Wright v Rowland & Anor

Factual and Procedural Background

The Plaintiff claims that the Defendants contractually agreed to grant him an option to purchase up to 5% of the shares of Company A for an option exercise price of 2.5 million. The Plaintiff alleges that this agreement has been repudiated and seeks damages. Alternatively, he claims a quantum meruit for services rendered, including introducing the Defendants to the opportunity to acquire Company B.

The Plaintiff, a former solicitor turned entrepreneur, began working with the Defendants, a wealthy businessman and his eldest son, from 2008 to assist in locating and acquiring investments. The Plaintiff contends that an oral agreement (the "2008 Agreement") was made for his remuneration involving a monthly retainer, expenses, and profit shares depending on risk exposure.

The Plaintiff further alleges that on 20 July 2009, during a party on a motor yacht, a variation or separate agreement was made granting him the option to purchase shares in Company A, an annual fee, a loan for a property purchase, and profit shares from transactions related to Company A. The Plaintiff asserts that this agreement was repudiated in June 2013 following a decline in relations after one Defendant's stroke.

The Defendants deny any binding oral agreement in 2008 or on the yacht in 2009, asserting that discussions were informal, lacked intention to create legal relations, and were too uncertain. They also deny that the Plaintiff introduced the opportunity to acquire Company B or that he is entitled to any quantum meruit claim.

The claim form was issued in June 2015, and the Defendants served their defences later that year, denying the contractual claims and disputing the Plaintiff's entitlement to damages or quantum meruit.

Legal Issues Presented

1. Whether the Plaintiff and Defendants entered into a binding oral contract in 2008 or by conduct outlining the Plaintiff’s remuneration and profit share arrangements.
2. Whether the Plaintiff sourced the opportunity to acquire Company A for the Defendants.
3. What role the Plaintiff played in the acquisition transaction of Company A.
4. Whether a binding agreement was made on board the motor yacht on 20 July 2009 including the grant of an option to purchase shares in Company A.

Arguments of the Parties

Plaintiff's Arguments

• The Plaintiff contends that he was engaged under the "2008 Agreement" with agreed terms of monthly retainer, expenses, and profit shares.
• He asserts that on 20 July 2009, a binding oral contract was made granting him a 5% option in Company A shares at the same price paid by the Defendants, an annual fee, a loan to assist with property purchase, and profit shares from Company A related deals.
• The Plaintiff claims he introduced the opportunity to acquire Company B to the Defendants and played a significant role in negotiating and closing the acquisition.
• He alleges repudiation of the agreement in June 2013 and seeks damages or alternatively a quantum meruit for his services.

Defendants' Arguments

• The Defendants deny the existence of any binding oral agreement in 2008 or on 20 July 2009, characterising discussions as informal, friendly, and lacking intention to create legal relations.
• They assert that Jonathan Rowland lacked authority to bind David Rowland to any such agreement.
• The Defendants deny that the Plaintiff introduced the opportunity to acquire Company B.
• They deny that the Plaintiff is entitled to any quantum meruit claim, arguing that any enrichment would have been of corporate entities rather than the Defendants personally.
• They further contend that no binding agreement was made without a written contract, especially given the complexity and commercial nature of the matters discussed.

Table of Precedents Cited

Court's Reasoning and Analysis

The court carefully examined the factual and documentary evidence, expressing reservations about the credibility and consistency of the Plaintiff’s and Defendants’ witness testimonies. The court emphasized reliance on contemporary documents and inferences over oral evidence due to the unsatisfactory nature of the witness accounts.

Regarding the "2008 Agreement," the court found no reliable evidence of a concluded binding contract, noting the absence of written documentation or contemporaneous recording of terms. It was considered unlikely that David Rowland would have authorized such an open-ended agreement without formalization.

On the critical issue of the alleged 20 July 2009 agreement on the yacht, the court acknowledged that some discussion about remuneration likely occurred but rejected the Plaintiff’s claim of a binding oral contract granting an immediate option to purchase shares. The court found the lack of contemporaneous documentation, the complex nature of the subject matter, and the surrounding negotiations for formal option agreements with others inconsistent with the existence of a firm oral commitment.

The court analyzed related emails and correspondence, finding them insufficient to establish a binding agreement or firm commitments. The Plaintiff’s attempts to obtain written confirmation were unsuccessful, and the Defendants’ denials were supported by the absence of clear documentary evidence.

On the quantum meruit claim, the court applied established principles requiring proof of enrichment of the Defendants personally, at the Plaintiff’s expense, and that such enrichment was unjust. The court found no evidence that the Defendants personally were enriched, as any benefit accrued to corporate entities not party to the claim. Furthermore, the Plaintiff failed to establish the objective market value of his services exceeding the remuneration he had already received.

Consequently, the court concluded that the Plaintiff’s contractual and quantum meruit claims failed based on the absence of binding agreements, insufficient proof of enrichment, and lack of valuation evidence.

Holding and Implications

The court DISMISSED the Plaintiff’s claims for breach of contract and quantum meruit.

The decision directly affects the parties by denying the Plaintiff any recovery for the alleged option to purchase shares or for services rendered under a quantum meruit theory. The court found no binding agreement or unjust enrichment that would justify damages or payment. No new legal precedent was established; the ruling applied established principles of contract formation, intention to create legal relations, and unjust enrichment.