[1] The case should not be confused with Dunlop Pneumatic Tyre Co Ltd v Selfridge & Co Ltd,[2] which held that the same resale price maintenance practice was unenforceable against a third party reseller as a matter of the English rule of privity of contract.

The Court of Appeal held by a majority that the clause was a penalty and Dunlop could only obtain nominal damages.

To assist this task of construction various tests have been suggested, which if applicable to the case under consideration may prove helpful, or even conclusive.

These appeals, which raised similar legal issues, gave the Supreme Court an opportunity to review the law on penalties based on Dunlop.

For many years, the courts have struggled to apply standard tests formulated more than a century ago for relatively simple transactions to altogether more complex situations.