A recent court case demonstrates what can happen when a contractual intent becomes unclear due to ambiguous wordings. For example, the court’s ruling in European Professional Club Rugby v RDA Television LLP [2022] EWHC 50 (Comm) reminds us that ambiguous wordings in a contract producing results that are commercially absurd are likely to be ignored by the courts in order to establish the true contractual intent; and, contract termination provision may not always be restrictive, or in other words, it may not have conditions attached to it imposing restrictions to its application. However, at times parties may have to demonstrate that they have indeed acted rationally and in good faith (as a condition) while exercising any discretion under a contract, although neither party in the present case asserted that such a restriction existed.
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