[2025] EWHC 2275 (Ch)

not only be contrary to the ordinary meaning of the words used in Clause 16.1.1; but

also mean that the parties had already effectively agreed that the demerger was to be achieved by (i) the Defendants receiving Sites F and G, and (ii) the Claimants receiving the remaining Sites. Such a meaning would be wholly inconsistent with and render utterly academic the operative provisions under clause 16.1, which required the parties to “use all reasonable endeavours to negotiate and agree….. which properties held by PPL will be transferred to [D1 and D2] on the one hand, and the [Claimants] on the other..”.

[18] ……..

…….

The reliance placed in some cases on commercial common sense and surrounding circumstances should not be invoked to undervalue the importance of the language of the provision which is to be construed. The exercise of interpreting a provision involves identifying what the parties meant through the eyes of a reasonable reader, and, save perhaps in a very unusual case, that meaning is most obviously to be gleaned from the language of the provision. Unlike commercial common sense and the surrounding circumstances, the parties have control over the language they use in a contract. And, again save perhaps in a very unusual case, the parties must have been specifically focussing on the issue covered by the provision when agreeing the wording of that provision;

When it comes to considering the centrally relevant words to be interpreted, the clearer the natural meaning, the more difficult it is to justify departing from it. The less clear they are, or, to put it another way, the worse their drafting, the more ready the court can properly be to depart from their natural meaning. However, that does not justify the court embarking on an exercise of searching for, let alone constructing, drafting infelicities in order to facilitate a departure from the natural meaning; 

Commercial common sense is not to be invoked retrospectively. The mere fact that a contractual arrangement, if interpreted according to its natural language, has worked out badly, or even disastrously, for one of the parties is not a reason for departing from the natural language. Commercial common sense is only relevant to the extent of how matters would or could have been perceived by the parties, or by reasonable people in the position of the parties, as at the date that the contract was made;

While commercial common sense is a very important factor to take into account when interpreting a contract, a court should be very slow to reject the natural meaning of a provision as correct simply because it appears to be a very imprudent term for one of the parties to have agreed, even ignoring the benefit of wisdom of hindsight. The purpose of interpretation is to identify what the parties have agreed, not what the court thinks that they should have agreed. Accordingly, when interpreting a contract a judge should avoid re-writing it in an attempt to assist an unwise party or to penalise an astute party;

….”

PCo is in occupation of Sites B and D; but

Sites C, E, F, G and H are occupied by third parties.

the supply of pallets from the third party business operating from Site C; and

rights of access over and parking of HGV lorries on Site E.