“The Husband and Wife undertake to each other and to the court (and agree that these undertakings will be incorporated into a formal undertaking which will be lodged with the court): 9. They will not cause, or take any steps to cause, any of the companies of which they are a director or shareholder (whether legally or beneficially) to deal with (whether by sale, charge, pledge of title deed or documents or otherwise), dispose of, dissipate or diminish the value of any property, or any other asset held by any of the companies other than in the ordinary course of business.”
“You have committed Docklock to a Car Hire Agreement for the sum of£559 per month for 3 years and an initial outlay payment in excess of£5,000 . This sum should now be paid out of Christo & Co and it will be considered part of your earnings. In conclusion I would ask that you no longer mix the financial affairs of Christo & Co with Docklock Ltd. Docklock Ltd is a financially independent entity from Christo & Co the only relationship is that you hold a directorship in Christo & Co as you do in Docklock. If you are not prepared to comply then please advise as it will be necessary to take immediate steps to prevent unauthorised funds being extracted from Docklock.”
“In the circumstances it was resolved unanimously that the Company should take the following initial steps to protect its interests: 3.1 In relation to the flat situated at Flat 2, 73 Parkway, London NW1 7PP owned by the Company and currently occupied by CC free of any rental or any other payment obligation, the Company should serve notice on CC requiring him to vacate the flat in one month’s time with a view to letting the flat for a market rental, and at the same time to provide CC the opportunity to continue residing in the flat subject to the terms of a tenancy agreement to be agreed between the parties, entailing the payment of a fair market rental capable of being justified objectively. 3.2 That the Company should serve notice on Christo & Co requiring Christo & Co to vacate the business premises situated at Ground and First Floor (part), 66-70 Parkway, London NW1 7AH in four months’ time with a view to letting the premises under a commercial lease on terms that reflect the market value of the property, Christo & Co having not been required to pay any rental or other occupation payment before now; in addition Christo & Co is to be given the opportunity to enter into negotiations for a formal lease on terms that match the legitimate commercial expectations of the Company in accordance with such professional advice as the Company may obtain. The Company’s priority shall be to maximise capital value for the benefit of the shareholders. 3.3 That the Company should serve four months’ notice on Christo & Co terminating the arrangement it has had with Christo & Co for provision of property management services in relation to the Company’s properties. 3.4 That the Company should seek to engage the services of an independent company for the provision of professional property management services to the Company on acceptable terms that are competitive in the marketplace. 3.5 That the Company shall forthwith cease making payment to Christo & Co management charges reflecting the salary paid by Christo & Co to its employee, Mark Forrester in accordance with the request made by CC on7 November 2014 . 3.6 That the Company shall request from Christo & Co reimbursement of the sums spent on the car leasing agreement entered into by Christo & Co in relation to the Audi motor vehicle provided to Mark Forrester, in accordance with the request made by CC on7 November 2014 .”
“It is not accepted that the arrangements provided to date have been provided pursuant to any formal legal contract between Docklock Limited and Christo & Co, but we wish to give Christo & Co what we believe to be reasonable notice of termination, and in those circumstances please accept this letter as firstly notice terminating our arrangements for the provision of the property management services, and secondly, to the extent that it is found by a Court that such services were provided pursuant to a contract (which is not admitted) terminating such contract, on the basis that termination is to take effect four months from today’s date.”
“Until further order of the court the respondent and second respondent are each forbidden to: a. Take any steps to terminate the arrangement, or to give effect to any purported termination of the arrangement, whereby Christo & Co Ltd provides property management services to any other company, including but not limited to Ridlington Ltd and Docklock Ltd; b. Take any steps to alter in any way the working arrangements between Christo & Co Ltd and any other company, including but not limited to Ridlington Ltd and Docklock Ltd;….g. Take no steps to obtain vacant possession of 66-70 Parkway London NW1 7AH; h. Take not [sic] steps to seek to obtain vacant possession of Flat 2, 73 Parkway, London NW1 7PP.”
“a. Christo & Co (‘Christo’) shall continue to manage the properties of Docklock Ltd (‘Docklock’) and Ridlington Ltd (‘Ridlington’) on behalf of each of them respectively as before; b. The rents collected by Christo in respect of Docklock’s properties shall be paid promptly to Docklock’s bank account in its own name, with account number 20701368 and sort code 309384; c. The Applicant shall be permitted to occupy Flat 2, 73 Parkway, London NW1 7PP rent-free, and the Respondents shall not take steps to evict the Applicant therefrom; d. Christo will be permitted to occupy 66-70 Parkway, London NW1 7AH rent-free, and the Respondents shall not take steps to evict Christo therefrom;………….g. Each of the Respondents will sign the Docklock accounts forthwith and in any event by 4 pm on5 May 2015 , provided that they are provided promptly with any information and/or documentation they reasonably require to enable them to do so;…..”
“If what H says is true, and he has never charged either company for any of the management services C Ltd provides, there would not appear to be any loss of its income stream from this source for C Ltd.”
“1.1 Since its incorporation in 1986, Docklock’s property portfolio has been managed by a team of five employees at the property management firm Christo & Co Limited (“Christo”). These services have been supervised for the majority of this time by Christo’s employee, Mark Forrester. Mr Forrester is a chartered surveyor and has built up a considerable wealth of knowledge about the operation of Docklock’s business and its assets. We understand that Christo has managed Docklock’s portfolio competently for 30 years and (without prejudice to its entitlement to claim such fees) this has been at no cost to Docklock other than having passed the costs of Mr Forrester’s salary on to Docklock for certain periods of time (of no more than 18 months) and more recently needing to pass on certain administrative costs. 1.2 Notwithstanding the above, we note that Docklock attempted to terminate Christo’s management of Docklock’s property portfolio in February 2015 in order to move such management to Savills on arm’s length terms. Our client suspects this action was motivated by a desire to withhold information about Docklock’s management from our client so as to enable you to take actions such as those set out below in order to: (i) obtain a more favourable outcome in the divorce proceedings; and (ii) further your own interests (as opposed to those of Docklock) without our client’s knowledge. Our client does not consider it to be in the best interests of Docklock to terminate Christo’s services since:…..1.2.2 Savills will charge Docklock for property management services;… 1.3 In the event, we note that Docklock was restrained from terminating Christo’s services and that Christo has continued to manage Docklock’s portfolio without complaint from Docklock’s directors. In light of this our client assumes that Docklock does not intend to renew its attempt to terminate Christo’s services on three months’ notice (since such notice would not expire until March 2016) and that it instead agrees that Christo should continue to manage Docklock’s portfolio until after the division of assets at the divorce hearing in April.”
“We confirm that pending the provision of this information – and so long as it is provided promptly – Docklock will not take any steps to change the management of its property portfolio. The provision of this information is important so that Docklock’s directors can properly appraise whether (as you claim) the costs involved in moving to an independent managing agent would be significantly (or at all) greater than the total costs of the current arrangements with Christo.”
“In relation to Christo’s proposed charges for 2016, as this is a forward looking issue, we suggest that your clients discuss this with Christo directly. This will avoid miscommunication or misinterpretation. Christo confirms that it is willing to engage with your clients on this.”
“Furthermore, the parties agree that save in respect of the potential claims listed in subparagraphs a, b and c below, save as otherwise provided elsewhere in this order, this order together with the Mutual Waiver Agreement is intended to be in full and final satisfaction of all and any claims in England and Wales and any other jurisdiction: i. that the companies have against each other; ii. that the parties have against the companies; and iii. that the companies have against the parties including for the avoidance of doubt, any claim in respect of 73A Parkway, 73B Parkway, and 28 Cheyne Walk, save in the event and to the extent that either party breaches their obligations under paragraph 59. The only exceptions to this are the following civil claims at subparagraphs a. and b. and the exception at subparagraph c.: a. any claim or counterclaim by any of the applicant’s companies against Christo & Co and/or the respondent in respect of any monies received by Christo & Co as agent for any of the applicant’s companies in respect of the period beginning1 October 2014 and ending on1 September 2016 for which it is asserted that the respondent and/or Christo & Co has not duly accounted to and/or has not paid over to that company, including in respect of rent; b. any claim or counterclaim by Christo & Co against any of the applicant’s companies in respect of management fees for the period beginning1 October 2014 up to1 September 2016 which Christo asserts are owing to it (it being recorded that in the event that such claim or counterclaim is made, Docklock is not prevented from raising, as a set off, any occupation charge for Christo & Co’s occupation of 66-70 Parkway beginning1 October 2014 up to1 September 2016 . c. any claim for breach of this order.”
“On the basis that each party shall pay their own conveyancing costs, the applicant undertakes to procure, as a director of Docklock, a sale of 66-70 Parkway by Docklock to the respondent or a UK based company of his choice, subject to the security at paragraph 46 below being executed, at the price of£3,260,000 payable in cash, the sale to take place either at the Completion Date or as soon as possible thereafter and in any event by10 July 2017 .”
“The respondent undertakes that he shall ensure that neither he nor any of his companies take any steps to evict the applicant who may continue to reside rent-free in 28 Cheyne Walk until31st August 2017 and the applicant undertakes that neither she nor her companies shall take any steps to evict the respondent, who may continue to reside rent-free in the property at Flat A and Flat B, 73 Parkway until31st August 2017 and/or take any steps to evict Christo & Co, who may continue to reside in 6670 Parkway. Christo & Co’s occupation of 66-70 Parkway shall be rent-free save that, for the avoidance of doubt, in the event that Christo & Co brings a claim or counterclaim for management fees against Docklock, Docklock shall be entitled to claim (as a set off) occupation rent against Christo & Co for the period beginning1 October 2014 up until1 September 2016 .”
“1. In consideration of the entry by the other Parties into this Agreement, subject to the contents of, and the rights granted and obligations imposed by, the Order and subject to the indemnities set out at paragraphs 4 to 7 hereof, and save as set out at paragraphs 2 and 3 below:…… c. Betty’s Companies hereby agree to and do waive, and enter into this Agreement in full and final settlement of, all and any claims and rights of action, either existing now or which may arise in the future, which any of them has or may have, whether in England and Wales or in any other jurisdiction, against Chris or any of Chris’ Companies, arising out of the dealings between them to date; and d. Chris’ Companies hereby agree to and do waive, and enter into this Agreement in full and final settlement of, all and any claims and rights of action, either existing now or which may arise in the future, which any of them has or may have, whether in England and Wales or in any other jurisdiction, against Betty or any of Betty’s Companies, arising out of the dealings between them to date. 2. The only exceptions to the waiver and full and final settlement of claims set out at paragraph 1 above are: a. any claim or counterclaim by any of Betty’s Companies against Christo & Co and/or Chris in respect of any monies received by Christo & Co as agent for any of Betty’s Companies in respect of the period beginning1 October 2014 for which it is asserted that Chris and/or Christo & Co has not duly accounted to that company, including in respect of rent; b. any claim or counterclaim by Christo & Co against any of Betty’s Companies in respect of management fees for the period beginning1 October 2014 which Christo & Co asserts are owing to it; c. in the event only that any such claim or counterclaim is made as referred to at b. above, any claim or counterclaim by Docklock against Christo & Co in respect of the latter’s occupation of 66-70 Parkway up to1 September 2016 …… e. any claim in respect of any rights granted by, or for breach of, the Order.”
“As is well known, the liability to account arises from a variety of relationships, varying from strict trusteeships to an agency where the agent controls property belonging to a principal. “The taking of an account is the means by which a beneficiary requires trustee to justify his stewardship of trust property” (Ultraframe (UK) Ltd. v Fielding[2006] FSR 17 at [1513], cited in Snell Op. et Loc. Cit.). The following passage from the text book is of particular relevance to this case: ‘Taking the Account. (3) The accounting party first submits his verified accounts and supporting documents, and the beneficiary may then raise any specific objections he may have. Objections to an account presented to the court as complete are either by way of surcharge or falsification. The beneficiary surcharges the account when he contends that the accounting party should have charged himself on the incoming side of the account with more than he had admitted. The beneficiary falsifies the account when he challenges an item of discharge entered into the outgoings side of the account. Burden of Proof. (4) The beneficiary carries the burden of proving surcharges and the accounting party carries the burden of proving his discharge. The accounting party must therefore be prepared to document each item, and presumptions may be made against him if he has not kept proper records or has destroyed them…’”
“I was satisfied that the figures I produced at Q3 – the adjustments that I made here were accurate, because I was taking payments that related to1st October 2014 onwards and including them in the calculations, rather than disregarding the Q3, 2014 statement completely and saying it was outside the period. I was actually looking at it and bringing figures into the relevant period, rather than taking them out. So, I felt that I was actually giving an accurate, in my opinion, I felt I was giving an accurate position of the financial position. Q. But it was not done on the same basis as the schedules that you have recently prepared in relation to the end period -- the end of the relevant period? A. There is a slight difference, yes, but I maintain that I believe these figures are accurate because we were looking at a period from 1st October. Any tenant whose rent was due from 1st October onwards -- tenants do not tend to pay you a week early. I maintain that I believe these figures are accurate, and, if anything, I was bringing money into the relevant period rather than ignoring it because it was on the previous RIES.”
“My Lords, it is said that the account dated August 22 brings the question within the authority of Clayton's Case, and, in order to see whether this is so, it is necessary to consider what Clayton's Case was, and the reasons given by Sir William Grant, who decided it. That learned judge says: where an account current is kept between parties as a banking account, “there is no room for any other appropriation than that which arises from the order in which the receipts and payments take place and are carried into the account. Presumably, it is the sum first paid in that is first drawn out. It is the first item on the debit side of the account that is discharged or reduced by the first item on the credit side; the appropriation is made by the very act of setting the two items against each other.”
“81. In the Scott Schedule, Docklock accepts that it received transfers of£1,272,073.44 . Christo asserts that the correct figure should be a total of£1,550,000 . 82. As with the income figure, Docklock’s figure for accepted transfers must be amended in light of the evidence as to the sitting balance. Docklock now accepts that (subject to verification of Christo’s figures) it has received transfers totalling£1,415,881.28 . This is Christo’s figure of£1,550,000 , less the sitting balance. 83. The reasons for the difference are as set out in Docklock’s skeleton argument in relation to appropriation of payments: the first£134,118.72 of the payments out made during the Relevant Period were in fact payments out of sums already sitting in the client account. They are therefore not to be taken into account as disbursements of income received during the Relevant Period. 84. Once this is understood, it is clear that Christo’s objection is simply wrong. Docklock is not seeking to claim any income received on its behalf prior to the Relevant Period, for the simple reason that this was already paid to it during 2014.”
“Christo & Co is not unlawfully withholding monies from your client, and there is no net debt owed by Christo & Co to your client. Christo & Co is entitled to set off fees it is owed by your client, in addition to expenses payable to third parties that were incurred on Docklock’s behalf, before paying any surplus to your client. In this case, the management and other fees your client owes to Christo & Co significantly exceed any amount Christo & Co owes to your client. Our client is in the process of calculating such outstanding fees as at today’s date (and of course is entitled to payment of future management and professional fees) but did not wish to delay sending this response in the meantime. Christo & Co is not therefore obliged to pay anything to your client.”
“a…..b. Prior to3 March 2010 , when Mr Chris Christoforou was the director/owner of the Claimant, he in his capacity as director/ owner of both the Claimant and the Defendant, agreed on behalf of both of the Claimant and the Defendant that the Defendant would be entitled to charge the Claimant a reasonable fee for the services provided by the Defendant. c. After3 March 2010 , when Mr Nicholas Christoforou became the director of the Claimant, Mr Nicholas Christoforou on behalf of the Claimant and Mr Chris Christoforou on behalf of the Defendant orally affirmed the agreement that the Defendant would be entitled to charge the Claimant a reasonable fee for the services provided by the Defendant and further agreed orally (in the light of the Claimant having cash at its disposal and in the light of taxation advantages) that the salaries of Messrs Nicholas Christoforou and Mark Forrester, employees of the Defendant, would be paid by the Claimant in lieu of management fees. The oral affirmation and that oral agreement took place in person at the offices of the Defendant a few weeks before the salaries of Messrs Nicholas Christoforou and Mark Forrester began to be paid by the Claimant in about 20132014. d. The payment made by the Claimant of the salary due from the Defendant to Mr Nicholas Christoforou from about 20132014 in lieu of management fees could not have been made (and was not made) without his express agreement as the director of the Claimant and the recipient of that salary. e. Alternatively, it was in the premises an implied term of the arrangement between the Claimant and the Defendant (implied on the basis of the obvious intentions of the parties and/or business efficacy and/orsection 15 of the Supply of Goods and Services Act 1982 ) that the Defendant would be entitled to charge the Claimant a reasonable fee for the services provided by the Defendant.”
“In the alternative, if contrary to D’s primary case, there was no agreement relating to these letting/renewal fees as aforesaid, the said services were all carried out by the D at C’s request (express or implied above) so as the Defendant is entitled to be paid a reasonable sum upon a quantum meruit equal to the amounts charged or as the court decides.”
“A reduction of£70,100 being payroll costs recharged to Docklock Ltd. Please transfer this amount from Docklock Ltd to this company referring to it as reimbursement of payroll costs. We will make the opposite journal in the 2013 Docklock accounts. Please note that we made a similar charge last year.”
“Christo and Co owes Docklock£50,000 . Therefore, set off and Docklock will have to pay the balance of£20,100 to Christo.”
“As at the year-end the company was owed£64,127 by Docklock Ltd and should be settled by the latter (this relates to previous years payroll costs charged to Docklock Ltd).”
“Preparing the VAT return for Docklock Limited for the quarter ended30th November 2014 . Including assessing and analysing all rental income, printing rental VAT invoices, compiling schedules of all income for the VAT period. Analysing and assessing all expenditure over the portfolio on all properties, assessing invoices and producing schedules and breakdowns of all invoices for the period. Undertaking VAT calculations, preparing and submitting VAT return online.”
“Our fees in relation to the letting renewal administration for the above flat. The agreement has been renewed to our applicants for a period of 1 year from the12th March 2015 at a rental of£29,892 per annum (£574.85 per week). To: Negotiations with tenants, agreeing renewal, preparation of new tenancy agreement and meetings with tenant to arrange signing thereof.”
“I enclose a reconciliation from C Christo & Co Ltd’s accounting records of Docklock’s account with the company. You will note that as at30 April 2014 (the last accounts prepared) Docklock Ltd owed C Christo & Co Ltd£66,994.94 . The difference between this amount and the payment made of£64,127 is£2,867 which seems to represent the PAYE liability for January ’14 which was paid by C Christo & Co Ltd. I assume that this amount was reimbursed to the company prior to31 January 2015 . The amount due to [sic] Docklock is primarily made up of two charges of£70,100 each booked in C Christo & Co Ltd’s accounts to30 April 2012 and 2013 respectively to apportion part of the company’s payroll costs to Docklock Ltd since the latter did not operate a PAYE scheme (no other administration or management fees were charged). No such charge was made in the 2015 accounts since Docklock Ltd was operating its own PAYE scheme during the year.”
“Professional services in connection with rent review works at 186 Camden High Street, London NW1, including inspection of premises, consideration of lease, undertaking a valuation exercise on 3 different premises, consulting the retail price index and investigating the market, meeting with tenant at our offices, explaining the basis of the rent review and effecting agreement in relation to the rent, consulting with clients and compilation and completion of the Rent Review Memorandum and accompanying documentation. To: Usual fee£8,390.70 but due to nature of rent review basis concessionary hourly rate @£250 per hour.”
“Q. I would suggest to you that the reason that it says no management charges have been made is because you were not charging management fees? A. Well, you are entitled to your opinion, counsel, but in my simple mind again, what it says -- unless you are saying we will charge the salaries, but we will also possibly charge you management fees in addition to that, or there are no management fees. What we are saying here is -- in actual fact, this confirms what I am saying. It says that we are not charging management fees, but we are charging salaries. We cannot charge both. The reason we are charging salaries is because they are in lieu of the management fees. It would have been very weird if we had said, "We are charging you salaries and we are charging you management fees as well." Q. So on your case, the amount of the management fees was the amount of the salaries? A. That is what I have been saying for two days now nearly. Q. Then you were the person who chose to bring that to an end in November 2014? A. Absolutely. My companies have to -- I knew exactly what was -- I said it yesterday and there is no point wasting the court's time on this.” iv) When Nicholas was cross-examined he accepted that he knew about the salaries being put into the accounts but he suggested that this was no more than an accounting device: Q. It is right there was no PAYE system at that stage, that did not get set up for another couple of years. But the point is, these are being entered in Docklock's accounts as management charges because that is what they were? A. I think the PAYE was after 11th January, when these accounts were filed, I think it was established some time in May, just a few months after the preparation of the accounts. But these were not -- I have come to say the truth -- these were not management charges in the form of a contractual or formal relationship as the defendant's case is. This was a means to an end in relation to the accounting. It was a method to put the salaries unconnected to any form of contract. It was the salaries of Mark and myself. Q. You are not suggesting that you did not know about this? A. I knew that the salaries and the -- I knew about the salaries being put into the accounts because it was an arrangement that Docklock had to take Mark Forrester's and my salaries, the accounts were signed by Chris at the time. Again, all part and parcel of this, you know, fluid state of affairs where, when the family was harmonious and happy. Even the accountant must have known he was not a director and yet they prepared them. Whether that was on accounting advice, I do not know, I cannot recall.” v) He was then taken to the minutes of the board meeting of Docklock on30 January 2015 , at which he and Betty were present and the term “management charges” was used. He accepted that there was an arrangement for Docklock to pay management charges and a liability to pay the salaries although he did not accept that this arrangement was a contractual one: Q. And the way you characterised those payments is as management charges, is it not? A. It says "management charges" there, I am not denying that, but that is not the reading or the intention to create, to adhere to some formal management contract. Q. It is not someone else's entry in an account; this is your minutes, are they not? A. They are prepared by the company and I believe signed by myself, yes. Q. Yes. Those were management charges. That was the case at this point, that there was a liability on the part of Docklock to pay management charges to CCL? A. The liability was to pay the salary, reflecting the salary. Q. It had nothing to do with the occupation or anything like that. There was no arrangement for Docklock not to pay fees because CCL was not paying rent, nothing like that. It was just a liability to paying management charges? A. It was an arrangement that Docklock would pay for the management charges. Whether the term "liability" means a contractual, I am not able to say that, so I will not use that. It was simply a way in which the salaries, the costs of Mark Forrester and myself at the time were paid to lessen the burden on and benefit because Docklock was cash-rich, generating cash. Q. And that arrangement, that agreement, we know that an attempt was made to serve notice, but the notice was of no effect. So the arrangement, the agreement that there was between the two companies at that stage, that continued. That is the simple fact of the matter, is it not? A. I disagree that the arrangement, these notices did not have an effect. It caused a knee-jerk ex parte application to prevent them to occur. I presume you would not need to have gone to do an injunction if they were not taken into effect or they did not have a force. Q. The notice terminating the retainer came to nothing. The retainer continued throughout the entire relevant period? A. The management services provided by Christo & Co, Docklock was unable to change, to effect what it had corporately agreed. It was hindered and restricted by an improper injunction that lasted effectively until, I believe, December when the actual order was finally -- December 2015, when the final, I believe, order was sought. I may be wrong. Q. I think it was discharged in September, but I do not think anything in principle turns on that.”
“There are no management charges at present.”
“No management charge has been made by Christo & Co for the year ended31 March 2014 .”
“I was able to correct it, and that is why you see8th May 2015 , at page 2023, accounts where I have been able, obviously at this point everything has gone nuclear and the responsibilities of -- I realised my responsibilities, and that is why in the restated accounts, I was able to record the 2014 correctly for the first time. Because, one, we had PAYE set up, and, two, that it gives effect to what I understood, what I had previously understood to be what was in place effectively the salaries of Mark and myself, placed within the accounts in that format.”
“100. For there to be a contract, there must be (a) agreement on essentials of sufficient certainty to be enforceable, (b) an intention to create legal relations and (c) consideration. Both the first two requirements fall to be judged objectively. In Chitty on Contracts (28th ed.) para. 1–034, it is pointed out that: “Contracts may be either express or implied. The difference is not one of legal effect but simply of the way in which the consent of the parties is manifested. Contracts are express when their terms are stated in words by the parties. They are often said to be implied when their terms are not so stated, as, for example, when a passenger is permitted to board a bus: from the conduct of the parties the law implies a promise by the passenger to pay the fare, and a promise by the operator of the bus to carry him safely to his destination.” 101. The same paragraph concludes: “Since, as we have seen, agreement is not a mental state but an act, an inference from conduct, and since many of the terms of an express contract are often implied, it follow that the distinction between express and implied contracts has very little importance, even if it can be said to exist at all.” 102. One distinction exists however in relation to the ease with which an express or implied contract may be established. Where there is an express agreement on essentials of sufficient certainty to be enforceable, an intention to create legal relations may commonly be assumed: Chitty, para. 2–146. It is otherwise, when the case is that a contract should be implied from the parties' conduct: Chitty, para. 2–147. It is then for the party asserting a contract to show the necessity for implying it: see The Aramis [1989] 1 Ll.R. 213 , Blackpool and Fylde Aero Club Ltd. v. Blackpool B.C.[1990] 1 WLR 1195 , The Hannah Blumenthal[1983] AC 854 and The Gudermes [1993] 1 Ll.R. 311.”
“It is important, in my judgment, to avoid reading the helpful dicta in the cases concerning implied contracts as if they were prescriptive deeds. The most significant aspect of the consideration of whether to imply a contract is the court's consideration of all the circumstances and, in particular, of the conduct of the parties.”
“It is common ground that the correct approach to the amount to be paid by way of a quantum meruit where there is no valid and subsisting contract between the parties is to ask whether the defendant has been unjustly enriched and, if so, to what extent. The position is different if there is a contract between the parties. Thus, if A consults, say, a private doctor or a lawyer for advice there will ordinarily be a contract between them. Often the amount of his or her remuneration is not spelled out. In those circumstances, assuming there is a contract at all, the law will normally imply a term into the agreement that the remuneration will be reasonable in all the circumstances. A claim for such remuneration has sometimes been referred to as a claim for a quantum meruit. In such a case, while it is no doubt relevant to have regard to the benefit to the defendant, the focus is not on the benefit to the defendant in the way in which it is where there is no such contract. In a contractual claim the focus would in principle be on the intentions of the parties (objectively ascertained). This is not such a case……. It is now well established that a court must first ask itself four questions when faced with a claim for unjust enrichment as follows. (1) Has the defendant been enriched? (2) Was the enrichment at the claimant's expense? (3) Was the enrichment unjust? (4) Are there any defences available to the defendant?”
“In summary, in my opinion, in a case of this kind, (i) the starting point for identifying whether a benefit has been conferred on a defendant, and for valuing that benefit, is the market price of the services; (ii) the defendant is entitled to adduce evidence in order subjectively to devalue the benefit, thereby proving either that he in fact received no benefit at all, or that he valued the benefit at less than the market price; but (iii) save perhaps in exceptional circumstances, the principle of subjective revaluation should not be recognised, either for the purpose of identifying a benefit, or for valuing a benefit received.”
“If you are trying to insinuate that was the intent and I could do that, the answer is that I would try my best to achieve that. I am not saying that we did not look at every function we could perform for Docklock so that we could charge the correct fee for the function that we performed. That certainly was the intent.”
“Where a defendant has permission to occupy the claimant’s land but no binding terms are agreed about payment, a claim in unjust enrichment lies to recover the value of the defendant’s use and occupation. Although it is easy to confuse the two, claims of this sort differ from wrong-based claims for mesne profits, which lead to an award of damages for the tort of trespass. They are not founded on wrongdoing, but on the defendant’s unjust enrichment at the claimant’s expense when he freely accepts the use value of the property, knowing that the claimant expects to be paid. The use value received by the defendant is not quantified by asking what he did with the property, but by assessing the saved costs of his occupation. This use value accrues day by day in the same way as the use value of money, and the normal measure of the defendant’s enrichment is the open market rental value of the property.”
“Zoning is a standard method of measuring retail premises to calculate and compare their value. It is used by both public and private sector surveyors. Zoning as a method has been applied in the UK to the analysis of shop rents and properties for rating purposes since the 1950s. Shop or retail premises are divided into a number of zones each of a depth of 6.1 metres – or 20 feet. Zone A closest to the window is most valuable with the value decreasing with distance from the frontage: Zone B is the next 6.1 metres and then Zone C until the entire depth of the retail area is allocated to a zone – anything after Zone C is usually defined as the remainder. The established valuation convention is to halve back from Zone A, with Zone B onwards assessed ‘In Terms of Zone A’ (ITZA): Zone B = A/2, Zone C = A/4, Zone D, which is usually the remainder of the retail area after Zone C, is assessed as A/8 and any ancillary space will probably be valued as A/10.”
“Q. So she was asking about which address to put on an invoice in relation to Ranulf Road, was she not? A. Without looking at the follow-up documentation, I cannot make a comment, but I think what you are probably saying is that it follows. Before you asked me did it happen that sometimes invoices were issued for the same company on a different property? It has happened. I have said that. Is this one of those examples? It could be. It does not alter the fact that the service has been provided and the person has been paid. Why the reason this happened, I cannot recall. There must have been a reason behind it and this would have been done with Nicholas's knowledge because Nicholas was involved on the Ranulf Road invoice development very heavily, and in Green Lanes as well. Q. So you did not copy Nicholas into your response? A. In a perfect world, I should have done that, yes, but I did not. But if the Ranulf Road development was the responsibility of Docklock, as it was, in my opinion, and as Nicholas agreed and consented, it does not make any difference, in my opinion. It is still Docklock paying for the expense of Ranulf Road.”
“I am sorry to have to ask, but please advise me as to the transfer from Docklock to Charles Russell.” “I was asked to make the transfer of£20,000 from Docklock Limited. I questioned whether I could do this and should I advise you first. Chris said quite right and copied the instruction and put it under your door. I then had a further talk with Chris as I was uncomfortable about doing this transfer and needed further clarification, and was effectively told that as an employee I was [sic] should be following the employers instruction.”
“The company reserves its right to rescind/reverse upon determination of litigation.”
“Save in a very clear case indeed, it would be wrong to attribute to a landlord and a tenant, particularly when they have entered into a full and professionally drafted lease, an intention that the tenant should receive an apportioned part of the rent payable and paid in advance, when the non-apportionability of such rent has been so long and clearly established. Given that it is so clear that the effect of the case law is that rent payable and paid in advance can be retained by the landlord, save in very exceptional circumstances (eg where the contract could not work or would lead to an absurdity) express words would be needed before it would be right to imply a term to the contrary.”
“the non-apportionability of such rent has been so long and clearly established”
“1. The Landlord acknowledges receipt from the Tenant on the date hereof of the sum of nine thousand pounds (£9,000 ) and the term “the Deposit” means the said sum (or the balance thereof in the event of any monies being applied in accordance with clause 4 hereof) and shall include any sums paid by the Tenant under clause 5 hereof and any interest earned thereon. 2. The Deposit shall be held by the Landlord in an interest bearing account in the Landlord’s name or in the name of the Landlord’s managing agent or solicitor in such bank as the Landlord shall from time to time decide (subject to the right to apply the same in accordance with clause 4 hereof) and all interest earned thereon shall be added to and become part of the Deposit. The Deposit shall be repaid to the Tenant on the earliest of the following events (after deducting any sums then payable by the Tenant to the Landlord): a. Seven days after the Tenant has complied with clause 27.1 of the Lease; b. Upon lawful assignment of the Lease by the Tenant made pursuant to a licence to assign granted by the Landlord.”
“This deed is collateral to the Lease and the obligations of the Landlord and the Tenant respectively are landlord and tenant covenants for the purposes of the Lease and are annexed to and incidental to the whole and every part of the premises demised by the Lease.”
“On my reading of the cases the line which the Court is seeking to draw in them is between serious breaches and relatively harmless ones – of which those described under the label of "harmless collaterality" are probably the archetype. The result will be fact dependent.”
“In a complex case, it might well be prudent, and certainly not out of place, for the judge, having handed down or delivered judgment, to ask the advocates whether there are any matters which he has not covered. Even if he does not do this, an advocate ought immediately, as a matter of courtesy at least, to draw the judge's attention to any material omission of which he is then aware or then believes exists. It is well-established that it is open to a judge to amend his judgment, if he thinks fit, at any time up to the drawing of the order. In many cases, the advocate ought to raise the matter with the judge in pursuance of his duty to assist the court to achieve the overriding objective (CPR 1.3 , which does not as such apply to these proceedings); and in some cases, it may follow from the advocate's duty not to mislead the court that he should raise the matter rather than allow the order to be drawn. It would be unsatisfactory to use an omission by a judge to deal with a point in a judgment as grounds for an application for appeal if the matter has not been brought to the judge's attention when there was a ready opportunity so to do. Unnecessary costs and delay may result. I should make it clear that there are general observations for assistance in future cases, and that I make no criticisms of Counsel in this case.”
“MR. COMISKEY: My Lord, I have a strong position and a weak position, which is this. So far as lettings fees are concerned, if they had continued to pass on third party agents' lettings fees, we would not have any issue with that, because that is simply carrying on doing what they had done before. THE JUDGE: They were, in a sense, a disbursement, were they not? MR COMISKEY: Yes, it is a disbursement. However, by not doing so, by trying to, whatever label you want to put on it -- obviously, we have said it was padding, but whatever label you want to put on it -- by trying to claim fees to which they are not entitled, they have not claimed the disbursement and they do not claim the disbursement now.” “That is an entirely novel form of fee, and so should not be paid by Docklock afterwards. It is all relevant to a quantum meruit. There is more that goes into a quantum meruit claim than this, because we would need to provide detailed evidence about what we did, what we did not do, why we did or did not do what we did; you know, were we essentially coerced into retaining Christo over that period; were we freely accepting any benefits conferred, or were we forced do so? Those are all issues which have not been addressed in the evidence in any sufficient detail and which we would have to address in the evidence. They were not put to Chris. Well, there is an overlap with some things that were put to Chris, but they were not put to Chris as those issues. They were not put to Nicholas as those issues, which is, frankly, quite proper, because you told Mr. Letman he was not allowed to. So, it is not a bare pleading point. It goes to the fairness of the trial that has taken place. THE JUDGE: Can I just be absolutely certain what you say you would have put to Chris. If he had pleaded a quantum meruit in relation to -- if they had applied for permission to plead, I do not know, what more would you have needed to be able to put to Chris? MR. COMISKEY: I do not have full instructions on the quantum meruit, on the defence to a quantum meruit, but I can tell you this much, my Lord, that there is a series of events which took place after the injunction was first obtained. So you have, first of all, the injunction, and then you have various return dates and moratorium agreements, and then there are solicitors' letters, inter partes letters; there is the pressure of the divorce proceedings, and there are actions being taken in the context of the divorce proceedings which hamper Docklock's ability to deal with other matters, bearing in mind that the divorce proceedings were extremely contentious, very valuable, and that the ownership of Docklock was in issue in the course of those proceedings. So that, in and of itself, is part of the background that you would have to take into account, because in circumstances where you have Chris potentially coming out as the sole shareholder of Docklock, saying, "I do not want you to move Docklock's management away from Christo", you need to consider whether it would even have been appropriate for Nicholas and Betty to carry on with what they were proposing to do. THE JUDGE: So, it generally goes to free acceptance and that we did not explore any of that material. MR. COMISKEY: None of it was explored.”
“Q. I do not accept that in terms of letting and renewal fees, by saying they might not have been coming through from Christo. There is no question, if you employ an agent, when you came to a point, when you looked in early 2015, I think that is when you, you looked around at other agents, you interviewed, if that is the right way to frame it, you interviewed Savills, you spoke to Knight Frank as to the possibility of appointing them to take over the portfolio, did you not? A. I had interviews with Knight Frank and Savills in relation to in part and partnership of moving away from the previous arrangements and putting everything, as I have, on a commercial basis, correct, yes. Q. Their proposals all included a general management fee and fees, as it were, rates of fees for letting and renewal charges, did they not? A. They had the option of having a letting service separate to a management service. If I had, on the hypothesis that I would give them management, it did not automatically give them letting, they had ---- Q. No. If it did not give them letting, who would the letting remain with? A. The status quo, as I understood it, was that, especially with the communications we received, especially not having information to hand due to the injunction, was that the previous arrangements would occur as such as other letting agents, third party letting agents would do their job and Docklock would pay them. And when the renewals occurred, the renewals would occur and there would not be fees charged other than the pass on fees I have already explained or any of the other charges, and that is how it was for many years on our understanding.”
“The only real difference may be this. We agree that in the case where services have been rendered which, viewed objectively, confer a benefit on the defendant, but a benefit which the defendant did not and does not want and would not have paid for, as in the examples of Pollock CB's cleaned shoes or Professor Virgo's cleaned windows ( Virgo , p 67), the claimant is not entitled to payment for the services because failure to pay would not unjustly enrich the defendant. The question is whether, in such circumstances, where there was no free acceptance of the services before or at the time they are rendered, but the defendant has accepted that he has received some benefit but not that the value of the benefit is as much as its market value, the defendant's figure should be accepted. In my opinion it should be open to the court so to conclude on the basis, on the one hand there would be unjust enrichment if the defendant paid nothing but, on the other hand, that it would not be just to award more than the benefit conferred on the defendant so calculated. Such an approach seems to me to respect the principle of freedom of choice or autonomy and to meet the case where the defendant sees the value of the benefit but would not have ordered the services save perhaps at a substantial discount to the market rate. I see no reason why a court should not take into account a defendant's subjective opinion of the value of the claimant's services in order to reduce the value of them to him, provided of course that the court is satisfied that it is his genuine opinion. If Lord Reed JSC's approach would produce a choice between a nil award and an award of the market value of the services, I would respectfully disagree. I prefer a nuanced approach, which seems to me to be more consistent with principle. However, given Lord Reed JSC's conclusions in para 138 of his judgment, there may be little, if anything, between us, especially since we both recognise the importance of respect for the defendant's autonomy or freedom of choice. It is not necessary to reach a final conclusion on these questions on the facts of this case. I certainly agree with Lord Reed JSC that the expression “subjective devaluation” is somewhat misleading.”