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Arctic thaw

KEVIN NICHOLSON reviews the Court of Appeal's judgment in 'Arctic Systems' and finds much in it to encourage small businesses.

SIR ANDREW MORRITT the Chancellor of the High Court took on the unlikely guise of Father Christmas on 15 December 2005 when he delivered the main judgment in the 'Arctic Systems' case (more formally Jones v Garnett). Sir Andrew gave Mr and Mrs Jones a welcome early Christmas present finding resoundingly for them. While not solving all the issues in the settlements/small business arena the decision gives a fairly clear indication in the great majority of situations.

How did we get here?

Most readers will be aware of the background to the case so this will only be a brief recap.
In 1992 shortly after Mr Jones was made redundant he and his wife acquired the newly-formed Arctic Systems Limited through which to contract the personal services of Mr Jones as an IT consultant. Mr and Mrs Jones each acquired one share...

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