High Court Rules in Favor of The Witz Company LLC in Contract for Difference Dispute

Citation: [2023] EWHC 2877 (Comm)
Judgment on


The High Court of Justice Business and Property Courts of England and Wales delivered a judgment concerning a dispute between The Witz Company LLC (TWC) & Anor and Edmund Truell, revolving around the true construction of a contract for difference (CFD) and the implications of the same. The case underscores the interpretation of complex financial instruments, the role of ‘commercial common sense’ in contractual terms, and the quantification of damages.

Key Facts

The dispute stemmed from a CFD entered into by Mr. Truell and Mr. Hurwitz. Mr. Truell, a founder of Tungsten Corporation, agreed to grant rights under the CFD to TWC, the investment vehicle for Mr. Hurwitz and his family. The disagreement arose over Mr. Truell’s obligations under the CFD and the impact of a supplementary bonus share issue by Zedra PCC on the valuation of shares due to TWC upon termination of the CFD. The Court was also required to address the failure by Mr. Truell to comply with orders relating to disclosure and quantify the sums due to TWC.

In elucidating the legal principles, the judgment referenced several critical decisions. Notably, the Court underscored the objective meaning of contractual language, referencing Wood v Capita Insurance Services Ltd [2017] AC 1173 and others, which emphasized understanding the contractual terms as a reasonable person with all background knowledge available to the parties at the time of contract formation.

The Court further reflected on ‘commercial common sense’ and its role in contract interpretation, acknowledging that where multiple constructions exist, preference lies with the one aligning with business logic, as highlighted in Rainy Sky SA v Kookmin Bank [2011] UKSC 50. However, ‘commercial common sense’ should not be applied retrospectively to reshape contractual commitments.

Another critical aspect was the treatment of ‘background knowledge’ or ‘factual matrix,’ which can inform the Court in its interpretive task, as evidenced by the email exchanges between Mr. Truell and Mr. Hurwitz regarding the intention behind the CFD.

The case of EIC Services v Phipps [2005] 1 WLR 1377 was cited concerning the nature of bonus shares and their treatment as a capital benefit. This contributed to the debate on whether the bonus shares issued were to be considered a ‘payment’ under the CFD.


The Court ruled that TWC is entitled to the net asset value of 362.298752 class A shares in Zedra as at 31 January 2019, thus favoring TWC’s interpretation of the CFD and the inclusion of bonus shares in the valuation. The Court also had to make an assessment of the share value based on available information due to non-compliance by Mr. Truell and lack of expert evidence provided by TWC, eventually setting the figure at £360 per share.

Interest was awarded at a rate of 3 percentage points above the Bank of England base rate from 2 March 2019 until the date of judgment, reflecting an interest rate accommodating the circumstances of TWC as an investment vehicle rather than a commercial borrower.


The judgment in The Witz Company LLC & Anor v Edmund Truell provides a comprehensive example of contract interpretation within the ambit of financial investments. The Court’s reliance on the principle of ‘commercial common sense’ and its meticulous approach to the ‘factual matrix’ demonstrate the need for clarity in drafting and executing financial contracts. Furthermore, the decision underscores the importance of compliance with disclosure obligations and the potential consequences of non-compliance. The outcome reaffirms that the intention behind a contract, as understood by the reasonable person, will shape the judicial outcome in disputes over contractual terms.

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