NATIONAL BANK OF ABU DHABI PJSC V BP OIL INTERNATIONAL LTD

[2016] EWHC 2892 (Comm), Queen's Bench Division, Commercial Court, The Honourable Mrs Justice Carr DBE, 18 November 2016

Contracts - Interpretation - Assignment - Prohibition of assignment binding one party to agreement - False representation as to rights to assign

By a Purchase Letter, NBAD had purchased from BP the receivables due to the latter in respect of a transaction under a framework agreement for a series of sales of crude oil between BP and S. S had subsequently become insolvent. The agreement between BP and S contained a clause making void any assignment of the agreement, or rights or obligations thereunder, without prior consent. It was common ground at first instance that this applied to legal as well as equitable assignment. BP had not sought the consent of S to any assignment. There was a single issue of interpretation to be resolved, namely whether or not the existence of that prohibition meant that the representation given by BP to NBAD in the Purchase Letter was false. NBAD contended that it was; BP contended that it was not. BP relied on the concept of assignment of the fruits of performance, which was not generally invalidated by a non-assignment clause, and referred additionally to the concept of an agreement to assign an expectancy or future property.