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Lloyd's Maritime and Commercial Law Quarterly

VARIATIONS AND CONSIDERATION IN NEW ZEALAND AND CANADA Marcus Roberts * Gloria Jean’s Coffees v Daboko Rosas v Toca In Rock Advertising Ltd v MWB Business Exchange Centres Ltd 1 the Supreme Court of the United Kingdom sought to bring commercial certainty to the question of the legal effect of no oral modification clauses. However, the other “truly fundamental issue” 2 facing the Court was ducked: namely, what is the law relating to consideration for variation agreements? Thanks to its decision on no oral modification clauses, the Court did not need to explore the apparent inconsistency between the part-payment of debt rule in Foakes v Beer 3 and the practical benefit test for consideration for variation agreements in Williams v Roffey Bros & Nicholls (Contractors) Ltd . 4 The Supreme Court went no further than pouring some rhetorical cold water on the Court of Appeal’s decision 5 that the practical benefit test could be utilised in cases like Foakes v Beer . This has left some “uncertainty” 6 in this area of contract law in the United Kingdom which remains to be cleared. 7 How far does the decision in Williams v Roffey extend? Is the full rigour of the pre-existing duty rule for variation agreements still good law? * Senior Lecturer in Law, University of Auckland. 1. [2018] UKSC 24; [2019] AC 119. See R Harris [2018] LMCLQ 441; J Senu [2019] LMCLQ 552; S Harder [2019] LMCLQ 138. 2. In the words of Lord Sumption, Rock Advertising , supra , fn.1, [1]. 3. (1884) 9 App Cas 605 (HL). 4. [1991] 1 QB 1 (CA). 5. MWB Business Exchange Centres Ltd v Rock Advertising Ltd [2016] EWCA Civ 553; [2017] QB 604. 6. Simantob v Shavleyan [2019] EWCA Civ 1105; [2019] All ER 34, [53], per Simon LJ. 7. For a further discussion of the Supreme Court’s decision, see Marcus Roberts, “ Foakes v Beer : Bloodied, Bowed, But Still Binding Authority?” (2018) 29 KLJ 344. 34

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