208. Exception For Payments In Discharge Of Legal Obligations Etc

(1) Approval is not required under section 205 (payment by company), 206 (payment in connection with transfer of undertaking etc.) or 207 (payment in connection with share transfer) for a payment made in good faith–
(a) in discharge of an existing legal obligation (as defined below),
(b) by way of damages for breach of such an obligation,
(c) by way of settlement or compromise of any claim arising in connection with the termination of a person’s office or employment, or
(d) by way of pension in respect of past services.
(2) In relation to a payment within section 205 (payment by company) an existing legal obligation means an obligation of the company, or any body corporate associated with it, that was not entered into in connection with, or in consequence of, the event giving rise to the payment for loss of office.
(3) In relation to a payment within section 206 (payment in connection with transfer of undertaking etc.) or 207 (payment in connection with share transfer) an existing legal obligation means an obligation of the person making the payment that was not entered into for the purposes of, in connection with or in consequence of, the transfer in question.
(4) In the case of a payment within both section 205 (payment by company) and section 206 (payment in connection with transfer of undertaking etc.), or within both section 205 (payment by company) and section 207 (payment in connection with share transfer), subsection (2) above applies and not subsection (3).
(5) A payment part of which falls within subsection (1) above and part of which does not is treated as if the parts were separate payments.