Trading names in a contract – beware

Year Published: 2013

The Court of Appeal recently confirmed that an individual was personally party to (and therefore personally liable under) a contract notwithstanding the fact he signed the document using the trading name for his limited company.

The rationale for the decision was because there was nothing in the contract to actually indicate that this was the trading name of the limited company (rather than the trading name of an individual) and as a result, the counterparty had no knowledge of the link between the trading name and the company and assumed he was contracting with the individual personally.

It was held, that regardless of the fact the connection between the trading name and the limited company was public information, the signatory became bound under the contract because he failed to express this connection in the contract.

This decision is a warning to anybody entering into a contract (Hamid v Francis Bradshaw Partnership [2013] EWCA Civ 470). Click here to view a detailed case summary.

For professional legal advice on matters of this nature or any other contract matter, please contact Kaye Whitby in our commercial team on 01244 305982.

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