KINLED INVESTMENTS LIMITED v ZOPA GROUP LIMITED

KINLED INVESTMENTS LIMITED v ZOPA GROUP LIMITED

There was no agreement to vary the engagement letter to provide a 24-month tail period; even if there was, it was not supported by consideration. Kinled's services in the second investment round were provided speculatively and not in anticipation of a contract. The engagement letter is unenforceable under s.26 FSMA as Kinled carried out regulated activities without authorisation, but it is just and equitable for Kinled to retain the £345,000 fee under s.28 FSMA. Both claim and counterclaim are dismissed.

Parties
Claimant: Kinled Investments Limited; Defendant: Zopa Group Limited
Jurisdiction
England and Wales
Judgment Date
27 May 2022
Procedural Posture
Commercial Claim and Counterclaim / Judgment After Trial
Outcome
Both claim and counterclaim dismissed
Legal Topics
Variation of Contract, Quantum Meruit, Illegality Under FSMA, Introducer's/intermediary's Fee, Consideration, Enforceability of Contracts, Just and Equitable Relief
Contract Law Financial Regulation Restitution/unjust Enrichment Variation of Contract Quantum Meruit Illegality Under FSMA Introducer's/intermediary's Fee Consideration +2 more

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Parties

Kinled Investments Limited

Claimant

Zopa Group Limited

Defendant

Procedural Posture

Commercial Claim and Counterclaim / Judgment After Trial

Legal Issues

  1. 1 Whether the engagement letter was varied to extend the tail period to 24 months for introducer's fee
  2. 2 Whether Kinled is entitled to a quantum meruit for intermediary services in the second investment round
  3. 3 Whether the engagement letter is unenforceable under s.26 FSMA due to regulated activities without authorisation

Ratio Decidendi

There was no agreement to vary the engagement letter to provide a 24-month tail period; even if there was, it was not supported by consideration. Kinled's services in the second investment round were provided speculatively and not in anticipation of a contract. The engagement letter is unenforceable under s.26 FSMA as Kinled carried out regulated activities without authorisation, but it is just and equitable for Kinled to retain the £345,000 fee under s.28 FSMA. Both claim and counterclaim are dismissed.

Court Disposition

Both claim and counterclaim dismissed