This will be a fully consensual private contractual agreement between the creditors and the debtor company. If the parties disagree on the meaning or effectiveness of their standstill agreement and the defendant`s case is correct, the claimant may argue that the defendant is prevented from invoking its contractual rights. This may occur if there is a common acceptance of the importance of the agreement (known as Estoppel by convention) or where the defendant has abused the applicant`s manifest error from an unfair point of view. A standstill agreement may maintain the applicant`s position of limitation by suspending or extending the time limit. Where the standstill agreement results in a suspension of the time limit, the applicant shall, on expiry of the standstill period, have the same period for asserting his claim as at the time of the agreement. If the standstill agreement merely extends the time limit, the applicant must bring an action after the expiry of the standstill period. The defendants provided surveying and project management services for the applicants` construction project. The project was marked by difficulties for which the plaintiffs held the defendants responsible. The parties entered into three standstill agreements, the third of which expired on 30 November 2016. On 1 December 2016, the applicants charged the defendant. The defendants argued that the claims were time-barred.
This term is generally used in three quite different contexts: (i) in certain acquisition situations where a company and a shareholder agree to limit the shareholder`s ability to acquire other shares in the company; (ii) in agreements which have the effect of preventing or extending statutory limitation periods for different types of rights; and (iii) in a restructuring context where a private agreement has been entered into between the creditors and the debtor enterprise. It is the latter form of status quo agreement that is discussed in this article. Often, parties enter into standstill agreements when they approach the expiry of a limitation period. This case shows the difference between the period of suspension and the extension of the time for the purpose of prescription in a standstill agreement. As regards interpretation, the Tribunal found that the standstill agreement had a suspension of the time limit, which meant that the remainder of the limitation period continued after the expiry of the standstill agreement. Although the Tribunal did not remove the opportunity for claimants to assert a right, reminds the case of the importance of considering limitation issues and acting prudently in negotiating standstill agreements: (1) Stuart Howard Russell (2) Naomi Patricia Russell vs. (1) Peter Stone (negotiable as PSP Consultants) (2) PSP Consultants Limited (3) PSP Consultants (a company)  EWHC 1555 (TCC) . . .