Maranello Rosso Ltd v Lohomij BV
| Jurisdiction | England & Wales |
| Judge | Keyser |
| Judgment Date | 06 September 2021 |
| Neutral Citation | [2021] EWHC 2452 (Ch) |
| Docket Number | Case No: BL-2020-000765 |
| Court | Chancery Division |
[2021] EWHC 2452 (Ch)
HIS HONOUR JUDGE Keyser QC
sitting as a Judge of the High Court
Case No: BL-2020-000765
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
Royal Courts of Justice
Rolls Building, 7 Rolls Buildings
Fetter Lane, London, EC4A 1NL
Justin Fenwick QC, Tim Chelmick and Usman Roohani (instructed by Mishcon de Reya LLP) for the Claimant
Richard Eschwege (instructed by Morrison & Foerster (UK) LLP) for the First and Fourth Defendants
Daniel Toledano QC and Oliver Butler (instructed by RPC) for the Second, Third and Sixth Defendants
Matthew Collings QC (instructed by Kastle Solicitors) for the Fifth Defendant
Robert Weekes (instructed by Foot Anstey LLP) for the Seventh Defendant
Hearing dates: 18, 19, 20 and 21 May 2021
Judgment circulated in draft: 23 August 2021
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.
HIS HONOUR JUDGE Keyser QC
JUDGE Keyser QC:
This is my judgment upon applications by the various defendants for orders striking out the claims against them pursuant to CPR r. 3.4 or for summary judgment in their favour pursuant to CPR r. 24.2. The applications were heard remotely over four days by Microsoft Teams.
I am grateful to counsel and solicitors for the respective parties for the manner of their preparation and conduct of the applications. There was a fair amount of overlap in the submissions, at least those on behalf of the defendants, and in what follows I shall from time to time attribute certain submissions to particular counsel, although others may have made the same points; for which, my apologies.
This judgment will be structured as follows:
A. A general survey of the parties and the claims: paragraphs 4 to 10;
B. A short summary of the applications: paragraphs 11 to 15;
C. A summary of the law concerning CPR r. 3.4 and r. 24.2: paragraphs 16 to 25;
D. A factual narrative: paragraphs 26 to 76;
E. A brief outline of the allegations made in the Particulars of Claim in their proposed amended form: paragraphs 77 to 83;
F. A discussion of the Settlement Agreement between the parties: paragraphs 84 to 124;
G. A discussion of causes of action pre-dating the Settlement Agreement: paragraphs 125 to 170;
H. A discussion of causes of action arising after the Settlement Agreement: paragraphs 171 to 356. This comprises:
• Summary of pleadings: paragraphs 174 to 179;
• Statement of facts: paragraphs 180 to 301;
• Discussion: paragraphs 302 to 356.
I. A summary of the conclusions: paragraphs 357 to 361.
A. General Survey of the Claims and the Parties
The claimant, Maranello Rosso Limited (“MRL”), is a company registered in Guernsey. It was incorporated in 2013 by Mr Graham Sullivan, who is one of its ultimate beneficial owners, for the specific purpose of purchasing the company that owned the collection of classic cars, comprising 33 Ferraris and 38 Abarths, in the Violati Maranello Rosso Museum. I shall refer to the collection as “the Collection” and to the cars contained in it as “the Cars”. MRL's intention, once it had acquired the Collection, was to sell the Cars at auction.
The first defendant, Lohomij BV (“Lohomij”) is a company based in The Netherlands. It is part of Louwman Group (“LG”), which carries on business in the automobile industry, and is controlled directly or indirectly by the fourth defendant, Mr Evert Louwman. The Louwman family has a museum of classic cars in The Hague. By a loan agreement dated 29 May 2014 (“the Facility Agreement”) Lohomij lent €90m to MRL (“the Loan”) to enable it to acquire the Collection, on terms that required MRL to sell the Cars through the second defendant.
The second defendant, Bonhams 1793 Limited (“Bonhams”), is a well-known auction house in London. The third defendant, Bonhams & Butterfields Auctioneers Corporation (“B&B”), is a US affiliate of Bonhams. I shall refer to Bonhams and B&B together as “the Bonhams Defendants”. The Bonhams Defendants acted in the sale of the Cars by MRL pursuant to an agreement dated 30 June 2014 (“the Commercial Agreement”).
The fifth defendant, Mr Robert Brooks, was a former chairman of Bonhams. Sadly, he died on 23 August 2021, after the hearing but before this judgment was handed down. By an order dated 3 September 2021 I have made provision for his estate to be represented for the further purposes of these proceedings.
The sixth defendant, Mr James Knight, was at the material times a specialist in classic cars at Bonhams.
The seventh defendant, Mr Anthony MacLean, was a non-executive director of Bonhams from 11 April 2002 until 8 June 2016; during that period he did not have responsibility for the day-to-day management of the company and did not even attend board meetings, but he assisted it in various projects, including the sale of the Cars. From 2014 he also provided assistance to MRL as a consultant in respect of efforts to sell some of the Cars. After July 2015, which is a significant date in this case, his only involvement in respect of the Cars was in acting for and on behalf of MRL. Mr MacLean has never been a shareholder in Bonhams or any of its associated companies or in any of the companies within the Louwman Group.
The general nature and basis of MRL's claims are conveniently set out in the Executive Summary at the beginning of the Particulars of Claim:
“1. This is a claim for, amongst other things, unlawful means conspiracy and deliberate breaches of fiduciary duty against the Defendants relating to the sale of the world-renowned Violati Maranello Rosso Museum collection of 71 classic cars including 33 important Ferrari road and racing cars worth over £150 million. This involved some of the most well-known names in the industry. In summary, the Defendants (and in particular Mr Robert Brooks of Bonhams and Mr Evert Louwman of Lohomij) acted dishonestly and conspired to force a sale of a selection of the cars contained within the collection, including the $60 million plus 250 GTO, in the USA, thereby breaking up the collection, when the best price would have been achieved by selling all of the cars together in England as had originally been envisaged and agreed. They did so solely to advance the reputation and international profile of Bonhams in advance of a proposed sale of the business to a private equity investor. They dishonestly put their own financial interests above those of their client in breach of the fiduciary duties owed by Bonhams, B&B and their servants and agents.
2. Ten of the cars, including the most valuable, were ultimately sold without reserve at an auction in the USA, which was illegally conducted by Mr Brooks and B&B. This achieved a far lower price than if they had been sold as part of the Collection in England but nevertheless achieved the purposes of Bonhams and Lohomij (or at least Mr Brooks and Mr Louwman) as the sale generated significant publicity for Bonhams and still included a world record price for one car, the 250 GTO. This sale substantially increased their market share in the USA.
3. After the auction Bonhams breached the Commercial Agreement by refusing to sell 43 of the remaining 60 cars, worth in excess of £85 million, in September 2014 at the Goodwood Revival meeting.
4. The Claimant, Bonhams and Lohomij then entered into a settlement agreement [the “Settlement Agreement” between MRL, Bonhams, B&B and Lohomij dated 31 July 2015] to compensate the Claimant for losses that it suffered on the assumption that the auction was carried out negligently. The Claimant now has knowledge leading them reasonably to conclude and plead that Bonhams, Lohomij and their respective principals were acting dishonestly. Such claim was neither compromised nor barred by the Settlement Agreement.
5. The unlawful means conspiracy continued after the auction and after the date of the Settlement Agreement as Lohomij deliberately interfered in and unreasonably refused to consent to sales of various cars (and so also acted in breach of contract). It did so by relying on valuations from Mr James Knight which cannot have been honestly given. The purpose of this appears to have been to ruin the Claimant along with one of its principals, Mr Graham Sullivan, and to force the sale of certain cars to associates of Mr Louwman at an undervalue. It may also have been Lohomij's intention to increase the ultimate sums due and owing to Lohomij under the terms of the Amended Facility Agreement [an agreement between Lohomij and MRL dated 31 July 2015, which amended the Facility Agreement].
6. As a result, it is now clear that the Defendants were acting pursuant to an unlawful means conspiracy and that Bonhams (through Mr Brooks, Mr Anthony Maclean and Mr Knight) were acting in deliberate breach of their fiduciary duties owed to the Claimant from the start.”
B. The Applications
The claim was issued on 20 May 2020. Particulars of Claim, with a statement of truth signed by Mr Sullivan, were served on 17 September 2020.
Defences and Counterclaims have been filed on behalf of all defendants, except Mr Brooks, who made the first of the present applications. The Defence and Counterclaim of Lohomij and Mr Louwman was served on 19 November 2020; the statements of truth were signed by a company officer for Lohomij and by Mr Louwman on his own...
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