Results | Nov 2, 2021

LOLG Successful in Enforcing
Valuable Tax Indemnity

Back to all news On November 1, 2021, the Superior Court (Commercial List) granted judgment in a major commercial tax indemnity dispute. Crawford Smith and Zain Naqi acted for the successful applicants. The case involved the interpretation of tax indemnities in a share purchase agreement for the sale of a mine in Finland. After the purchase agreement was signed, the purchaser Boliden, a leading Swedish mining company, was reassessed tens of millions in Euros in additional taxes and penalties by Finnish tax authorities arising out of a restructuring carried out by the seller, First Quantum Minerals, while it owned the mine. LOLG argued that the applicants were entitled to full indemnity. Justice Penny agreed, finding that First Quantum had given a “broad, unqualified promise” that there were no grounds for a reassessment and that it had breached its representations and warranties to Boliden. His Honour granted judgment for over €8 million, with additional amounts to be determined. This is an important decision for the interpretation of tax indemnities entered into by sophisticated commercial parties. Read the Reasons for Judgment here: 2021 11 01 - Boliden Mineral AB v FQM Kevitsa Sweden Holdings AB