CA-2024-001924 - [2025] EWCA Civ 1206

In my view, it is not the case that a repudiatory breach of the SHA is necessarily incapable of remedy for the purposes of clause 7.1(d). I therefore agree with the Judge that “[t]he fact that certain of the breaches of the SHA were repudiatory in nature … did not, in itself, render them irremediable for the purposes of clause 7.1(d)”.

Clause 7 provided for a shareholder to have the right to compel another shareholder to transfer his shares in the specific circumstances given in the clause. By clause 7.1(d), that right arises where a shareholder has committed a “material or persistent breach” of the SHA which, “if capable of remedy, has not been so remedied within 10 Business Days of notice to remedy the breach being served by the Board (acting with Shareholder Consent)”. Under the terms of the provision, accordingly, its applicability depends on the existence of a “material or persistent breach” and a failure to remedy it within 10 business days of a notice to do so. Had they so intended, the parties could have stated that a repudiatory breach was to be considered irremediable, but they did not do so. In fact, the word “repudiatory” was not used at all. Plainly, a “material or persistent” breach such as clause 7.1(d) requires might well be repudiatory, but the clause still proceeds on the basis that such a breach might be “capable of remedy” and drew no distinction between repudiatory and other breaches.

Buckland was not concerned with the meaning of “capable of remedy” as used in a contractual provision. It addressed the position where, at common law, there has been a repudiatory breach of contract. In particular, it provides authority for the proposition that “a repudiatory breach of contract, once it has happened, cannot be ‘cured’ by the contract breaker” and the innocent party retains the “right to go” (to use words of Jacob LJ). The decision casts no light on the distinct question of whether a breach is “capable of remedy” within the meaning of a contractual provision such as clause 7.1(d).

It seems to me that the case law shows that, when determining whether a breach of contract is “capable of remedy” within the meaning of either a contractual provision or a comparable statutory one, a “practical rather than technical” approach is, at least normally, to be adopted. It may be that, in a specific contract or statute, “capable of remedy” could, because of the particular context, mean something different. In general, however, a question as to whether a breach of contract is “capable of remedy” for the purposes of either a termination clause (as in Schuler v Wickman and Force India) or a compulsory transfer provision such as clause 7.1 is to be determined in a “practical rather than technical” way in which common law rules as to repudiation have no place.

This issue is raised by ground 4 of the grounds of appeal.