T&L Sugars Ltd v Tate & Lyle Industries Ltd
| Jurisdiction | England & Wales |
| Judge | The Hon Mr Justice Flaux,The Honourable Mr Justice Flaux |
| Judgment Date | 10 April 2014 |
| Neutral Citation | [2014] EWHC 1066 (Comm) |
| Date | 10 April 2014 |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case No: 2013 FOLIO 445 |
[2014] EWHC 1066 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
The Honourable Mr Justice Flaux
Case No: 2013 FOLIO 445
Mr Ian Mill QC and Ms Leona Powell (instructed by Clifford Chance LLP) for the Claimant
Mr John Nicholls QC and Mr Yash Kulkarni (instructed by Linklaters LLP) for the Defendant
Hearing date: 4 April 2014
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Introduction and background
This is the judgment on a trial of preliminary issues in this matter pursuant to the Order of Walker J dated 16 December 2013. The dispute in this litigation concerns a Share and Business Sale Agreement ("the SBSA") dated 30 September 2010 for the sale of the European sugar business of Tate & Lyle Plc to American Sugar Holdings Inc. Under the SBSA the claimant was the Principal Purchaser and the defendant the Principal Seller. The claimant claims that the defendant is in breach of the express and/or implied terms of the SBSA in relation to three distinct parts of the business transferred at Closing: (i) the defendant's Inward Processing Relief balance; (ii) the sugar futures contracts held in the defendant's hedging books at Closing ("the Futures Claim") and (iii) a biomass plant. It is not necessary for the purposes of the trial of the preliminary issues to set out the detail of those claims. The preliminary issues concern whether or not the claims were issued and served in time within the meaning of the SBSA.
The clauses of the SBSA with which the preliminary issues are primarily concerned are as follows:
" 10.1 Time limitation for claims
No Relevant Seller shall be liable under this Agreement in respect of any Warranty Claim … unless a notice of the claim is given by the Principal Purchaser to the Principal Seller specifying the matters set out in Clause 11.2 …
10.1.2 in the case of any other Warranty Claim, within 18 months following Closing;
11 Claims
11.1 Notification of potential Claims
Without prejudice to the obligations of the Principal Purchaser under Clause 11.2, if a Relevant Purchaser or any Group Company becomes aware of any matter or circumstance that may give rise to a claim against any Relevant Seller under this Agreement … the Principal Purchaser shall as soon as reasonably practicable give a notice in writing to the Principal Seller setting out such information as is available to the Relevant Purchaser or Group Company as is reasonably necessary to enable the Principal Seller to assess the merits of the potential claim, to act to preserve evidence and to make such provision as the Principal Seller or the Relevant Sellers may consider necessary.
11.2 Notification of Claims under this Agreement
Notices of claims under this Agreement (excluding the Tax Warranties) or any Local Transfer Document shall be given by the Principal Purchaser to the Principal Seller within the time limits specified in Clause 10.1, specifying in reasonable detail (to the extent available to the Principal Purchaser) the legal and factual basis of the claim and the evidence on which the party relies … and, if reasonably practicable, setting out the Principal Purchaser's estimate of the amount of Losses which are, or are to be, the subject of the claim (including any Losses which are contingent on the occurrence of any future event).
11.3 Commencement of Proceedings
Any claim notified pursuant to Clause 11.2 shall (if it has not been previously satisfied, settled or withdrawn) be deemed to be irrevocably withdrawn 12 months after the notice is given pursuant to Clause 11.2 … unless at such time legal proceedings in respect of the relevant claim have been commenced by being both issued and served."
Closing, defined as completion of the sale under the SBSA, took place on 30 September 2010. Thereafter the claimant made a number of claims under the SBSA, including the three categories of claims subsequently made in these proceedings, in relation to which the claimant gave a notice in writing under clause 11.2 to the defendant on 30 March 2012, the last day of the 18 month period prescribed by clause 10.1.2 for Warranty Claims. The claimant accepts that the requirement for a notice in writing under clause 11.2 encompasses all claims under the SBSA, not just the particular types of claim specified in clause 10.1, albeit that, for present purposes the time limit in clause 10.1.2 only applies to Warranty Claims. That concession obviates the need to consider Issues 2 and 3 of the preliminary issues.
On 26 March 2013, the defendant's solicitors, Linklaters, confirmed to the claimant's solicitors, Clifford Chance, that they were instructed to accept service of proceedings. On 27 March 2013, the Claim Form was issued and sealed by the Court at the request of the claimant. Also on 27 March 2013, Clifford Chance delivered the original sealed copy of the Claim Form and Particulars of Claim to Linklaters' offices in London by hand, under cover of a letter which referred to Linklaters' confirmation the previous day that they were instructed to accept service and stated that those documents were enclosed by way of service. 27 March 2013 was the Wednesday before Easter.
In [4]–[6] of the Defence and Counterclaim served on 24 May 2013, the defendan contended that all the claimant's claims were contractually deemed to be irrevocably withdrawn because they were not issued and served in time within the meaning of clause 11.3 of the SBSA and in [7] that the Futures Claim was not adequately notified under clause 11.2. It is to those contentions that the preliminary issues are directed.
The two remaining preliminary issues are as follows:
Issue 1
Whether the claimant's claims were "issued and served" within the meaning of Clause 11.3 of the SBSA by 30 March 2013 by the admitted delivery on Wednesday 27 March 2013 of the Claim Form and Particulars of Claim to the defendant's solicitors (who had confirmed on 26 March 2013 that they were instructed to accept service of the same on behalf of the defendant).
Issue 4
What the contractual consequence would be if Clause 11.2 of the SBSA applies to the Futures Claim for the reasons advanced by the defendant in the List of Issues at paragraph 6, and it is determined at trial that the claimant's notice given on 30 March 2012 did not comply with the requirements of Clause 11.2 of the SBSA.
Issue 1
Summary of the defendant's submissions
Mr John Nicholls QC on behalf of the defendant submits in summary that:
(1) The phrase "issued and served" in the context of the SBSA means issued and served in accordance with the Civil Procedure Rules ("CPR"), given that any proceedings would have to take place in England because clause 16.16.2 contains an exclusive English jurisdiction clause.
(2) The phrase does not mean simply delivered and received in a non-legal sense as the claimant contends. The SBSA set out two distinct regimes: one for contractual notices which had to be delivered and received respectively by the claimant and the defendant and the other for the "service" of legal proceedings, from which the court should conclude that it was not intended that service in the latter regime should be synonymous with delivery and receipt of the claim form.
(3) Whilst the delivery of the claim form and Particulars of Claim took place on 27 March 2013, so that the relevant step under CPR 7.5 ("Delivering to or leaving the document at the relevant place [Linklaters' offices]") was completed at that time, by virtue of CPR 6.14, the proceedings were not served until they were deemed to be served on the second business day after the completion of that relevant step under CPR 7.5. The next day, 28 March 2013 was a business day, but because of the intervention of Easter, 29 March was Good Friday, 30–31 March were the Easter weekend, 1 April was a bank holiday, so that none of those days qualified as a business day by virtue of CPR 6.2(b). Accordingly, the second business day after 27 March 2013 was Tuesday 2 April 2013.
(4) Accordingly, the proceedings were not issued and served within 12 months after the 30 March 2012 notice being given, from which it follows that they are deemed irrevocably withdrawn pursuant to clause 11.3.
(5) Although, in relation to a similar provision in a share purchase agreement, that proceedings should be "commenced by validly issuing and serving legal process" within six months of the making of a claim, Green J decided in Ageas (UK Limited v Kwik-Fit (GB) Limited [2013] EWHC 3261 (QB): (i) that the word "serving" was to be given a non-legal business meaning of delivery and receipt of the claim form and (ii) even if it was a reference to service within the CPR, the relevant provision was CPR 7.5, which had been complied with, not the deemed service provision in CPR 6.14, that decision was either distinguishable because it was dealing with a different provision in a different contract or the reasoning was flawed and I should not follow it.
Summary of the claimant's submissions
Mr Ian Mill QC on behalf of the claimant submitted in summary as follows:
(1) The word "served" in clause 11.3 of the SBSA should be given its natural commercial meaning of delivery to and receipt by the defendant's duly appointed solicitors on 27 March 2013, not some strained meaning arising from the peculiarity of one part of the CPR. Green J in the Ageas case was considering a materially identical provision and his analysis was correct and should be followed by this court.
(2) Applying the principle enunciated by Lord...
To continue reading
Request your trial
-
Gary Paice and Another v MJ Harding (trading as MJ Harding Contractors)
...the relevant step under rule 7.5(1). 39 The apparent inconsistency between these two rules was considered by Flaux J in T&L Sugars Ltd v Tate and Lyle Industries Ltd [2014] EWHC 1066 (Comm). Having pointed out that the effect of CPR 7.5, which is headed "Service of a claim form", is that c......
-
Howard Kennedy v The National Trust for Scotland
...in Paxton Jones v Chichester Harbour Conservancy. These were Ageas (UK) Ltd v Kwik-Fit (GB) Ltd [2013] EWHC 3261 (QB); T&L Sugars Ltd v Tate & Lyle Industries Ltd [2014] EWHC 1066 (Comm); and DB UK Bank Ltd v Sinclair Solutions Ltd [2015] EWHC 4219 114 Mr Callus' second argument was that ......
-
Oran Environmental Solutions Ltd v QBE Insurance (Europe) Ltd
...32 The First Claimant contends by reference to the authorities of Mr Justice Flaux in T&L Sugars Ltd v Tate & Lyle Industries Ltd [2014] EWHC 1066 (Comm) at paragraphs 27 – 43, Master McCloud in Paxton Jones v Chichester Harbour Conservancy [2017] EWHC 2270 (QB) at paragraphs 37 – 40 and ......
-
Brightside Group Ltd (formerly Brightside Group Plc) and Others v RSM UK Audit LLP (formerly Baker Tilly UK Audit LLP) and Another
...notice the applicable CPR 7.5(1) step has been completed. He cited Ageas (UK) Ltd v Kwik-Fit (GB) Ltd [2013] EWHC 3261 (QB), T&L Sugars Ltd v Tate & Lyle Industries [2014] EWHC 1066 (Comm), Heron Bros Ltd v Central Bedfordshire Council [2015] EWHC 604 (TCC), decisions respectively of Green ......