Tethys Petroleum Limited v The Rt Hon The Lord Lilley & Anor

Tethys Petroleum Limited v The Rt Hon The Lord Lilley & Anor

The indemnity clause in Article 133(A) of the Claimant’s articles of association provides a complete defence to the claim, as the pleaded case is one of negligence and not wilful act, neglect, or default. Mr Hammond was not an employee of the Claimant under the service agreement, and the Claimant did not suffer the relevant loss, which was incurred by its subsidiary. The claim is therefore struck out and summary judgment entered for the Defendants.

Parties
Claimant: Tethys Petroleum Limited; First Defendant: The Rt Hon The Lord Lilley; Second Defendant: Julian Hammond
Jurisdiction
England and Wales
Judgment Date
27 January 2023
Procedural Posture
Civil / Summary Judgment / Strike Out Application
Outcome
Claim struck out; summary judgment for Defendants
Legal Topics
Directors' Duties, Indemnity Clauses, Summary Judgment, Strike Out, Privity of Contract, Loss and Causation
Company Law Contract Law Tort Law Directors' Duties Indemnity Clauses Summary Judgment Strike Out Privity of Contract +1 more

Case Brief

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Parties

Tethys Petroleum Limited

Claimant

The Rt Hon The Lord Lilley

First Defendant

Julian Hammond

Second Defendant

Procedural Posture

Civil / Summary Judgment / Strike Out Application

Legal Issues

  1. 1 Whether the Defendants can rely on the indemnity provision in Article 133(A) of the Claimant’s articles of association
  2. 2 Whether Mr Hammond was an employee of the Claimant and owed duties as such
  3. 3 Whether the contractual claim against Mr Hammond is an abuse of process

Ratio Decidendi

The indemnity clause in Article 133(A) of the Claimant’s articles of association provides a complete defence to the claim, as the pleaded case is one of negligence and not wilful act, neglect, or default. Mr Hammond was not an employee of the Claimant under the service agreement, and the Claimant did not suffer the relevant loss, which was incurred by its subsidiary. The claim is therefore struck out and summary judgment entered for the Defendants.

Court Disposition

Claim struck out; summary judgment for Defendants

Orders

  • Claim struck out pursuant to CPR rule 3.4(2)
  • Summary judgment given in favour of Defendants pursuant to CPR rule 24.2