Credico Marketing Limited & Anor. v Benjamin Gregory Lambert & Anor.
[2023] EWCA Civ 262
Mackie Motors (Brechin) Limited v RCI Financial Services Limited
4 May 2023
[2023] EWCA Civ 476
Court of Appeal
A car dealership sued a finance company for ending their business relationship. The dealership tried to argue there was a secret agreement, but the court said there wasn't enough evidence and the finance company's contract clearly allowed them to end things quickly. The dealership's other arguments also failed.
Key Facts
- •Mackie Motors (Brechin) Limited (Mackie) was a Renault, Nissan, and Dacia car distributor.
- •Mackie had various agreements with RCI Financial Services Limited (RCI), including dealer financing contracts (RCI contracts) with a 7-day termination clause and dealership agreements (Dealership Agreements) with a 24-month termination clause.
- •RCI terminated its contracts with Mackie after making a suspicious activity report to the National Crime Agency.
- •Mackie's initial claim alleging abuse of dominant market position and unfair contract terms failed.
- •Mackie then sought to amend its claim, alleging an implied umbrella agreement encompassing various services provided by RCI, including dealer and customer financing.
- •Mackie also claimed implied terms of good faith and 24-month notice periods, estoppel, and that the RCI contracts should be interpreted to align with the Dealership Agreements' 24-month termination clause.
Legal Principles
Test for allowing amendments to pleadings: a real (not fanciful) prospect of success, more than merely arguable.
Elite Property Holdings v Barclays Bank [2019] EWCA Civ 204
Implying a contract requires demonstrating necessity and intention to create legal relations.
Baird Textile Holdings Ltd v Marks & Spencer plc [2001] EWCA Civ 274; Modahl v British Athletic Federation Ltd [2002] 1 WLR 1192; Heis v MR (Global) Services Ltd [2016] EWCA Civ 569
Test for implying terms in fact: necessity.
Marks & Spencer Plc v BNP Paribas Securities Services Trust Co (Jersey) Ltd [2015] UKSC 72
Relational contracts may imply a good faith obligation, but this does not override express contractual terms.
Yam Seng Pte Ltd v International Trade Corp Ltd [2013] EWHC 111 (QB); Braganza v BP Shipping Ltd [2015] UKSC 17
Estoppel requires a clear and unequivocal representation; it is a defence, not a cause of action.
Central London Property Trust v High Trees House Ltd [1947] KB 130
Contractual interpretation: unambiguous clauses are applied literally; implication or reinterpretation is not permitted.
Outcomes
Appeal dismissed.
Mackie failed to demonstrate a real prospect of success on any of its claims. The court found no basis for implying an umbrella agreement, implied terms contradicting express contractual terms, or a different interpretation of the RCI contracts' termination clauses. The estoppel claim was also rejected.