Key Facts
- •Mr. Gary Keane claimed he became a partner in a partnership relating to shares in Document Risk Solutions Limited (DRSL) on June 18, 2012.
- •The business, DRS, initially operated through DRSL, with four directors (Sargen, Beaton, MacGloin, Martin), each holding a share.
- •In early 2012, Keane was offered a 5% equity stake in DRSL, rising to equal parity with existing directors.
- •DRS was restructured into a limited liability partnership (LLP) for tax benefits, with DRSL as a corporate member and the four original directors as members.
- •Keane stated he didn't want DRSL shares due to potential tax liabilities.
- •An LLP agreement was signed on June 18, 2012, including Keane, the four original directors, and DRSL as members.
- •The agreement didn't include performance criteria from earlier proposals.
- •Subsequent agreements (MIPAs) transferred interests in the LLP to DRSL, and Keane eventually left, receiving payments.
- •The Judge found a partnership existed between Keane and the four original directors regarding DRSL shares, starting June 18, 2012.
Legal Principles
Appellate courts should only interfere with a trial judge's factual findings if the decision is unreasonable or lacks evidential basis.
Henderson v Foxworth Investments Ltd [2014] UKSC 41
A party must put to opponent's witnesses the relevant parts of their case concerning those witnesses (Browne v Dunn principle).
Browne v Dunn (1893) 6 R 67; Markem Corp v Zipher Ltd [2005] RPC 31; Chen v Ng [2017] UKPC 27
Judges should intervene minimally during witness examination, especially cross-examination, to maintain fairness and effectiveness.
Jones v National Coal Board [1957] 2 QB 55; Serafin v Malkiewicz [2020] UKSC 23; Southwark London Borough Council v Kofi-Adu [2006] EWCA Civ 281; Michel v R [2009] UKPC 41
Appeals based on unpleaded points at trial are only valid if the complaining party sought a ruling at trial.
Hawksworth v Chief Constable of Staffordshire [2012] EWCA Civ 293
Partnership is a legal relationship where two or more persons carry on a business in common with a view of profit.
Partnership Act 1890
Outcomes
Appeal allowed; claim dismissed.
The Judge's finding of a partnership lacked evidential support. The “Agreed General Package” was not contractually agreed, and there was no evidence Keane joined the partnership on June 18th, 2012.
Judge's interventions during cross-examination deemed inappropriate but not enough to render the trial unfair.
The interventions were excessive but did not prevent the appellants from presenting their case or impair the Judge's judgment, given Keane's poor recollection.
Amendment to pleadings regarding the partnership start date would have been allowed.
The defendants were not prejudiced by the later consideration of a partnership's earlier formation.