The breach of contractual indemnities under English law – a debt claim or a damages claim?

  • Febechi Chukwu

Abstract

In 2015 the English High Court delivered two important but not widely publicised judgments in the cases of ABM Amro Commercial Finance plc v Ambrose McGinn & others [2014] EWHC 1674 (Comm.) and Durley House Limited v Firmdale Hotels plc [2014] EWHC 2608 (Ch.). Febechi Chukwu reviews those judgments, and several previous rulings by the English courts, concluding that the lack of a single interpretive rule for contractual indemnities in English law is a preferable approach. The English courts should be clearer in accepting the complexity of properly interpreting indemnities and assessing the available remedies for breach. Ultimately that assessment is substantially dependant on how the indemnity in question is drafted and constructed in the contract. The courts should boldly promote the more nuanced approach to determining whether a particular breach gives the innocent party a right to a claim in debt or a claim in damages, and this will be of benefit also to practitioners negotiating indemnity clauses in English law contracts.

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Published
2020-03-02
Section
Articles