UK Politics: Oh Ambassador you are really spoiling us!

[JoannaL]

2 minutes ago, Filippa Eilhart said:

also:

13.1.AstraZeneca. AstraZeneca represents, warrants and covenants to the Commission and the Participating Member States that:

it is not under any obligation, contractual or otherwise, to any Person or third party in respect of the Initial Europe Doses or that conflicts with or is inconsistent in any material respect with the terms of this Agreement or that would impede the complete fulfillment of its obligations under this Agreement;

Woah, that is really clear, no wriggle room!  everything AZ said last week with "later contract" and "supply chains" was just lying.

[The Anti-Targ]

7 hours ago, SeanF said:

First come, first served,  is a principle in contract law.  Suppose I contracted to sell something to you, at a future date, then three months later, contracted to sell the same thing to someone else.  You’d still be entitled to force me to complete the sale to you, notwithstanding the later contract.  

That's if you are selling a thing to a single party, not millions of things to multiple parties. If you agree to sell a thing to one party then subsequently agree to sell the same thing to another party that's not breach of contract, that's fraud.

 

[SeanF]

31 minutes ago, JoannaL said:

Woah, that is really clear, no wriggle room!  everything AZ said last week with "later contract" and "supply chains" was just lying.

This however, is Astra Zeneca A.B., the company incorporated in Sweden.  If the party that contracted with the NHS is, as I suspect, Astra Zeneca plc, incorporated n England and Wales, there would be no breach of warranty.

[SeanF]

1 minute ago, The Anti-Targ said:

That's if you are selling a thing to a single party, not millions of things to multiple parties. If you agree to sell a thing to one party then subsequently agree to sell the same thing to another party that's not breach of contract, that's fraud.

 

In all likelihood yes, but the first party can still insist on fulfilment of the terms, even though that is to the detriment of the second party.

But, I think (now the redacted contract has been published) that the European Commission has contracted with a different company to the UK, Astra Zeneca AB, rather than Astra Zeneca plc.

[Filippa Eilhart]

it's just another kind of lie

[The Anti-Targ]

3 hours ago, Hereward said:

Your moral superiority in hypothetically refusing the vaccines you don’t produce to alleviate a disease you’re not suffering from is noted and admired. Pat yourself on the back again. 

 

 

[ljkeane]

2 hours ago, Filippa Eilhart said:

so the definition of best effort *is* different from Curevac, without any reference to "other purchasers:

That's actually more vague than the Curevac one. I think that leaves more wiggle room.

2 hours ago, Filippa Eilhart said:

And it does include the UK in the definition of "EU manufacturing sites".

It says that Astrazeneca can manufacture the 'Initial European Doses' in the UK. It doesn't say that it will.

There's more of this APA redacted but from what we can see what Astrazeneca is actually required to do is 'use it's best reasonable efforts to build capacity to manufacture 300 million doses of the vaccine' for distribution within the EU. I'm going to guess what Astrazeneca will say is that setting up the sites in Belgium and Holland are it's best reasonable efforts to build that capacity. The sites in the UK were it's efforts to build capacity for it's UK order. That's why they keep referring to setting up different supply chains. It probably depends what they reported to the EU about the process of setting up their manufacturing capacity over the last few months.

[Padraig]

1 hour ago, SeanF said:

In all likelihood yes, but the first party can still insist on fulfilment of the terms, even though that is to the detriment of the second party.

Has anyone said otherwise?

The problem is, the second party can still insist on the fulfillment of terms also, even if it is to the detriment of the first party.  "Who signed first" is not the winning card.

The blame goes towards Astrazeneca.

Are you now saying that the EU's contract doesn't apply to the UK factories because its a different "Astrazeneca", despite the contract saying it applies to the UK factories?

I also read the inews opinion piece.  It is very much an opinion piece with nothing in the way of sources or references.  I think we should all be skeptical of those.  I do agree with the view that the UK being in the EU may have changed the EU's approach.  Via the EMA's previous location, the UK had built up quite a lot of expertise in this medical side of things.  Its advice may have been very useful.  But, a big reason why the EU approved the vaccine slower than the UK is because it went for a different type of approval (rightly or wrongly).  And not mentioning this reinforces my fear that he is missing other things (deliberately or not).  Furthermore comparing the UK's overall rate of vaccination to the EU's is misleading given the UK started earlier.  The UK rate should be way ahead (at this time)!  There are so many different factors at play.

But sure, leaving the EU has advantages and disadvantages.  I think both sides knew that already though (even if they disagreed on the balance between the two).

Anyhow, one of the reasons I like the concept of the EU is because there is a sense of us all in this together.  The UK is out of that.  Many people there are happy with that.  But hopefully if they were part of the EU, they would share that positive "all in this together" sense also.

[Padraig]

4 minutes ago, ljkeane said:

That's actually more vague than the Curevac one. I think that leaves more wiggle room.

13.1 seems to be the more powerful clause.

But I think us debating the merits of particular caveats is bit pointless.  Its a legal game for real legal people.  We'll see whether there is an over-arching view in the media over the next day or so.

[Heartofice]

I’m still waiting for someone in the media to give a quick take on it, so far most commentators I’ve seen who’ve looked at the contract seem to be saying that both sides have a reasonable case 

[SeanF]

13 minutes ago, Padraig said:

Has anyone said otherwise?

The problem is, the second party can still insist on the fulfillment of terms also, even if it is to the detriment of the first party.  "Who signed first" is not the winning card.

The blame goes towards Astrazeneca.

Are you now saying that the EU's contract doesn't apply to the UK factories because its a different "Astrazeneca", despite the contract saying it applies to the UK factories?

I also read the inews opinion piece.  It is very much an opinion piece with nothing in the way of sources or references.  I think we should all be skeptical of those.  I do agree with the view that the UK being in the EU may have changed the EU's approach.  Via the EMA's previous location, the UK had built up quite a lot of expertise in this medical side of things.  Its advice may have been very useful.  But, a big reason why the EU approved the vaccine slower than the UK is because it went for a different type of approval (rightly or wrongly).  And not mentioning this reinforces my fear that he is missing other things (deliberately or not).  Furthermore comparing the UK's overall rate of vaccination to the EU's is misleading given the UK started earlier.  The UK rate should be way ahead (at this time)!  There are so many different factors at play.

But sure, leaving the EU has advantages and disadvantages.  I think both sides knew that already though (even if they disagreed on the balance between the two).

Anyhow, one of the reasons I like the concept of the EU is because there is a sense of us all in this together.  The UK is out of that.  Many people there are happy with that.  But hopefully if they were part of the EU, they would share that positive "all in this together" sense also.

I'm saying that the Commission can't claim that AZ AB is in breach of its contractual obligation to use "best reasonable efforts" to supply the vaccine, merely because AZ plc is fulfilling its contractual obligation to the NHS, thereby limiting the ability of AZ AB to supply the vaccines.   Nor can they say that AZ AB is in breach of the Warranty at 13.1, if AZ AB is under no such contractual obligation to the NHS.

[Padraig]

21 minutes ago, SeanF said:

I'm saying that the Commission can't claim that AZ AB is in breach of its contractual obligation to use "best reasonable efforts" to supply the vaccine, merely because AZ plc is fulfilling its contractual obligation to the NHS, thereby limiting the ability of AZ AB to supply the vaccines.   Nor can they say that AZ AB is in breach of the Warranty at 13.1, if AZ AB is under no such contractual obligation to the NHS.

Sure.  We'll call that the "pull a fast one" approach to contract making.

[Heartofice]

https://www.spectator.co.uk/article/it-s-hard-to-see-how-the-eu-can-win-a-case-against-astrazeneca

Here's the opinion of a barrister who's looked at the contracts. He'd also looked at the previous one mentioned before. Seems his general opinion is that 'Reasonable best effort' is going to trip up the EU if they try taking this to court.. well a UK court anyway. 

 

Quote

The contract between AstraZeneca and the EU has now been published. It confirms my view, expressed on Coffee House, that the EU does not – despite its claims – have any form of ‘strong case’ or way to jump a queue to speed up its vaccine rollout.

Both contracts (the one, published previously, which I used as an example in my last post, and today's) are what the EU calls advance purchase agreements, or APAs. The latest contract has slightly different wording in some places. But the differences are not substantial. This, then, appears to be bad news for the EU if it is serious about taking action against AstraZeneca.

The words ‘Reasonable best efforts’ remains in the contract and is the cornerstone of the obligation AstraZeneca is under. Clause 5.1 says they must use their reasonable best efforts to deliver the due doses. The definitions used here differ slightly from the previous contract published. But still: it is hard to see that will help the EU's cause.

What our courts say is that if you wanted the contract to say X, you should have written it as X. If they wanted a strict guarantee, they should have written in a strict guarantee. If parties write they must use best efforts, it means they must use best efforts. Attempts to erode that or increase the burden bump headfirst into this problem.

This contract does contain, as the president of the EU commission has said, 'binding orders'. But these are binding orders to use best efforts. If you leave those words out, as Ursula von der Leyen has done in her public statements, people do not get the full picture. So the publication of this contract doesn't change my view that statements made by the commission remain wrong and unhelpful.

After all, it will be very difficult to show that AstraZeneca has not used its best efforts. It is a factual question, of course, so it may be for a court. But if the EU’s argument is as I set out above, that AstraZeneca are in breach by supplying others, I do not see any way of that argument working in English law. Would it work under Belgian law?

If so, it would come as surprise to me. But then, I am not qualified in Belgian law. Where Belgian law differs from our law it does so by having a ‘good faith’ principle in contract. We have always rejected that in English law, because it causes confusion and what business needs is certainty. Our view of law is that law facilitates, or helps, business to function.

Perhaps here is where the problem arises. If so, maybe the best solution is for all business contracts to in future choose to use English law.
It is possible the EU’s odd statements over the last few days relate to an over reliance on clause 13.1(e). This is a warranty, a statement by AstraZeneca that, at the time it signed the contract in August 2020, it did not have any other contracts which might hinder this one. But contracts must be read as a whole and this warranty cannot rewrite clause 5.1.

Worse, for anyone arguing this is a plausible legal argument, is clause 6.2:

'In the event AstraZeneca's ability to fulfill [sic] its obligations under this Agreement is impeded by a competing agreement entered into by or on behalf of the Commission … AstraZeneca shall not be deemed in breach of this Agreement as a result of any such delay due to the aforementioned competing agreement(s).'

That would destroy any argument the EU has made in public, at least in an English court, because you cannot turn 'try' in to 'do'. What it would do in a Belgian court is harder to say. But again, I'd be surprised if a Belgian judge took a different view.

If AstraZeneca is in the wrong, clause 8.2 seems to limit the impact of a failure to meet any due delivery. If AstraZeneca fails to meet a monthly delivery then 'the obligation of payment will be suspended'. This doesn’t exclude any other remedy, but is an indication that the normal response to a failure to deliver is just to not get paid. That is more normal in a contract, and a far cry from the more outlandish claims which have been made of the potential consequences of failing to deliver.

To make matters worse, the EU published this contract earlier today without correctly redacting confidential information. No doubt a court would find interest in that; the confidentiality clause is in clause 16.

This is an unseemly row between the EU and AstraZeneca, but if what matters is this contract (and in law, that’s all that matters) then under it the EU do not seem to have any case at all.

 

[Filippa Eilhart]

the governing law is the law of Belgium. Which I know nothing about but it would be a Belgian court in any case.

[SeanF]

26 minutes ago, Padraig said:

Sure.  We'll call that the "pull a fast one" approach to contract making.

It's legalistic, for sure, but people are paid vast sums to get the drafting correct.

What 13.1 ought to have said, for the Commission to be correct is

"13.1. AstraZeneca represents, warrants and covenants to the Commission and the Participating Member States that:

 neither it nor any other company in the AZ group of companies is under any obligation, contractual or otherwise, to any Person or third party in respect of the Initial Europe Doses nor that conflicts with or is inconsistent in any material respect with the terms of this Agreement nor that would impede the complete fulfillment of its obligations under this Agreement"

,

[SeanF]

1 minute ago, Filippa Eilhart said:

the governing law is the law of Belgium. Which I know nothing about but it would be a Belgian court in any case.

Belgian law is reckoned to be very generous to Big Pharma.

[Heartofice]

1 minute ago, Filippa Eilhart said:

the governing law is the law of Belgium. Which I know nothing about but it would be a Belgian court in any case.

Sure, but the question is how different would Belgian law really be on this matter? This guy can't imagine it can be that different.

[JoannaL]

The EU will not get full delivery in time because it is just not there. That was clear from the beginning. But all the outlandish claims of the lying AZ boss: like UK plant only for UK delivery and EU gets less because signed contract later and so on ; its now clear to everyone that there were lies. That there is a valid EU claim and if AZ does not try to deliver to all its customers as good as it can it is in breach of contract.

1 hour ago, Padraig said:

Anyhow, one of the reasons I like the concept of the EU is because there is a sense of us all in this together.  The UK is out of that.  Many people there are happy with that.  But hopefully if they were part of the EU, they would share that positive "all in this together" sense also.

The EU is far from perfect but it is trying something noble and exciting. I  really like being part of the EU (at least most of the time).

[Padraig]

1 hour ago, SeanF said:

It's legalistic, for sure, but people are paid vast sums to get the drafting correct.

 

On both sides.   Wouldn't you be very embarrassed if you were one of the teams of lawyers who put in a clause that X was supposed to ensure supply from sites in Y and Z.  And then somebody months later said, "haha...X has no power over Z".

Unless you are a legal expert, I am a little dubious that you, on your own, can fix this multi billion euro contract.  No offense.

As HoI pointed out, the legal experts are giving their views now.  I'm going to wait for a few more beyond I comment.

[Heartofice]

Here’s another contract lawyers opinion on the contract. On this one I will accept that he’s maybe ‘just some guy’ on the internet. But he seems to be followed by the secret barrister so that adds some weight to it IMO.

Basically seems to be rubbishing the EUs claims