Hawksford Trustees Jersey Ltd v Stella Global UK Ltd & Anor

Hawksford Trustees Jersey Ltd v Stella Global UK Ltd & Anor

The court found convincing proof that all parties, through their relevant decision-makers, shared a common continuing intention that Mr Begg’s 2007 consultancy payments would be excluded from 2007 EBITDA for the purposes of the minimum earn out consideration, and that the SPA as executed failed to reflect this due to a drafting mistake. The court held that rectification should be ordered to amend the SPA accordingly.

Parties
Claimant: Hawksford Trustees Jersey Limited (As Trustee of the Bald Eagle Trust); First Defendant: Stella Global UK Limited; Second Defendant: Global Voyager Holdings No. 1 Pty Limited (formerly Stella Holdings No. 1 Pty Limited)
Jurisdiction
England and Wales
Judgment Date
09 March 2011
Procedural Posture
Civil (contract/commercial) / High Court Trial Judgment
Outcome
Claim for rectification allowed.
Legal Topics
Rectification for Common Mistake, Company Law—attribution of Knowledge, Interpretation of Commercial Contracts
Contract Law Equity Rectification for Common Mistake Company Law—attribution of Knowledge Interpretation of Commercial Contracts

Case Brief

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Parties

Hawksford Trustees Jersey Limited (As Trustee of the Bald Eagle Trust)

Claimant

Stella Global UK Limited

First Defendant

Global Voyager Holdings No. 1 Pty Limited (formerly Stella Holdings No. 1 Pty Limited)

Second Defendant

Procedural Posture

Civil (contract/commercial) / High Court Trial Judgment

Legal Issues

  1. 1 Whether the SPA should be rectified to exclude all 2007 consultancy payments to Mr Begg from the calculation of 2007 EBITDA for the minimum earn out consideration.
  2. 2 Who was the relevant decision-maker for the Claimant and Defendants for purposes of rectification.
  3. 3 Whether there was a common continuing intention and mistake as to the terms of the SPA.

Ratio Decidendi

The court found convincing proof that all parties, through their relevant decision-makers, shared a common continuing intention that Mr Begg’s 2007 consultancy payments would be excluded from 2007 EBITDA for the purposes of the minimum earn out consideration, and that the SPA as executed failed to reflect this due to a drafting mistake. The court held that rectification should be ordered to amend the SPA accordingly.

Court Disposition

Claim for rectification allowed.

Orders

  • The SPA is to be rectified by amending the definition of 2007 EBITDA to specifically exclude all costs incurred by the Company in connection with the two jets, helicopter, catamaran, two cars, and all payments made by the Company to George Begg pursuant to the consultancy agreement dated 1 February 2003 for the year...