Method of calculating the defined benefit liabilities of a pension scheme, which reflects the cost of buying out those liabilities through the purchase of matching annuities. SI 2005/678, reg 5(11) provides that the amount of the liabilities in respect of pensions and other benefits is to be calculated and verified by the actuary on the assumption that they will be discharged by the purchase of annuities of the kind described in section 74(3)(c) of the Pensions Act 1995 (discharge of liabilities; annuity purchase) and for this purpose the actuary must estimate the cost of purchasing annuities.

Insurance policy purchased by trustees in the name of a member or other beneficiary when the member's pensionable service is terminated. The insurance policy provider pays the member's benefits instead of the scheme trustees. Also known as a s 32 policy.

Commercial analysis: The Court of Appeal has held that the initial purported termination by the buyer under a supply contract was unlawful so that the seller could have treated the buyer’s conduct as a repudiatory breach of contract, entitling the seller to terminate and claim damages. As the seller did not do so, the contract remained alive for performance and the seller was obliged to comply with its contractual delivery obligations. When it failed to do so, the buyer became entitled lawfully to terminate the supply contract. The seller’s claim for damages for non-acceptance of goods failed as a result. A related claim for commission on the uncollected goods brought by intermediaries also failed. The Court of Appeal did, however, agree with the seller that the buyer had not entered into the supply contract on the basis of a third-party misrepresentation as to the production capabilities of the seller’s factory, but had instead relied on its own due diligence. Therefore, the buyer’s alternative case of rescission for misrepresentation failed. Written by Andrew Meads, partner at Hill Dickinson LLP, and Reema Shour, legal director and Professional Support Lawyer at Hill Dickinson LLP.

This checklist serves as a guide of certain key matters for the buyer’s solicitors to consider when drafting a share purchase agreement (also known as SPA or share sale agreement) recording the sale and purchase of the entire issued share capital of a private limited company, where the transaction involves split exchange and completion. Parties The drafter should: • check to see if the legal and beneficial title to the sale shares is split, ie check to see if the seller's sale shares are held in the name of a nominee, requiring the beneficial owner to: ◦ be named as the seller in the SPA instead of the registered holder, and ◦ procure the sale of the sale shares to the buyer • check to see if the transaction involves any parties connected with company directors, which may constitute substantial property transactions requiring certain approvals (see Practice Note: Substantial property transactions—requirement to obtain members’ approval) • check to see if the seller's obligations under the SPA need to be supported by a guarantor, eg

This checklist serves as a guide of certain key matters for the buyer’s solicitors to consider when drafting a share purchase agreement (also known as SPA or share sale agreement) recording the sale and purchase of the entire issued share capital of a private limited company, where the transaction involves simultaneous exchange and completion. Parties The drafter should: • check to see if the legal and beneficial title to the sale shares is split, ie check to see if the seller's sale shares are held in the name of a nominee, requiring the beneficial owner to: ◦ be named as the seller in the SPA instead of the registered holder, and ◦ procure the sale of the sale shares to the buyer • check to see if the transaction involves any parties connected with company directors, which may constitute substantial property transactions requiring certain approvals (see Practice Note: Substantial property transactions—requirement to obtain members’ approval) • check to see if the seller's obligations under the SPA need to be supported by a guarantor, eg

Commercial analysis: Iain Sharp, partner, and Vassilis Mavrakis, legal director at Hill Dickinson, consider a recent Court of Appeal decision that overturned the Commercial Court’s ruling. The judgment held that where sellers under the Norwegian Saleform 2012 fail to meet the cancelling date due to a lack of due diligence, buyers may cancel the memorandum of agreement (MOA) and claim damages for loss of bargain (not merely for wasted expenditure).

1 Definitions Biodiversity Gain • the biodiversity gain objective described in Schedule 7A of TCPA 1990, and any analogous requirement relating to biodiversity net gain; CIL • the Community Infrastructure Levy introduced by sections 205—225 of the Planning Act 2008 (and/or any equivalent form of taxation or levy); CIL Liability • the amount that the Buyer reasonably considers it will have to pay by way of CIL in respect of the Development, calculated in accordance with clause 2.2; CIL Regulations • the Community Infrastructure Levy Regulations 2010, SI 2010/948 (as amended); [Condition • the Buyer obtaining Satisfactory Planning Permission;] Development • the use of the whole or part of the Property for [insert a detailed description of the Development including the maximum and minimum number of units/floorspace etc]; Expert • a person with at least [10] years’ post qualification experience including significant relevant experience in relation to the subject matter of the dispute; Planning Acts • the statutes and statutory instruments from time to time in force relating to town and country planning; Planning Agreement • includes: (a) any agreement with the local planning or other authority (whether or not under section 106 of TCPA 1990, sections 25, 38 or 278 of the Highways

This Practice Note is part of a series of notes which examine commercial property contract clauses from the buyer’s perspective and suggests practical amendments and issues to look out for—see: Buyer's practical contract negotiation collection. It focuses on typical clauses dealing with arrears in a contract for sale subject to leases. In this context arrears are sums due from tenants which have not been paid to the seller as at completion (including any VAT in respect of such sums). This Practice Note looks at issues arising from the buyer’s due diligence in relation to arrears, the relevant position under the Standard Commercial Property Conditions (Third Edition—2018 Revision), how arrears are commonly dealt with in practice and suggests practical due diligence and drafting tips for buyers. It does not deal with arrears in the context of a headlease, see instead: Due diligence—head lease rent arrears—checklist. The right to collect or sue for arrears The buyer should check how the contract deals with who has the right to collect, or sue for, arrears. While the parties may negotiate both

This Checklist is intended to help a buyer’s solicitor carry out an initial review of the first draft of a contract for the purchase of commercial property issued by the seller by identifying headline points to check. Sometimes the seller’s solicitor will have drafted the contract without a full appreciation of all the issues that will need to be dealt with and so it is important for the buyer to be alive to anything missing at the outset and flag any likely issues or contract requirements as early as possible (even if only as a placeholder within the contract pending instructions or further information). Identification of seller and buyer The heads of terms may not define the parties accurately: • Companies House—assuming the seller is a company, the buyer’s solicitor should check at Companies House that the correct party and company number is mentioned in the heads of terms and that it matches the details shown in the title documents • if the seller is: ◦ an overseas company, partnership or other entity, the

Nature and purpose of a deposit While this Practice Note primarily covers commercial property matters, it also touches on residential considerations. There is no common law requirement for a buyer to pay or a seller to demand a deposit. There must be a specific provision for a deposit in the contract. A deposit serves two purposes: • as the seller’s security for the buyer’s performance of the contract • part payment of the purchase price when the sale completes The deposit gives the seller comfort that the buyer will perform its obligations under the contract. Unless the contract, taken as a whole, shows an intention to exclude the right to forfeit, the seller is entitled to forfeit the deposit if completion does not occur due to the buyer’s default. This is the case even if the contract does not expressly provide for forfeiture. The law infers that a deposit is paid as a guarantee for performance of the contract. In Samarenko v Dawn Hill House [2011] EWCA Civ 1445, the Court of Appeal held that

When does risk pass to the buyer? The fundamental principle which most contracts invariably follow is that risk passes to the buyer on exchange of contracts. The parties would not ordinarily vary this unless the seller is carrying out works or perhaps there is a long period between exchange and completion. This reflects the common law principle (also known as the open contract position) and is confirmed in the Standard Commercial Property Conditions (Third Edition—2018 Revision) (SCPCs) in condition 8.1: ‘The property is at the risk of the buyer from the date of the contract.’ The question of passing of risk is a separate question to that of who insures between exchange and completion. The latter turns on whether the property is being sold with vacant possession or subject to leases. Whatever the insurance position, the risk must pass to the buyer as there may be damage by uninsured risks (although this is subject to the seller’s obligation to look after the property—see Duty to look after property below). If the property is in the

This Practice Note is part of a series of notes which examine commercial property contract clauses from the buyer’s perspective and suggests practical amendments and issues to look out for. It focuses on typical clauses dealing with: • the management of occupational leases (OLs) affecting the property between exchange and completion, and • existing maintenance/service contracts It considers how these matters are commonly dealt with in practice, the relevant Standard Commercial Property Conditions (Third Edition — 2018 Revision) (SCPCs) and suggests practical due diligence and drafting tips for buyers. Occupational lease management between exchange and completion The parties should agree in the contract how management matters relating to occupational leases will be dealt with in the period between exchange and completion. Buyers should be most concerned about this issue where the property is multi-let and where there is a significant gap between exchange and completion. For a single-let property with a short period to completion (say less than a month) the buyer might take a more relaxed approach and rely on the