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TASK 1 Read MWB Business Exchange Centres Ltd v Rock Advertising Ltd [2016] EWCA Civ 553 and answer the following questions.

1. Which court decided the case? Why is this important?

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COURT OF APPEAL (CIVIL DIVISION) – CA is binding on itself (eg.

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Precedent) (unless there are conflicting decisions, reached per

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incureiam, careless decisions, bound by HOL and Supreme

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Court so if a decision doesn’t fit with decisions in these higher

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courts – then they so not have to follow). 1. Identify the legal issues raised by the case.

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Did the anti-oral variations clause in the licence mean that the oral variation to reschedule the monthly licence fees was of no effect? If an oral variation could still be effective, was it supported here by sufficient consideration provided by Rock?

2. Briefly, state the facts of the case. The facts are MWB had office space and rock advertising used the office spaces – they wanted bigger offices and entered in to a written agreement for that – unfortunately they couldn’t pay fees to MWB (around £12,000) – there was an oral agreement to reschedule payments – mwb locked out rock, terminated the agreement and sued them for a raise – however, on 27 th of feb there was an oral agreement to reschedule the fees – pay more and more each month to make them able to be paid by rock – mwb said there was no consideration for this agreement Also said they would claim under the doctrine of estoppel on the promise of changing the payments and not doing so. Rock Advertising (Rock) was the licensee of managed office space owned by the licensor (MWB). It had fallen into arrears with its monthly licence fees. MWB served a notice to terminate the licence. Rock argued that an oral agreement had been reached between MWB’s credit controller and a director of Rock to reschedule the monthly licence fees (so that Rock would pay at a lower rate for a number of months and would then pay at a higher rate for the remainder of the licence). The licence agreement had a standard clause which stated that: “all variations to this licence must be agreed, set out in writing and signed on behalf of both parties before they take effect.”

3. How does the court deal with the cases of World Online Telecom v I-Way Ltd [2002] EWCA Civ 413 and United Bank Ltd v Asif and anor. (11 February 2000, unreported)? Both cases looked at same ideas but were conflicting authorities, in their outcomes (eg. Whether oral agreements are a contract) – as both were CA decisions (they aren’t bound by two decisions and therefore have to choose) Follow the newest case, (Globe motors case – another CA decision on a similar issues) – considered so fully even if they only obiter dicta comments (Lord Justice Beeson) (persuasive because they had gone into a lot of detail and had full argument with an full court following - would need powerful reason for not following the case) – MWB case agreed with this – and said that because of freedom of contract individuals should be free to abandon and change their methods of contract (eg. Written to oral) (free to make whatever contracts you want to make – and the courts shouldn’t be stopping people making these contracts)

4. What is the rule in Williams v Roffey? PRACTICIAL BENEFITS - GLIDEWELL LJ STATED: “(i) If A has entered into a contract with B to do work for, or to supply goods or services to, B in return for payment by B; and (ii) at some stage before A has completely performed his obligations under the contract B has reason to doubt whether A will, or will be able to, complete his side of the bargain; and (iii) B thereupon promises A an additional payment in return for A’s promise to perform his contractual obligations on time; and (iv) as a result of giving his promise, B obtains in practice a benefit, or obviates a disbenefit; and (v) B’s promise is not given as a result of economic duress or fraud on the part of A; then (vi) the benefit to B is capable of being consideration for B’s promise, so that the promise is legally binding.” 6 points to this principle – First point – there is a contract Second – at some point one party has reasonable doubt to doubt whether A will finish Third – additional payments to perform on time

Fourth – as a result of giving the promise, B obtains in practice a benefit Fifth – b promise is not a result of economic duress or fraud Sixth – the benefit to b is capable of being consideration for B’s promise, so the promise IS LEGALLY BINDING

5. Explain why the variation to the contract is supported by consideration. was there consideration? GLIDEWELL (FROM WILLIAMS v ROFFEY) – there was a practical benefit for MWB and therefore there is a contract (the practical benefit is £3.5k and the promise of further payments that is beneficial to the company.) CA identified: money was recovered immediately (£3.5k), and there was some hope of cover the arises, but more importantly rock remained a licencee of the premise and thus avoided the premises being left empty (as this would have led to other problems of it being empty – “avoiding the void”)

6. What is the significance of the estoppel argument? Explain whether or not the estoppel argument would have succeeded before the court No, Rock had already won on the oral variation and therefore the estoppel argument wasn’t relevant to the case - In this case is merely obiter ditca – not binding on anyone

WHAT IS ESTOPPEL? This is an alternative argument to consideration - Estoppel – how it works – you owe me £100, and I say to you that I will accept £25 – what happens is that, you then have more money that you think and go out on the town and spend the rest of the money you owe – acting on a promise (eg. Buy spending the money because the promise was not to ask for the rest of the money)

PROMISSORY ESTOPPEL – not based on exchange (NO NEED FOR CONSIDERATION FOR ESTOPPEL) – looking for something else…and that is the basis for estoppel – based upon a promise being made not to enforce a contract and

it being inequitable (unfair for promisor to go back on the promise) (can not go back on your promise of the payment being terminated)

CENTRAL LONDON PROPERTY LTD v HIGH TREES HOUSE (1947) – (HIGH TREES CASE) –lord denning = source of the modern expression of estoppel – the case was about a 99 year lease of a block of flats in London at a price of £2,500 per year – the claimant would sublet the flats and make a profit by doing that – however, the problem was that in the second world war the company was in trouble as no one wanted to rent their flats in central london as it was being bombed – the defendant in this case sought to negotiate the contract to bring down the rent – and a written agreement was reached between both parties that said that the ground rate would be reduced to £1,250 for the flats per annum (half the price) – reduced rate was paid for a number of years until 1945 (when all the flats were letted out) – landlord wanted to revive the original rate of the flats- they asked for the last 2 quarters of 1945 – Denning J said Yes you can have the full rent for the last 2 quarters and it was revived – Denning – what if the landlord sought to claim the rent for the reduced price years – HOWEVER, ESTOPPEL would stop this.

HUGHES v METROPOLITAN RAILWAYS (1877)

MWB BUSINESS EXCHANGE CENTRES LTD v ROCK ADVERTISING LTD (2016) EWCA Civ 553: Raises precedent issues and the issue of practical benefits – read a commentary or case analysis before you read the main case – the facts are mwb had office space and rock advertising used the office spaces – they wanted bigger offices and entered in to a written agreement for that – unfortunately they couldn’t pay fees to MWB (around £12,000) – mwb locked out rock, terminated the agreement and sued them for a raise – on 27th of feb there was an oral agreement to reschedule the fees – pay more and more each month to make them able to be paid by rock – mwb said there was no consideration for this agreement – was there consideration? KITCHIN LJ – there was a practical benefit for MWB and therefore there is a contract (the practical benefit is £3.5k and the promise of further...