Ross River Ltd & Anor v Cambridge City Football Club Ltd, Court of Appeal - Chancery Division, September 19, 2007, [2007] EWHC 2115 (Ch),[2008] 1 All ER 1004
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Ross River Ltd & Anor v Cambridge City Football Club Ltd, Court of Appeal - Chancery Division, September 19, 2007, [2007] EWHC 2115 (Ch),[2008] 1 All ER 1004
Neutral Citation Number: [2007] EWHC 2115 (Ch)
Case No: HC07C00021IN THE HIGH COURT OF JUSTICECHANCERY DIVISIONRoyal Courts of JusticeStrand, London, WC2A 2LLDate: 19/09/2007Before :MR JUSTICE BRIGGS- - - - - - - - - - - - - - - - - - - - -Between :- - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - -Jonathan Seitler QC and Andrew Mold (instructed by Field Fisher Waterhouse) for the ClaimantsNicholas Davidson QC and Alexander Hall - Taylor (instructed by Messrs Ince & Co) for the DefendantsHearing dates: 23rd 24th 25th 26th 27th 30th 31st July 2007- - - - - - - - - - - - - - - - - - - - -JUDGMENTMr Justice Briggs:Introduction 1. This judgment follows the liability only trial of a claim by the defendant Cambridge City Football Club Ltd (``the Club'') to rescind or have set aside three related transactions with the claimants Ross River Ltd (``Ross River'') and Blue River LP (``Blue River'') providing for the sale and lease-back of its football ground and stadium in Cambridge (``the Ground''). The first of those transactions consisted of the sale of the Club's freehold interest in the Ground to Ross River for £1.3 million plus a share in the overage attributable to the obtaining of residential planning permission (``the Overage''), pursuant to a conditional agreement dated 3rd February 2005, completed on the 29th April 2005. The second consisted of a sale by the Club to Ross River of its share in the Overage for £900,000 on 7th October 2005 (``the Overage Agreement''). The third was a contracted-out lease of the Ground by Ross River to the Club dated 21st June 2006, for a term which expired on the 31st May 2007, following which the Club has continued in occupation, pending the outcome of this litigation. That lease replaced two earlier consecutive lease-backs of the Ground dated respectively 29th April and 7th October 2005.2. The Club claims to be entitled to have those three transactions set aside on two distinct grounds. The first arises from payments made in June and November 2005 and January 2006 by agents on behalf of Ross River to Mr Arthur Eastham, the then chief executive of the Club, who took the lead in the negotiation of the three transactions on behalf of the Club, which the Club characterises as having constituted bribes. The second basis is that the Club claims to have been induced to enter into the second and the predecessor of the third of those transactions by reason of fraudulent misrepresentations made on behalf of Ross River by a Mr Paul Harney of Waveley Project Management Ltd (``Waveley'') to a Mr Edwin Lee of the Club's surveyors Cheffins in a letter dated 25th May 2005.3. The claimants admit that the payments to Mr Eastham and the statement to Mr Lee were made on behalf of Ross River. As to the payments, they allege that the first of these consisted of the discharge in part of the Club's liability to pay consultancy fees to Mr Eastham, known to and requested by the Club at a time when it lacked the funds to make the payment itself. The remaining payments are said to be for work done by Mr Eastham for Ross River after the sale of the Club's share in the Overage. As to the representations, the claimants' defence is in outline that they were honest and accurate expressions of the claimants' belief and (to the extent factual) of the underlying facts, but that the Club did not rely upon them in any event.4. The apparent oddity that the claims in this litigation are made by the defendant against the claimants arises from the fact that the immediate casus belli consisted of the Club's registration of a unilateral notice on 24th October 2006 against the claimants' title to the Ground at HM Land Registry, leading to the claimants issuing the present proceedings for the purposes of securing the removal of the notice, and declarations of non-liability, possession of the Ground upon the termination of the 2006 lease, and damages for breach of statutory duty under section 77 of the Land Registration Act 2002. The claims with which in substance this litigation is primarily concerned were then made by the Club in its Defence and Counterclaim.The witnesses5. The Claimants called eight witnesses, seven of whom were cross examined. Mr Brian Peter York gave evidence first. He and his family beneficially own and control the claimants. He was neither a particularly satisfactory nor obviously unreliable witness. The most noticeable feature of his attitude towards giving oral evidence was that he appeared to have schooled himself, (there was no suggestion that he had been schooled), into a too easy inability to recall matters about which he was being cross examined. In particular, he tended to confuse the question whether he could recall an event with the question whether he could remember a particular document in which that event had been referred to or described. An understandable lack of recollection of the document led him all ...See the full content of this document
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