Dawnus Sierra Leone Ltd v Timis Mining Corporation Ltd and Another
| Jurisdiction | England & Wales |
| Judge | H.H. Judge Keyser |
| Judgment Date | 11 February 2016 |
| Neutral Citation | [2016] EWHC 236 (TCC) |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Date | 11 February 2016 |
| Docket Number | Case No. B50CF015 |
[2016] EWHC 236 (TCC)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
CARDIFF DISTRICT REGISTRY
TECHNOLOGY AND CONSTRUCTION COURT
Cardiff Civil Justice Centre
2 Park Street, Cardiff, CF10 1ET
His Honour Judge Keyser Q.C.
sitting as a Judge of the High Court
Case No. B50CF015
Andrew Butler (instructed by Douglas-Jones Mercer) for the Claimant
Adam Johnson and Emily Blanshard (of Herbert Smith Freehills LLP) for the Defendants
Hearing dates: 29 January 2016
H.H. Judge Keyser Q.C.:
Introduction
The claimant ("DSL") is a company registered in England and Wales. The first defendant ("TMC") is a company registered in the Cayman Islands. The second defendant ("TMCSL") is a company registered in Sierra Leone. TMC is the sole shareholder of TMCSL. Both companies are part of a group ("the Timis Group") that is ultimately owned and controlled by Mr Frank Timis.
In these proceedings, DSL claims against TMC and TMCSL in the alternative payment of approximately US$18 million for services provided in connection with the operation of Marampa Mine ("the Mine") in Sierra Leone. The defendants' case is that DSL's services were provided to, and pursuant to a contract with, TMCSL and not TMC, and that by reason of substantial pre-payments already made DSL owes TMCSL a substantial repayment.
The contract between the parties-whoever the parties might be-provided that the courts of England and Wales should have non-exclusive jurisdiction. By the time DSL commenced the present proceedings, TMCSL had already commenced proceedings in Sierra Leone. The defendants have applied for an order that the present proceedings be set aside or stayed, on the ground that Sierra Leone is the convenient jurisdiction to determine the dispute. TMC goes further and seeks an order setting aside service of the claim form upon it, on the ground that this court has no jurisdiction over it. DSL resists those applications and itself applies for an injunction to restrain TMCSL from pursuing the proceedings in Sierra Leone.
At the hearing the defendants relied principally on three witness statements from Christoph Erdin, who provides legal services to the Timis Group and was involved in the events giving rise to the relevant contract. They also relied on two short witness statements from Oliver Elgie and Onoriode Aziza, both of Herbert Smith Freehills LLP ("HSF"), who act for the defendants in this country. DSL relied on three witness statements of their solicitor, Hugh Hitchcock, of Douglas-Jones Mercer ("DJM").
I am grateful to Mr Butler and to Mr Johnson, assisted by Ms Blanshard, for their helpful skeleton arguments and oral submissions.
In the remainder of this judgment I shall set out the relevant sequence of events and then discuss in turn the issues arising on the three applications.
Narrative
Until October 2014 DSL was providing services at the Mine to London Mining Company Ltd ("LMC"), which owned the Mine and held the Large-Scale Mining Licence in respect of its operations. LMC entered into administration in autumn 2014. With a view to the acquisition of LMC's assets, the Timis Group incorporated TMC on 10 October 2014 and TMCSL on 24 October 2014. Another company, Timis Mining Corporation (UK) Ltd, was incorporated in England and Wales at about the same time, though it appears that it never traded or carried on any business. After a period of negotiation, on or around 1 November 2014 TMCSL purchased some of LMC's assets, including the Mine, and took a transfer of the Large-Scale Mining Licence. It did not take an assignment of the benefit of, or enter into a novation of, the existing contract between LMC and DSL.
By 20 October 2014 at the latest, DSL was aware that the Timis Group was in discussions with LMC's administrators, and it began communicating with Mr Timis, through his assistants, with a view to ensuring that an agreement would be made to enable DSL to continue providing services at the Mine. The evidence gives no reason to suppose that DSL either knew or particularly cared how Mr Timis was arranging his corporate affairs or precisely what corporate entities he intended to use for the purpose of acquiring the Mine.
After the acquisition of the Mine, negotiations commenced in late October 2014 between Andy Peters of DSL and Victoria Sherwood of the Timis Group, both orally and by email. Ms Sherwood's emails described her as "Executive Director, Timis Mining Corp Limited". According to Mr Erdin she was in fact the Executive Director of TMCSL and had previously been working for another company, African Minerals Ltd, of which Mr Timis was chairman; she was therefore at the time working out of African Minerals Ltd's premises in London.
In an attempt to conclude contractual arrangements between DSL and "the appropriate entity within the Timis Group" (particulars of claim, paragraph 7), on 31 October 2014 Mr Peters sent by email to Ms Sherwood a draft "Interim Operations Agreement", showing the date as 5 November 2014 and the parties as "Timis Corporation Limited, a company registered under the laws of [ ]" and DSL. The parties did not execute it or proceed on the basis of it. Discussions continued both by email and face to face.
On 10 November 2014 Mr Erdin, who had formerly been Head of Legal at LMC and was now working for the Timis Group, sent to Ms Sherwood by email a draft of a Letter of Intent. Underneath his name at the end of the email appeared the words: "Timis Mining Corporation (SL) Limited is registered in Sierra Leone, company number 0000991, and has a registered office at 35 Liverpool Street, Freetown, Sierra Leone." On 11 November Ms Sherwood forwarded that email and the draft to Mr Peters, saying that she had not had a chance to read them and asking Mr Peters to do so.
The draft Letter of Intent was marked "Subject to Contract-for discussion purposes only" and was on headed paper. At the top was the logo of a bull, which was the group logo of the Timis Group, and next to the logo was the name "Timis Mining Corporation Ltd". Underneath was an address: 56B Motor Main Road, Wilberforce, Freetown, Sierra Leone; this was the address at which LMC had carried on its business and the address at which the business at first continued to be carried on after acquisition by TMCSL. At the foot of the page were the words: "Registered address: 35 Liverpool Street, Freetown, Republic of Sierra Leone"; that is and was TMCSL's registered office. The draft Letter of Intent was addressed to DSL and contained the following relevant passages:
You were engaged by London Mining Company Limited ('LMC') pursuant to a certain contract mining agreement (the 'LMC Mining Contract') dated December 3 rd 2012 between LMC and Dawnus Sierra Leone Ltd as Contractor and Dawnus Construction Limited as Guarantor. You have been notified on 3 November 2014 by Price Waterhouse Coopers ('PWC') that an administrator has been appointed for LMC by its board of directors and that the Large Scale Mining Licence No. ML02/09 was transferred to Timis Mining Company (SL) ('TMC' or 'the Company') effective 1 st November 2014 by the Government of Sierra Leone … The Company under this Letter of Intent owns the Site which includes the Marampa Mine …
It is our intention to accept your offer to carry out the Services, subject to the negotiation and execution of a formal mining contract ('the Contract') …
In order to continue the execution of the Service in advance of finalising the Contract …, this will confirm the agreement between TMC and Dawnus ('Letter Agreement') that the Parties hereto have entered into business relationship whereby you would execute and deliver the Services.
Please take this Letter Agreement as our instruction (the 'Notice to Proceed') to commence the Services …
A series of numbered clauses set out the parties' respective obligations under the Letter of Intent. By clause 1 the Company was to make the Mine available to DSL, and by clause 2 it was to provide certain plant and equipment and perform specified services. Clause 6 provided that the Company might by written notice to DSL vary the services to be provided by DSL as might reasonably be required. Clause 15 provided that the Letter Agreement should continue in force until the envisaged Contract had been finalised or, if earlier, until terminated in accordance with its terms; it provided that either party might terminate the Letter Agreement on ten days' written notice. Clauses 9 and 16 provided for payment: the gist was that DSL would be remunerated on a "cost plus" basis, for which it would receive advance payments, and that upon termination of the Letter Agreement there would be a resolution of moneys due. Clause 18 provided:
This Letter Agreement and the parties' respective rights and obligations including all non-contractual obligations arising under or in connection with this Letter Agreement shall be governed by, and construed in accordance with, the laws of England and Wales and the parties irrevocably submit to the non-exclusive jurisdiction of the courts of England and Wales in relation to any claim, dispute or difference which may arise out of or in connection with this Letter Agreement.
At the end of the Letter of Intent was provision for execution by signature. The parties were shown as DSL and "Timis Mining Corporation".
On 14 November 2014 Mr Peters sent to Ms Sherwood a revised draft of the Letter of Intent ("the Revised Letter of Intent"), showing the proposed alterations by track changes. There were many such alterations, many of which concerned the financial arrangements under the Letter Agreement. However, none of the proposed changes had a bearing on the identity of the contracting parties,...
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Contract terms
...per Wheeler Ja. See paragraphs 23.46–23.50. 372 See, by way of illustration, Dawnus Sierra Leone Ltd v Timis Mining Corporation Ltd [2016] EWhC 236 (TCC) at [49]–[59], per hhJ Keyser QC. 373 Euromark Ltd v Smash Enterprises Pty Ltd [2013] EWhC 1627 (QB) at [22]–[25], per Coulson J. 374 rome......
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Table of cases
...Construction Holdings Ltd v Marsh Life Ltd [2017] EWHC 1066 (TCC) III.24.136 Dawnus Sierra Leone Ltd v Timis Mining Corporation Ltd [2016] EWHC 236 (TCC) I.3.87 Dawnus Sierra Leone Ltd v Timis Mining Corporation Ltd [2016] EWHC B19 (TCC) III.26.156 Dawson v Fitzgerald (1876) 1 Ex D 257 III.......