Tactus Holdings Limited v Philip Mark Jordan & Ors
[2024] EWHC 399 (Comm)
The Motoring Organisation Limited v Spectrum Insurance Services Limited
9 February 2024
[2024] EWHC 261 (Comm)
High Court
Two companies, TMO and Spectrum, planned to merge. Spectrum got a valuable warranty deal (SsangYong) that it was supposed to share with TMO if they merged. Spectrum kept the deal for itself, breaching their agreement with TMO and acting in bad faith. They also got a separate deal to manage other clients of TMO, but the court said TMO gave them this deal directly and that there was no agreement to share profits. TMO won the case for the first deal, but not the second.
Key Facts
- •TMO (Claimant) and Spectrum (Defendant) were involved in selling car warranties and insurance products.
- •Both parties engaged in merger discussions.
- •TMO alleges Spectrum wrongfully exploited two business opportunities: the SsangYong warranty opportunity and an opportunity to provide GAP insurance to 2020 customers.
- •TMO claims breach of contract, breach of confidence, breach of fiduciary duty, and unjust enrichment.
- •The trial focused solely on liability.
Legal Principles
Contractual agreement is determined objectively, by reference to the words and conduct of the parties.
RTS Flexible Systems Ltd v Molkerei Alois Müller GmbH [2010] 1 W.L.R. 753
When identifying and construing the terms of a contract, consider the context and conduct of the parties.
Devani v Wells [2020] AC 129
Evidence of things said and done after the contract was concluded are admissible to help decide what the parties had actually agreed.
BVM Management Limited v Roger Yeomans [2011] EWCA Civ 1254
Place little reliance on witnesses’ recollections of what was said in meetings and conversations; base findings on documentary evidence and known facts.
Gestmin SGPS SA v Credit Suisse (UK) Limited & Anor. [2013] EWHC 3560 (Comm)
A fiduciary is someone who has undertaken to act for or on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence.
Bristol and West Building Society v Mothew [1998] Ch 1
Fiduciary duties will not be too readily imported into purely commercial relationships.
Glenn v Watson [2018] EWHC 2016 (Ch)
The requirements for a claim for breach of confidence are: (1) information has the necessary quality of confidence; (2) imparted in circumstances importing an obligation of confidence; (3) unauthorised use to the detriment of the party who communicated it.
Coco v AN Clark (Engineers) Ltd [1968] FSR 415
Unjust enrichment requires: (1) defendant enriched; (2) at claimant's expense; (3) unjust factor; (4) no restitutionary defences.
Benedetti v Sawiris [2014] AC 938
Outcomes
TMO succeeded in establishing liability for breach of contract, breach of fiduciary duty, and breach of confidence in respect of the SsangYong Opportunity.
The court found an oral agreement existed where Spectrum would place the SsangYong warranty for TMO, benefiting only if the merger proceeded. Spectrum breached this agreement and owed fiduciary duties due to the relationship of trust and confidence. Confidential information was also improperly used.
TMO did not succeed in its claims regarding the 2020 customers.
The court found no oral agreement existed concerning the 2020 customers. Spectrum acted for its own account, not on behalf of TMO. There was no breach of fiduciary duty or confidence.
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