Kudos Catering (Uk) Ltd (Applicant/Claimant) v Manchester Central Convention (Respondent/Defendant)
| Jurisdiction | England & Wales |
| Judge | JUDGE SEYMOUR |
| Judgment Date | 19 April 2012 |
| Neutral Citation | [2012] EWHC 1192 (QB) |
| Date | 19 April 2012 |
| Court | Queen's Bench Division |
| Docket Number | Case No: HQ11X01013 |
[2012] EWHC 1192 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand
London WC2A 2LL
His Honour Judge Seymour Qc
Case No: HQ11X01013
MR J STUART (instructed by Crown Group Solicitors) appeared on behalf of the Claimant
MR A KRAMER (instructed by Pannone Solicitors) appeared on behalf of the Defendant
The claimant in this action, Kudos Catering (UK) Limited, entered into an agreement in writing in April 2007 with the defendant, Manchester Centra] Convention Complex Limited.
As I understand it the defendant is a company the shares in which are beneficially owned by Manchester City Council and it operates two venues in Manchester, one called Gmex and the other called Manchester International Convention Centre.
The claimant carries on business as a company providing catering and hospitality services.
The agreement which was made between the defendant and the claimant, at that time called Kudos Hospitality Limited, provided for the claimant to provide catering and hospitality services at the venues which I have mentioned for a term starting on 1 April 2007 and continuing until 31 March 2012, subject to the possibility of termination under clause 28 of the agreement.
It is convenient to notice at once the provisions of clause 28. Clause 28.1 is concerned with the potentially serious situation in which the making of the agreement had been induced by bribery but the other detail of it is not presently material.
In clause 28.2 there were these provisions:
"If the Contractor or the Company; -
28.2.1. commits a material breach of any of its obligations under this Agreement and such breach if remediable is not remedied within ten (10) business days of written notice by the non-defaulting party to the other;
28.2.2. commits a persistent breach of any of its obligations under this Agreement;
28.2.3. becomes bankrupt, or makes a composition or arrangement with its creditors, or has a proposal in respect of its company for voluntary arrangement for a composition of debts, or scheme or arrangement approved in accordance with the Insolvency Act 1986;
28.2.4. has an application made under the Insolvency Act 1986 to the Court for the appointment of an administrative receiver;
28.2.5. has a winding-up order made, or (except for the purposes of amalgamation or reconstruction) a resolution for voluntary winding-up passed;
28.2.6. has a provisional liquidator, receiver, or manager of its business or undertaking duly appointed;
28.2.7. has an administrative receiver, as defined in the Insolvency Act 1986, appointed;
28.2.8. has possession taken, by or on behalf of the holders of any debentures secured by a floating charge, of any property comprised in, or subject, to the floating charge;
28.2.9. is in circumstances which entitle the court or a creditor to appoint, or have appointed, a receiver, a manager, or administrative receiver, or which entitle the court to make a winding up order; then in such circumstances the other may, without prejudice to its accrued rights or remedies under this Agreement, terminate this Agreement by notice in writing having immediate effect."
Then, 28.3, was in these terms:
"If the contractor fails to provide the services or any part thereof in accordance with the contract standard then without prejudice to any other right or remedy which the company may possess in respect of such failure, the company may require the contractor to remedy such default within such time as may be specified by the authorised officer by providing or providing again as the case may be without further charge to the company such part of the services to the contract standard.
28.4 In the event that the contractor ceases to provide the services or a portion of the services covered by this agreement and the company wishes to procure the provision of the same by other means then the company shall be permitted to use therefore any of the food, beverages or supplies of the contractor which are available and in a suitable condition, having regard to all relevant legislation for sale to the public provided that the company shall account to the contractor for such food, beverages and supplies used at the actual cost thereof to the contractor.
28.5 If the contractor makes an operating loss in respect of the provision of the services throughout any financial year then in such circumstances the contractor may terminate this agreement by giving the company six months prior written notice provided that if required by the company at any time the contractor will provide to the company on demand a report of an independent chartered accountant and auditor certifying that the contractor has made such an operating loss."
For the purposes of the agreement between the parties the expression "the contractor" was used to refer to the claimant and the expression "the company" was used to refer to the defendant. Various of the expressions which are set out in the passages which I have cited from clause 28, in particular "services", and "contract standard" were also defined expressions.
There were no other provisions in clause 28 apart from those to which I have referred. In particular, there were no other provisions which dealt specifically with the consequences of termination, however it came about, of the agreement between the parties. However, it is immediately clear that, although the anticipated term of the agreement was the five-year period which I have mentioned, there were a considerable number of circumstances in which the agreement could be terminated before the end of the term had been reached.
It is also fair to say that from clause 28 it is clear that certain consequences adverse to the claimant were contemplated as likely to follow in the event of termination, specifically I have in mind clause 28.4.
What has actually happened in the present case is that by a letter dated 1 July 2010, purportedly pursuant to the provisions of clause 28, the defendant has terminated the agreement.
The letter of termination is pleaded at paragraph 6 of the particulars of claim in this action. At paragraph 7 of the particulars of claim it is pleaded that the claimants have accepted the said repudiation as terminating the contract unlawfully with effect on 31 July 2010. Consequently the position of the claimant is that the despatch of the letter dated 1 July 2010 by the defendant was not a letter terminating the contract in accordance with the provisions of clause 28 but rather a manifestation of an intention to repudiate the agreement which the claimant has chosen to accept.
At paragraph 10 of the particulars of claim appears this:
"Further, by reason of the Defendant's repudiatory breach of the Agreement, the Claimants have suffered substantial financial losses in respect of lost profits anticipated over the course of the remaining 20 months of the Term of the Agreement. The Claimants hereby claim damages equivalent to the relevant net profits which they have lost as a result of the unlawful early termination of the Agreement."
There follow, in paragraph 10 of the particulars of claim, particulars of the alleged losses of profit, which are totalled at £1,297,231.
The agreement between the parties included a clause 18. Clause 18 followed the rubric "indemnity and insurance". However, that rubric, for present purposes, is wholly immaterial because it was provided by clause 1.52 that "in the interpretation of the contract, unless the contrary intention appears", and the relevant one is 1.52.6, "condition headings are for ease of reference only and shall not affect the construction of this agreement".
That said, the rubric, with one fairly conspicuous exception, does appear accurately to describe what is to be found in clause 18.
Clause 18.1 provided for the contractor, that is to say the claimant, to indemnify the defendant "against all actions, claims, demands, proceedings, damages, costs, charges and expenses in respect of or in any way arising out of the provision of the services",
(that expression, as I have indicated, is defined): "In relation to the injury to, or death of, any person, and/or loss of, or damage to, any property including without limitation property belonging to the Company except and to the extent that it may arise out of the negligence of the Company its employees or agents."
Clause 18.2 provided for the claimant to effect insurance in respect of its liabilities under the clause 18.1.
Clause 18.3 provided for the claimant to provide evidence to the defendant that it had complied with its obligations in respect of insurance under clause 18.2.
Clause 18.4 was in these terms:
"The Company [that is to say the defendant] shall indemnify and keep indemnified the Contractor against all actions, claims, demands, proceedings, damages, costs, charges and expenses whatsoever in respect of or in any way arising out of the provision of, or damage to, any property including property belonging to the Contractor to the extent that it may arise out of the negligence of the Company, its employees or agents."
Clause 18.5 provided, in effect, for the defendant to arrange any insurance which the claimant was bound by the contract to arrange but failed to arrange.
Clause 18.6 was in these terms:
"The Contractor hereby acknowledges and agrees that the Company shall have no liability whatsoever in contract, tort (including negligence) or otherwise for any...
To continue reading
Request your trial
-
Kudos Catering (UK) Ltd v Manchester Central Convention Complex Ltd
...IN THE COURT OF APPEAL (CIVIL DIVISION) ON APPEAL FROM THE HIGH COURT OF JUSTICE QUEEN'S BENCH DIVISION His Honour Judge Seymour QC [2012] EWHC 1192 (QB) Royal Courts of Justice Strand, London, WC2A 2LL Lord Justice Laws Lord Justice Tomlinson and Lord Justice Mccombe Case No: A2/2012/1070 ......