Tony Vick v Vogle-gapes Ltd
| Jurisdiction | England & Wales |
| Judgment Date | 30 June 2006 |
| Neutral Citation | [2006] EWHC 1665 (TCC) |
| Docket Number | Case No: MER 6021 |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Date | 30 June 2006 |
[2006] EWHC 1665 (TCC)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
HHJ Seymour QC
Case No: MER 6021
Oliver Segal (instructed by Morgan Cole) for the Claimant
Jason Coppel (instructed by Howes Percival) for the Defendant
Hearing dates: 22,23,24,25 and 26 May 2006
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 RICHARD SEYMOUR Q.C.
HIS HONOUR JUDGE RICHARD SEYMOUR Q.C.:
Introduction
The defendant company, Vogle-Gapes Ltd., to which I shall refer in this judgment as "the Company ", was incorporated in October 1999 to take over the business carried on up to that point by a firm which traded under the style "Town and Country ". The Company still uses that name as a business name. The business of the Company is in reality a development of a business originally established in 1962 by Mr. Barry Page. In this judgment I shall refer to that business, both in its original form, and once it came to be carried on by a firm, as "the Business ". In the first instance the Business sold handbags and other leather goods to retailers and to the public. From 1975 the Business started to design its own products. It was successful in this field of endeavour until about 1988, when it began to feel the effects of competition from, amongst others, manufacturers based in the Far East, which had lower costs of production. The Business then diversified into areas such as shoes, belts and corporate clothing. However., that sector, too, proved vulnerable to competition from overseas manufacturers. In about 1992 Mr. Barry Page decided that production of the goods which he sold should be transferred to the Far East. At the same time there was a further change in the focus of the Business towards tool belts and gloves for the hardware industry and gloves and footwear for gardeners. It is in those sectors that the Company still carries on business.
2.The business established by Mr. Barry Page has, certainly in recent years, been a family business. Mr. Barry Page retired as the managing director of the Company in October 2005, but he has been succeeded by his son, Nick. Mr. Nick Page was, until he took over as managing director, the sales director. Another son of Mr. Barry Page, Mr. Jamie Page, has also been involved in the business of the Company on the information technology side.
3.In 1993 four people were employed in the business which Mr. Barry Page had founded. The decision was made to employ three salesmen, bringing the total number of employees to seven. There are now a total of 25 employees, including a sales force often.
4.The claimant, Mr. Tony Vick, was first associated with what became the Company when he was employed in September 1996 as a salesman. His status changed in 1999 when he gave up his employment and became a self-employed sales agent for the Business. Whilst employed as a salesman in the Business Mr. Vick made a good impression. He was considered to be effective and to have a good rapport with customers. In those circumstances Mr. Barry Page and Mr. Nick Page were amenable to the suggestion of Mr. Vick that the nature of the arrangement should alter and he should become self-employed. An agreement in writing dated 1 February 1999 was entered into between "Town and Country" and Mr. Vick. In this judgment I shall refer to that agreement as "the Agency Agreement". It will be necessary to refer to some of the terms of the Agency Agreement in some detail later in this judgment. However, at this stage it is material to record that the Agency Agreement came to an end in April 2004 in circumstances about which there was a degree of dispute. The case for Mr. Vick in this action was that the Agency Agreement was repudiated by the Company, he accepted that repudiation and, as a result of that, he was entitled to be paid compensation. He also claimed other sums which were said to have fallen due,
but not to have been paid, under the terms of the Agency Agreement. The case for the Company was that, far from it being the Company which repudiated the Agency Agreement, it was actually Mr. Vick. He was said to have done that by purporting to treat the Company, in a letter dated 2 April 2004 to Mr. Barry Page, perhaps as clarified in a telephone conversation with Mr. Page on 6 April 2004, as having repudiated the agreement. Alternatively, so it was contended, if Mr. Vick did not repudiate the Agency Agreement in that way, he had repudiated it by his conduct which showed, so it was asserted, that he did not intend to be bound by the terms of the Agency Agreement. That repudiation was said to have been accepted by the Company by a letter dated 15 April 2004 written by Mr. Barry Page to Mr. Vick.
The pleaded claims of Mr. Vick
5. As matters turned out, the precise allegations made in the Particulars of Claim on behalf of Mr. Vick and the precise answers given to those allegations on behalf of the Company in the Amended Defence and Counterclaim proved to be of significance in the trial. It is therefore material to set out the way in which the material parts of the case of both Mr. Vick and the Company were pleaded. I deal first with the pleaded case of Mr. Vick.
6.It is convenient to start the consideration of how Mr. Vick's case was pleaded by looking at his case as to how his agency came to an end. What was pleaded was:-
"19. In the circumstances, it is the Claimant 's primary case ("the Primary Case ") that the Defendant terminated his agency without notice, in breach of Regulation 15, on about 15 April 2004 (alternatively on the date the letter of 7 April 2004 was received by the Claimant).
20. Alternatively, if which is denied, it is held that the Claimant 's letter of 2 April 2004 did amount to a unilateral termination by the Claimant of his agency, the Claimant 's secondary case ("the Secondary Case ") is that he terminated the agency on about 2 April 2004, by reason of the Defendant 's said breaches of the agency agreement set out at paragraphs 8
—12 above."
7.I shall come to Mr. Vick's Primary Case in more detail later, but for the present it is material to consider how the secondary case was put. The reference to alleged breaches of the agency agreement being set out in paragraphs 8 —12 of the Particulars of Claim was an error. The paragraphs intended to be referred to were in fact 7 to 11. They were in the following terms:-
"7. In breach of the terms pleaded at paragraph 3 above and/or of Regulation 7(1) and/or 7(2), the Defendant, in a letter dated 30 January 2004, purported unilaterally and unreasonably to vary the Territory and Market with effect from 1 March 2004, primarily by introducing a large number of additional excluded customers, and thereafter has failed to pay commission to the Claimant in respect of orders to those additionally excluded customers.
8. The Claimant did not accept that the Defendant was entitled to make the said variation and, inter alia, in a letter dated 25 February 2004 (and incorrectly marked "Without Prejudice ") sought compensation and reminded the Defendant of the existence/effect of Regulation 7 in respect of his continued entitlement to commission.
9. Further at around this time, the Defendant was failing in any event to pay to the Claimant commission due in respect of all material orders, pursuant to its obligations under the Contract and Regulations (and was late in paying such commissions as it did pay to the Claimant). These matters were raised with the Defendant in correspondence from the Claimant on 19 and 28 March 2004.
10. The Claimant is unable fully/properly to particularise these claims for commissions due on sales made during the agency prior to disclosure herein.
11. Further, in breach of its obligations under Regulation 4, the Defendant, in this same period (early 2004), by requiring its employed staff to visit customers in the Territory without the knowledge or consent of the Claimant, who undermined the Claimant's efforts on behalf of the Defendant to those customers, and then itself inaccurately and unfairly undermining the Claimant's efforts in writing to the Claimant."
8.In the event, the allegations pleaded in paragraph 11 of the Particulars of Claim were not pursued. The customers in respect of sales to whom it was contended that Mr. Vick was entitled to commission which was not paid proved to be two, in the end, namely Otter Nurseries in respect of two sales in early 2004 and Charlie's Stores more generally. Although those non-payments of commission were relied upon as being repudiatory breaches of the Agency Agreement and there were more general allegations of late payment of commission, the real focus of the allegations which formed part of the Secondary Case that the Company had repudiated the Agency Agreement was the contention that it had done that by varying Mr. Vick's " Territory" and " Market". Those expressions were defined in the Agency Agreement and I shall come to the definitions later in this judgment. The various pleaded references to "Regulations" were to Commercial Agents (Council Directive) Regulations 1993, SI 1993 No. 3053; (to which I shall refer in this judgment as "the Commercial Agents Regulations") and again I shall come to them later in this judgment.
9.In the Amended Defence and Counterclaim the response to the allegations in paragraphs 19 and 20 of the Particulars of Claim was to be found, so far as is presently material, in paragraphs 20, 21 and 23:-
"20. Paragraph 19 is denied. The Claimant terminated the Contract within the meaning of the Regulations. The Defendant will rely upon a subsequent letter dated 26 July 2004 from the...
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