Hawksford Trustees Jersey Ltd v Stella Global UK Ltd & Anor [2011] EWHC 503 (Ch) (09 March 2011)

Hawksford Trustees Jersey Ltd v Stella Global UK Ltd & Anor [2011] EWHC 503 (Ch) (09 March 2011)

The court found that the parties did not have a sufficiently clear and continuing common intention, outwardly manifested, to exclude Mr Begg's 2007 consultancy payments from the calculation of 2007 EBITDA for the purposes of the SPA. The evidence did not establish that the relevant decision-makers for all parties were under a common mistake at the time of execution. Accordingly, the requirements for rectification were not met.

Citation
[2011] EWHC 503 (Ch)
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
Claim for Rectification of Contract (share Purchase Agreement) / Judgment After Trial
Outcome
Claim dismissed
Legal Topics
Rectification of Contract, Common Mistake, Share Purchase Agreement, Interpretation of Contracts
Contract Law Equity Rectification of Contract Common Mistake Share Purchase Agreement Interpretation of Contracts

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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

Claim for Rectification of Contract (share Purchase Agreement) / Judgment After Trial

Legal Issues

  1. 1 Whether the Share Purchase Agreement (SPA) should be rectified to exclude consultancy payments made by Global to Mr George Begg in 2007 from the calculation of 2007 EBITDA for the purpose of determining the minimum earn out consideration.
  2. 2 Whether there was a common intention and common mistake among the parties regarding the exclusion of these payments.
  3. 3 Whether the relevant decision-makers for each party were under a mistake.

Ratio Decidendi

The court found that the parties did not have a sufficiently clear and continuing common intention, outwardly manifested, to exclude Mr Begg's 2007 consultancy payments from the calculation of 2007 EBITDA for the purposes of the SPA. The evidence did not establish that the relevant decision-makers for all parties were under a common mistake at the time of execution. Accordingly, the requirements for rectification were not met.

Court Disposition

Claim dismissed

Orders

  • Rectification of the SPA refused
  • No order for rectification to exclude Mr Begg's 2007 consultancy payments from 2007 EBITDA