Tahir Fadallah v John Pollak

JurisdictionEngland & Wales
CourtQueen's Bench Division
JudgeHis Honour Judge Seymour,His Honour Judge Richard Seymour
Judgment Date22 October 2013
Neutral Citation[2013] EWHC 3159 (QB)
Date22 October 2013
Docket NumberCase No: HQ12X00478

[2013] EWHC 3159 (QB)



Royal Courts of Justice

Strand, London, WC2A 2LL


His Honour Judge Richard Seymour Q.C. (sitting as a Judge of the High Court)

Case No: HQ12X00478

Tahir Fadallah
John Pollak

Luke Harris (instructed by Ronald Fletcher Baker LLP) for the claimant

Anthony Higgins (instructed by Tees Law) for the defendant

Approved Judgment

Hearing dates: 8 and 9 October 2013

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 Seymour QC

His Honour Judge Richard Seymour Q.C.:



On any view the circumstances giving rise to this action were unfortunate. What caused the commencement of the action was, essentially, the going into creditors' voluntary liquidation on 1 November 2011 of a company called Eagle Power Ltd. ( "Eagle"). It appears that, before it went into liquidation, Eagle had agreed to sell to the claimant, Mr. Tahir Fadallah, two 1270 kVA second-hand Cummins KTA50G3 diesel generating sets, with the respective serial numbers 33116392 and 33116400 ( "the Generating Sets"), for the sum of £110,000. Mr. Fadallah, or a company of which he appears to be a director called Tahir Guest Palace Ltd., seems to own and operate an hotel called Tahir Guest Palace ( "the Hotel") situate near Kano in Nigeria. In his witness statements dated, respectively, 25 November 2011 and 15 March 2013, made for the purposes of this action Mr. Fadallah asserted, in paragraphs 4 of each, that he owned and ran the Hotel. However, in stationery used in the business of the Hotel copies of which were adduced in evidence there appeared at the foot the name "Tahir Guest Palace Ltd.", followed by the name of two directors, Mr. Tahir Fadallah and Mr. Mohammed Fadallah. No point has been taken in this action as to whether Mr. Tahir Fadallah in his personal capacity is the correct claimant, so it is unnecessary to consider that matter further. The case of Mr. Fadallah was that he had agreed to purchase the Generating Sets for use for the purposes of the Hotel, that he had paid the agreed price, but had not received delivery of the Generating Sets, which, by the date of the commencement of this action, were under the control of the defendant, Mr. John Pollak. Mr. Pollak carries on business under the style or title " JMP Developments" as a dealer in new and used electrical generators. In essence the case of Mr. Pollak was that, at the time Eagle purported to enter into an agreement to sell the Generating Sets to Mr. Fadallah, the Generating Sets did not belong to Eagle, but to him. Mr. Pollak accepts that, on or about 30 August 2011, he did agree to sell the Generating Sets to Eagle for the sum of £120,000, but on terms that property in the Generating Sets was to remain in him unless and until he was paid, and he never was. In this action it was contended on behalf of Mr. Fadallah that, in the circumstances, Mr. Fadallah was entitled as against Mr. Pollak to delivery up of the Generating Sets or to payment of the value of them, which, it was contended, was what Mr. Fadallah had paid for them. On behalf of Mr. Pollak those contentions were disputed. I do not think that there was any dispute before me both that Mr. Fadallah had caused payment to be made to Eagle for the price agreed for the Generating Sets of £110,000, and that Mr. Pollak had not been paid by Eagle the price at which he had agreed to sell the Generating Sets to Eagle. The consequence of the liquidation of Eagle thus was that one or other of otherwise innocent parties had sustained loss. Either Mr. Fadallah would get nothing for the payments totalling £110,000 which had been made, or Mr. Pollak would be required to deliver up to Mr. Fadallah the Generating Sets for which Mr. Pollak had not been paid.


The answer to the question who was to sustain a loss depended, as it seemed to me, simply on the application of established principles of English law to the facts which I found were the material facts of the present case. At one level the purpose of the English law of contract, and more specifically in the present case, of sale of goods, is to provide a mechanism to resolve problems of exactly the type which arose in the present case.


There was little dispute as to the essential facts of this case, and it is convenient to rehearse what was not in dispute before turning to those matters which required decision by me.

Facts which were not in dispute


Mr. Pollak and Eagle had had dealings over many years — as I understand it, eighteen — prior to the events giving rise to the claims made in this action. Those dealings, it was common ground between Mr. Pollak and Mr. Nissr Nijim, formerly managing director of Eagle, had taken place on the standard terms and conditions of Mr. Pollak ( "the Pollak Terms"), which included, at condition 6(b):-

"Title in the goods remains vested in the Company [defined as "JMP Developments"] and shall only pass from the Company to the Customer upon full payment being made by the Customer of all sums due on whatsoever account or grounds to the Company."


At the end of March 2011 Mr. Nijim telephoned Mr. Pollak and notified him that Eagle was in a position to offer for sale five generating sets, including the Generating Sets, which were then physically located at premises belonging to J.P. Morgan at Chaseside, Bournemouth. Mr. Pollak went to inspect the five generating sets. Then, following discussion with Mr. Nijim, Mr. Pollak wrote him a letter dated 5 April 2011 which was, so far as presently material, in the following terms:-

" Re: Acquisition of 5 x Cummins Gensets from JP Morgan — Bournemouth

I refer to our recent discussions regarding the diesel generating sets currently located at the JP Morgan office complex at Chaseside, Bournemouth.

The engine and alternator serial numbers of the machines are as follows:-

[They were then set out.]

In addition to the above machines, all ancillary equipment including control panels, synchronising panels, switchgear, fuel tanks, fuel pumps, exhaust silencers form an integral part of the acquisition agreement.

The agreed purchase price for the above is £150,000.00.

It is formally agreed that the principle contract condition is that JMP Developments will receive Full Title of ownership of these machines upon payment of the deposit.

Disconnection, uplift, transport collection, delivery, storage and display of the machines at Eagle will be the responsibility of Eagle Power Ltd. at no cost to JMP Developments.

Accordingly, please find enclosed cheque to the value of £20,000 + VAT as the agreed deposit."


The reaction of Eagle to receipt of that letter seems to have been to produce an undated invoice numbered 1107 in which the details of each of the relevant generating sets, including the Generating Sets, was recorded, with a price of £20,000, together with Value Added Tax of £4,000. Upon the face of the invoice was typed the words, " We hearby [sic] pass full title of these goods to JMP Developments upon full payment of this invoice." The copy of the invoice adduced in evidence also bore upon it in manuscript the words, " PAID IN FULL [followed by a signature] 5/4/2011" and the words, " Paid 5/4/11 Chq No 102000". On the assumption, which was not disputed before me, that Eagle had the ability in law at that stage to transfer title to the five generating sets the subject of the invoice to Mr. Pollak, it would seem that at that point he acquired, so far as is presently material, title to the Generating Sets.


Subsequently Eagle raised an invoice numbered 1125 dated 28 April 2011 in respect of the balance of the agreed price of the five generating sets, £130,000 plus Value Added Tax of £26,000, making a total of £156,000. Again the invoice set out the details of the five generating sets. Beneath those details were typed the words, " We hereby pass full title of the above generators to JMP Developments upon full payment of this invoice". In the circumstances those words seem to have been unnecessary, as property had already passed.


At all events, the reaction of Mr. Pollak to receipt of the invoice numbered 1125 was to write a letter dated 5 May 2011 to Eagle to this effect:-

" Re: 5 x Cummins Gensets, Switchgear & Accessories

Thank you for your invoice No. 1125 dated 28/04/11 covering the balance for the acquisition of 5 x Cummins Gensets, Switchgear and Accessories previously owned by JP Morgan at Chaseside, Bournemouth.

Accordingly please find enclosed cheque to the value of £156,000.00 inc VAT in full payment of your invoice.

In accordance with our agreement, it will be your obligation to make arrangements to oversee and assist with the careful dismantling and loading of the equipment onto your transport for delivery and storage at West Bromwich [that is, at the premises of Eagle].

I trust that above together with the attached will meet with your approval."


It seems that at least the Generating Sets were collected from Bournemouth and taken to the premises of Eagle in West Bromwich by about the middle of June 2011. In a witness statement dated 21 February 2013 made for the purposes of this action, Mr. Pollak said, in passages which were not disputed:-

" 23. Between 23 May and 15 June 2011 I visited JP Morgan's premises in Bournemouth on a number of occasions. Again, my wife accompanied me on the journeys. Whilst Eagle Power were primarily responsible for moving my machines to West Bromwich I had played an active hands on role in ensuring that they were properly disconnected, uplifted and in particular all spares and ancillary items were taken to Eagle Power's West Bromwich depot. It was important from my point of view to ensure...

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