CPL LTD v CPL OPCO (TRINIDAD) LTD (2016)

The claimant applied for permission to add an additional defendant to its claim and to re-amend the particulars of claim to make a claim against that party.

The claimant was the originator of a cricket league staged in the West Indies. The defendant, a company incorporated in Trinidad and Tobago, had been set up for the specific purpose of operating a cricket team representing Trinidad and Tobago. The proposed second defendant (P) was a company incorporated in Madeira; it was the indirect parent company of the defendant. The claim was based on an agreement dated 22 July 2013 between the claimant and the defendant described as a Participation Agreement (the agreement). Under it, the claimant was responsible for the costs of operating the league, while the defendant became the operator of the team representing Trinidad and Tobago and was responsible for the costs of operating that team. The claimant’s case was that the defendant had failed to comply with its obligations under the agreement and accordingly was liable in debt or damages. The sum claimed was about £700,000. The defendant had stated that it would be unable to satisfy any judgment. In the instant applications, the claimant alleged that there had been a collateral agreement, made orally or by conduct, between it and P under which P warranted that it would share primary liability for any debt incurred by the defendant under the agreement. The primary basis on which the collateral agreement was alleged was that a particular individual, with P’s authority, had made an oral promise to the claimant that P would be responsible for all payments due under the agreement. It was alleged that in reliance on that oral promise and in consideration for it, the claimant entered into the agreement. It was said that the claimant’s decision not to exercise its right under the agreement to secure a guarantee from P was, as P knew and intended, influenced by and therefore taken in consideration for the oral promise. It was also said that the collateral agreement was formed or evidenced by P’s conduct in asking the claimant to send it invoices for sums due and paying those invoices. The instant applications were made three months before the trial date.

HELD: The correct test to be applied to joinder applications was that applicable to amendment generally, namely that a joinder would not be permitted if it would not survive an application for strike-out or summary judgment. Where the proposed party to be joined was a foreign party, that reflected the standard for the test on the merits in an application for service out of the jurisdiction. Save for the allegation that the collateral agreement was formed by P’s conduct in asking the claimant to send it invoices and paying those invoices, the fresh claim had a real prospect of success. Further, the relatively late stage at which the instant applications had been made did not justify refusing them. There did not seem to be any good reason why the claimant did not sue P from the outset. On the other hand, various factors militated in favour of granting the applications. One was the defendant’s conduct. It had failed to engage with the proceedings. It delayed, for example, for over six months in providing disclosure, which it only gave once an unless order had been made. Its costs were being paid by a third party and the only prejudice it would suffer would be the delay in having the claim resolved, but it had caused delays itself. If the claimant were compelled to issue fresh proceedings against P, that would be wasteful of its and at the least potentially the court’s resources. Moreover, P’s joinder would not require a recasting of the claimant’s case against the defendant. In the circumstances, it would be appropriate to accede to the joinder and amendment applications, Quah v Goldman Sachs International [2015] EWHC 759 (Comm) applied (see paras 23, 37, 39, 42, 45, 48, 50-54 of judgment).

Applications granted

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