Contra Holdings Ltd v Mark Joseph Cyril Bamford
| Jurisdiction | England & Wales |
| Judge | Lady Justice Carr,Lord Justice Newey,Sir Geoffrey Vos |
| Judgment Date | 05 April 2023 |
| Neutral Citation | [2023] EWCA Civ 374 |
| Docket Number | Case No: CA-2022-002030 |
| Court | Court of Appeal (Civil Division) |
| Year | 2023 |
[2023] EWCA Civ 374
Sir Geoffrey Vos, MASTER OF THE ROLLS
Lord Justice Newey
and
Lady Justice Carr
Case No: CA-2022-002030
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
COMMERCIAL COURT (KBD)
Mr Justice Jacobs
Royal Courts of Justice
Strand, London, WC2A 2LL
Paul McGrath KC and Andrew Legg (instructed by Stephenson Harwood LLP) for the Appellant
Laurence Rabinowitz KC and Alexander Polley KC (instructed by Slaughter and May) for the Respondent
Hearing date: 29 March 2023
Approved Judgment
This judgment was handed down remotely at 10.30am on Wednesday 5 April 2023 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
Introduction
This short appeal arises out of another dispute between members of the Bamford family following the death in 2001 of Joseph Cyril Bamford, the founder of the well-known JCB group of companies (“the JCB Group”). Joseph Bamford had two sons: the elder son, Lord Anthony Bamford DL, and Mark Bamford, the younger. Richard Bamford, a chartered accountant, is their second cousin and the chief executive officer of the Appellant (“Contra”), formerly named Touch Worldwide Holdings Limited. For ease of reference and without meaning any disrespect, I identify Anthony, Mark and Richard in this judgment by their first names.
In May 2021 Contra issued proceedings against Mark for breach of a written agreement said to have been entered into by the parties in June/July 2011 (“the Touch Agreement”). Particulars of Claim were served on 9 September 2021. Mark's response (on 11 October 2021) was to issue an application under CPR Part 3.4(2)(a) and CPR Part 24.2 to strike out the claim and/or for reverse summary judgment (“the Application”).
By judgment dated 18 July 2022 Jacobs J (“the Judge”) granted the Application. In doing so, he adopted the approach endorsed in ICI Chemicals & Polymers Ltd v TTE Training Ltd [2007] EWCA Civ 725 (at [12]). He considered that he had before him all the evidence necessary for the proper determination of the relevant issues of contractual interpretation and accordingly “grasped the nettle”, deciding those issues outright. If the case was bad in law, the sooner that it was determined, the better. He ruled in favour of Mark, with the result that Contra had no real prospect of succeeding on its claim.
On appeal Contra alleges that the Judge made errors of law which require correction, and contends that there are evidential matters which demand that the case should proceed to trial. In particular, very shortly before the hearing of the Application, Mark denied key facts leading to the formation of the Touch Agreement; this development is said to suggest that Mark has something to hide from a trial and that the true facts would materially affect the outcome of the claim.
Mark contends that what is in reality Contra's central argument, namely that the Touch Agreement entitles Contra absolutely to a “deferred payment”, does not survive contact with the words of the agreement (and would produce a commercially absurd result). The relevant text clearly distinguishes between Contra's past work for Mark and intended future work in respect of a quite different transaction. Contra seeks to complicate the analysis by leaning heavily on the background to the transaction, but none of the matters relied on, taken at their highest, make out the case being advanced.
The core facts
The Judge summarised the core facts and background to the Touch Agreement up to 17 June 2011 at [7] to [22], essentially by reference to the Particulars of Claim (or documents referred to therein). It is not necessary for me to repeat those paragraphs here, which are to be taken as read, and I adopt where necessary the same definitions as selected by the Judge. It was common ground that, for the purpose of the Application, the material facts pleaded in the Particulars of Claim, including all admissible matters of factual matrix there set out, were true (or were at least to be assumed to be true).
The Touch Agreement
The Touch Agreement was drafted by Richard and entered into by both parties without the assistance of external (legal or other) advisors. It referred to Mark as “MB”, to Anthony as “AB” and to Richard as “RB”. Bermuda Trust Company Limited, the trustee of the AB and MB Trusts (identified by the Judge at [9] and [10]), was referred to as “BTCL”.
It provided materially as follows:
“Agreement for the services of RB
STRICTLY PRIVATE AND CONFIDENTIAL
1) MB will now authorise BTCL to pay from the MB1 trust to Touch a success fee of £2,600,000 for the services of RB up to and including the settlement reached between MB and AB on 17 June 2011.
2) RB will now step back from advising MB as he works directly with Macfarlanes to document and implement the terms of the 17 June settlement, which is expected to be completed by 31 December 2011.
3) MB will continue to privately brief RB on progress towards that completion, and in addition the steps being taken to prepare the JCB Group for sale in 2012 (“Project Crakemarsh”). MB will also, whenever he feels it is appropriate, give assurances to AB regarding MB having used RB as a commercial advisor.
4) AB has accepted that MB will have to have his own advisors for Project Crakemarsh in due course. MB has not and will not give any form of commitment to AB that he will not appoint RB, through Touch, to be his commercial advisor for Project Crakemarsh, and at the appropriate time MB wants to do so. MB expects this to be when either an investment bank is due to be formally appointed to handle the sale of the JCB Group, or when the beneficiaries of the trusts are first consulted on the Project Crakemarsh plan, and may themselves appoint their own advisors.
5) When MB appoints RB, Touch will ensure that RB is available to MB on an exclusive basis to advise on all of MB's interests in the development, negotiation, implementation and completion of Project Crakemarsh.
6) In consideration of these services, MB will take all necessary steps to authorise BTCL (or if applicable any replacement trustee of the MB1 trust) to pay to Touch a success fee on the completion of Project Crakemarsh equal to 2% of the value attributed to the 50% shareholding in the JCB Group held by the MB1 trust and the MB2 trust, less the sum paid under paragraph 1) above.
Signed 1 July 2011”
Although, as set out above, the Touch Agreement stated that it was signed on 1 July 2011, it does not appear in fact to have been signed by or on behalf of either party. Although there is a dispute as to whether any agreement was concluded, the assumption for the purpose of the Application was that the Touch Agreement was a legally binding document.
The first payment envisaged under Clause 1 was paid (in tranches), but there has been no payment under Clause 6. It was common ground that no sale of the JCB Group took place in 2012 or subsequently. (There was a dispute as to whether or not some other form of restructuring has taken place such as to trigger a right to payment under clause 6; but, as the Judge noted, this debate would only be relevant if Contra's case on the proper interpretation of the Touch Agreement were to succeed.)
The principal issue before the Judge was whether any payment under Clause 6 was due. In this regard, Contra's case was as follows:
i) The 2% fee in Clause 6 was also payable if the divestment of the assets or the separation of the interests of Mark in the MB Trusts took a different form than the anticipated sale of the JCB Group, for example if Anthony or the AB Trusts acquired the assets of the MB Trusts, or if some other form of restructuring took place;
ii) Alternatively, a term to the same effect was to be implied (“the first implied term”);
iii) In the further alternative, a term was to be implied that, if no sale of the JCB Group did or was to take place, Contra would in any event be “made whole” in respect of the services rendered by Richard. On this basis, Contra could charge an appropriate rate for the work actually performed (after 17 June 2011) (“the second implied term”).
The relevant legal principles
The Judge set out the relevant law:
i) On contractual interpretation at [46] to [51];
ii) On the implication of terms at [52];
iii) On the applicable tests for strike-out and summary judgment at [53].
Again, it is not necessary for me to repeat the Judge's summary of what are well-established and non-contentious principles.
All that needs to be added is a reference to the recent majority decision of the Supreme Court in Barton v Gwyn-Jones [2023] UKSC 3; [2023] 2 WLR 269 (“ Barton”). On the premise that the express term orally agreed between the parties was a “complete statement of the circumstances in which [Mr Barton] was promised some reward under the agreement” (see [107]), the majority concluded that there was no room for the implication of a term providing for a lesser reward on a different basis:
i) Whether or not the words “if, and only if” were used by the parties in their negotiations, the effect of the contract as found by the first-instance judge was that Mr Barton was only entitled to be paid if the event that they agreed would be the trigger for that payment occurred. To imply a term that there was an obligation to pay without that trigger would go “directly against what the judge found the parties had agreed” (see [24] to [26]). Where parties stipulate in their contract the circumstances that must occur in order to impose a legal obligation on one party to pay, they necessarily exclude any obligation to pay in the absence of those...
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