A recent decision of the High Court decided that terms of agreement contained in a Consent Order did not constitute the full extent of the agreed terms between the parties.

Traditionally, when two parties in litigation settle the claim between them, they would enter into a Consent Order (or ‘Tomlin Order’) that set out the terms of agreement. The court would (usually) rubber-stamp those terms, which represent the final terms of agreement.

However, the recent decision of the High Court in Adibe v National Westminster Bank plc [2017] EWHC 1655 (Ch) (16 March 2017) has cast some doubt on that by looking beyond the terms of settlement in a consent order to decide what the obligations of the parties are.

Background facts

Mr Adibe was sued by NatWest for a debt of just over £5,000. During a telephone call between Mr Adibe and NatWest’s lawyers to discuss settlement, Mr Adibe set out an offer of £2,000, on the condition that adverse credit entries against his name were removed. NatWest’s lawyers said entries could not be removed, but could be marked as ‘settled’, and they would take instructions on the offer from NatWest.

Read more: http://www.tltsolicitors.com/insights-and-events/insight/consent-orders-doubts-cast-on-the-obligations-of-parties/