Advanced Technology Structures Ltd v Cray Valley Products Ltd

JurisdictionEngland & Wales
Judgment Date21 December 1992
Date21 December 1992
CourtCourt of Appeal (Civil Division)

Court of Appeal

Before Lord Justice Glidewell, Lord Justice Leggatt and Lord Justice Hirst

Advanced Technology Structures Ltd
Cray Valley Products Ltd

Practice - champerty - managing director assisting company

Champertous agreement is void

An agreement under which a managing director agreed to use all reasonable endeavours to assist his company in prosecuting proceedings in consideration for the payment of one-third of any damages recovered by the company net of their direct losses and legal costs was champertous and therefore void.

The Court of Appeal so stated in dismissing an appeal by Anthony Raymond Pratt against the judgment and order of Judge Davies refusing Mr Pratt's application to be substituted as plaintiff in an action between the plaintiffs, Advanced Technology Structures Ltd, and the defendants, Cray Valley Products Ltd.

Mr Desmond Wright, QC and Mrs Karen Troy-Davies for Mr Pratt; Mr Roger Toulson, QC and Mr Justin Fenwick for the defendants.

LORD JUSTICE HIRST said that the intended plaintiff's case was that he should be substituted as a necessary party to the action under Order 15, rule 7(2) of the Rules of the Supreme Court on the footing that the plaintiff company, which had no assets, had validly assigned its cause of action against the defendants to him, and that he was the only person able effectively to pursue it, seeing that, although he was also devoid of means, he was entitled to legal aid and the plaintiff company was not.

The plaintiff company, which was owned 100 per cent by a Mr and Mrs Ashfield, issued a writ against the defendants in January 1986 claiming tens of millions of pounds for misrepresentation, negligence and breaches of contract.

Mr Pratt had been appointed managing director in December 1985. On September 17, 1986 an oral agreement was entered into that Mr Pratt would continue to use all reasonable endeavours to assist the company in the prosecution of the proceedings in consideration of the payment to him of one-third net of the damages recovered.

On November 5, 1991 the plaintiff company and Mr Pratt executed an assignment under which, inter alia, the company assigned all its rights of action to him.

Champerty was defined in Halsbury's Laws of England (4th edition, vol 9, para 400) as "maintenance of an action in consideration of a promise to give the maintainer a share in the proceeds or subject matter of the action".

An agreement which...

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17 cases
  • Norglen Ltd v Reeds Rains Prudential Ltd
    • United Kingdom
    • House of Lords
    • 27 November 1997
    ...order for security made by the District Judge. The judge held, following the decision of the Court of Appeal in Advanced Technology Structures Ltd. v. Cray Valley Products Ltd. [1993] B.C.L.C. 723, that the assignment of the cause of action should not be recognised or given effect because i......
  • Eurocross Sales Ltd and Another v Cornhill Insurance Plc
    • United Kingdom
    • Court of Appeal (Civil Division)
    • 13 July 1995 impose the disputed payment condition on Mr Sood? 32 In contending that it is, Miss Lee relies strongly on Advanced Technology Structures Limited v Cray Valley Products Limited [1993] BCLC 723. The facts of the case are important. The plaintiff company issued a writ against the defendant......
  • Norglen Ltd v Reeds Rains Prudential Ltd
    • United Kingdom
    • Court of Appeal (Civil Division)
    • 29 March 1996
    ...J, made two orders. First, applying the decision of this court in Advanced Technology Structures Limited v Cray Valley Products Limited [1993] BCLC 723, he dismissed a summons by Mr and Mrs Rodgers to be substituted for Norglen Limited as plaintiff in this action. Secondly, he ordered that ......
  • Circuit Systems Ltd ((in Liquidation)) and Another v Zuken-Redac (UK) Ltd (Formerly Racal Redac U.K. Ltd)
    • United Kingdom
    • Court of Appeal (Civil Division)
    • 29 March 1996
    ...reached his decision in November 1994. But we begin with the case of Advanced Technology Structures Ltd v. Cray Valley Products Ltd (1993) BCLC 723. There a company had started an action in 1986 as plaintiff claiming tens of millions of pounds in damages. (The headnote asserts that shortly ......
  • Request a trial to view additional results

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