Commercial bulletin: key developments for businesses in September 2026

Loss of bargain damages are recoverable for non-repudiatory breach

The Supreme Court has provided an important ruling concerning whether a party will be entitled to recover a claim for a ‘loss of bargain’ (e.g. the profits that would have been earned had the contract been properly performed).

The defendant argued that, following an old 1963 Court of Appeal decision, a party can only recover for a loss of bargain if there has been a breach that’s so serious that it goes to the root of the agreement, otherwise known as a repudiatory breach.

Whilst the Supreme Court did not overturn the 1963 decision it did criticise it and found that, in this instance, the claimant was entitled to claim for its loss of bargain.

It should be noted that in this case there were detailed contract terms that were helpful to the Claimant’s case.

The decision now leaves uncertainty on whether a party can recover a loss of bargain if the contract terms are not clear on whether such losses will be recoverable.  

Good intentions are not enough

A recent Supreme Court decision provides an important reminder that company directors must do more than simply believe they are acting in the company’s best interests. The case involved a director who thought delaying a company sale would deliver a better outcome for shareholders. However, rather than openly challenging the board’s agreed strategy, he pursued his preferred approach while withholding key information from other directors. The Court found that this conduct breached directors’ duties.

The judgment reinforces that good faith is not just about intentions. Directors must also follow proper governance processes and act transparently; disagreements must be addressed openly in the boardroom, not behind the scenes.

Update on Braganza duty in contract law

A recent Commercial Court decision in CIT Group Finance v SpiceJet provides guidance on when a contractual discretion will be subject to a so-called “Braganza duty”. This duty, derived from a 2015 Supreme Court case, can require parties exercising contractual discretion to act rationally, in good faith and consistently with the contract’s purpose.

The dispute arose after aircraft leasing arrangements were terminated and replaced with agreements allowing CIT to revert to the original leases if SpiceJet breached certain obligations. SpiceJet argued that CIT’s discretion to do so should be constrained by a Braganza duty. The Court disagreed. It held that the duty does not automatically apply simply because a contract uses the word “discretion”. Instead, the question depends on the wording, structure and commercial context of the contract.

The judgment reinforces that there is no general duty of good faith under English contract law; Braganza duties remain on of the few exceptions.

What does it mean when information is in the public domain for NDAs?

A recent Court of Appeal decision has provided important guidance on what it means for information to be in the “public domain” for the purposes of NDAs. In Illiquidx v Altana Wealth, the court confirmed that information does not lose its confidential status simply because it has been shared with a large number of people. In this case, around 200 potential investors.

The key test is whether the information is so widely accessible that it can no longer reasonably be regarded as confidential. Confidentiality is a relative concept; information does not need to be completely secret to receive legal protection.

Clarification on the meaning of “unforeseeable”

A recent High Court decision has provided important guidance on the interpretation of the term “unforeseeable”. The court held that an unforeseeable event is not simply something that could not reasonably be predicted. Instead, in the context of a force majeure clause, it means an event with a “negligible probability” of occurring when the contract was entered into.

The case arose from delays to grain shipments after inspectors unexpectedly halted vessel inspections. The court found that an extended suspension of inspections could qualify as unforeseeable, even though shorter disruptions had occurred previously.

Importance of liability caps in professional services contracts

A recent case has provided a stark reminder that the Unfair Contract Terms Act (UCTA) may render liability caps in contracts void.

In this instance which involved a claim against a law firm, the law firm succeeded in enforcing its liability cap, but only because, on technical arguments and due to the international nature of the contract, UCTA did not apply.

The more interesting part of the case was the Judge’s comments that if UCTA had applied, the law firm’s liability cap of £3m would have been unreasonable. The Judge identified three key factors.

• The firm’s wider financial resources were relevant: although its balance-sheet insolvent, it was likely to have support from its UK parent, which had substantial net assets.
• The available professional indemnity insurance was understood to be around £30 million.
• The cap assessed against the scale of the underlying claim was disproportionately low.

The ASA’s decisions on Eurowings and Qatar Airways

On 15 July, the ASA published two rulings relating to environmental claims by Eurowings and Qatar Airlines. The ASA found that both airlines’ advertisements gave consumers the impression that flight emissions could be compensated through environmental programmes offered during the booking process, but neither airline provided sufficient evidence to support these claims. Interestingly, both advertisements were identified through the ASA’s AI monitoring system.

The decisions form part of a broader crackdown on greenwashing. The ASA stressed that environmental claims must be clear, evidence-based and not misleading.

CMA v Emma Sleep

The High Court has provided a partial ruling in the CMA’s long-running case against Emma Sleep which concerns retailers using “was/now” pricing. The CMA argued that businesses should meet a fixed sales ratio, requiring one item to be sold at the higher reference price for every two sold at the discounted price. However, the Court rejected this approach, finding that low sales volumes alone do not automatically make a reference price misleading.

The Court has told the CMA and Emma Sleep to find a different approach to determine when “was/now” pricing is acceptable and to come back to Court before Christmas if they cannot agree.

Until we receive more guidance from the Courts, we recommend that businesses consider the  pricing guidance available from the CTSI and the ASA and, importantly, ensure they have robust evidence to support pricing claims.

Consumer law enforcement

Consumer law enforcement remains firmly in the CMA’s sights. On 29 July, the CMA launched an investigation into Microsoft 365 subscriptions, focusing on the rollout of Copilot and concerns around automatic renewals at higher prices. It then opened a further three investigations on 19 August into alleged drip pricing involving Trainline, Virgin Atlantic and RED Driving School, examining whether mandatory fees and local taxes were being presented transparently to consumers.

Looking ahead, the CMA is expected to provide an update on its investigation into Ryanair’s family seating policy in December. The government is also consulting this autumn on whether practices such as invented discounts should become banned commercial practices under the DMCC Act.

With the new subscription regime arriving earlier than anticipated in January 2027, businesses should review their subscription models now. It is also a timely opportunity to review the CMA’s updated guidance on unfair consumer terms.

SRA’s Warning Notice on the misuse of AI and new statement on liability for AI harms

Two recent developments highlight the growing legal and regulatory focus on the responsible use of AI. The SRA has issued a Warning Notice reminding law firms that they remain accountable for AI-generated work, citing concerns around inaccurate outputs, fabricated legal authorities, confidentiality breaches and the misuse of client data. The SRA emphasised the need for robust governance, human oversight and safeguards to protect confidential information.

Similarly, the UK Jurisdiction Taskforce has published a statement examining who may be liable when AI systems cause harm. Rather than calling for entirely new laws, the statement concludes that existing legal principles, including negligence, misrepresentation and product liability, can often address AI-related disputes.

Together, these developments send a clear message: AI can deliver significant benefits, but organisations must consider strong oversight, clear accountability and effective risk management.

ICO’s guidance on how to process personal data relating to crimes

The ICO has published guidance to help businesses use personal data to prevent crime while remaining compliant with data protection law. The guidance responds to growing concerns about balancing crime prevention with privacy obligations.

The ICO confirms that businesses can use tools such as CCTV, dashcams and video doorbells to protect their premises. However, information relating to suspected criminal activity is classed as criminal offence data, meaning organisations must take additional compliance steps, including carrying out Data Protection Impact Assessments and maintaining appropriate policies on data handling and retention.

The guidance also covers information sharing, stressing that businesses should share suspected offender information carefully, and not post images of suspected offenders on social media.

The ICO also addresses facial recognition technology, emphasising that its use in public spaces faces a high legal threshold. Businesses must be able to demonstrate necessity, consider less intrusive alternatives, and minimise privacy risks before deploying it.

The EU AI Act updates

The EU AI Act has entered a new phase, with transparency obligations under Article 50 now in force. New European Commission guidance requires clear disclosure when people interact with AI systems, when deepfakes are used, and when certain AI-generated content is published. Providers and deployers must also implement appropriate labelling and marking measures, with non-compliance carrying fines of up to €15 million or 3% of global annual turnover.

For advertisers and agencies, the changes are particularly significant. Anyone deploying deepfakes may need to label content where it resembles real people, events or products that could appear authentic to consumers. Responsibility may sit with both advertisers and agencies.

Legislation

New regulations, will extend the time limit for most statutory employment tribunal claims from three to six months from 1 October 2026.

The change applies only where the claim’s relevant date falls on or after 1 October 2026; earlier claims remain subject to existing time limits. The reform was introduced under the Employment Rights Act 2025.

Consultations and codes of practice

Acas publishes revised draft Code of Practice on Disciplinary and Grievance Procedures and launches consultation

ACAS has issued a revised draft Code of Practice on Disciplinary and Grievance Procedures. The draft Code brings informal resolution within the scope of the statutory Code for the first time.

Under the draft Code:

• employment tribunals could increase or reduce compensation by up to 25% where an employer or worker unreasonably fails to engage with informal steps to resolve workplace concerns, where it is just and equitable to do so, and
• employers and staff are expected to attempt early resolution where appropriate and explain what informal steps have been taken before commencing formal procedures.

ACAS is consulting on the proposed changes until 23 September.

Electronic and workplace balloting – new Code of Practice

On 25 August, legislation permitting electronic and hybrid voting in statutory trade union ballots came into effect. It is supported by a new Code of Practice which provides guidance on electronic and workplace balloting.

Recent cases

Part-time status need not be sole cause of less favourable treatment under Part-time Workers Regulations

The Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 (the Regulations) prohibit less favourable treatment of part-time workers compared with comparable full-time workers unless it is objectively justified.

The Supreme Court has clarified that the Regulations are breached where part-time status is an effective cause of the treatment.

In Augustine v Data Cars Ltd a part-time taxi driver challenged a flat weekly circuit fee charged to all drivers regardless of hours worked. Earlier Scottish authority required part-time status to be the sole cause of the treatment. Overturning that approach, the Supreme Court held that part-time status need only materially influence the treatment, aligning the test with broader discrimination law principles.

Right to be accompanied requires a request

In Wolfe v Taka Mayfair Ltd the EAT confirmed that the statutory right to be accompanied at disciplinary or grievance hearings only arises if the worker requests accompaniment.

The claimant was dismissed at an unexpected meeting and argued he had not requested a companion because he was unaware of the meeting’s purpose. Rejecting the claim, the EAT held that the statutory wording is clear: without a request, the right does not arise, even if the meeting’s purpose was not explained.

Vicarious liability to a third party for employees’ torts does not transfer under TUPE

In ABC v Huntercombe (No.12) Ltd the Court of Appeal has confirmed that TUPE, which protects employees’ rights and employment-related liabilities when a business transfers, does not transfer an employer’s vicarious liability to third parties. ABC, a former psychiatric patient, alleged abuse and excessive restraint by hospital staff before ownership of the hospital transferred to another company under TUPE. ABC argued that the transferor’s liability passed to the transferee.

The claim failed in the High Court and the Court of Appeal unanimously dismissed the appeal, holding that TUPE is concerned with employee rights, not third-party claims.