Broadcasting Investment Group Ltd & Ors v Smith & Ors

Broadcasting Investment Group Ltd & Ors v Smith & Ors

BIG's claim to enforce the joint venture agreement, whether for damages or specific performance, is barred by the rule in Prudential as clarified in Marex, because SS PLC has an independent cause of action under the Contracts (Rights of Third Parties) Act 1999. The rule does not bar Mr Burgess's claim as he is not a direct shareholder in SS PLC. The alternative claim based on a Restructuring Agreement is unmaintainable as pleaded and is struck out.

Parties
Claimant: Broadcasting Investment Group Limited; Claimant: Visual Investments International Limited; Claimant: Kenneth Burgess; Defendant: Adam Smith; Defendant: Dan Finch; Defendant: Parkhead Properties Limited; Defendant: Skoosh Investments Limited; Defendant: Streaming Investments PLC
Jurisdiction
England and Wales
Judgment Date
21 September 2020
Procedural Posture
Civil (company/commercial) / Strike Out And/or Summary Judgment Application
Outcome
Application allowed in part; BIG's claims struck out, Mr Burgess's claim proceeds, alternative Restructuring Agreement claim struck out.
Legal Topics
Reflective Loss Principle, Third Party Rights Under Contract, Specific Performance, Derivative Actions, Shareholder Claims
Company Law Contract Law Reflective Loss Principle Third Party Rights Under Contract Specific Performance Derivative Actions Shareholder Claims

Case Brief

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Parties

Broadcasting Investment Group Limited

Claimant

Visual Investments International Limited

Claimant

Kenneth Burgess

Claimant

Adam Smith

Defendant

Dan Finch

Defendant

Parkhead Properties Limited

Defendant

Skoosh Investments Limited

Defendant

Streaming Investments PLC

Defendant

Procedural Posture

Civil (company/commercial) / Strike Out And/or Summary Judgment Application

Legal Issues

  1. 1 Whether Broadcasting Investment Group Limited's claim is barred by the reflective loss principle as explained in Marex and Prudential.
  2. 2 Whether SS PLC has an independent cause of action under the Contracts (Rights of Third Parties) Act 1999.
  3. 3 Whether Mr Burgess's claim is barred by the reflective loss principle.

Ratio Decidendi

BIG's claim to enforce the joint venture agreement, whether for damages or specific performance, is barred by the rule in Prudential as clarified in Marex, because SS PLC has an independent cause of action under the Contracts (Rights of Third Parties) Act 1999. The rule does not bar Mr Burgess's claim as he is not a direct shareholder in SS PLC. The alternative claim based on a Restructuring Agreement is unmaintainable as pleaded and is struck out.

Court Disposition

Application allowed in part; BIG's claims struck out, Mr Burgess's claim proceeds, alternative Restructuring Agreement claim struck out.

Orders

  • BIG's claim to enforce the joint venture agreement is struck out.
  • Mr Burgess's claim to enforce the joint venture agreement may proceed to trial.