Multi-Link Leisure Development Ltd v North Lanarkshire Council: Commercial Interpretation or Relief from a Bad Bargain

Abstract

The interpretation and construction of contracts is the “staple diet” of the courts and commercial lawyers and “the very lifeblood of commercial law”. Commercial agreements, Sir Christopher Staughton points out, are “virtually the only contracts which in these days anyone can afford to litigate about”. However, the frequency with which these cases come before the courts does not mean they are run of the mill. They are often of enormous significance to the parties – that is why they have pursued litigation, in many cases to the highest appellate courts. The principles that guide judicial resolution of these commercial disputes therefore assume great practical significance. A key feature of the modern approach to these cases is a shift towards the “commercial interpretation” of contracts. While the need to take an approach to interpretation that is in touch with business common sense is undeniable, the benefits and dangers of the role it plays have not been considered in any great depth. The recent decision of the United Kingdom Supreme Court in Multi-Link Leisure Developments Ltd v North Lanarkshire Council, a case of exactly the kind described above, provides a convenient landscape within which to consider the proper scope of this commercial approach.