House of Lords Gives Judgment in Lonsdale v Howard & Hallam

04 Jul 2007

The House of Lords delivered its judgment in the test case on commercial agents’ compensation under Regulation 17 of the Commercial Agents (Council Directive) Regulations 1993 on 4th July 2007.

The House of Lords (Lord Hoffmann giving the lead Opinion, with the other members concurring) upheld the Court of Appeal’s approach that compensation is to be assessed by way of a business valuation of the value of the agency to the agent at the date of termination. He clarified that courts should presume a hypothetical buyer and a hypothetical open-market sale, but that otherwise the actual value should be assessed.

The House of Lords expressly disapproved of the approach in the Scottish Outer House of the Court of Sessions case King v Tunnock and also declined to make a reference to the European Court of Justice.

Philip Moser of Monckton Chambers acted for Lonsdale on behalf of Amicus.

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Philip Moser QC