No Oral Modification Clauses

• Published date: 19 January 2021
• Law Firm: Reed Smith (Worldwide)
• Author: Ms Elena Evoyan

We have previously dedicated blog posts to so-called "No Oral Modification" or "NOM" clauses. You can find our previous post focusing on the Supreme Court judgment in MWB Business Exchange Centres v. Rock Advertising [2018] UKSC 24 here.

The validity of contractual modifications is a recurring theme in commercial disputes. A recent English Court of Appeal judgment in Kabab‑Ji S.A.L (Lebanon) v. Kout Food Group (Kuwait) [2020] EWCA Civ 6 considered this issue.

The NOM clause in Kabab‑Ji was not unlike clauses often seen in commercial contracts. It read as follows: "The Agreement may only be amended or modified by a written document executed by duly authorised representatives of both Parties". The contract also imposed good faith and fair dealing obligations on the parties.

In the underlying arbitration proceedings, Kabab‑Ji claimed against KFG, a company which was not (originally) party to the agreement out of which the dispute arose. Kabab‑Ji...