1. The Deed envisaged that the assignment might not lead to an effective legal assignment, and in those circumstances provided that the claims would be held on trust for Henderson Jones. 2. Henderson Jones paid JDC £6,500 for the assigned claims, with further payment to JDC dependent upon outcome; 3. Henderson Jones had conduct and control of any proceedings pursued in relation to the assigned claims;
The delay in starting enforcement from 2018 to 2020 was explained by the developing law resulting in the decision in Bresco . The five and a half year delay from mid-2012 to 2018 was caused by quite different matters relating to the involvement of a company called Henderson Jones Ltd (see next).
Henderson Jones
In 2016 along came the company called Henderson Jones (H&J) whose business was to "… purchase[s] litigation and arbitration claims for immediate money and/or a share of the proceeds." In this case, that was not what was done. Instead H&J took an assignment of the claim against Erith. However, this assignment did not take effect as a legal assignment because the bespoke NEC3 terms applicable to the subcontract contained an express non-assignment clause on top of which Erith refused its consent. Erith now went further and said it was H&J who brought the proceedings, having acquired rights to the dispute from the liquidator of JDC. Erith also pointed to the fact that the bulk of the spoils of any judgment in JDC's favour would go to H&J as one of the reasons why summary judgment should not be granted. The Deed of Assignment was followed by a Deed of Agreement, entered into between the Liquidator of JDC and H&J dated 13 December 2019. After reviewing the deed the court concluded the following pertinent points:
4 . Recovery of any claims were to be paid to Henderson Jones;
5. 45% of net recovery in those subsequent proceedings (meaning recovery less costs) were to be paid out to JDC by Henderson Jones;
6. Henderson Jones would therefore retain 55% of the net recovery.
Whether or not the deed was intended to avoid some of the criticisms of this type of arrangement the court noted that such criticisms were raised by Erith following the adjudication (and in the court proceedings) and could have been predicted, due to the judgment handed down in October 2019 in Meadowside[9] where such arrangements were held to be contrary to the 2013 Regulations[10] pertaining to damages based agreements and also champertous.
[9] Meadowside Buildings Development Ltd (in liquidation) v 12-18 Hill Street Management Co Ltd [2019] EWHC 2651 [10] Damages Based Agreements Regulations 2013
Made with FlippingBook - Online Brochure Maker