Addleshaw Goddard

UK 200 2014 position: 22

Paying the penalty in a football case

In a recent claim brought against Blackburn Rovers Football Club by Henning Berg, its manager, the High Court decided that a contractual payment due as compensation on early termination of Berg’s fixed-term contract by the club was not a penalty and was enforceable.

Blackburn Rovers terminated Berg’s three-year fixed-term contract after just 57 days in the job. There was a provision in Berg’s contract giving Blackburn Rovers the express right to terminate, provided that the club notified him in writing and paid him a sum equal to his gross basic salary for the unexpired balance of the fixed period (£2.25m) as liquidated damages.

The club initially admitted that it was liable to pay the penalty of £2.25m, but later argued that the contractual provision was a penalty clause and therefore unenforceable. It was in the club’s interest for the clause to be deemed a penalty as that would mean that payment under it could not be enforced by Berg, who would then only be entitled to damages for breach of contract under normal contractual principles. That would require him to mitigate his loss, limiting his entitlement to damages by requiring him to take steps to find alternative employment…

If you are registered and logged in to the site, click on the link below to read the rest of the Addleshaw Goddard briefing. If not, please register or sign in with your details below.

Sign in or Register to continue reading this article

Sign in


It's quick, easy and free!

It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.

Register now

Why register to The Lawyer


Industry insight

In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.


Market intelligence

Identify the major players and business opportunities within a particular region through our series of free, special reports.


Email newsletters

Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.

More relevant to you

To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.

Analysis from The Lawyer

View more analysis from The Lawyer


Milton Gate
60 Chiswell Street

Turnover (£m): 171.35
No. of lawyers: 598