Fairford Water Ski Club Ltd v Craig Ronald Cohoon

JurisdictionEngland & Wales
Judgment Date28 February 2020
Neutral Citation[2020] EWHC 290 (Comm)
Date28 February 2020
Docket NumberCase No: E90BS009
CourtQueen's Bench Division (Commercial Court)

[2020] EWHC 290 (Comm)




Bristol Civil & Family Justice Centre

2 Redcliff Street





(Sitting as a Judge of the High Court)

Case No: E90BS009

Fairford Water Ski Club Limited
(1) Craig Ronald Cohoon
(2) Scott Richard Cohoon
(3) Jane Louise Cohoon
(4) Craig Cohoon Watersports (A Firm)

Siward Atkins (instructed by Wilmot & Co) for the Claimant

Hugh Sims QC and Katie Gibb (instructed by Harrison Clark Rickerbys Limited) for the Defendants

Hearing dates: 7 th to 11 th and 17 th October and 29 November 2019

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.




This judgment comprises the following sections:

(1) Introduction and Background: paras. 2 to 25

(2) The Proceedings: paras. 26 to 46

(3) Legal Principles: paras. 47 to 158

(4) Witnesses: paras. 159 to 190

(5) The Claims

a) Management Fees and Charges: paras. 191 to 307

b) Unexplained Payments (presumed to be for a defendant's benefit): paras. 308 to 330

c) Specific Payments (alleged to be for a defendant's benefit): paras. 331 to 386

d) Payments Not Collected or Not Accounted For: paras. 387 to 415

e) Property-related Dealings: paras. 416 to 530

(6) Conclusion: para. 531

(1) Introduction and Background


This is my judgment following the 7 day trial of a claim in which the claimant (“ the Club”) seeks to hold each of the defendants accountable for monies and property which, to summarise, it alleges were misappropriated from it through the actions of the defendants. In response to that claim the fourth defendant (“ Watersports”) has counterclaimed for payment of a management fee which it says is due to it in respect of a period of time after January 2017 following the termination of an agreement for its management of the Club's premises (and which, although pleaded primarily as an ongoing period, was identified in closing submissions as being a period of one year as representing a reasonable period of notice of termination of the management agreement relied upon).


It will be apparent from what I say below that the length of the trial (itself longer than originally fixed) did not permit proper consideration of every one of the nigh-on 300 transactions that remained in issue between the parties. I should therefore state at the outset that despite the parties' voluminous closing submissions – the defendants' ran to 79 pages and was accompanied by 5 detailed appendices of spreadsheets and tables comprising dozens more – I have come to the clear conclusion in preparing this judgment that many of them cannot be decided against the defendants as if each had been given proper consideration at trial.


The Club was incorporated in 1976 under the name of Cotswold Motor Boat Racing Club Limited. It adopted its present name in 1999. Its business is that of running a members' club centred upon water skiing activity on a lake and surrounding land near Fairford, Gloucestershire (“ the Site”). The Club owns the Site (though the water in the lake belongs to Thames Water). It is the payment of a Club membership fee which entitles a club member to water-ski on the lake. If any member brought a guest skier then a guest fee was payable to the Club (though at Section 5(d) of this judgment I address an issue over the Club's entitlement).


The Club's turnover is based not only upon membership and guest fees but also extends to income generated from renting and selling (on long leases) the lodges and static caravans situated on or near the lakeside and which are generally occupied for leisure purposes rather than as all-year-round dwellings. When its business first started those who stayed at the Site did so in touring caravans. However, over time, the Club moved to leasing or selling static caravans and lodges, though there remains an area where touring caravans can be parked. The Site now accommodates 41 static caravan sites (sometimes referred to at trial as “statics”) and 18 lodges (alternatively described as log cabins).


The lodges are constructed out of two wooden units which are then cladded. The main supplier of them was a company called Salop Leisure (“ Salop”). The lodges are situated at the north end of the Site, near the Coln river and are known as the Coln River Lodges.


In addition to the statics and lodges, there is also the area at the site on which visitors in touring caravans can pay to stay during the 7 months of April to October.


In order to avoid confusion on the point, in circumstances where the witnesses have referred to the Club's “members” usually with a meaning different from that to be taken by a company lawyer, I will refer to the members of the Club, as a corporate entity, as “shareholders” and to members of the water ski club operated by it as “members”. Not all shareholders are members and not all members are shareholders. Neither do all occupiers of lodges or statics take to the water on skis.


I will, without intending any discourtesy to the individuals concerned, refer to the first three defendants by their first names (as the parties did during the course of the trial): Craig, Scott and Jane. Craig is the father of Scott and the husband of Jane. Craig and Jane were married in 2017, though they had been living as man and wife for some years before.


In addition to being a proprietor of Watersports, Craig was a director of the Club between around 1977 and his resignation on 16 January 2017. He had been involved in water skiing at the Site from earlier in the 1970's when an unincorporated entity was responsible for permitting the use of the lake by members for power boat racing and, when not being used for that activity, water skiing. By the time the Club was incorporated Craig was giving water skiing lessons during summer evenings and weekends. By the late 1980's, at a time when water skiing had taken over from power boat racing as the preferred activity, Craig was living in a touring caravan at the Site.


Scott was a director of the Club between November 2007 and 27 February 2017 when he too resigned. Scott was also its Company Secretary between those dates. Scott is a qualified water ski instructor.


Although not a point flagged in the Defence, Jane is now said by the defendants to have been an alternate director (to act, as required, in place of either Craig or Scott) and they say she took no active role and received no director's remuneration as other directors did (sometimes by way of a credit against their member's fee). Jane was appointed as a director on 15 February 2015 and like Craig resigned from office on 16 January 2017. The Club did not accept Jane's alternate director status, saying that there is no written record of her being appointed as such in accordance with the Club's Articles. The defendants responded by saying that Jane was not challenged on her position in cross-examination. I return to this issue below.


Jane is also a qualified water ski instructor with approximately 20 years' experience. Over the years she has helped out in the business of Watersports on an irregular basis when there was a shortage of staff, both by giving skiing lessons and, less frequently, helping out in its shop.


It is appropriate to note at this stage that Craig, Scott and Jane were not the only directors of the Club in the period prior to 2017. I mention below the previous directorships of Mr Colin Garner (“ Mr Garner”) and Mr Ian Hamilton (“ Mr Hamilton”), each of whom gave evidence at the trial, as well as that of Mr Derek Thompson (“ Mr Thompson”, who died in 2007). Since early 2017, and following the Club's discovery of matters which have prompted it to make this claim, the Club has been under the directorship of Mrs Christine Owens (“ Ms Owens”, who is the wife of Mr Garner) and Mr Paul Godden (“ Mr Godden”).


Watersports is an unincorporated business which is independent from the Club. Craig established the business in the early 1980's. Although the Club had alleged that Watersports is a partnership between Craig, Jane and Scott, at the start of the trial it was recognised that only Craig and Scott were partners at the times material to these proceedings. After working in Watersports' business for a year towards the end of the 1980's, Scott returned from other employment to work full time in the business with Craig in around 1994.


The business of Watersports involved running a water ski school at the Site, providing lessons for skiers, and operating a shop for the sale of water ski equipment. The ski school was established before the shop.


Watersports occupied its premises and made use of the lake under a 10 year lease granted by the Club (by its former name) to Craig in 1995 and subsequently under a 15 year lease (effective from May 2007) which was formalised in June 2012.


For some time Watersports' shop was located in a portacabin on the Site but it was later moved to part of a building built as a shop (the subject of the 1995 lease) and shower block and then, later again from around 2007, from the building located in the Site known as the Old Rangoon Pub (the subject matter of the 2012 lease). Customers of the shop would obviously include members of the Club. Guests of members would also take advantage of the skiing lessons on the lake provided by Watersports.


After Craig and Scott ceased to be directors of the Club, Watersports severed its connection with the Site. Its business is now confined to its shop which is now located nearby at Parry's Barn, London Road, Fairford.


At all times material to these proceedings before 2017 the Club's day-to-day...

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2 firm's commentaries
  • Fairford Water Ski Club Ltd V Cohoon
    • United Kingdom
    • Mondaq UK
    • 2 June 2021
    ...Water Ski Club Ltd v Cohoon & Anor [2021] EWCA Civ 143 the Court of Appeal allowed an appeal against the decision of HHJ Russen ([2020] EWHC 290 (Comm)) holding Mr Cohoon and two other defendants liable for breaches of duty in proceedings brought by Fairford, a company of which Mr Cohoon ha......
  • 2020 Summer review M&A legal and market developments
    • United Kingdom
    • JD Supra United Kingdom
    • 20 September 2020
    ...involves receiving a payment from the company, the amount of the payment must be disclosed. (Fairford Water Ski Club Ltd v Cohoon [2020] EWHC 290 (Comm))Strict application of principle of shareholders’ unanimous consentThe Court of Appeal decided that, for the principle of shareholders’ una......

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