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Court of Appeal Rules on £30 Million Football Stadium Contract

PLEASE NOTE: Information in this article is correct at the time of publication, please contact DFA Law for current advice on older articles.

It may seem gloomy, but one of the reasons why you need a professional contract drafter is that things do not always go quite according to plan. In one case, a deal which was intended to deliver a new £30 million stadium for a football club unravelled after it hit an unforeseen planning glitch.

Car SupermarketBristol Rovers had signed a conditional contract with Sainsbury’s by which the supermarket chain would purchase the football club’s stadium, demolish it and use the site for a superstore development. That in turn would provide the financial resources required for the club’s move to a state-of-the-art new ground.

However, the project was dependent on an acceptable planning permission being obtained for the superstore. Sainsbury’s ultimately pulled out of the deal after local councillors imposed a condition which forbade early morning deliveries. Bristol Rovers launched proceedings, claiming that Sainsbury’s had no entitlement to terminate the contract and that it was obliged to complete its side of the bargain.

The club’s arguments failed before the High Court and, in dismissing its challenge to that decision, the Court of Appeal ruled that the supermarket chain had been entitled to withdraw. Although the termination had in part been motivated by a change in the economic climate, Sainsbury’s had used all reasonable endeavours to obtain an acceptable planning consent. It had also not been obliged to lend its name to an attempt by the club to persuade councillors that the restriction on delivery hours should be lifted.

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