exception is a narrow one and only applies to three