JBR Capital Ltd v JM Investments/Trading Ltd
| Jurisdiction | England & Wales |
| Judge | Ms Clare Ambrose |
| Judgment Date | 03 February 2023 |
| Neutral Citation | [2023] EWHC 174 (Comm) |
| Docket Number | Case No: LM-2020-000138 |
| Court | Queen's Bench Division (Commercial Court) |
[2023] EWHC 174 (Comm)
Ms Clare Ambrose
Sitting as a Deputy Judge of the High Court
Case No: LM-2020-000138
IN THE HIGH COURT OF JUSTICE
KING'S BENCH DIVISION
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
LONDON CIRCUIT COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mark Wraith (instructed by Asserson Law Offices) for the Claimant
Piers Hill (instructed by Geoffrey Leaver LLP) for the Defendants
Hearing dates: 17–18 January 2023
Judgment supplied to the parties in draft on 23 January 2023
Approved Judgment
I direct that 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 was handed down by the judge remotely by circulation to the parties' representatives by email and release to The National Archives. The date and time for hand-down is deemed to be Friday 03 February 2023 at 10:30am.
Introduction
This was a trial relating to finance provided to the First Defendant under four hire purchase agreements relating to the acquisition of four high-end vehicles, namely two Lamborghinis, a Ferrari Daytona GT de Competition (“the Daytona”) and a Bentley.
The Claimant was the finance company and it terminated the hire purchase agreements for arrears in May 2020. It now claims the total outstanding balance across all the agreements in the principal sum of £954,231.13 plus interest up to 18 January 2023 in the sum of £331,763.28. The largest component of the claim (the principal sum of £687,779.18) fell under the fourth hire purchase agreement relating to the Daytona. The Claimant also makes claims in the same sum against the Second Defendant under personal guarantees said to have been provided in relation to the hire purchase agreements.
Factual Background
The parties helpfully agreed a chronology and also a cast list. They also agreed the non-contentious factual background as follows.
The Claimant [C] is a finance company specialising in high-end vehicles, and was founded by Mr Darren Selig.
The First Defendant [D1] is a company the business of which is leasing high-end vehicles to customers as well as trading such vehicles. The Second Defendant [D2] is its sole director.
The parties had a relatively long-standing trading relationship. Mr Abbott was introduced to Mr Selig in around May 2014 and over the years the First Defendant concluded around 26 deals for hire purchase of a vehicles with the Claimant.
Claims had originally been made under six hire purchase agreements (“the Agreements”) and guarantees but those under the first and sixth agreements (relating to a used BMW and a Mercedes Benz) were not pursued at trial. All six Agreements are included below as they formed part of the context and affected the agreed terminology used):
7.1. An Agreement numbered A00015 (the “First Agreement”) dated 6 April 2015, for the hire with an option to purchase of a used BMW 118d M Sport 5dr (the “BMW”), with a total amount payable of £23,406.20.
7.2. An Agreement numbered A00968 (the “Second Agreement”), for the hire with the option to purchase of a used Lamborghini Aventador (the “Aventador”), with a total amount payable of £475,490.68 comprised of an initial payment of £5,194.91 on 5 February 2017, 46 monthly payments of £4899.91 on the 5 th of each month, and a final balloon payment in the sum of £244,899.91 on 5 January 2021.
7.3. An Agreement numbered A01011 (the “Third Agreement”) for the hire with the option to purchase of a used Bentley Mulsanne V8 Mulliner (the “Bentley”), with a total amount payable of £208,366.52 comprised of an initial payment of £2,858.99 on 27 February 2017, 46 monthly payments of £2,563.99 on the 27 th of each month, and a final balloon payment in the sum of £87,563.99 on 27 January 2021.
7.4. An Agreement numbered A01695 (the “Fourth Agreement”) for the hire with the option to purchase of the Daytona, with a total amount payable of £1,788,496.90 comprised of an initial payment of £18,473.26 on 26 October 2017, 58 monthly payments of £18,173.36 on the 26 th of each month, and a final balloon payment in the sum of £715,678.36 on 26 September 2022.
7.5. An Agreement numbered A03514 (the “Fifth Agreement”) for the hire with the option to purchase of a new Lamborghini Huracan (the “Huracan”), with a total amount payable of £200,984.20 comprised of an initial payment of £3,293.96 on 23 December 2018, 46 monthly payments of £2,998.96 on the 23 rd of each month, and a final balloon payment in the sum of £132,998.96 on 23 November 2022.
7.6. An Agreement numbered A03809 (the “Sixth Agreement”) for the hire with the option to purchase of a Mercedes Benz (the “Mercedes”) dated 8 February 2019, with a total amount payable of £40,598.04.
The terms and conditions applicable to each of the Agreements were largely identical, and included the following:
“ 2 PAYMENTS
2.2 The Customer [D1] agrees to pay [C]:
(a) the Basic Rentals (including the Final Basic Rental) on the due dates;
(b) Any Document Fee shown overleaf of the date of the Agreement;
(c) All other amounts within 7 days of the Claimant's written demand;
2.6 If [D1] fails to pay any sum due under this Agreement on the due dates for payment then [D1] shall pay daily interest, from the due date until actual payment on all such unpaid amounts at 8% above Finance House Base Rate, such interest to be payable both before and after any court Judgment [C] may obtained against [D1]. [D1] shall also pay to [C] any costs incurred by it in enforcing or servicing this Agreement including but not limited to [C's] administration costs, costs of recovery of the Vehicles, bank charges and all legal costs on a full indemnity basis. This clause will survive and apply after termination of this Agreement.
7 TERMINATION EVENTS
7.1 The customer may terminate this agreement at any time by giving JBR Capital notice in writing and the Customer shall immediately return the Vehicle to JBR Capital at such a place in the United Kingdom as JBR Capital may require and pay JBR the sums set out in clause 8.2.
7.2 [C] may terminate this Agreement immediately if any of the following events occurs:
(a) [D1] breaches any term of this Agreement;
…
(m) if JBR Capital has reasonable grounds to believe the Vehicle or JBR Capital's interest in them is at risk;
(n)….
8 CONSEQUENCES OF TERMINATION
8.1 On termination of this Agreement for any reason, [D1] shall:
(a) Return the Vehicle to [C]… in the same condition as at the date of this Agreement (fair wear and tear excepted)…
(b) pay to [C]:
(i) all payments and sums due up to the date of termination including any interest due on unpaid amounts in accordance with the terms of clause 2.6; and
(ii) a sum equal to all Basic Rentals plus the Final Basic Rental which but for the termination of the hiring of the Vehicle would have become due and payable during the remainder of the Hire Period, each discounted at a rate of 2% per annum from the date of termination to the date the Basic Rental or Final Basic Rental (as applicable) would have been due;
(c) in addition to the termination figure calculated above, [D1] will also pay to [C] any costs incurred by it in repossessing, repairing, storing, insuring and selling the Vehicle, delivering it to a buyer and any sales commission paid by JBR Capital upon demand.
8.2 After termination of this Agreement [C] will, if it is in possession of the Vehicle, try to sell it and provided [D1] pays all sums due to [C] (and whether arising under (i) this Agreement or (ii) any other Agreement with [C])… [C] will pay to [D1] the net proceeds of sale of the Vehicle (excluding VAT and [C's] cost of repossession, insurance, storage, and sale). For the purposes of this clause net proceeds of sale will be the net proceeds of sale of the Vehicle (excluding VAT and [C's] cost of repossession, insurance, storage and sale) received by [C], or if it has not sold the Vehicle within 28 days after repossessing it the trade value of the Vehicle (excluding VAT and [C's] remarketing expenses) established as soon as practicable after the 28 days by a dealer selected by [C] in vehicles of the same kind as the Vehicle. The Customer's obligations under this clause will be treated as if they had arisen immediately before termination.
…
10 GENERAL
…
10.8 Waiver: [C's] rights under this Agreement will not be affected by any forbearance or concession made by [C] to [D1]. [C] will only grant a waiver for breach by [D1] in limited circumstances and any such waiver will only be effective if given in writing by [C] and it refers to the breach to be waived.
…
10.10 Entire Agreement: This Agreement and documents referred to herein contain all the terms agreed between [C] and [D1] in respect of the subject matter of this Agreement and may not be varied other than by a document duly signed by [C] and [D1].
…
10.13 Notices: Each communication shall be in writing and addressed to the recipient at the address stated above or such other address in Great Britain as it may for this purpose notify to the other and shall be deemed to have been given upon delivery [if by hand] or when received [if by fax] or two days after posting (if sent by first class mail).”
On or around the same date as signing the hire purchase agreements Mr Abbott also signed as a deed six guarantee agreements (“the Guarantees”). He signed each agreement and the signature was witnessed. Each of the Guarantees was on the Claimant's standard terms and are materially identical. They each provided that the Claimant was described as “ Lender” and Mr Abbott was described as “ the Guarantor”. The Guarantees also provided as follows:
“DEFINITIONS
In this Deed the...
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