End-of-chapter questions: Answer Guidance 28.1

Agreed remedies

This question concerns a deposit. Following Makdessi v Cavendish Square Holdings BV [2015] UKSC 67, it seems that you should first apply the rule against penalties, and then consider whether equitable relief against forfeiture should be granted. On the penalties point, it is important first to establish whether there is a breach of contract, and then to apply the test of penalties as recently stated by the Supreme Court in Makdessi. When turning to forfeiture, it is important to decide whether the deposit is reasonable, and whether partial enforcement may be appropriate. Given that the facts raise both penalties and forfeiture, it would perhaps be interesting to see some discussion of the relationship between the two doctrines.