Court Refuses to Strike Out Deceit Claim in Business Sale

The High Court has refused an application for summary judgment on a claim of deceit in relation to the sale of a business, or alternatively to strike out the claim.

The claimant had acquired a health business from the defendants. It claimed that it had not been told prior to the transaction that one of the business's key customers had triggered a price review clause in its contract with the business in relation to a pharmaceutical product, which led to a substantial reduction in the price at which the product was supplied. The claimant brought claims for breach of warranties given in the Share Purchase Agreement, and a claim for deceit in relation to representations allegedly made in a draft of the Disclosure Letter. The defendants applied for summary judgment on the deceit claim, or alternatively to have it struck out, arguing that the Disclosure Letter did not give rise to any actionable representations.

After considering a number of previous cases dealing with the distinction betwee