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Recovering Payments That Were Wrongly Withheld Following the Sale of a Business

Our client sold his consultancy business to an overseas company. Our client received a lump sum payment and was due to receive a number of monthly payments following completion. The buyer made the first couple of payments but then refused to pay any more money on the basis that our client had given inaccurate warranties or representations about the company which were included in the share purchase agreement.

We were instructed to issue a claim to recover the missing payments and to ask the court to issue a declaration or legal finding that our client had not given inaccurate warranties. The buyer’s response was to issue a substantial counterclaim alleging that there had been various breaches of warranty, misrepresentations about the business and further breaches of the share purchase agreement.

The litigation was particularly hard fought over nearly two years but the defendant’s decision to change its solicitors and a delay in exchanging witness statements suggested that it was experiencing difficulties in defending the claim and pursuing its own case. The defendant’s case collapsed shortly before trial when it consented to a judgment being entered against it for the full amount of the claim perhaps to avoid being liable for any further legal costs. The defendant had resisted a number of attempts at settlement but the client’s determination to pursue the claim to trial and our own persistence secured judgment for our client.  

Alex Haddad

About the author

Alex Haddad

Alex joined Nockolds in 2011 and is a Principal Associate in our Commercial and Property Litigation Team. Before joining the firm Alex studied law at ...

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