Q&As

What is the meaning of the expression ‘so far as the seller is aware’, ‘to the seller’s best knowledge, information and belief’ (or similar expressions) where used to qualify warranties in a share purchase agreement or asset purchase agreement?

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Produced in partnership with Hannah Laithwaite of Lamb Chambers
Published on: 05 May 2017
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The need for warranties

In a Share or asset purchase, there is no statutory or common law protection as to the assets and liabilities being acquired. The practice of building in robust warranties into any contract to protect a buyer is therefore commonplace, as are attempts by sellers to limit their liability under the warranties.

One method of limiting liability under a warranty or representation is to qualify the Knowledge which the seller is deemed to have within the transaction, on the basis that it cannot be expected to disclose matters which it does not know about. A buyer will, however, typically resist such qualification for the majority of warranties (unless the seller is a trustee, administrator or similar, or perhaps in an auction sale process heavily weighted towards the seller).

Knowledge qualifiers

Common examples of knowledge

Hannah Laithwaite
Hannah Laithwaite

Lamb Chambers

Hannah is a barrister specialising in commercial chancery work, insolvency, property and construction work. She provides advisory, drafting and advocacy expertise at all stages of the litigation process with an emphasis on providing a practical and efficient service. Hannah was called to the bar in 2012 and is a tenant at Lamb Chambers.

Hannah has provided seminars and training on a range of topics, most recently including: corporate insolvency: winding up petitions; the advent of the Insolvency Rules 2016; property notices and break clauses in the context of commercial leases; and rights to light in a development context.

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Jurisdiction(s):
United Kingdom
Key definition:
Knowledge definition
What does Knowledge mean?

Knowledge is knowing that something is so, or being “virtually certain” about something.

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