Minimum acceptable performance contractually binding


In Sutton Housing Partnership Ltd v Rydon Maintenance Ltd [2017] EWCA 359 the Court of Appeal held that the examples of ‘Minimum Acceptable Performance’ set out in the contract documentation were not inserted as mere hypotheticals but were contractually binding. The conclusion that they were not contractually binding did not make any commercial sense, given that it would render parts of the contract, including the bonus and termination provisions, inoperable. The case illustrates the important role that commercial common sense can play in the interpretation of a contract. But it should be noted that in many ways this was an extreme case. The terms of the contract were described by the court as being ‘curious’ and the construction advocated by the defendant would have rendered parts of the contract inoperable. In these circumstances it is understandable why the Court of Appeal adopted the construction of the contract which they did.