Sophia Purkis & Leigh Callaway delve into the implications for ‘no oral modifications’ clauses in the fallout from MWB v Rock.
- In MWB v Rock, The Supreme Court has upheld the effectiveness of anti-oral variation clauses
In the shifting sands of the commercial world, matters governed by an executed commercial agreement often change necessitating a variation of the agreement. While parties are unlikely to be prohibited from agreeing a variation, the manner in which such variation may take place is frequently dictated by the terms of the contract—for example, the variation might need to be agreed in writing or by deed. It is, however, also not uncommon for parties to put aside legal niceties in the interests of resolving issues quickly and to overlook such strict contractual requirements.
Previously, a quick-fix variation agreed between the parties’ principals might have been acceptable to the court notwithstanding that the manner in which the variation was agreed did not comply with the contractual terms; for example, the principals might have agreed a variation orally despite a contractual prohibition
