Musst Holdings Limited v Astra Asset Management UK Limited
[2023] EWCA Civ 128
Astra Asset Management UK Ltd v Odin Automotive S.a.r.l.
16 June 2023
[2023] EWHC 1465 (Comm)
High Court
A company (Astra) helped another (Odin) get a loan. When Odin got a better deal elsewhere, Astra sued for a fee they agreed to pay if the deal fell through. The judge said Astra did its part, so Odin had to pay.
Key Facts
- •Astra Asset Management UK Limited (Astra) sought summary judgment against Odin Automotive S.à r.l (Odin) for two sums under a Mandate Agreement.
- •Astra arranged credit facilities and Odin, a Luxembourg company, sought funding for an acquisition.
- •The Mandate Agreement stipulated a US$2 million fee if Odin breached undertakings or failed to close the transaction (Clause 5.1), and an indemnity for costs and expenses (Clause 8.1).
- •Odin obtained alternative funding, but Astra claimed the US$2 million and £219,830.56 in costs.
- •Odin disputed liability, claiming Astra failed to use best efforts and proposed onerous terms.
- •Astra argued its obligation was to use best efforts to arrange a facility satisfactory to itself, and Odin's refusal constituted a breach.
Legal Principles
Summary judgment requires the claimant to have a 'realistic' prospect of success, not merely an arguable claim.
Easyair Limited v Opal Telecom [2009] EWHC 339 (Ch), approved in AC Ward & Sons Limited v Catlin (Five) Limited [2009] EWCA Civ 1098
The court must consider evidence reasonably expected at trial, avoiding a 'mini-trial'.
Swain v Hillman [2001] 1 All E.R. 91; ED & F Man Liquid Products v Patel [2003] EWCA Civ 472; Royal Brompton Hospital NHS Trust v Hammond (No.5) [2001] EWCA Civ 550; Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd [2007] F.S.R. 3; ICI Chemicals & Polymers Ltd v TTE Training Ltd [2007] EWCA Civ 725
The applicant must show the respondent has no real prospect of success, and there's no other reason for a trial.
ED&F Man Liquid Products Ltd v Patel [2003] EWCA Civ 472
In summary judgment, the court can evaluate evidence and conclude there's no real prospect of success, but must be cautious and avoid a mini-trial.
King v Stiefel [2021] EWHC 1045 (Comm)
Outcomes
Summary judgment granted to Astra for US$2 million under Clause 5.1.
Astra used best efforts to arrange a facility; the terms were satisfactory to Astra; Odin's refusal to accept constituted a breach, triggering the break fee; the 'any reason' clause in 5.1 encompasses Odin's decision to seek alternative funding.
Summary judgment granted to Astra for £219,830.56 under Clause 8.1.
Clause 8.1 is a 'pay on demand' indemnity; Astra's cost statement was sufficiently detailed; Odin can later request a breakdown.
Claim for breach of undertaking (Clause 4.1(b)) dismissed.
Triable issue of fact, unsuitable for summary determination.
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