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Sanctity of Oral Agreements: MWB Busines...

Pathak, Akhileshwa...

Case

Sanctity of Oral Agreements: MWB Business Exchange Centres Ltd v Rock Advertising Ltd

Pathak, Akhileshwar

IIMA-BP0434 | Published March 27, 2019 | 11 pages Case

Collection: Indian Institute of Management, Ahmedabad

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The founding principle of contracts is the freedom of the parties. The parties are free to choose their terms and follow any modality of communication, oral or written. As they can freely make a contract, they can freely modify or unmake it. Written contracts have a clause, No Oral Modification Clause (NOM Clause), precluding oral modifications of the contract. Irrespective of it, business persons make oral agreements modifying the contract, and later, dispute its validity. If the parties are free to contract, why should the oral agreement not be binding? In a NOM Clause then, ineffective? The United Kingdom Supreme Court, in MWB Business Exchange Centres Ltd v Rock Advertising Ltd, explores this fundamental question on contract law.

Founding principles of contracts; Sanctity of oral agreements; Effect of No oral Modification clauses in contracts