Buying a business

A recent High Court judgment emphasises the importance of expressly specifying the method for serving legal proceedings for the purposes of any relevant contractual provisions, in particular time-bar clauses.

In this case, the court held that legal proceedings for a breach of warranty claim under a share purchase agreement had been validly served within the contractual time limit. Under the agreement, the claimant was required to give notice of any warranty claims within a specified period and to serve proceedings in respect of a notified claim within six months of the notice of claim. As it was common ground that the claim form had in fact been delivered and received by the defendant before the relevant contractual deadline had passed, the claim form had been validly served and was in time under the agreement.

Read this checklist that highlights the main legal risks to consider when buying another business or enterprise - click here