The legal effect of an anti-oral variation clause

In Globe Motors Inc v TRW Lucas Varity Electric Steering Ltd [2016] EWCA Civ 396 the Court of Appeal gave consideration to the legal effect of an anti-oral variation clause (that is to say, a clause in a written contract which provides that it can only be amended by a written document in a prescribed form which has been signed by both parties). The court’s consideration of this issue was technically obiter because the appeal was decided on another ground but, given the current inconsistency in the caselaw, the view expressed by the Court of Appeal is likely to be influential. The Court of Appeal concluded that the effect of the clause was not to deprive the parties of their freedom to vary the contract or to enter into a new one without going through the prescribed formality but that the presence of the anti-oral variation clause may perform an evidential function in so far as it may make it more difficult for the party seeking to rely on the oral variation to establish that both parties intended that what was said or done should alter the legal relations between the parties.