UT (Tax & Chancery) UT-2024-000044 - [2025] UKUT 00094 (TCC)

Mr Firth submitted that the FTT’s approach and conclusion on this requirement were wrong in law.

First, it rendered the wording “ad hoc” completely otiose and irrelevant.

Second, there is a fundamental inconsistency between a contract that provides for services to be provided on an “ad hoc” basis and an interpretation that would permit the service user to demand that they be provided continuously, all the time (which the FTT accepts is the result of its interpretation of the actual words ([47]). That is plainly not ad hoc provision of service. The FTT’s interpretation thus directly contradicts the actual terms of the contract.

Third, the FTT failed to address the meaning of “required” and seemed to interpret it as being the same as “requested”. “Required” connotes the services being necessary, not just desirable.

Fourth, the FTT stated that “as and when required” means required by Sky, but that is not what the contract says (and it would have been very easy to say that, if that was what was meant). The principle of contra proferentum applies against Sky in this respect, as the provider/drafter of the contract, particularly when taken with what the completely unacceptable consequence of the interpretation (ability to require service all day, every day) and when read alongside the phrase “ad hoc”.

Fifth, “first call” simply means that the Appellant could not provide Mr Thompson’s services for another commercial engagement in preference to Sky if Sky had already requested services, it did not mean that the Appellant had to provide Mr Thompson whenever Sky wanted, for however long Sky wanted. Indeed, that would be an unworkable construction for the further reason that the Company would not itself have the right to demand that PT work on such terms.

Sixth, clause 2.1 only means that when the Services are to be provided, the Appellant will procure that Mr Thompson provides them. It is not concerned with when the Services are to be provided.

Seventh, Mr Firth maintained that the phrase “ad hoc as and when required basis” is so vague and lacking in substance as to mean that a Court (and Tribunal) could not reach any conclusion as to what was in the parties’ minds in terms of binding enforceable obligations.

Finally, and the point Mr Firth concentrated upon in oral submissions, the FTT attempted to solve the problems caused by its interpretation by implying a term of reasonableness, but that is wrong in law. The frequency or quantity of the Services to be provided was a fundamental term of the contract.

A term of reasonableness cannot be imposed because there are no objective criteria by which the court could assess reasonableness – see Baird Textile Holdings Limited v. Marks & Spencer plc [2001] EWCA Civ 274:

“[30]…The alleged obligation on M&S to acquire garments from Baird is insufficiently certain to found any contractual obligation because there are no objective criteria by which the court could assess what would be reasonable either as to quantity or price…”

Thus, Mr Firth argued that implying a “reasonableness” requirement is avoiding the difficulty rather than solving it. The Court would be making the contract for the parties.It pushes all the problems and arguments, caused by the FTT’s interpretation of the express wording, back into an implied term that does not resolve anything.