P&G supplied products to S. The contract provided for prices stipulated in euros, with payment to be made in pounds. There was no mention in the contract itself of any particular exchange rate. However, a document appended to the contract showed P&G’s manufacturing budgets and had an annotation at its foot which gave an exchange rate for pounds to euros. S argued that the annotation in that document represented the exchange rate. P&G said that there was no way the parties had intended that document to fix an exchange rate.
The High Court agreed with P&G. If the exchange rate had been intended to be fixed, it would not have been included in such a casual and elliptical way. It was also not necessary to imply a term into the contract to fix the exchange rate. Accordingly, the general rule – that a payer must provide enough of the agreed currency of payment to cover the current of account at the prevailing exchange rate when payment was due – applied.