Baird Textile Holdings Ltd v Marks & Spencer plc

Baird Textile Holdings Ltd v Marks & Spencer plc.

Court	Court of Appeal
Citation(s)	[2001] EWCA Civ 274, [2002] 1 All ER (Comm) 737, [2001] CLC 999
Transcript(s)	Full text of judgment
Keywords
intention to create legal relations, course of dealing

Implied terms cases

Hutton v Warren [1836] EWHC Exch J61

The Moorcock (1889) 14 PD 64

Southern Foundries (1926) Ltd v Shirlaw [1940] AC 701

Liverpool CC v Irwin [1976] UKHL 1

Johnstone v Bloomsbury HA [1991] 2 All ER 293

Scally v Southern Health Board [1992] 1 AC 294

Malik v BCCI SA [1997] UKHL 23

Equitable Life Assurance Society v Hyman [2000] UKHL 39

Baird Textile Holdings Ltd v M&S plc [2001] EWCA Civ 274

Attorney General of Belize v Belize Telecom Ltd [2009] UKPC 10

Carter v Boehm (1766) 97 ER 1162

Yam Seng v International Trade Corp [2013] EWHC 111 (QB)

Bhasin v Hrynew, 2014 SCC 71

Implied terms in English law

Baird Textile Holdings Ltd v Marks & Spencer plc [2001] EWCA Civ 274 is an English contract law case on the possibility of an implied contract after a course of dealings between two businesses.

Facts

Baird Textile Holdings Ltd^[1] had supplied clothes to Marks & Spencer plc. for thirty years. All of a sudden, M&S said they were cancelling the order. Baird sued M&S on the grounds that they should have been given reasonable notice. The problem was that there was no express contract under which such a term could be said to have arisen. Baird argued that a contract should be implied through the course of dealings. The judge found there was no such contract, and Baird appealed to the Court of Appeal.

Judgment

Sir Andrew Morritt V-C (with whom Judge LJ and Mance LJ concurred), found that a contract could not be implied unless it is necessary. Here, any such agreement to keep up the purchase of clothes, subject to reasonable notice for termination, would be too uncertain. Uncertainty was confirmed by an absence of intention to be legally bound. Furthermore, an argument of estoppel could not succeed because estoppel is not capable (in English law as yet) of creating its own cause of action. Also, concerning estoppel, Judge LJ held, “The interesting question... is whether equity can provide a remedy which cannot be provided by contract. It seems clear that the principles of the law of estoppel have not yet been fully developed....” He questioned estoppel and the applicability of equity.

Richard Field QC, Charles Bear and Herbert Smith acted for Baird, and Michael Brindle QC, Andrew Burrows and Freshfields Bruckhaus Deringer acted for M&S.