Misunderstanding of contract terms ends in an own goal: Ticket2Final OU v Wigan Athletic AFC Ltd.21st April 2015
In conjunction with Wigan FC, T2F advertised and sold options to fans to purchase a ticket to particular future match should it take place. Of particular interest were options for tickets for FA Cup matches. T2F offered options to purchase FA Cup tickets including for tickets to the final. Having made it to the final, Wigan was allocated 21,000 tickets and limited sales to 2 per season ticket holder. Having 10,000 season ticket holders, only 1,000 tickets remained for T2F. When this was queried by T2F, Wigan purported to terminate the agreement for T2F’s breach of contract due to late payments. T2F was subsequently informed the FA did not permit or approve of the sale of options for FA Cup tickets. T2F argued Wigan was therefore in breach of its own obligations for the sale of options for match tickets. Further, under the terms of the agreement, Wigan represented and warranted it had the necessary power and authority to perform its contractual obligations.
This case acts are a reminder on two points. Firstly, although the representation relied upon by T2F was false (the ability to supply the FA Cup tickets to T2F was not within Wigan’s power), it was not fraudulent as Wigan’s representative, whether rightly or wrongly, did not properly consider the full consequence of that representation and therefore could not have made the false representation knowingly. The Court was unwilling to find fraud due to the ignorance of the negotiator of the contract.
Secondly, Wigan was entitled to terminate by a notice in writing following a default in payment of 7 days. No such notice was provided and therefore Wigan failed to meet this comply requirement when it demanded payment before termination. The judge rejected Wigan’s arguments that (a) the formal notice clause did not apply to a notice demanding payment; and (b) notice could be provided by email under an implied term arising from the parties’ conduct. The Court held the formal notice procedure notifies the recipient of the importance of the notices, particularly for a notice which, if not complied with, may result in the contract being terminated.
This case acts as a useful reminder to commercial teams to ensure the necessary power and authority to grant rights has been considered and identified. Also, notice provisions need to be accurately included within contracts to reflect a client’s approach to business communications.