Taking a Chance on Good Faith

In Matière SAS v ABM Precast Solutions Ltd [2025] EWHC 1434 (TCC), the TCC found that there had been a breach of a good faith obligation, but the breach did not cause the loss of a chance. This decision is a useful reminder about the meaning of ‘good faith’ and the challenges in establishing a loss of chance claim.

Facts

Matière SAS (Matière) and ABM Precast Solutions Ltd (ABM) agreed to jointly bid for a sub-contract relating to the HS2 rail project. The plan was that Matière would design three ‘cut and cover’ tunnels (and coordinate their installation), with ABM providing the pre-cast concrete tunnel linings.

The parties did not enter into a formal joint venture arrangement, but did execute a number of agreements in relation to the proposal. Two of these included ‘good faith’ obligations.

The bid failed. ABM sued Matière for breach of the good faith obligations. ABM claimed that Matière’s breach had caused ABM to lose a chance for the bid to succeed.

Decision

The Court determined that Matière had breached its good faith obligations. It found that Matière, when speaking to the main contractor alone, had undermined ABM’s proposal to manufacture the concrete in a factory in Scunthorpe. Matière added to this by looking at alternative production sites and alternative manufacturers, without consulting ABM, and in support of a proposal for ABM to be replaced as the supplier of the tunnel linings.

Nevertheless, the Court went on to dismiss ABM’s case. This was because the Court decided that the bid was unlikely to have been successful, in any event. The Court found that the main contractor had its own concerns about the Scunthorpe factory, and that the undermining of the Scunthorpe factory was done with the main contractor’s encouragement. It also found that the main contractor had other concerns about ABM. And that ABM was never in a position to fund the construction of the Scunthorpe factory.

Key takeaways

This case provides useful clarification of a number of points.

First, the Court considered what a ‘good faith’ obligation means, in the context of a joint venture. It decided that it meant that the parties “would act honestly with each other and would not conduct themselves in a manner which would be regarded as commercially unacceptable to reasonable and honest people.” The Judgment provides further authority that ‘good faith’ is not just about behaving honestly, but also commercially.

Secondly, the Court applied the three-stage approach for a loss of chance doctrine: (1) determine whether loss of chance is recognised as a distinct head of damage, (2) establish, on the balance of probabilities, that a chance has been lost, and (3) quantify the lost chance as a percentage. The Court held that for ‘loss of a chance’ claims, there must have been a ‘non-negligible’ chance that has been lost. In this case, the Court decided that a chance of less than 10% would be negligible.

Finally, the case is a reminder to carry out a sceptical review of the evidence supporting a loss of a chance claim. Such claims are inherently difficult, and it is easy to fall into a trap of overestimating how strong the evidence will appear to a neutral observer.

Cassandra Stead, Trainee Solicitor, co-authored the article.