Wednesday 3 August 2016

UK: Scotland: corporate groups and implied terms

Lord Malcolm, sitting in the Court of Session (Outer House), delivered his opinion in Fisher v Applied Drilling Technology International Ltd [2016] CSOH 108 last month. At issue was whether the company, ADTI, was in breach of an implied term in Mr Fisher's contract of employment concerning the making of enhanced redundancy payments. It was said that such a term arose through custom and practice within a group of companies. The company sought to have the action dismissed on the grounds that the pleadings did not set out a relevant and sufficiently specific case. Lord Malcolm refused to dismiss the action.

Of interest, albeit at this early stage in the case, is the fact that Lord Malcolm refused to uphold the submission that Mr Fisher was bound to fail in his claim that senior executives of the parent company, acting on behalf of other companies in the group, had given undertakings in respect of the enhanced payments.

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