Flanagan v Liontrust Investment Partners LLP & Ors

Flanagan v Liontrust Investment Partners LLP & Ors

The compulsory retirement and garden leave notices served on Mr Flanagan were invalid due to failure to comply with the LLP Agreement and Side Letter, including lack of proper notice and Management Committee involvement. The exclusion of Mr Flanagan from the LLP was a repudiatory breach of contract by the LLP. However, the common law doctrine of repudiatory breach does not apply to multi-party LLP agreements, so Mr Flanagan's purported acceptance of the breach was of no legal effect. No collateral contract or actionable misrepresentation was made, and no implied terms as to marketing or good faith arose or were breached. Mr Flanagan remains a member of the LLP and is entitled to damages...

Parties
Petitioner: Eoghan Flanagan; Respondents: Liontrust Investment Partners LLP and Others
Jurisdiction
England and Wales
Judgment Date
24 July 2015
Procedural Posture
Unfair Prejudice Petition Under Section 994 Companies Act 2006 (as Applied to Llps) / Judgment on Liability Issues
Outcome
Petition allowed in part; declaration of continuing membership and entitlement to damages for breach of contract; no entitlement to pro rata share of capital or profits; no collateral contract or actionable misrepresentation found.
Legal Topics
Limited Liability Partnerships, Repudiatory Breach, Unfair Prejudice, Contract Interpretation, Expulsion and Retirement of Members
Company Law Contract Law Limited Liability Partnerships Repudiatory Breach Unfair Prejudice Contract Interpretation Expulsion and Retirement of Members

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Parties

Eoghan Flanagan

Petitioner

Liontrust Investment Partners LLP and Others

Respondents

Procedural Posture

Unfair Prejudice Petition Under Section 994 Companies Act 2006 (as Applied to Llps) / Judgment on Liability Issues

Legal Issues

  1. 1 Whether the termination of Mr Flanagan's membership of the LLP was valid under the LLP Agreement and Side Letter
  2. 2 Whether the exclusion of Mr Flanagan from the LLP constituted a repudiatory breach of contract
  3. 3 Whether the common law doctrine of repudiatory breach applies to LLP agreements

Ratio Decidendi

The compulsory retirement and garden leave notices served on Mr Flanagan were invalid due to failure to comply with the LLP Agreement and Side Letter, including lack of proper notice and Management Committee involvement. The exclusion of Mr Flanagan from the LLP was a repudiatory breach of contract by the LLP. However, the common law doctrine of repudiatory breach does not apply to multi-party LLP agreements, so Mr Flanagan's purported acceptance of the breach was of no legal effect. No collateral contract or actionable misrepresentation was made, and no implied terms as to marketing or good faith arose or were breached. Mr Flanagan remains a member of the LLP and is entitled to damages...

Court Disposition

Petition allowed in part; declaration of continuing membership and entitlement to damages for breach of contract; no entitlement to pro rata share of capital or profits; no collateral contract or actionable misrepresentation found.

Orders

  • Declaration that Mr Flanagan remains a member of the LLP
  • Declaration that the LLP breached the LLP Agreement by excluding Mr Flanagan from participation