“9. This judgment uses the following terminology: (1) Computer programs of the kind in issue in the present case are written and edited by the author in human readable form. This is known as ‘source code’. In the present case, some of the source code is written in highlevel programming language, and some of it is written in low-level programming language (called ‘C’ and ‘assembly language’ or ‘assembler’ respectively). Source code comprises text files which are intelligible to a suitably skilled person and contain step-by-step instructions defining particular algorithms, and it may be divided into a number of separate modules or libraries, each dealing with a different algorithm or related group of algorithms. (It is SEL’s case that in order to enhance, modify or fix bugs in the program it is in practice essential to have access to, and the right to edit, the source code.) (2) The form of the program which can be run on the target computer is known as ‘object code. A computer program known as a ‘compiler’ is used (possibly in conjunction with other procedures) to turn source code into object code, which is machine-readable and consists of binary numbers as opposed to text. Source code and object code are different forms of a computer program. (3) A ‘Hex File’ is one form in which object code can be stored. A device known as a ‘programmer’ is used to take the Hex File and to transfer and store it in the appropriate component of the target computer system on which it is to be run. The component may be a memory chip or the memory of the micro-computer itself, depending on the design of the target computer system. A Hex File may be loaded on to production equipment, and used by customers, independently of, and without any need to store or to access, the source code. In addition, aspects of the program, including many sitespecific parameters, can be configured by users without the need to modify the source code. However, access to the source code is needed if it is thought necessary or desirable to make changes to the underlying logic of the computer program. (4) The term ‘software’ embraces intangible program code and associated data. This term is used to distinguish such materials from the computer ‘hardware’. Software which is stored permanently in components on an electronic circuit board may be referred to as ‘firmware’. In this case, Hex Files are firmware. (5) The small computer which forms part of the SEL hardware is referred to in the documents and by the witnesses as a ‘microcontroller’ or ‘microprocessor’ (the technical differences between the two do not matter for present purposes). (6) ‘Intel’ and ‘Microchip’ are rival manufacturers of microcontrollers.” (1) Computer programs of the kind in issue in the present case are written and edited by the author in human readable form. This is known as ‘source code’. In the present case, some of the source code is written in highlevel programming language, and some of it is written in low-level programming language (called ‘C’ and ‘assembly language’ or ‘assembler’ respectively). Source code comprises text files which are intelligible to a suitably skilled person and contain step-by-step instructions defining particular algorithms, and it may be divided into a number of separate modules or libraries, each dealing with a different algorithm or related group of algorithms. (It is SEL’s case that in order to enhance, modify or fix bugs in the program it is in practice essential to have access to, and the right to edit, the source code.) (2) The form of the program which can be run on the target computer is known as ‘object code. A computer program known as a ‘compiler’ is used (possibly in conjunction with other procedures) to turn source code into object code, which is machine-readable and consists of binary numbers as opposed to text. Source code and object code are different forms of a computer program. (3) A ‘Hex File’ is one form in which object code can be stored. A device known as a ‘programmer’ is used to take the Hex File and to transfer and store it in the appropriate component of the target computer system on which it is to be run. The component may be a memory chip or the memory of the micro-computer itself, depending on the design of the target computer system. A Hex File may be loaded on to production equipment, and used by customers, independently of, and without any need to store or to access, the source code. In addition, aspects of the program, including many sitespecific parameters, can be configured by users without the need to modify the source code. However, access to the source code is needed if it is thought necessary or desirable to make changes to the underlying logic of the computer program. (4) The term ‘software’ embraces intangible program code and associated data. This term is used to distinguish such materials from the computer ‘hardware’. Software which is stored permanently in components on an electronic circuit board may be referred to as ‘firmware’. In this case, Hex Files are firmware. (5) The small computer which forms part of the SEL hardware is referred to in the documents and by the witnesses as a ‘microcontroller’ or ‘microprocessor’ (the technical differences between the two do not matter for present purposes). (6) ‘Intel’ and ‘Microchip’ are rival manufacturers of microcontrollers.”
“3. There shall be an inquiry as to the damages suffered by the claimant by reason of the following: - (1) the defendants' failures to provide the claimant with the items specified in paragraph 1 above in breach of the first defendant's obligations specified in paragraphs 57 to 59 of the particulars of claim, and in breach of the second defendant's duties specified in paragraph 62 of the particulars of claim; (2) the first defendant's failure to perform Schedule No. 200815 as alleged in paragraphs 72 to 74 of the particulars of claim.” (1) the defendants' failures to provide the claimant with the items specified in paragraph 1 above in breach of the first defendant's obligations specified in paragraphs 57 to 59 of the particulars of claim, and in breach of the second defendant's duties specified in paragraph 62 of the particulars of claim; (2) the first defendant's failure to perform Schedule No. 200815 as alleged in paragraphs 72 to 74 of the particulars of claim.”
“The rule of the common law is, that where a party sustains a loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed.”
“The general issue is in my view appropriately stated as being whether any profit or loss arose out of or was sufficiently closely connected with the breach to require to be brought into account in assessing damages. Resolution of that issue involves taking into account all the circumstances, including the nature and effects of the breach and the nature of the profit or loss, the manner in which it occurred and any intervening or collateral factors which played a part in its occurrence, in order to form a common sense overall judgment on the sufficiency of the causal nexus between breach and profit or loss.”
“[22] There is a central flaw in the appellants' submissions. Some claims for consequential loss are capable of being established with precision (for example, expenses incurred prior to the date of trial). Other forms of consequential loss are not capable of similarly precise calculation because they involve the attempted measurement of things which would or might have happened (or might not have happened) but for the defendant's wrongful conduct, as distinct from things which have happened. In such a situation the law does not require a claimant to perform the impossible, nor does it apply the balance of probability test to the measurement of the loss.”
“[81] It is well recognised that the so-called duty to mitigate is not a duty in the sense that the innocent party owes an obligation to the guilty party to do so:Darbishire v Warran[1963] 1 WLR 1067 , 1075, per Pearson LJ. Rather, it is an aspect of the principle of causation that the contract breaker will not be held to have caused loss which the claimant could reasonably have avoided.”
“In other words, it is not enough for the wrongdoer to show that it would have been reasonable to take the steps he has proposed: he must show that it was unreasonable of the innocent party not to take them.This is a real distinction. It reflects the fact that if there is more than one reasonable response open to the wronged party, the wrongdoer has no right to determine his choice. It is where, and only where, the wrongdoer can show affirmatively that the other party has acted unreasonably in relation to his duty to mitigate that the defence will succeed.”
“In every case where an issue of failure to mitigate is raised by the defendant it can be characterised as an issue of causation in the sense that, if damage has been caused or exacerbated by the claimant's unreasonable conduct or inaction, then to that extent it has not been caused by the defendant's tort or breach of contract.”
“As a result of a breach of contract a party is obliged to mitigate. In his attempts to mitigate he may go beyond his obligation, but that is his reaction to the problem caused by the breach and the consequences of the rules of mitigation follow. It is quite different if the transaction, which is relied upon as avoiding loss, is an entirely independent and collateral matter arising not in the context of mitigation at all.”
“It does not matter … that his decision was a reasonable one, or was a sensible business decision, taken with a view of reducing the impact upon him of the legal wrong committed by the shipowners. The point is that his decision is independent of the wrong.”
“[78] The broad principle deducible from The Elena d'Amico [[1980] 1 Lloyd’s Rep 75 ] and the cases there considered is that where a contract is discharged by reason of one party's breach, and that party's unperformed obligation is of a kind for which there exists an available market in which the innocent party could obtain a substitute contract, the innocent party's loss will ordinarily be measured by the extent to which his financial position would be worse off under the substitute contract than under the original contract. [79] The rationale is that in such a situation that measure represents the loss which may fairly and reasonably be considered as arising naturally, ie according to the ordinary course of things, from the breach of contract: Hadley v Baxendale 9 Exch 341. It is fair and reasonable because it reflects the wrong for which the guilty party has been responsible and the resulting financial disadvantage to the innocent party at the date of the breach. The guilty party has been responsible for depriving the innocent party of the benefit of performance under the original contract (and is simultaneously released from his own unperformed obligations). The availability of a substitute market enables a market valuation to be made of what the innocent party has lost, and a line thereby to be drawn under the transaction. [80] Whether the innocent party thereafter in fact enters into a substitute contract is a separate matter. He has, in effect, a second choice whether to enter the market – similar to the choice which first existed at the time of the original contract, but at the new rate prevailing (the difference being the basis of the normal measure of damages). Theoptionto re-enter or stay out of the market arises from the breach, but it does not follow that there is a causal connection between the breach and hisdecisionwhether to re-enter or to stay out of the market, so as to make the guilty party responsible for that decision and its consequences.The guilty party is not liable to the innocent party for the adverse effect of market changes after the innocent party has had a free choice whether to re-enter the market, nor is the innocent party required to give credit to the guilty party for any subsequentmarket movement in favour of the innocent party. The speculation which way the market will go is the speculation of the claimant.”
“Thus when asking whether an action was reasonable and so does not break the chain of causation, a special sense of ‘reasonable’ is meant. It does not mean sensible or having a reason, rather it means acting sensibly in response to and not independently of the wrong.”
“[10] An injured party such as the owners may not, generally speaking, recover damages against a repudiator such as the charterers for loss which he could reasonably have avoided by taking reasonable commercial steps to mitigate his loss. Thus where, as here, there is an available market for the chartering of vessels, the injured party’s loss will be calculated on the assumption that he has, on or within a reasonable time of accepting the repudiation, taken reasonable commercial steps to obtain alternative employment for the vessel for the best consideration reasonably obtainable. This is the ordinary rule whether in fact the injured party acts in that way or, for whatever reason, does not. The actual facts are ordinarily irrelevant. The rationale of the rule is one of simple commercial fairness. The injured party owes no duty to the repudiator, but fairness requires that he should not ordinarily be permitted to rely on his own unreasonable and uncommercial conduct to increase the loss falling on the repudiator.”
“The law is satisfied if the party placed in a difficult situation by reason of the breach of a duty owed to him has acted reasonably in the adoption of remedial measures, and he will not be held disentitled to recover the cost of such measures merely because the party in breach can suggest that other measures less burdensome to him might have been taken.”
“[86] I consider that the authorities establish the following propositions. (a) The fact and, if so, the extent of the diversion of staff time have to be properly established and, if in that regard evidence which it would have been reasonable for the claimant to adduce is not adduced, he is at risk of a finding that they have not been established. (b) The claimant also has to establish that the diversion caused significant disruption to its business. (c) Even though it may well be that strictly the claim should be cast in terms of a loss of revenue attributable to the diversion of staff time, nevertheless in the ordinary case, and unless the defendant can establish the contrary, it is reasonable for the court to infer from the disruption that, had their time not been thus diverted, staff would have applied it to activities which would, directly or indirectly, have generated revenue for the claimant in an amount at least equal to the costs of employing them during that time.”
“[79] None of the cases I have referred to has or could have questioned the principle laid down by the majority of the Court of Appeal in Abrahams [v Herbert Reiach Ltd[1922] 1 KB 477 ] which is set out most clearly in the judgment of Atkin LJ. The court, in my view, has to conduct a factual inquiry as to how the contract would have been performed had it not been repudiated. Its performance is the only counter-factual assumption in the exercise. On the basis of that premise, the court has to look at the relevant economic and other surrounding circumstances to decide on the level of performance which the defendant would have adopted. The judge conducting the assessment must assume that the defendant would not have acted outside the terms of the contract and would have performed it in his own interests having regard to the relevant factors prevailing at the time. But the court is not required to make assumptions that the defaulting party would have acted uncommercially merely in order to spite the claimant. To that extent, the parties are to be assumed to have acted in good faith although with their own commercial interests very much in mind.”
“A type or kind of loss is not too remote a consequence of a breach of contract if, at the time of contracting (and on the assumption that the parties actually foresaw the breach in question), it was within their reasonable contemplation as a not unlikely result of that breach.”
“[21] It is generally accepted that a contracting party will be liable for damages for losses which are unforeseeably large, if loss of that type or kind fell within one or other of the rules in Hadley v Baxendale: see, for example, Staughton J in Transworld Oil Ltd v North Bay Shipping Corpn (The Rio Claro)[1987] 2 Lloyd’s Rep 173 , 175 and Jackson v Royal Bank of Scotland plc[2005] 1 WLR 377 . That is generally an inclusive principle: if losses of that type are foreseeable, damages will include compensation for those losses, however large. But the South Australia and Mulvenna cases [South Australia Asset Management Corpn v York Montague Ltd[1977] AC 191 and Mulvenna v Royal Bank of Scotland plc[2003] EWCA Civ 1112 ] show that it may also be an exclusive principle and that a party may not be liable for foreseeable losses because they are not of the type or kind for which he can be treated as having assumed responsibility. [22] What is the basis for deciding whether loss is of the same type or a different type? It is not a question of Platonist metaphysics. The distinction must rest upon some principle of the law of contract. In my opinion, the only rational basis for the distinction is that it reflects what would reasonably have been regarded by the contracting party as significant for the purposes of the risk he was undertaking. In Victoria Laundry (Windsor) Ltd v Newman Industries Ltd[1949] 2 KB 528 , where the plaintiffs claimed for loss of the profits from their laundry business because of late delivery of a boiler, the Court of Appeal did not regard ‘loss of profits from the laundry business’ as a single type of loss. They distinguished, at p 543, losses from ‘particularly lucrative dyeing contracts’ as a different type of loss which would only be recoverable if the defendant had sufficient knowledge of them to make it reasonable to attribute to him acceptance of liability for such losses. The vendor of the boilers would have regarded the profits on these contracts as a different and higher form of risk than the general risk of loss of profits by the laundry.”
“[43] Hadley v Baxendale remains a standard rule but it has been rationalised on the basis that it reflects the expectation to be imputed to the parties in the ordinary case, i.e. that a contract breaker should ordinarily be liable to the other party for damage resulting from his breach if, but only if, at the time of making the contract a reasonable person in his shoes would have had damage of that kind in mind as not unlikely to result from a breach. However, South Australia and Transfield Shipping are authority that there may be cases where the court, on examining the contract and the commercial background, decides that the standard approach would not reflect the expectation or intention reasonably to be imputed to the parties. In those two instances the effect was exclusionary; the contract breaker was held not to be liable for loss which resulted from its breach although some loss of the kind was not unlikely. But logically the same principle may have an inclusionary effect. If, on the proper analysis of the contract against its commercial background, the loss was within the scope of the duty, it cannot be regarded as too remote, even if it would not have occurred in ordinary circumstances.”
“… as I read the authorities, the claimant does not have a choice whether to adopt theAllied Maplesapproach; if the case is anAllied Maplestype of case, this is the appropriate way to approach the issues of causation and quantification.”
“The loss of a chance principle is accordingly mandatory in the sense that where the claimant’s loss depends on the hypothetical action of a third party then the claimant must prove as a matter of causation that he has a real or substantial chance of the third party taking that action, and if that is shown then the evaluation of the chance is part of the assessment of the quantum of damage.”
“… where the plaintiffs’ loss depends upon the actions of an independent third party, it is necessary to consider as a matter of law what is necessary to establish as a matter of causation, and where causation ends and quantification of damage begins.”
“(3) In many cases the plaintiff's loss depends on the hypothetical action of a third party, either in addition to action by the plaintiff, as in this case, or independently of it. In such a case, does the plaintiff have to prove on balance of probability, as Mr. Jackson submits, that the third party would have acted so as to confer the benefit or avoid the risk to the plaintiff, or can the plaintiff succeed provided he shows that he had a substantial chance rather than a speculative one, the evaluation of the substantial chance being a question of quantification of damages? Although there is not a great deal of authority, and none in the Court of Appeal, relating to solicitors failing to give advice which is directly in point, I have no doubt that Mr. Jackson's submission is wrong and the second alternative is correct.”
“… the law regards the world as in principle bound by the law of causality. Everything has a determinate cause, even if we do not know what it is. … There is no inherent uncertainty about what caused something to happen in the past or about whether something which happened in the past will cause something to happen in the future. Everything is determined by causality. What we lack is knowledge and the law deals with lack of knowledge by the concept of the burden of proof.”
“[82] One striking exception to the assumption that everything is determined by impersonal laws of causality is the actions of human beings. The law treats human beings as having free will and the ability to choose between different courses of action, however strong may be the reasons for them to choose one course rather than another. This may provide part of the explanation for why in some cases damages are awarded for the loss of a chance of gaining an advantage or avoiding a disadvantage which depends upon the independent action of another person: see Allied Maples Group Ltd v Simmons & Simmons[1995] 1 WLR 1602 and the cases there cited. [83] But the true basis of these cases is a good deal more complex. The fact that one cannot prove as a matter of necessary causation that someone would have done something is no reason why one should not prove that he was more likely than not to have done it.So, for example, the law distinguishes between cases in which the outcome depends upon what the claimant himself (McWilliams v Sir William Arrol & Co[1962] 1 WLR 295 ) or someone for whom the defendant is responsible (Bolitho v City and Hackney Health Authority[1998] AC 232 ) would have done, and cases in which it depends upon what some third party would have done. In the first class of cases the claimant must prove on a balance of probability that he or the defendant would have acted so as to produce a favourable outcome. In the latter class, he may recover for loss of the chance that the third party would have so acted. This apparently arbitrary distinction obviously rests on grounds of policy. In addition, most of the cases in which there has been recovery for loss of a chance have involved financial loss, where the chance can itself plausibly be characterised as an item of property, like a lottery ticket.”
“[23] The claimant has first to establish an actionable head of loss. This may in some circumstances consist of the loss of a chance, for example,Chaplin v Hicks[1911] 2 KB 786 andAllied Maples Group Ltd v Simmons & Simmons[1995] 1 WLR 1602 , but we are not concerned with that situation in the present case, because the judge found that, but for Mr Bomford's fraud, on a balance of probability Tangent would have traded profitably at stage 1, and would have traded 98. more profitably with a larger fund at stage 2. The next task is to quantify the loss. Where that involves a hypothetical exercise, the court does not apply the same balance of probability approach as it would to the proof of past facts. Rather, it estimates the loss by making the best attempt it can to evaluate the chances, great or small (unless those chances amount to no more than speculation), taking all significant factors into account: see Davies v Taylor[1974] AC 2017 , 212, per Lord Reid, and Gregg v Scott[2005] 2 AC 176 , para 17, per Lord Nicholls of Birkenhead, and paras 67-69, per Lord Hoffmann. [24]. The Appellants' submission, for example, that ‘the case that a specific amount of profits would have been earned in stage 1 was unproven’ is therefore misdirected. It is true that by the nature of things the judge could not find as a fact that the amount of lost profits at stage 1 was more likely than not to have been the specific figure which he awarded, but that is not to the point. The judge had to make a reasonable assessment and different judges might come to different assessments without being unreasonable. An appellate court will therefore be slow to interfere with the judge's assessment. … ”
“[103] Toulson LJ is thus saying that Tangent's claim was not one which depended on ‘loss of a chance’ in order to identify some head of loss. The judge had been able there to find that it was likely that Tangent would have traded profitably, as contrasted with cases such asChaplin v Hicks[1911] 2 KB 786 where no analogous conclusion could be drawn. The judge was nevertheless required to take account, in the assessment of damages, of ‘the chances, great or small (unless those chances amount to no more than remote speculation), taking all significant factors into account.’”
“[20] The general rule is that the claimant must prove that the defendant's breach caused the loss which he seeks to recover by way of damages. That must be proved on the balance of probabilities. When that is done the loss is recoverable in full subject only to questions of mitigation or remoteness. In some cases, however, where the claimant's ability to have made the profit which it claims depends on the actions of unrelated third parties, there may be room for arguing that the court should approach the issue of causation by taking into account the chances of those events having occurred. [21] In the classic loss of a chance case the most that the claimant can ever say is that what he (or she) has lost is the opportunity to achieve success (e.g.) in a competition (Chaplin v Hicks[1911] 2 KB 786 ) or in litigation (Kitchen v Royal Air Forces Association[1958] 1 WLR 563 ). The loss is by definition no more than the loss of a chance and, once it is established that the breach has deprived the claimant of that chance, the damage has to be assessed in percentage terms by reference to the chances of success. But there will be other loss of chance cases where the recoverability of the alleged loss depends upon the actions of a third party whose conduct is a critical link in the chain of causation. The decision of this court in Allied Maples Group Ltd v Simmons & Simmons [1995]1 WLR 1602 has established that causal issues of that kind can be determined on the basis that there was a real and substantial chance that the relevant event would have come about. [24] Judge Levy, in the passages I have quoted from his judgment, found as a fact that Zorbas would have been a successful restaurant and therefore assessed its lost profits on that basis. His analysis of the variable factors I have outlined which formed the agreed components of that calculation involved taking into account the time needed to establish a reputation and other everyday contingencies but did not involve a more general discount of the kind described in Allied Maples to take account of the statistical possibility of failure. That was excluded by his finding that the restaurant would have been a success. [25] Where the quantification of loss depends upon an assessment of events which did not happen the judge is left to assess the chances of the alternative scenario he is presented with. This has nothing to do with loss of chance as such. It is simply the judge making a realistic and reasoned assessment of a variety of circumstances in order to determine what the level of loss has been. …”
“As explained earlier, the issue of how successful the restaurant would have been was not an issue of causation. It was relevant only to quantum. Judge Dight and Judge Levy were satisfied that the restaurant would have been profitable and calculated the damages accordingly. One can express this in terms of them assessing the chances of success at 100% but either way there is no room for a further discount. The calculation of profits which they made was not determined as the best level of profits reasonably obtainable.It was the amount which on their findings he would have earned.”
“[100] I would have thought that, applying those principles to the present case, it would be plain that, whilst WP would need to show on the balance of probabilities that, but for the negligence complained of, they would have opened a US office (a question of causation dependent on what the claimant would have done in the absence of a breach of duty), the actual loss which they claimed to have been caused by the defendant was dependent on the hypothetical actions of a third party, namely Nomura. Accordingly, in line with well established principle, the chances of Nomura deciding to award the mandates to WP would have to be reflected in the award of damages. … [109] On the judge's findings in the present case, the only viable claim to loss of profits in the United States was one to the loss of some of the Nomura mandates. WP's case on causation, that Withers' negligence caused WP to lose the Nomura mandates, was one which depended on the hypothetical actions of Nomura, a third party. WP had, first, to prove that its own actions would have been such as to place itself in a position to obtain that work, and it had to do so on the balance of probabilities. It did so. All that remained on the issue of causation was for WP to establish whether there was a real and substantial chance that Nomura would have awarded some part of the mandates to WP. It did so. That was the beginning and end of its case on causation. [110] It does not follow at all, however, that it is no longer relevant to consider the chances that WP would have obtained the mandates. The evaluation of that chance is part of the process of the quantification of damages. It would be wrong in principle to treat the conclusion on causation as if it meant that the chances of obtaining some part of the mandate were 100%. The judge was correct to reflect his view of the chances of WP obtaining the mandate in his quantification of damages.”
“[21] … Allied Maples had made a corporate takeover of assets and businesses within the Gillow group of companies, during which it was negligently advised by the defendant solicitors in relation to seeking protection against contingent liabilities of subsidiaries within the vendor’s group. Allied Maples would have been better off, competently advised, if, but only if: (a) it had raised the matter with Gillow and sought improved warranties and (b) Gillow had responded by providing them. The Court of Appeal held that Allied Maples had to prove point (a) on a balance of probabilities, but that point (b) should be assessed upon the basis of loss of the chance that Gillow would have responded favourably. The Court of Appeal (Stuart-Smith, Hobhouse and Millett LJJ) were unanimous in that statement of legal principle, although they differed as to the outcome of its application to the facts. It was later approved by the House of Lords in Gregg v Scott[2005] 2 AC 176 , at para 11 by Lord Nichols of Birkenhead and para 83 by Lord Hoffmann.”
“To the extent that the supposed beneficial outcome depends on what others would have done, this depends upon a loss of chance evaluation.”
“This leaves us with the task of getting round this whilst at the same time providing software security for SE. Something that needs more discussion.”
“3) Ed [Prescott] wants a route map to software security. The route discussed is work to remove known bug. Edit commentary. Place compilable code in secure place. Then recruit engineer for transfer. I am not clear whether this is agreed.”
“The route discussed is work to remove known bug. Edit commentary. Place compilable code in secure place. Then recruit engineer for transfer. I am not clear whether this is agreed.”
“Jim [Lock] reported that the problem of armature fuse blowing has been contained by issuing version 6.13 firmware. This is not a long term fix as v6.13 has its own problems (particularly with transitioning into standby field) although these are considered less significant. Timescales for implementing a full corrective action are unknown at present as Aris [Potamianos] has been unable to commit to working on the problem. More than 600 v6.13 drives have been shipped but realistically the number of units exposed to this issue will be far fewer as 50Hz applications do not appear to be affected.”
“Jim has drafted a list of improvements for the PL/X and JL/X firmware but Aris has given no commitment as to when he will be able to action these.”
“Elephant in the room is software and the PLX product range which is the main earner. … There are known bugs and published functions not working correctly in the current software. Also there is weakness in the method for upgrading the software on the customer's site. These are not materially affecting sales but need to be fixed. The JLX (Slip ring motor drive) is hampered in sales because it hasn't got a slick menu for the user. Plus the default configuration should be improved.”
“This to me is the single biggest threat. Aris is refusing to hand over the source code because there is no shareholder agreement. There is no shareholder agreement because Aris does not agree that my 60% should allow me to appoint 3 directors and his 40% only 2. (This was intrinsic in the original agreement). So now we have to rely on the articles. There is no ongoing program of product improvement for the software and hasn't been for a year at this date. This is because of the fact that Aris does not seem inclined to participate at this time. The PLX is the mainstay of sales and without solving the above issues there is no long term future for SE. Without Aris available for whatever reason to further develop the software then the PLX is not a product we can build our future on as the software platform is not stable. This makes debugging and development difficult, if not impossible. Without knowing the status of the source code and documentation it is hard to assess the development effort required to create a robust and reliable platform but in the worst case it is likely to mean a complete code re-write. This is a formidable task (multiple man years). We need to make a product that as well as fulfilling the performance requirements of a modern, reliable DC motor controller, must be field upgradeable with modern comms interfaces (Ethernet, USB, Bluetooth) and a user-friendly configuration tool. On top of this we would be instantly exposed with any field problem involving the software and unable to solve it without access to the source code. It has always been the case that Aris is the only person able to support the PLX software and we have been running the risk of his illness or death during this time and been fortunate. At least then he was committed to the same goals. Aris does not seem to appreciate the risk that this is currently subjecting SE to. If he does then he is prepared to accept it, but I would not put myself in his position as it affects our heirs. In summary, the PLX in its current form is a barrier to growth. If we push the existing product into more territories and applications then we risk exposing its shortcomings to a wider audience, exacerbating the technical support overhead and doing reputational damage that will be difficult to reverse. … In conjunction with Mark I have assessed what resource we would need to replace Aris. It requires 2 high level engineers with complimentary skills. Engineer 1. Understanding the physics of motor control with coding ability. Engineer 2. Specialise in coding with comms experience. Combined cost estimate £l00K. We have identified a potential candidate for E1. The 2 engineers would have to be under the direction of Mark. However Aris has told me that he would refuse to train Mark. This presents a further difficulty. I was lucky to find Aris in 1998 in that he had the skills of E1 plus E2 plus the experience of designing the 590 series. It was for this reason that when the opportunity arose with DVDW buyback I facilitated Aris becoming a significant shareholder in 2007 because I wanted ongoing security of software.”
“Scope • Develop 6.13+ based on v6.11.01 • Tidy code • Fix bugs • Add boot loader for field upgrade • Ethernet and new configuration tool as per option 1 • DriveWeb for automation • Risks • Few enhancements for users Benefits • Maintainable code • Low resource requirements • No CAPEX” • Develop 6.13+ based on v6.11.01 • Tidy code • Fix bugs • Add boot loader for field upgrade • Ethernet and new configuration tool as per option 1 • DriveWeb for automation • Risks • Few enhancements for users • Maintainable code • Low resource requirements • No CAPEX”
“77. Accordingly the claimant is entitled to repayment of sums paid to BDL in respect of [Schedule] 200815 … , namely£42,000 + VAT… 78. Alternatively, the claimant is entitled to damages for BDL's failures to perform [Schedule 200815], … which the claimant quantifies as the price agreed … namely£42,000 +VAT …”
“SEL could only create code for JL/X which could be used on the Microchip platform once Dr Fells he had been able to create from the v6.11 of the PL/X code a version of code which was functionally equivalent to v6.13 of the PL/X code.”
“[310] For these reasons, I hold that BDL failed to perform Schedule No 200815 or has otherwise acted in breach of that contract as alleged in paragraphs 72 to 74 of the Particulars of Claim, and that SEL is entitled to damages for breach of contract as a result. [311] I am not dissuaded from reaching that conclusion by a further point that was taken by BDL and Dr Potamianos, namely that SEL’s pleaded case, at paragraph 78 of the Particulars of Claim, quantifies the damages claimed as the price agreed under the Schedule, whereas damages should correspond to the loss (if any) resulting from the breach. Accordingly, BDL and Dr Potamianos submitted that SEL was in breach of its duty to plead a valid basis on which damages can be quantified, as a matter of fairness to them (see Perestrello E Companhia Limitada v United Paint Co Ltd[1969] 1 WLR 570 , at 579-580), that in these circumstances only nominal damages should be awarded to SEL for any breach, and that there was no need for any subsequent trial on quantum. [312] In my view, SEL’s pleaded claim for damages notifies BDL and Dr Potamianos of the case that they have to meet. If they wanted to argue that this case is so misconceived that it could only properly result in an award of nominal damages even if SEL succeeds on the issue of liability, I consider that they could and should have raised that argument before the Order was made on the Case Management Conference on8 November 2017 . In that way, if the argument had been accepted, the time and costs that have been expended on the trial of liability under this heading could have been saved, on the footing that, generally speaking, a claimant does not come to court to obtain an award of only nominal damages, and it will not generally accord with the overriding objective to order a trial in which such an award is the best that the claimant can expect to achieve. Having not taken the point at that stage, I consider that, in accordance with the Order that was made by Snowden J, quantum falls to be determined at a further trial.”
“50. The specific JL/X source code files developed by Aris were not left by him on SEL's server. It was not possible for Dr Fells or I to know for certain what changes Aris had made to turn code found on the server into something suitable for the JL/X until the delivery up in October 2018 in addition to changing the menus. Dr Fells had to do a significant amount of ‘up front’ work to understand what the Intel version of the code did, but once he had done this Dr Fells was able to make some educated guesses, and as it turned out he was largely right. But he could not be 100% sure he was right until he saw the code which was delivered up. Functional changes which he correctly anticipated were to 7 files and related to something called PIN 98 (the details of which are not relevant for present purposes). When he compared the JL/X code which Aris delivered up with the V6.13 files Aris delivered up, he tells me could see that there were 2 more changes made which he had not anticipated: a) The size of "eerowbuffer'' variable was changed. The reason for this change is not clear and whether it has any effect is not clear. b) Changes relating to Voltage and current scaling in the file ‘mmi.c’.” a) The size of "eerowbuffer'' variable was changed. The reason for this change is not clear and whether it has any effect is not clear. b) Changes relating to Voltage and current scaling in the file ‘mmi.c’.”