CMC Group plc v Zhang

Repayment clause in settlement agreement was a penalty and unenforceable
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Overview

This Court of Appeal case casts some doubt on the enforceability of 'repayment clauses' commonly contained in compromise agreements. Z signed an agreement settling his claim against CMC for about £21,000. It contained a clause stating that the full amount would be 'immediately repayable' if Z broke any of the terms in the agreement.

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