Invalid shares, when there is clearly a problem of moaning with the payment of financial obligations, it has sometimes existed. If there is a revolting issue that is supported by the payment of this loan, customers try not to contact the microfinance transaction in which the loan was granted and may not formalize the mortgage restructuring. – interest that should have been due, “even if Mr. Holyoake had scrupulously complied with the repayment schedule.” In this scenario, the sanctions rule could not be applied, as this provision is not contrary to the violation.- Interests that would not have been charged if Mr. Holyoake had complied with the payment plan. The judge found that “failure to comply with the repayment plan” was the trigger for interest, and it was “undoubtedly a violation of the agreement.” The clause therefore stipulated the sanctions rule. In the second scenario, the question arose as to whether the clause protected a legitimate commercial interest and whether the protection was “extravagant or exorbitant or unacceptable”. The judge again chose to oppose Mr. Holyoake on this point because the clauses providing that the total balance of the debt must be paid in the event of a late payment are standard rules and that the collection of additional interest in addition to this amount is also a common practice.
As the judge noted, there is a strong economic basis: “Once the debtor is late in payment, the creditor is not only kept out of his money, but is at increased credit risk.” COMMENT This case shows that carefully formulated obligations can make a difference in the court`s application of the rule against criminal clauses. It seems that obligations that do not apply in the event of a breach of contract, but in the event of non-compliance with a condition, should not be covered by the rule against the penalty clauses. This is also reflected in the decision of the Edgeworth Capital Court of Appeal2. In this case, the Tribunal found that a “cross-by-default” provision is not contrary to the sanctions rule, since the fee payable has nothing to do with damages for infringement; it was payable for the event of a particular event. This case, as well as the Edgeworth Capital case, may also show a reluctance on the part of the court to use the sanctions rule to thwart standard credit rules. Footnote:1 The Angelic Star  1 Ll Rep 122.2 Edgeworth Capital (Luxembourg) SARL – anr v Ramblas Investments BV  EWCA Civ 412. Although the finger is often directed at lawyers who add increasingly complex projects and provisions to applicable documents, they often solve an already identified problem, or document a commercially agreed position, which is precisely so randomly involved and more complex than the previous transaction. Comparing a loan contract with the LMA form may be a little unfair, given that the LMA form is a very useful form for industry standards, but the business transaction often relies on a “market” precedent that, as described above, has extended over time to both the practical realities of the creditor-debtor relationship and the subsequent development of documents in new forms with additional characteristics. Ironically, a shorter time frame for financial statements may lead to even longer and shorter documents, as parties tend to add additional wording (particularly the nature “regardless” of the nature of the crossing) to score a point, rather than accurately voting on certain equivalent terms.