This case highlights the continued need for careful drafting of entire agreement clauses. It also illustrates the care with which the court should look at the wider agreement when interpreting a particular contract term.

NFFC Group Holdings Limited (Seller) sold shares in Nottingham Forest Football Club to NF Football Investments Limited (Buyer). In due diligence the Seller was told that the liabilities of the club were approximately £6.6 million. In reality they were over £10 million.

The Buyer claimed for negligent misrepresentation with the Seller arguing that the contract's entire agreement clause prevented this claim. The entirety of the clause is set out below:

'This agreement (together with the documents referred to in it) constitutes the entire agreement between the parties and supersedes and extinguishes all previous discussions, correspondence, negotiations, drafts, agreements, promises, assurances, warranties, representations and understandings between them, whether written or oral, relating to its subject matter.'

The clause did not include the additional provisions that commonly follow such an 'entire agreement' statement. Notably, the statement that the Buyer had not relied on anything else was not included. The no reliance wording is conventionally included as part of entire agreement clauses in order to satisfy the requirement that the exclusion be "clearly stated" (see the Court of Appeal's 2011 AXA Sun Life decision).

In June the Seller was successful in obtaining summary judgment to strike out the Buyer’s claim. It was found that the parties had intended to exclude misrepresentation claims. In particular, the Master gave great weight to the fact that within the SPA the Seller indemnified the Buyer for any business liabilities in excess of the due diligence figure showing, he said, that the parties had considered and set up a contractual procedure for exactly the scenario in question.

However in November the High Court overruled the Master's decision and allowed an appeal. It did not agree with the Master's reasoning that a contractual mechanism to allow a remedy carries with it the implication that other remedies (in this case, misrepresentation) are excluded.