Court of Appeal upholds High Court’s decision on the preferred contractual construction of a term in an exclusion clause

The Court of Appeal has upheld the High Court’s decision on a claim involving the legal meaning of ‘goodwill’ and the contractual construction of an exclusion clause excluding liability for lost goodwill: Primus International Holding Co & Ors v Triumph Controls – UK Ltd & Anor [2020] EWCA Civ 1228.

In doing so, the Court of Appeal has confirmed that (unless there are clear words to the contrary in a contract) the ordinary legal meaning of a particular term will be preferred to an unusual, technical or non-legal meaning. The Court of Appeal agreed, in this case, that the ordinary legal meaning of "goodwill" applied to the exclusion clause under consideration as opposed to the technical accounting definition advanced by the defendants; there were no indications otherwise to suggest that the technical definition should be preferred.

For more information see this post on our Banking Litigation Notes blog.