In Idemitsu Kosan Co Ltd v Sumitomo Corporation, the High Court followed the previous decision of Mann J in Sycamore Bidco Ltd v Breslin and another that a contractual warranty, without more, would not constitute an actionable claim for damages in misrepresentation under the Misrepresentation Act 1967. Concluding a contract on terms which include mere contractual warranties does not mean that the warrantor makes any statement which the counterparty could characterise as a misrepresentation. The judge declined to follow the previous High Court decision of Invertec Ltd v De Mol Holding BV and another.
The judgment provides useful guidance for parties engaged in negotiating share purchase agreements or other contracts. If it is intended that breaches of warranties are to be actionable as misrepresentations, in addition to contractual remedies, express wording should be included to that effect in the contract.