Scomadi Ltd & Anor v RA Engineering Co. Ltd & Ors
Decision date: 27 October 2017
Neutral citation: [2017] EWHC 2658 (IPEC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
This case concerned a contract dispute and design-right claims arising from a broken commercial relationship between Scomadi and Hanway under a Design and Manufacture Agreement (DMA) and a later Supplementary Agreement (SA). The court found the SA to be a binding variation supported by consideration, held that clause 2A and the parties’ conduct estopped Scomadi from denying Hanway’s contributory design ownership, and concluded Hanway validly terminated after Scomadi had effectively “found” a third party by late October 2016. The court upheld validity of RCD1 and RCD2 (RCD3 invalid), found the GT infringed RCD2 but not RCD1, and found GP1 and GP2 did not infringe RCD1 or RCD2.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: medium
The judgment supports that a supplementary agreement acknowledging another party’s design contribution can create an estoppel preventing the acknowledging party from later denying joint design ownership, and that continuation of a commercial venture plus changed commercial terms can constitute sufficient consideration for a contractual variation. It also treats a commercial decision to proceed with a third party as satisfying a contractual “finding” of that third party for termination rights.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The judgment noted (obiter) that informal or “rough and ready” settlement-style agreements should be interpreted to give effect to their commercial purpose in allowing contributors to continue exploiting jointly developed designs, and that where design freedom is deliberately constrained by close adherence to prior styling, registered design protection will be narrowly construed.