The General Court examined the correct approach to the interpretation of the recitals and their interaction with the operational terms in the light of recent developments in the Law on the Interpretation of Contracts. If the recitals and operational provisions of an agreement are clear but incompatible, preference should in principle be given to operational provisions (Re Moon (1886) 17 Q.B.D. 275). However, the courts are now placing more emphasis on the facts and the recitals are increasingly taken into account to facilitate the interpretation of the contract. The applicant usually offers the first draft. This can be based on the precedent of its lawyers or on a model provided by a service like Practical Law, as happened in Russell v Stone. The problem with any template occurs when the parties modify it. The status quo agreement gives time to both parties. It also means less useful that the parties (usually their lawyers) have to negotiate and agree on a contract at a time when they are gathering evidence and grappling with the content of the dispute. If there is more than one defendant, the plaintiff will want to agree on identical standstill agreements with each of them. Even if all defendants are willing to play the ball, which they may not be, plaintiffs often end up with multiple agreements and subsequent variations when time is running out again. In this case, the wording of the contract did not indicate a narrow interpretation of the termination provision – a defendant could insist on particular wording to that effect if it so wished. It was also decisive that the defendant had already taken considerable advantage of the status quo at the time of the infringement.
There is no indication that the defendant paid the claim during the notice period. Two scenarios can lead to process abuse in this context. The first, illustrated by Lewis v. Ward Hadaway, was triggered by a cash flow problem in the face of rising court costs. The defendants refused to enter into a standstill agreement, so the plaintiffs had to issue in a way that saved time before receiving disbursement funding to pay the legal costs. The plaintiffs` lawyers paid the fees themselves. In order to reduce court costs, they set lower information in the value statements on the claim forms than the plaintiffs wanted to claim. They then amended the claim forms and paid the higher issuance fee before submitting the claim forms. This was considered an abuse of process. Limitation should always be at the forefront of lawyers` concerns, but this is especially true given the challenges facing COVID-19. An understanding of the tools at your disposal should help limit difficulties, and a key tool is a moratorium on the limitation or a status quo agreement.
Elton John sings “I`m Still Standing” on his “Farewell Yellow Brick Road” tour and it appears that civil litigants in England and Wales are still motionless after a recent Court of Appeal ruling backing stalled restriction agreements. Courts have often asked complainants to initiate proceedings in these circumstances and then request a stay of compliance with the Protocol. A suspension serves to suspend time, but unlike a status quo agreement, it requires a court order. The Technology and Construction Tribunal (TCC) Guide recommends this course. As Judge Coulson commented in Russell v Stone, this is a much safer option than the mess that results from the self-inflicted complication of status quo agreements that don`t work. A standstill agreement is a contract and is subject to the same rules as other contracts. Although recent cases involve disputes over the terms of individual standstill agreements, problems can also arise when entering into the contract. The agreement may be oral, but generally the parties agree not to be bound until the agreement is in writing, often using the phrase “subject to contract”. What is the practical benefit of a standstill agreement? In addition to the evidence that it sets the limit or extends the restriction, it will allow the parties to comply with any relevant pre-action protocol. For example, the Protocol on the Preparation of Occupational Diseases (paragraph 11): Decision: Suspension, no extension of the limitation period Comments were made on an obscure basis, but raised concerns among litigants who had entered into such agreements in other claims. “However, I would like to emphasize that if the parties choose the status quo route, there should be a clear written agreement setting out the terms/duration of such an agreement, and that each of the potential parties should be included in the agreement.” (Lady Justice King). In Exsus Travel Ltd v.
Baker Tilly, counsel for the applicant misunderstood how the standstill period worked. The court rejected the argument that the forfeiture was caused by convention – there was no evidence that the defendant`s lawyer shared the false assumption or was aware of the error. The standstill agreements contain recitals stating that the purpose of those agreements was to extend the period during which the applicants could bring an action. In contrast, the operational provisions of the status quo agreements concerned the “suspension” of time and the “suspension of time”. The complainants referred to the operational provisions and argued that the standstill agreements had the effect of suspending the limitation period, while the defendants referred to the recitals (and certain other factors) and argued that the standstill agreements were only intended to extend the time limit. .