John and Ors v. Price Waterhouse and Ors [2001] EWHC Ch 438 (11th April, 2001)

John and Ors v. Price Waterhouse and Ors [2001] EWHC Ch 438 (11th April, 2001)

On the true construction of the management agreements, JREL was not contractually obliged to bear the tour agents' costs or the entirety of the staff salaries/expenses in the manner alleged by the claimants. Price Waterhouse, as auditors, did not owe or breach a duty of care to report the alleged breaches in the circumstances, nor did Mr Haydon as director/shadow director. The losses claimed were not caused by any breach of duty by the defendants. The settlement agreement with JREL/John Reid was in full and final satisfaction of the relevant claims. The claims are in any event time-barred under the Limitation Act 1980.

Citation
[2001] EWHC Ch 438
Parties
Claimant: Sir Elton John; Claimant: Happenstance Limited; Claimant: William A. Bong Limited; Claimant: J. Bondi Limited; First Defendant and Part 20 Claimant: Price Waterhouse (now PricewaterhouseCoopers); Second Defendant: Andrew Haydon; Part 20 Defendant: Frere Cholmeley / Frere Cholmeley Bischoff
Jurisdiction
England and Wales
Procedural Posture
Civil Negligence/professional Negligence / High Court Trial Judgment
Outcome
Claims dismissed
Legal Topics
Management Agreements, Auditor's Duty of Care, Director's Duty of Care, Breach of Contract, Damages, Contribution Proceedings, Limitation, Estoppel by Convention, Quasi Rectification
Contract Law Tort Law Professional Negligence Company Law Management Agreements Auditor's Duty of Care Director's Duty of Care Breach of Contract +5 more

Case Brief

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Parties

Sir Elton John

Claimant

Happenstance Limited

Claimant

William A. Bong Limited

Claimant

J. Bondi Limited

Claimant

Price Waterhouse (now PricewaterhouseCoopers)

First Defendant and Part 20 Claimant

Andrew Haydon

Second Defendant

Frere Cholmeley / Frere Cholmeley Bischoff

Part 20 Defendant

Procedural Posture

Civil Negligence/professional Negligence / High Court Trial Judgment

Legal Issues

  1. 1 Whether Price Waterhouse owed and breached duties of care as auditors and/or financial advisers to the claimants regarding tour agents' costs and staff salaries/expenses under management agreements.
  2. 2 Whether Andrew Haydon owed and breached a duty of care as director/shadow director regarding the same.
  3. 3 Whether the losses claimed were caused by the alleged breaches and are recoverable, given the settlement with JREL/John Reid.

Ratio Decidendi

On the true construction of the management agreements, JREL was not contractually obliged to bear the tour agents' costs or the entirety of the staff salaries/expenses in the manner alleged by the claimants. Price Waterhouse, as auditors, did not owe or breach a duty of care to report the alleged breaches in the circumstances, nor did Mr Haydon as director/shadow director. The losses claimed were not caused by any breach of duty by the defendants. The settlement agreement with JREL/John Reid was in full and final satisfaction of the relevant claims. The claims are in any event time-barred under the Limitation Act 1980.

Court Disposition

Claims dismissed

Orders

  • All claims against Price Waterhouse and Andrew Haydon dismissed.
  • Part 20 claims against Frere Cholmeley/Frere Cholmeley Bischoff dismissed.