Settlement Agreements - Khanty-Manisysk Recoveries Ltd V Forsters (Court Of Appeal)

Author:Clyde & Co LLP
Profession:Clyde & Co

Case Alert - [2018] EWCA Civ 89

Court of Appeal considers the scope of a settlement agreement

The settlement agreement entered into by the parties compromised "claims" which were defined as "any claim, potential claim...whether known or unknown, suspected or unsuspected...whether or not such claims are within the contemplation of the parties at the time of this agreement arising out of  or in connection with the Action or the invoice..."

The appellant argued that there were two limitations on the apparent scope of the settlement agreement: (1) the agreement captured only claims that were "realistically supposed to exist" and (2) the agreement did not cover "inconceivable claims".

The leading case on the interpretation of settlement agreements is the House of Lords decision in BCCI v Ali [2001]. In that case, it was accepted that, depending on its wording, a settlement agreement can encompass "claims which could not on the facts known to the parties have been imagined", but that there is a "cautionary...

To continue reading