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A CONSTRUCTION CONUNDRUM?

Lloyd's Maritime and Commercial Law Quarterly

A CONSTRUCTION CONUNDRUM?

David McLauchlan*

This article analyses the recent decision of the United Kingdom Supreme Court in Multi-Link Leisure Developments Ltd v. North Lanarkshire Council and argues that the reasons given by their Lordships for dismissing the appeal are unconvincing. It is suggested that the decision arguably crossed the fine line between giving a commonsense or “commercial” interpretation to the bargain actually made and granting relief from an unfavourable bargain. More importantly perhaps, it is argued that the case illustrates that, despite the wide acceptance of Lord Hoffmann’s restatement of the fundamental principles of interpretation in Investors Compensation Scheme Ltd v. West Bromwich Building Soc, his Lordship’s “old intellectual baggage of ‘legal’ interpretation” is still carried around by some judges and, as a result, discrepancies continue in the basic approach of the courts to issues of contract interpretation.

1. Introduction

The recent decision of the United Kingdom Supreme Court in Multi-Link Leisure Developments Ltd v. North Lanarkshire Council 1 will not be regarded as a leading case on the law of contract interpretation. Indeed, the case will probably attract little comment because at first sight it appears to be a relatively uninteresting decision on its own peculiar facts. However, it caught my attention for a number of reasons. First, it involved a narrow but difficult issue of interpretation, described by Lady Hale as a “conundrum”,2 and typically, when such issues reach the highest appellate courts, a large sum of money was at stake. The appellants, Multi-Link, stood to make a capital gain of some £5 million if their argument was accepted. Secondly, while eight appellate judges disagreed with the ruling of the first instance judge, it seemed to me that there was much to be said for the latter’s conclusion, or at least that the reasoning employed by the former for reversing that conclusion was unconvincing. Thirdly, the case illustrates the often fine line between granting relief from an unfavourable bargain and giving a commonsense interpretation to the bargain actually made. Fourthly, and perhaps most importantly, it also illustrates continuing discrepancies in the basic approach of the courts to issues of contract interpretation.
A CONSTRUCTION CONUNDRUM?

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