TAKE OR PAY CLAUSE MAY BE A PENALTY

M & J Polymers Ltd v Imerys Minerals Ltd [2008] EWHC 344 (Comm), 29 February 2008

In M & J Polymers Ltd v Imerys Minerals Ltd [2008] EWHC 344 (Comm), 29 February 2008, Mr Justice Burton held that a take or pay clause could be a penalty clause, although on the facts of the case he held that it was not penal because it was commercially justifiable and did not have the predominant purpose of seeking to deter a breach of contract.