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Compass Group UK and Ireland Ltd (trading as Medirest) v Mid
Essex Hospital Services NHS Trust [2012] EWHC 781
The contract obliged the parties to a long term facilities
agreement to "co-operate with each other in good faith".
The Trust in this case had the right to terminate Medirest's
engagement because Medirest had exceeded the number of permitted
"service failure points", but the key question was
whether Medirest also had the right to terminate owing to a breach
of the obligation to act in good faith.
The Court held that it was; the Trust had breached a material
obligation to act in good faith (having prepared "patently
absurd", "cavalier", "indefensible"
calculations of service credits under the contract).
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