Termination Of An Oral Contract

Article by Charlotte Walker-Osborn Head of TMT Sector and Laura Friend, Solicitor, Commercial.

What? In BVM Management Ltd v Roger Yeomans t/a The Great Hall at Mains and another [2011], the parties disagreed on what was incorporated into an oral contract.

So What? This case demonstrates the perils of parties commencing performance without a written contract in place.

The parties entered into an arrangement whereby the claimant would provide event management services to the defendant. A written contract was never signed, although a draft contract was prepared which provided that the contract would be for a two year fixed term, with a right to terminate early on three months' notice. It was common ground that the parties had entered into an oral contract incorporating all the terms of the draft contract, save that the claimant alleged that it had not agreed to the right of early termination.

The Court of Appeal dismissed the claimant's appeal, finding that the oral contract did...