What was in issue

The share purchase agreement made part of the price contingent on revenue in the two years after completion. Revenue fell short. Our client, the buyer, was accused of having engineered the shortfall by redirecting business to a sister company.

How it ran

The case turned on internal sales data rather than on the drafting. We resisted an application for expedited trial, took the extra four months to complete a forensic reconstruction of the order book, and put the whole of it in a single expert report.

The result

The court accepted that the fall in revenue was market-driven and that the buyer had been under no implied obligation to maximise the earn-out. The claim was dismissed with costs on the standard basis.

Earn-out disputes are rarely about the words. Both sides usually agree what the clause says; they disagree about whether the buyer ran the business in a way that made the target unreachable. That turns the case into a factual reconstruction of ordinary commercial decisions taken over two years.

What decided it

We rebuilt the order book from the buyer’s own systems and matched it against the group’s sales into the same territories. The reconstruction showed a market-wide decline that predated completion and continued after it, which the seller’s expert had modelled as company-specific.

Why it matters

The judgment confirms that an implied obligation to maximise an earn-out will not be read into a carefully drafted agreement between commercial parties, and that a seller who wants that protection must bargain for an express covenant.