Construction – Transfer of shares – Claimant chef involved in restaurant business with first and second defendants

Construction – Transfer of shares – Claimant chef involved in restaurant business with first and second defendants

White v Parton and others: Chancery Division: 20 June 2013

The claimant was a well-known chef. He owned a 31.8% share in the third defendant company, which ran a restaurant. The first and second defendants were also important shareholders in the restaurant. In August 2009, the shares in the third defendant were re-organised, and a new company was formed. A dispute subsequently arose between the parties, as to the use of the claimant's name at the restaurant, and in November 2010, the claimant terminated his association with the restaurant. The claimant issued proceedings.

The claimant contended that an oral agreement had been made at a meeting held on the 9 November 2007 between himself and the first and second defendants. He contended that there had been a plan agreed at that meeting, under which the third defendant would cease to exist, and a new company would be formed to control the restaurant. Under the agreement, the new company would then give 38% of its shares to the claimant, in return for being allowed to make use of the claimant's name.

The claimant submitted that, although the new company had been formed, no shares in it had been given to him. He contended that the defendants were in repudiatory breach and that the contract was terminated. He sought damages and a 38% shareholding in the new company. The first and second defendants contended that, among other things, no contract had existed as said or otherwise, and that the claimant had agreed to allow his name to be used by the company in exchange for the 38% share. Since, they submitted, he had resiled from that position, he was not entitled to the shares. The claim would be dismissed.

It was established law that, where parties to a contract had agreed on two aspects of a contract but not on the third, that contract would not be formed. The claimant's evidence had not been detailed, and the claim was a bold one. On the evidence, there had been no contract regarding the right to use the claimant's name or any binding contract as alleged by the claimant. The parties were therefore not obliged to give the claimant 38% of the business.

Robert Deacon (instructed via Public Access) for the claimant; Max Mallin (instructed by Teacher Stern LLP) for the defendant.