Signet Partners Ltd v Signet Research & Advisory SA & Ors, Court of Appeal - Queen's Bench Division, May 24, 2007, [2007] EWHC 1263 (QB)
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Signet Partners Ltd v Signet Research & Advisory SA & Ors, Court of Appeal - Queen's Bench Division, May 24, 2007, [2007] EWHC 1263 (QB)
Neutral Citation Number: [2007] EWHC 1263 (QB)
Case No: TLQ/06/0849IN THE HIGH COURT OF JUSTICEQUEEN'S BENCH DIVISIONRoyal Courts of JusticeStrand, London, WC2A 2LLDate: 24 5 2007Before :MR JUSTICE BURTON- - - - - - - - - - - - - - - - - - - - -Between :- - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - -Mr Romie Tager QC and Mr Gary Blaker (instructed by Manches LLP) for the ClaimantMr Michael Lazarus (instructed by SJ Berwin LLP) for the DefendantsHearing dates: 20, 21, 22, 26, 27, 28, 29 March, 2, 4, 25, April 2007, 8, 9 May 2007- - - - - - - - - - - - - - - - - - - - -JudgmentMr Justice Burton: 1. In these two consolidated proceedings the Claimant is Oppenheim Partners Ltd, formerly Signet Partners Ltd (``SPL''), of which the principal is Marc Oppenheim (``MO''). The claims in both proceedings arise out of the relationship between MO, through SPL, and one or more of the Signet Group, which lasted from 2002 to 2006, but continues by virtue of SPL's accounting entitlement in respect of investments placed during that period. There is, as will appear, an issue as to whether that relationship was with Signet Research and Advisory SA (``SRA''), the first Defendant, or with one or more other Signet companies in addition, so, save where it is necessary for the purpose of distinction - or resolution of that issue - to refer to a particular company, I shall use the generic term ``Signet''. 2. From 2002 MO was engaged by Signet as an introducer of their hedge funds, which are based in Lausanne in Switzerland. Signet, under the guiding influence of Mr Robert Marquardt (``RM''), has been active since 1993 in the alternative investment markets and, since the late 90s, ever more successfully in the operation of hedge funds. 3. Introducers are remunerated, and generously so, for finding potential investors, such as pension funds, to place monies into the various hedge funds. Such remuneration is, or can be, shared with intermediaries who themselves influence or advise clients, and/or with the introducer's own sub-agents or sub-introducers. The different fees that can be earned, for the purposes of this case, are management fees which, because they are ongoing for so long as the monies remain invested in the fund, are also called trailer fees, calculated by a reference to a small percentage of the funds invested (known as ``basis points'' (bps), 0.75% for example being 75 bps): performance fees, being a percentage payable depending upon the achievement of the fund: and sometimes, though not always, a one-off placement fee by way of a percentage of the sum invested. 4. There is no issue that MO, after a fairly considerable period for learning curve on his part and contact-developing, such that his first investor placed funds about a year after he started in February 2002, became very successful, and by February 2005 had introduced some $55m of funds. It is not in dispute both that he was entitled to receive the various fees in respect of investments he, or SPL, introduced, and that he has continuing entitlement so long as those funds remain invested with Signet. 5. The issues which I have to decide in the first of these proceedings (``Claim 1'') relate to whether he is entitled to receive, both as to the past and continuing into the future, fees, and/or damages, in respect of investments introduced, not by him or SPL, but by a Mr Vilien Stanisic (``VDS''), through his company VDS Investment Group AG (which I shall also refer to as VDS, save where distinction falls to be made between him and his company). 6. The second proceedings (``Claim 2'') relate to the fact that Signet has deducted from the fees to which SPL was otherwise entitled a sum of £123,623, which Signet asserts was due to them in respect of recoupable advances made at the outset of their relationship. The amount claimed in respect of Claim 2 is thus not in dispute, and the issue as to entitlement is in relatively short compass, although, as will be seen, its resolution has required consideration of contested evidence as to what occurred in May 2002 and of some authorities. 7. As to Claim 1, the extent of the entitlement, if the Claimant is successful, is not agreed nor could it be established in these proceedings: in part it would depend upon the taking of an account, and in part it may depend upon an assessment of damages, although I am invited to resolve certain issues of principle with a view to simplifying any subsequent enquiry. I have heard evidence from eleven live witnesses (one by video link) and read statements from a further seven, over a period of 8½ extended days of oral evidence in a trial which took 11 hearing days in all (plus a 2-hour evening interlocutory hearing (``Day 10'')). However, as will be seen, both as a result of the co-operative attitude and constructive approach of the able Counsel for both sides, Mr Tager QC leading Mr Blaker for the Claimant and Mr Lazarus fo...See the full content of this document
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