Repudiatory Breach Of Contract Revisited

DRL Limited v. Wincanton Group Limited [2011] EWCA Civ 839

The issue of repudiatory breach of contract is a notoriously difficult one because it is often not easy to establish which contractual party is in repudiatory breach and which has accepted the other's repudiation and thereafter ceased to perform its own contractual obligations. This case demonstrates that there can be a very fine line between imposing improper commercial pressure on a counterparty and repudiating one's own contractual obligations.

The background facts

Wincanton supplied logistics services to DRL under an agreement concluded in 2005 and which was subsequently varied in 2007. Under the agreement, Wincanton would invoice DRL weekly for amounts owed less certain deductions, including any damage and stock loss liability, and the invoices were to be agreed and signed off by both parties. Under the agreement, DRL was obliged to pay the invoices without deduction, set-off or counterclaim