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You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Templeton Insurance Ltd & Anor v Brunswick & Ors [2012] EWHC 1522 (Ch) (31 May 2012) URL: https://www.bailii.org/ew/cases/EWHC/Ch/2012/1522.html Cite as: [2012] EWHC 1522 (Ch) |
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CHANCERY DIVISION
BIRMINGHAM DISTRICT REGISTRY
The Priory Courts 33 Bull Street Birmingham B4 6DS |
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B e f o r e :
(sitting as a Judge of the High Court)
____________________
(1) TEMPLETON INSURANCE LIMITED (2) KNOX D'ARCY OPERATIONS LIMITED |
Claimants |
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- and - |
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(1) RALPH STEPHEN BRUNSWICK (2) ELIZABETH JANE BRUNSWICK (3) JONATHAN RONALD BOOTH (as trustee of the estate of Ralph Brunswick in bankruptcy) |
Defendants |
____________________
Mr Edmund Cullen (instructed by Forbes Anderson Free) for the 1st Defendant
Ms Bridget Lucas (instructed by Hannah & Mould Solicitors) for the 2nd Defendant
The 3rd Defendant was not represented and did not appear at trial
Hearing dates: 21-25 November 2011, 28 November-2 December 2011, 5–6 December 2011
____________________
Crown Copyright ©
HHJ Simon Barker QC :
Outline of the action
The Claim against the First Defendant
(1) at all material times until 30.6.06, D1 was an employee of both C1 and C2 in consequence of which he owed contractual duties (a) to serve Cs loyally and faithfully, (b) to exercise good faith and honesty in all dealings with Cs' money and assets, and (c) not knowingly to do anything to the prejudice or loss of C1 or C2;
(2) as a director of both C1 and C2, D1 owed each of Cs fiduciary duties (a) of loyalty and good faith in all dealings with Cs, their property, assets and affairs, (b) not to place himself in a position where his duties might conflict with his self-interest, (c) to make full disclosure to Cs including of any misconduct, and (d) not to make a secret profit or to act for his own benefit or that of a third party; and,
(3) D1 is liable to repay some £0.5m to C1 and/or C2 as a result of his breach of contract, or as money had and received, or as constructive trustee and that D1 at all material times held the £0.5m as trustee for C1 and/or C2.
The Claim against the Second Defendant
The Claim against the Third Defendant
Generally
Relevant Principles of Law
English Law
Burden and Standard of Proof
Fraud
Dishonesty
S.281 IA 1986
Breach of Contract
Breach of Fiduciary Duty
(1) to conduct all dealings with the property, assets and affairs of each company loyally and in good faith;
(2) not, without the company's consent, to place himself in a position where his duties might conflict with self interest;
(3) to make full disclosure of any misconduct on the part of himself and/or any employee of the company; and
(4) not to profit from his position as a director or to act for his own benefit or that or a third party.
(1) to act in good faith;
(2) not to make a profit out of his trust;
(3) not to place himself in a position where his duty and his interest may conflict; and,
(4) not to act for his own benefit or the benefit of a third person without the informed consent of his principal[31].
Knowing Receipt
(1) disposal of the claimant's assets in breach of fiduciary duty;
(2) beneficial receipt by the defendant of assets which are traceable as representing the assets of the claimant; and,
(3) knowledge on the part of the defendant that the assets received are traceable back to a breach of fiduciary duty[35].
Unjust enrichment ~ a volunteer receiving trust property
"If a transferee of trust property is a volunteer, then the property will remain burdened with the beneficiaries' equitable interest, whether or not he has notice of the trust, because a volunteer has no equity against a true owner. Where, therefore, the trust property can be followed into the hands of a volunteer, who still has it at the time of the claim, an order for restoration will be made against him. Moreover, a volunteer will also be personally liable to account to the beneficiaries as a constructive trustee if after acquiring knowledge of the trust he dissipates the trust property so that no proprietary tracing claim lies against him".
(1) tracing and an order for restoration against a volunteer depend upon the volunteer being in possession of the trust property at the time of the claim;
(2) if still in possession at the time of the claim, equity is not interested in the state of the volunteer's knowledge because the remedy (tracing and restoration) operates against the trust property; but,
(3) if the volunteer has disposed of or dissipated the trust property, personal liability to account as a constructive trustee depends upon knowledge of the trust being acquired before disposal or dissipation.
Agency
Background to the Claimants and their witnesses
The Knox D'Arcy group
Templeton Insurance Limited
Knox D'Arcy Operations Limited
Mr Richard Steele
C1's financial information, 'X Tables' and 'free cash'
(1) Table 3X extends the income and expense statement (which is a conventional profit and loss account showing the derivation of current and cumulative profit before tax) (a) to include KD group costs attributable to but not paid by C1 (referred to as Extra Notional Costs (ENCs)), and (b) to disregard (by excluding or discounting to £Nil) all non-cash assets. The adjustment for ENCs involves the identification and deduction of expenses (eg payroll) funded by other KD group entities (mainly, if not exclusively, C2) and other administrative overheads attributable to C1's operation and business, and also the deduction of a notional return on KD group's capital investment (specified by RS at 10%[49] compounded annually applied to the share capital);
(2) Table 6X provides a detailed breakdown of premium income;
(3) Table 9X provides a detailed breakdown of commission and incentive payments; and,
(4) Table 10X provides a detailed breakdown of insurance debtors.
The information for Tables 6X, 9X and 10X was readily available from C1's underlying accounting records. It is important to understand that the X Tables are memorandum schedules derived from and in the case of Tables 6X, 9X and 10X providing detailed information about the transactions recorded in C1's electronically maintained accounting ledgers. In the case of Table 3X, the information is an extrapolation from C1's accounts (summarised profit and loss account and summarised balance sheet) to produce additional financial information to that contained in C1's accounting ledgers.
(1) 'real result' which is profit before tax after adjusting for ENCs;
(2) 'free cash' which is cash balances net of liabilities and ENCs; and,
(3) 'change in free cash' which shows the net inflow/outflow of free cash over the current accounting period.
The provision of these 3 lines of information reveals the purpose for which the 3X Tables were produced and, thereby, the information of particular interest to RS.
The Claimants' disclosure and witnesses
Background to the First and Second Defendants
Mr Ralph Brunswick
Mrs Elizabeth Brunswick
D1's witnesses and Ds' disclosure
The arrangements between Cs and D1
Was there an agreement in 1994 and, if so, what was it?
(1) In relation to D1 being party to a written contract of employment, RS's oral evidence was that Cs discovered that D1's written employment contract had disappeared when they "went to look for it" in May/early June 2006. RS was challenged to point to any mention of the existence of such an agreement prior to his 2nd statement (dated 14.11.11, i.e. 1 week before commencement of the trial) on the basis that it could be drawn to his attention by Mr Booth QC in re-examination. No such reference was made. RS's effort to support this untruth led to his false statement that restrictive covenants were introduced into a standard form contract as a result of litigation said to have occurred before D1 joined KD group, which I have referred to above and rejected as untrue;
(2) in his oral evidence, RS said that the standard contract of employment was drafted by solicitors with the proforma maintained on KD group's computer system in the IoM, that D1's contract would have been printed out there, posted to RS, was signed by D1 when he met RS in London, and was then sent to the IoM. In the light of the material put before me at trial and for reasons already given, I have rejected that evidence as false. However, I observe that it was given with a degree of measure and confidence that was a hallmark of RS's oral evidence; this further amplifies my need to approach his evidence and, therefore, Cs' case with caution;
(3) RS's evidence about accepting D1's suggestion that KD group could benefit from an insurance business is that there was a meeting at RS's home in Johannesburg at which, during a very brief conversation, RS "simply told [D1] what we would do and that was that … He asked me what was in it for him and I told him". On RS's evidence what RS told D1 is far from clear. This is in part due to RS and Mr Cullen being at cross-purposes at times (as when RS referred to C1 being different from other KD group companies because it was a "separate entity", by which Mr Cullen understood RS to be referring to a company as a separate legal entity, which, of course, would not distinguish C1 from any other KD group company, whereas RS meant that C1 is a separate division constituting KD group's insurance operation), and in part due to the difficulty of recalling events 20 years in the past. Also, and even after making these allowances, RS's explanation of what he told D1 was at times contradictory. However, the most significant problem is that RS had considerable difficulty in differentiating between what he had said or might have said on the one hand and he what now considers he had intended to say or now believes D1 understood him to say or mean or intend on the other. As a result, RS's evidence was confused. Subject to the foregoing, my understanding of RS's evidence is that he told D1 that he would be entitled to "10% of whatever [C1] makes" which was also expressed as 10% of any profit on KD group's investment, by which RS says he meant and D1 understood him to mean profit after deducting the initial £0.5m investment and after a return thereon to KD group at the rate of 10% p.a.. This was described by RS as D1's participation. RS also said that he "explained it as profit on our investment and [D1] agreed";
(4) RS's evidence was inconsistent and contradictory on whether actual repayment to KD group, as opposed to notional deduction, was a pre-requisite to any payment to D1. In one interchange during cross-examination, RS maintained that he had in terms explained to D1 that no bonus would arise until KD group's initial investment had actually been repaid and added ".. over the years, that was one of [D1's] gripes : oh well I'm not getting a bonus because the capital is staying in the business to grow the business". However, that was quickly contradicted and RS accepted that he "didn't explain it in those terms". In particular, RS acknowledged that in 1994 he did not specify repayment as a condition. RS also said that he and D1 both knew that this was what RS meant, but RS never actually explained how D1 would have so known;
(5) as a rider, I should add that RS also included, as a deduction, ongoing expenses relating to C1 paid by other KD group companies (this is not in dispute); and,
(6) as a further rider, questions about the requirement to cover the capital investment before any bonus entitlement would arise caused RS to observe that "it was quite clear that [D1] wouldn't be getting a bonus any time soon". Tellingly, this indicates to me that the reality, even from RS's perspective, was not that there was no agreement as to a 10% bonus or profit entitlement, but that RS considered D1's entitlement to be paid a bonus was at or beyond a distant horizon which would not require monitoring or be activated for some years to come, and which could and would be revisited as and when it did arise.
Was there a contract between either or both of Cs and D1 and, if so, what were the terms?
D1's 2003 bonus
Renegotiation of D1's 10% entitlement
(a) Was the existing arrangement between D1 and C1/RS varied in March 2004?
(b) Was a new arrangement made between D1 and RS/C1 or was the existing arrangement between them varied on or before 20.6.05?
(c) Was a new arrangement made between D1 and RS/C1 or was the existing arrangement between them varied after 20.6.05?
(1) there is no evidence of any negotiation of payment intervals to this effect between D1 and RS at this stage. The evidence is that D1 stipulated monthly production of management accounts and Table 3Y to SW;
(2) Table 3Y served a different function from the X Tables and SW is unlikely to have sent Table 3Y to RS unless directed so to do by D1 or it was inserted into C1's management accounts for any particular period. Table 3Y was a schedule by which D1's bonus entitlement was computed, which Table was then used as a source document by Cs for the authorisation and payroll processing of payments to D1; the evidence does not indicate that such information was required by or routinely sent by SW to RS. In contrast, the X Tables were created to provide RS with information he specifically required. Had the 3Y Tables been sent to RS and had he seen them, he would have understood that "paid as we go" meant paid monthly; but, had that happened, I have no doubt that a dialogue between RS and D1 would have followed, which would have led to a negotiation about which RS and D1 would have given evidence, and there would probably also have been some communication with or through DT;
(3) whilst it is correct that RS did receive quarterly cash sheets prepared by SW which did disclose substantial salary payments relating to C1's payroll, that falls some way short of drawing RS's attention to payments being made to D1 in respect of his accrued bonus entitlement;
(4) on 7.7.05, RS sought to introduce a variant to the timing of any payment to D1 by limiting actual payment of a bonus to 10% of whatever KD group extracted from C1. D1 understood that this would cause a significant departure from even annual intervals between payments because he knew that RS was interested in maximising a capital gain and had no particular interest in periodic income returns. D1 responded by sending a letter of resignation to RS at his London office which was then forwarded to him in Johannesburg. The letter is not in evidence but there has been no evidence that, whether by the letter or at that time, D1 accused RS of reneging on an agreement to permit monthly payment of bonuses;
(5) on 11.7.05, RS and D1 met in London to discuss and resolve outstanding issues. After that meeting, D1 reported to DT that, although not certain, he thought RS had accepted the majority of the points he (D1) had raised. DT and RS then had a telephone discussion in which a new service agreement was discussed on the basis that it should be with C1. RS reported that (1) they had agreed profit participation by reference to 10% of free cash; (2) D1 had accepted a 10% uplift[58] in favour of KD group applied to capital participation; and, (3) a golden parachute provision could be agreed. RS said he regarded himself as being between a rock and a hard place and, although unhappy, had little choice but to "do the deal" for 2 reasons : D1 was needed as a witness in other proceedings (Oxus litigation); and, D1 was needed to bring C1 to the point where RS could extract value. Neither D1 nor RS appear to have told DT that particular payment intervals had been agreed;
(6) thus, on 11.7.05, RS and D1 reached an agreement which had the effect of varying the existing agreement between C1 and D1 as to the basis of calculation of D1's 10% bonus entitlement (by extrapolating an audited profit based calculation to a free cash based calculation). There was no requirement or term of that agreement that such a variation was conditional upon the agreement of other terms (e.g. as to restraints) or upon the execution of a written document;
(7) on 19.7.05, DT forwarded to RS (but not to D1) a 1st draft of an employment contract between C1 and D1. The draft terms appear to reflect DT's uncertainty as to the meaning of "paid as we go" because DT left open for selection alternative payment intervals of monthly, quarterly and yearly. RS's reaction was to strike through the monthly and quarterly alternatives, but not to seek to vary annual payment intervals by introducing payment by reference to cash withdrawal by KD group; and,
(8) most significantly, when D1 did eventually receive a draft service agreement (on 27.7.05) which provided for accrued bonuses to be paid annually, his response to DT appears to have been to raise quarterly payment for negotiation not monthly payment as a term already agreed; and, DT's note reflects the fact that quarterly audits by KPMG were to be considered as a possibility if verification was required.
(1) as at 11.7.05, D1 had reached a sufficient consensus with RS (on behalf of C1) to give rise to a contractual entitlement to be paid a bonus calculated by reference to 10% of free cash (in effect by a variation of the 1995 agreement between C1 and D1);
(2) at no time prior to D1's departure from C1 on 30.6.06 was an agreement reached (expressly or by reference to informed conduct) that D1 was entitled to payment at monthly intervals, or at any other interval. Consequently, D1's bonus entitlement remained payable on the signing off of the annual audited financial statements;
(3) the 3Y Tables are derived from 3X Tables which, in turn, are based on C1's management accounts. The figures in C1's management accounts for the year to 31.12.05 in the trial bundle are materially identical to C1's audited financial statements for 2005 (signed off on 29.6.06).Table 3Y[65] for the year to 31.12.05 is calculated in accordance with the agreement referred to above and shows bonus payments paid to D1 during 2005 totalling £443,112 and a further accrued bonus at 31.12.05 of £51,700; and,
(4) the prior year adjustment to C1's profit for the year ended 31.12.05 effected through the comparative figures in C1's audited financial statements for the year ended 31.12.06 is to be ignored for the purposes of these proceedings.
Did D1 take or receive bonus payments during 2005 in breach of his contract with C1?
(1) as at 11.7.05 the implied contract between C1 and D1 was varied so that D1's 10% entitlement was to be calculated by reference to free cash instead of profit, but the payment interval remained unchanged (annual after signing off of C1's report and financial statements);
(2) the right to receive any payment was determined by the approval (by signing off) of C1's report and financial statements, i.e. payment was to be made at annual intervals;
(3) D1 was entitled to a bonus which had accrued at 31.12.05 in the sum of £494,812 (as calculated by Table 3Y) and was payable on, but not before, 29.06.06;
(4) the subsequent restatement of C1's 2005 profit by a prior year adjustment is irrelevant to D1's bonus calculation.
(1) Cs' own pleaded case is that all payments were made by C2 from C2's bank accounts;
(2) although C1's report and financial statement for the year to 31.12.05 included a note to the effect that D1 was indebted to C1 in the sum of £443,112 by reason of receiving unauthorised payments, D1's indebtedness to C1 had disappeared or been reversed by the time C1's 2006 report and financial statements were signed off on 12.12.07;
(3) C1's report and financial statement for the year to 31.12.05 included a note to the effect that there was a recharge of various expenses by C2 totalling £741,215[66]. However, in the 2006 financial statements, the recharge by C2 for 2005 was restated as £261,760[67], a sum materially less than the bonus payments by C2 to D1 and capable of explanation by, and consistent with C1's management accounting information in the trial bundle as to, other expenses. Thus, the treatment of D1 as a related party debtor of C1 appears to have been reversed and there is no indication on the balance sheet that D1 is regarded as being a debtor of or having a liability to C1; and,
(4) D1's IoM form T14 (annual statement of gross remuneration and tax and NI deductions) shows KDL IoM to be D1's employer and D1's remuneration from that employment to have been £535,256.04 gross for the tax year 2005/2006.
This is not an exhaustive list, but it suffices as the basis for a finding that C1 has failed to establish on the balance of probabilities that it suffered any loss, damage or otherwise identified financial disadvantage as a result of D1's breaches of contract.
Did D1 take or receive bonus payments during 2005 in breach of his contract with C2?
Did D1 take or receive bonus payments during 2005 in breach of fiduciary duties to C1?
Did D1 take or receive bonus payments during 2005 in breach of fiduciary duties to C2?
Was D1's breach of his fiduciary duties fraudulent?
Is D1 released from liability to C2 by the operation of s.281(1) or does s.281(3) apply?
Conclusion in relation to D1
D2 as principal and D1 as her agent
(1) the passage relied upon by Mr Booth QC in Item Software did not and was not intended to contain a full statement of the relevant principle of the law of agency, but was intended only (1) to point out that in the law of agency there is a fraud exception to the rule that information held by an agent in the course of his agency is to be imputed to the principal, and (2) to note that the purpose of the fraud exception is to protect the principal's interests, whereas the purpose of attribution of knowledge is generally to protect the interests of third parties;
(2) assuming, for present purposes, that D1 was an agent of D2 as Mr Booth QC submits, as a matter of principle imputation is neither automatic nor absolute and its application is generally confined to knowledge acquired while acting within the scope of authority. The knowledge Mr Booth QC relies upon was acquired outside the scope of D1's authority and before the monies were received into D1 and D2's joint accounts;
(3) as to the general rationale for attribution of knowledge (protection of 3rd party interests), the interests of 3rd parties (here Cs) are perfectly well protected in law without having to resort to the improbable fiction of automatically attributing the agent's knowledge to the principal. In a case where misappropriated funds are paid into an innocent 3rd party's account, protection is afforded by a proprietary remedy (tracing into the hands of the innocent person) ~ an obviously more realistic and practical approach than imposing liability as the result of the fictional attribution of an inherently unlikely state of mind; and,
(4) the law has a functioning mechanism for considering the recipient's actual or inferred (as distinct from imputed) state of mind and imposing liability in appropriate cases (the unconscionability test for knowing receipt).
D2 as a recipient of the 2005 bonus payments
Was D2 a knowing recipient of the 2005 bonus payments?
(1) D2 refused to release (for repayment) from the Avalon Trust the 2003 bonus (£55k) which D1 acknowledged belonged to C1 : the factual basis for this assertion is RS's account of what D1 told him; I have rejected that account. D2's evidence is that the suggestion that she knew that the 2003 bonus was unauthorised or a diversion of funds which she refused to allow D1 to repay is ludicrous. I accept D2's evidence;
(2) D2 knew that D1 received £363k as net income over 6 months and that the gross equivalent would have been a substantially greater sum, which D2 knew to be a sum many times greater than D1's salary and many times greater than any previous bonus : this is entirely neutral as a particular of knowledge in the context of knowing receipt. What matters is whether D2 received a credible explanation for the receipts which she honestly believed. I have found that she did;
(3) D2 knew that bonuses were paid 6 monthly or quarterly and not on an ad hoc basis throughout the year : there is no evidence that D2 had any such knowledge and no basis for drawing an inference that D2's conscience was affected by the timing of the receipts;
(4) D2 knew that D1 was able to arrange himself for payment of £363k from C1 : on the contrary, D2 had been told by D1 and reasonably believed that all payments had been properly documented and had been approved by C1's Board;
(5) D2 knew that D1 had significant secret (from C1) equity interests in 6 other companies that were recipients or intended recipients of funds from C1 and that D1 intended to leave C1 in the near future : Mr Booth QC cross-examined D2 about one company, SGC. D2 confirmed that D1 had told her that he had an interest in this company and also stated that D1 had told her that RS knew of and "actively encouraged this because it was good for [C1]", which evidence I accept;
(6) D2 knew that the bonus payments belonged to C1 from the circumstances of the payment : the inference is that payments totalling some £363k net received over 6 months in the context of a much lower salary and no history of substantial bonus payments must have led D2 to conclude that the money was misappropriated. During cross-examination, D2 provided a credible and honest answer to this assertion; and/or
(7) D2's knowledge is to be inferred from her failure adequately to evidence or explain the receipt : this appears to be a comment on D2's pleaded defence. It is not for her to disprove knowing receipt. However, had the burden of proof been upon D2, she would have discharged it.
D2 as a volunteer
D2's liability for the shortfall (£363k - £324k)
Interest
Claims against D3
Order as to judgment
Postscript
Note 1 Or 24.1.06 according to the schedule at #8.1 of the Re-Amended Particulars of Claim. [Back] Note 3 Cs’ counsel’s Opening Submissions #151 [Back] Note 4 Cs’ case summary for PTR on 3.11.11 [Back] Note 5 In re B Lord Hoffmann #13 and #15 [Back] Note 6 In re B Lord Hoffmann #15 [Back] Note 7 In re B Baroness Hale #32 [Back] Note 8 D v P Lord Herschell p.360 [Back] Note 9 D v P Lord Herschell p.376 [Back] Note 10 D v P Lord Herschell p.380 [Back] Note 11 Lord Nicholls stating the advice of the Judicial Committee of the Privy Council p.389 [Back] Note 12 Twinsectra Lord Slynn ##4-6 [Back] Note 13 Twinsectra Lord Hoffmann #20 [Back] Note 14 Twinsectra Lord Hoffmann #22 [Back] Note 15 Twinsectra Lord Hutton ## 29 and 36 [Back] Note 16 Twinsectra Lord Hoffmann #10 [Back] Note 17 Barlow Clowes Lord Hoffmann ##15-17 [Back] Note 18 Abu-Rahman Arden LJ #59 [Back] Note 19 Abu-Rahman Arden LJ #66 [Back] Note 20 Abu-Rahman Arden LJ #69 [Back] Note 21 Starglade The Chancellor #19 quoting #51 of the trial judge’s judgment [Back] Note 22 Starglade The Chancellor #20 quoting #54 of the trial judge’s judgment [Back] Note 23 Starglade The Chancellor #32 with whom Hughes and Leveson LJJ agreed, ##41-42 [Back] Note 24 Starglade The Chancellor ##38-39 with whom Hughes and Leveson LJJ agreed, ##41-42 [Back] Note 25 Starglade The Chancellor #39 with whom Leveson LJ concurred #45 [Back] Note 26 Woodland-Ferrari Ferris J ##32 and 50 [Back] Note 27 Woodland-Ferrari Ferris J #46 citing the judgment of Millett LJ in Armitage v Nurse [1998] Ch 241 at pp.250-251 [Back] Note 28 Woodland-Ferrari Ferris J #46 citing the judgment of Millett LJ in Armitage v Nurse [1998] Ch 241 at pp.250-251
[Back] Note 29 Mummery LJ, with Hale and Carnwath LJJ, #121 giving the judgment of the Court of Appeal [Back] Note 30 Mummery LJ #161 at (2) and (9) [Back] Note 31 Bristol and West Millett LJ p.18A-C [Back] Note 32 Lord Neuberger MR #35 with whose judgment Richards and Hughes LJJ agreed ##162-163 [Back] Note 33 Lord Neuberger MR #36 [Back] Note 34 Chadwick LJ, at ##25-29, with whose judgment Laws LJ and Sir Anthony Evans agreed ##54-55 [Back] Note 35 Akindele Nourse LJ p.448B-C with whose judgment Ward and Sedley LJJ agreed p.458D-E [Back] Note 36 Akindele Nourse LJ p.448G-H and p.450C-F [Back] Note 37 Akindele Nourse LJ p.455E-G [Back] Note 38 Akindele Nourse LJ p.456H-458C [Back] Note 39 Papamichael HHJ Chambers QC p.375 #247 [Back] Note 40 Tcpt day 11 pp.150-151 [Back] Note 41 Cs’ closing submissions Tcpt 10/154-170 [Back] Note 42 Arden LJ #45 (and see earlier #24 and #28), with whom Mummery LJ agreed #124, and with whose conclusion and reasoning on this issue Holman J agreed #84 [Back] Note 43 C2 directly and C1 indirectly as a direct subsidiary of C2 [Back] Note 44 There is also a KDL registered in Ireland which is an associated company of KDHL [Back] Note 46 E.g. D1’s evidence as to RS’s “winning team” observation when D1 thanked RS after receiving his first KD bonus and as to RS being grudging about bonuses, not necessarily for D1, at other times, which I accept [Back] Note 47 Tcpt day 7/120-121 [Back] Note 48 There is a dispute between RS and D1 as to whether this lunch meeting said by RS to have been at L’Oranger restaurant took place [Back] Note 49 Erroneously noted in various places, including by D1, as 15% [Back] Note 51 More than 6 years for many of the events [Back] Note 52 The proceedings before me allege that all payments were from C2’s bank accounts; the IoM proceedings allege that £136,585.71 of the total was paid from C1’s bank account [Back] Note 55 Between 17.7.03 and 4.8.03 [Back] Note 58 Notional interest charge [Back] Note 61 7/1303 and 7/1306 [Back] Note 62 Calculated by reference to the Table 3Y as at 31.12.05 showing payments to D1 as follows : 20.6.05 £158,912.04; 20.7.05 £140,300; 21.9.05 £36,100; 17.10.05 £63,700; 21.11.05 £5,100; and 14.12.05 £39,000 [Back] Note 68 Tcpt 10/157-161 [Back] Note 69 see 1/9 for detail of dates and amounts [Back] Note 70 23.6.05 £125k; 26.7.05 £115k; 19.10.05 £52k; 4.1.06 £32k [Back]