The parties concluded an exclusive distributorship agreement in 1987. The agreement provided for termination on not less than twelve months’ written notice, unless specific breaches justified immediate termination. In June 1991, following a corporate takeover and restructuring within the appellant’s group, the appellant sent two letters to the respondent indicating that the distributorship agreement was being terminated. These letters made no reference to the contractual twelve‑month notice period and conveyed that termination had already occurred, while suggesting negotiation of a convenient termination date. The respondent did not immediately reply but circulated an ‘agency announcement’ to its customers stating that it had decided to cease representing the appellant and had taken on a rival supplier. After receiving the announcement from a third party, the appellant alleged that the respondent had repudiated the agreement and purported to cancel it. Litigation followed in which the respondent counterclaimed for damages, alleging that the appellant had itself repudiated the agreement by its June 1991 letters.