![]() |
[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback] | |
England and Wales High Court (Chancery Division) Decisions |
||
|
You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Vellacott v The Convergence Group Plc & Ors [2007] EWHC 1774 (Ch) (31 July 2007) URL: http://www.bailii.org/ew/cases/EWHC/Ch/2007/1774.html Cite as: [2007] EWHC 1774 (Ch) |
||
[New search] [Printable RTF version] [Help]
CHANCERY DIVISION
Strand, London, WC2A 2LL |
||
B e f o r e :
____________________
| CHANTREY VELLACOTT |
Claimant |
|
| - and - |
||
| THE CONVERGENCE GROUP PLC CONVERGENCE GROUP INTERNATIONAL SA ALAN STUART MACDONALD ROBINSON GAIL FARRIN ROBINSON |
Defendants |
____________________
Mr Stephen Atherton QC (instructed by Brooke North LLP) for the Third Defendant, Mr Robinson
Mr Hugh Sims (instructed by Foot Anstey) for the Fourth Defendant, Mrs Robinson
The First and Second Defendants (both in administration) were not represented
Hearing dates: 8, 9, 13, 14, 29 and 30 March 2007
____________________
Crown Copyright ©
MR JUSTICE RIMER :
Introduction
Convergence's counterclaim
The present application
"… there is no realistic prospect of [Convergence] being able to establish the necessary chain of causation at trial. He says that it is unclear that even by September 1998 [Convergence] had any project to sell, and that anyway no company had yet acquired any of the necessary licences for the proposed operations, and he says that the licences were necessary for the obtaining of finance."
PLC - background
CV's retainer
The events of 1996
The events of 1997: part one
The Convergence projects in UK and Greece: the Silk Route project
The events of 1997: part two
Events from January to October 1998: the internet placing case
"… we now need to move forward and make formal applications for Data and/or CATV [cable television] licences.
We have continued our development work on producing an 'end to end digital bi-directional MVDS (wireless) network' and are currently operating a trial/demonstration network in the UK. We now need to move on and acquiring [sic] licences as part of the plan.
I would be grateful if you could investigate the requirements of the above licences such that we can have a meaningful discussion when we return to Greece."
That records the importance Mr Robinson attached to licences. Without them there could be no project. Throughout his oral evidence, however, Mr Robinson played down their importance, often referring to them as a "process" and conveying the impression that their grant was a matter of formality and time. That was an oversimplification, and whatever Mr Robinson may have said at the trial, at the time he was saying and writing very different things.
"In light of your requirement for an early 'placing' we propose that all parties work towards preparing the prospectus to be issued by the Gibraltar Plc. This will serve to focus the opinions and advice of the various contributors: Gibraltar: Keith Lawrence (KL), Guy Stagnetto (AVS), myself (AJH) – London/Paris: Ted Mercer (RM), Michael Llamas (MLL) and Convergence.
I note that you have a 'blueprint' of the 'Mems and Arts' which you would like to see incorporated into the Gibraltar Plc. Please forward as soon as possible."
"You will note that Andrew [Haynes] is suggesting that the MPIP be a foundation document around which usefully we can determine the relationship of all parties, and to this end, I would like to make a supreme effort to have a more comprehensive draft of the MPIP completed by the end of the week.
Following on from our conversation today, I know that you are very busy preparing the list of activities to be achieved by Silverstone and were also going to cast your mind to the positive arguments for moving the Project Oxygen management centre from Cadiz to Gibraltar. I appreciate, therefore, that you are already extensively committed in matters relating to Convergence (as well as to your other clients) and therefore, Job [Mr Maats], Gail [Mrs Robinson] and I will attempt to progress the MPIP at this stage.
Furthermore, as our legal activities are on the substantial increase, now would be a good time to review the matters relating to fees and future projected costs for this and other projects as we do not wish to fall out over such minor matters as money."
"1) Is it realistic, within the timetables and the framework set by Project Oxygen for a Gibraltar Plc to comply with the EU Second Investment Directive requirements and thereby being capable of offering the securities of the Gibraltar Plc to EU investors at large? How would Gibraltar's interpretation of the Second Investment Directive differ from the UK's interpretation of the Second Investment Directive i.e. the Public Offers of Securities Regulations 1995. (Statutory Instruments, 1995 – 1537, which was made on 14 June 1995). Is it realistic to issue a prospectus from Gibraltar which not only complies with the EU's SEC type requirements, but also with the Australian Securities Commission and the US Securities and Exchange Commission? (As Alan [Mr Robinson] will have explained, this is critical as we intend to offer securities beyond the EU to certain ethnic Greek diaspora communities. We can procure virtual travel into the EU should this be considered available!)
2) Is it realistic in view of the early stages of Gibraltar's desire to assume a more substantial standing in the global offshore community to base a professional team for a project with global first-mover advantages out of Gibraltar? To what extent will it be required to use agents in other jurisdictions? How can control over the team and professional costs be maintained?
3) What is the current status of Gibraltar's compliance with the EU telecoms deregulation and the general implementation of the EU's directives in this arena? Are there any current impediments in the Gibraltar legislation and regulatory climate and or sovereign status, even prior to the regularization of the Gibraltar telecoms regulations, which would inhibit the landing of a submarine cable by Project Oxygen? Are there any impediments to the operation of one of the world's three control centres for Project Oxygen out of Gibraltar? (rather than Cadiz).
We are looking forward to exploring these issues and then moving forward with due speed, subject to satisfactory answers on the above. …"
"Following the meeting at your [Mr Tzavellas's] office, I spent several hours with George Bairactaris and Christina Gennadopoulos going through in greater detail the background information that I discussed with you and have suggested that either George or Christina contact you directly.
Whilst the timetable of the 31st May is tight, I believe it is a realistic objective for the specific documentation required to be generated in Gibraltar, however, a certain number of material contracts will be required both out of the UK and out of Greece.
A considerable amount of the documentation associated with the UGS bid can be updated and will be applicable for this Marco Polo placing. However, consideration will now have to be given to transforming [CCGE] into a Societe Anonyme (SA) as previously envisaged and I have discussed this matter with George Bairactaris. It is also highly likely that a further SA will be required to be formed into which the licence applications can be made for the submarine cable to connect Athens with Crete.
A second major component is the purchase/formation from new/joint venture required to establish an Internet Service Provider (ISP) company. To this end, I am most keen to meet with the representatives of Singular as discussed with you at our last meeting."
"We believe that our meeting now positions us to focus all our efforts on a repetitive, tap like, structure for funding Marco Polo's financial and intellectual capital intensive commercial development at ever reducing systemic risk to thereby procure dilution suffered by the principals declines in line with the exponential growth in Marco Polo funding requirements over the next 12-18 months."
"In these circumstances I have not been able to give the level of attention to the substantial volume of documentation concerning 'Marco Polo' that I have received in the week, to enable me to make the critical judgements required to allow matters to proceed beyond this point.
In particular the nature of your various correspondence and dialogue, and that of Ian Gamse, with members of the management team of [PLC], have highlighted the need to now fully address and agree upon such basic fundamentals as proprietary information, confidentiality, references, protocols, objectives, ownership structure, management roles, areas of expertise, commitments, costs and cost controls in our proposed joint venture activities."
"We are all very keen to move on in an expeditious and cost effective fashion, but not to the detriment and risk of destabilising our established programme for the Burgess Hill Proof of Concept, the ITC trials, Wintranet and our other affairs to which you are not a party."
"As expressed at our meeting [on 23 June], I am not satisfied that the international group structure has been completed to best purpose, or properly checked against our commercial needs for Marco Polo, and that the expenditure on establishing a tax efficient auditable structure has been properly and sufficiently documented. We, therefore, propose as suggested and tentatively agreed at our meeting that:-
a) Dapo Ladimeji will validate the international group structure against the proposed Marco Polo placing and provide a written explanation and opinion as to its functionality and beneficial operation.
b) Colin Heath provide in conjunction with David Waterhouse, an explanation of how particular activities will be allocated to group companies and the reporting and accounting structure/procedures that will best facilitate the annual audit and tax computation.
We would expect the above to be completed within the next 6 weeks and be available for:-
a) Inclusion in our planned explanation of the International Group as required for the Marco Polo placing.
b) The 1996 tax filing and 1997 Audit completion.
We remain concerned that the international structure proposed and executed on our behalf by Dapo and Chantrey Vellacott has not yet been completed to reflect the identified requirements of the Group and yet further substantial charges could yet be incurred to reach a point of satisfactory conclusion."