The "P" in "Parties" also needed to be capitalized.
This is because, unlike with punctuation, capitalization was not (and still is not) consistent across legal documents. Some people/firms use all caps for defined terms; others standard capitalization, and many don't capitalize at all on the grounds that a a defined term is not a proper noun unless it is a person, place, or thing.
What was relevant was that the author failed to properly disclosed a "connected person" as defined in the legal agreement. The law he was referencing would have done nothing to address/correct his failure, regardless of the capitalization used.
“In legalese, there is a massive difference between proper and improper nouns.”
Do you understand or would you like more help?