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Contractual Termination Conundrum: The S...

Pathak, Akhileshwa...

Case

Contractual Termination Conundrum: The Sudden Insolvency of Phones 4U Limited

Pathak, Akhileshwar

IIMA-STR0472 | Published January 3, 2023 | 8 pages Case

Collection: Indian Institute of Management, Ahmedabad

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Learning Objectives

Phones 4U Limited (P4U) was a highly successful intermediary company, retailing mobile phones and selling mobile phone services for the major mobile phone operators in the UK. In 2014, two of the mobile phone operators left P4U. EE Limited, the only remaining partner, announced a year in advance that it would not renew the contract when it ended in 2015. This precipitated P4U's appointing administrators. Based on this, within the termination clause, EE terminated the contract with immediate effect and claimed damages for the loss of business for the remaining one year of the contract. P4U administrators have to find a way out.

To explore and understand the meaning, scope and application of good faith clauses in business contracts. To understand the general common law principles of termination of contracts. To understand the relationship between termination clauses in a contract and the general principles of termination of contract. To understand the principles of award of damages for termination when the termination is done under termination clauses of the contract.