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How Football Clubs Can Avoid Breaching a “Gentleman’s Agreement”

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Football clubs are urged to always formally confirm whether a legally binding agreement has been reached when negotiating the sale of players.

hlw Keeble Hawson logoThe advice from hlw Keeble Hawson litigation specialist, Andrew Broadbent, follows reports that Manchester City Football Club are considering taking action against Arsenal Football Club because  they believe Arsenal breached a “gentleman’s agreement” to sell forward, Alexis Sanchez, for £55m, before the transfer window closed on 31 August.

Irrespective of whether the story is true, it is a reminder of the importance of ensuring that vital terms are in place to make contracts binding.

As well as the need for an offer and acceptance, there must be ‘consideration’ for a contract to be valid – i.e. a party must receive something in return for what they have given or promised. Here, the exchange of £55 million and Alexis Sanchez meets that requirement.

The two most pressing concerns in this situation are whether there was an intention to create legal relations - and to what extent there was a certainty of terms.

In deciding whether the parties reached agreement on all essential terms, a court considers whether an honest and reasonable businessman would have concluded from their communications that they had settled all terms required to create legal relations – i.e. an enforceable agreement.

Even if certain conditions had not been agreed, an objective appraisal might decide that a legally binding contract was intended to exist.

To avoid a dispute over whether this has been reached, it is essential to make it clear whether a proposed agreement is intended to be binding or not – and then ensure that this is formally recorded.

It is unclear whether the football clubs in question followed this advice if/when they were in discussions about Alexis Sanchez.

Always take expert advice from a solicitor who is experienced in litigation law and dispute resolution who can guide you on the most appropriate course - then put this into action.

For more information, contact Andrew Broadbent on 0114 252 1416 or andrewbroadbent@hlwkeeblehawson.co.uk

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