EUROPEAN PROFESSIONAL CLUB RUGBY v RDA TELEVISION LLP

A force majeure clause may permit termination even where both contracting parties are affected by the same event, provided the contractual conditions for termination are satisfied. The relevant distinction is between the party whose performance has been prevented, hindered or delayed and the counterparty to whom that performance is owed. A contractual defence to liability and a contractual right to terminate address different matters and may operate cumulatively. The court must construe the clause in its contractual, factual and commercial context, giving effect to clear language and the agreement as a whole. A party’s commercial motivation for invoking the clause is immaterial unless the contract contains an applicable constraint on the exercise of the contractual power.

EPCR licensed media rights in European rugby competitions to RDA under a Media Rights Agreement. The Covid-19 pandemic postponed the 2019–20 quarter-finals, semi-finals and finals beyond the relevant season. RDA served notice terminating under the force majeure provisions after more than 60 days of disruption. EPCR treated that notice as a repudiatory breach and claimed damages. RDA counterclaimed for repayment and adjustment of minimum-guarantee payments.

The central issues were whether RDA was entitled to terminate under clause 26.4 of Schedule 6, despite being affected by the pandemic itself, and whether the postponement entitled RDA to a pro rata reduction under clause 1.7 of Schedule 2.

1. Termination valid. RDA’s notice under clause 26.4 was effective. EPCR had been prevented, hindered or delayed by a force majeure event from staging the relevant competitions and making the available live matches available during the 2019–20 season for more than 60 days.
2. Clauses 26.2 and 26.4 addressed different issues. Clause 26.2 supplied qualified protection from liability for force-majeure-caused non-performance or delay. Clause 26.4 gave the counterparty a contractual right to terminate after the prescribed period. The operation of clause 26.2 did not deprive the counterparty of recourse to clause 26.4.
3. The expression “the party not affected by the Force Majeure Event” referred to the party to whom the prevented or delayed performance was owed. It did not exclude termination merely because the counterparty was also affected in a general commercial sense by the same event. RDA’s downstream losses therefore did not prevent it relying on clause 26.4.
4. The clause 26.1 notice requirement was not a condition precedent to clauses 26.2 or 26.4 taking effect. In any event, EPCR’s correspondence could constitute the necessary notice.
5. The court applied the contractual construction principles stated in Arnold v Britton [2015] UKSC 36, Rainy Sky SA v Kookmin Bank [2011] UKSC 50, Wood v Capita Insurance Services Limited [2017] UKSC 24 and National Bank of Kazakhstan v Bank of New York Mellon [2018] EWCA Civ 1390. The earlier decision in Lebeaupin v Richard Crispin and Company [1920] 2 KB 714 was consistent with those principles when read in context.
6. RDA’s motivation was immaterial. No pleaded contractual constraint of the kind considered in Socimer International Bank v Standard Bank London [2008] EWCA Civ 116 or Braganza v BP Shipping Limited [2015] UKSC 17 arose.
7. EPCR’s damages claim failed. RDA was entitled to €375,000 repayment of the prepayments attributable to the later seasons and to a reduction of the 2019–20 minimum-guarantee payment to €169,338. Set-off and interest were reserved for further submissions.