What was the case about?

“Colltech” (yes, that’s what was misspelled on the agreement – note, two ‘l’s, not one) entered into a contract with Cera Care Limited (“Cera Care”) for the provision of recruitment services. Entirely separately, another Coltech entity – Coltech Consulting Limited (“CCL”) – entered into a separate agreement with Cera Care for the provision of certain consultancy services.

The recruitment services were actually provided by Coltech Recruitment Limited (“CRL”), but Cera care denied this.

CRL instructed Sherrards in early 2022 when Cera Care refused to pay invoices amounting to £359,681.00, relating to the provision of 23 temporary workers supplied to Cera Care and whose services Cera Care admitted to having received the benefit of.

The defence Cera Care raised was that it never contracted with CRL; it contracted with CCL. What ensued was a lengthy and long-running legal battle over which “Coltech” entity had contracted with Cera Care to provide the recruitment services – CRL or CCL.

What gave a degree of oxygen to Cera Care’s argument were two main factors:

1. The contract that was entered into did not name CRL as the recruitment “Agency”; it named “Colltech”. That begged the question: what is “Colltech”? Did it mean CRL or CCL?
2. The contract – unhelpfully, and clearly in error – displayed, in the top right-hand corner, a logo that referred to “Coltech Consulting”. Cera Care relied heavily on this as being clear evidence that the correct contracting party was CCL, not CRL.

Why did the CRL vs CCL distinction matter so much to Cera Care? It mattered because Cera Care claimed that it was owed a substantial sum of money from CCL pursuant to the contract for consultancy services, such that it was entitled to refuse to pay the recruitment fees and, instead, simply offset against the (much larger) sum it claimed it was owed under the consultancy contract. In order to get this argument off the ground, Cera Care had to succeed in showing that the recruitment services contract was with CCL, not CRL, and it attempted to do that by leaning heavily on the poor drafting of the contract and the inclusion of the logo that referred to “Coltech Consulting”.

Cera Care’s arguments – which Sherrards asserted were a try-on and utterly hopeless from the outset – ultimately failed, and badly, but not before CRL and 1PS had been forced to expend over £100,000 in legal costs on complex High Court litigation, involving hundreds and hundreds of pages of evidence and documents.

So what happened?

Sherrards promptly engaged Jonathan Cohen KC of Littleton Chambers – a heavyweight in commercial litigation, and with whom Sherrards has enjoyed a strong and successful relationship for many years – and, with his careful advice (and assistance from his junior, Stuart Sanders), CRL and 1PS applied to the High Court for summary judgment. Summary judgment is essentially a means by which a party can short-cut litigation where it can show that the other party’s argument has no real prospect of success and that there is no other compelling reason why the case should go all the way to a trial. The view was taken that Cera Care’s arguments fell into this category: they had no real prospect of success.

In August 2023, an application for summary judgment was prepared and issued. The matter came before Deputy Master Sabic KC on 31 January 2024, who, having heard a day of arguments on both sides, found resoundingly in CRL and 1PS’ favour.

A key feature of the case was that, on each and every occasion when Cera Care wanted to engage a temporary worker, a “Placement” would be produced, which (amongst other details such as the name of the worker, pay rates etc) named who the “Agency” was. The Placement was uploaded to a portal, accessed by Cera Care, and Cera Care would approve the Placements in the portal. Thus, the contract between the parties was not just the document that the parties signed at the outset (containing the words “Colltech” and the logo); it also included each of the Placements.

Importantly, the Placements – without exception – identified “Coltech Recruitment Limited” (i.e. CRL) as the “Agency”. Cera Care went to great lengths to try and dismiss the relevance of the Placements, but their arguments failed.

 

The Judgment – which can be read here, concluded (in the main) that:

1. The existence of the logo with the words “Coltech Consulting” was irrelevant. Brand names cannot constitute a company’s legal entity.
2. The logo did not even identify CCL as the contracting party; it only said “Coltech Consulting” (missing the word “Limited”).
3. The incorrect spelling of “Colltech” was also immaterial, because all parties accepted that an actual legal entity was the party to the contract, and “Colltech” is not a legal entity. It had to be either CRL or CCL, each of which are formal legal entities.
4. Analysis of the contract and the Placements leads to an unambiguous answer as to which Coltech entity was the true contractual counterparty: read consistently and coherently with each other, the contract and the Placements contain only one definition of “Agency” and it follows that the contracting party was CRL.
5. Cera Care’s attempts to argue that evidence might come to light at a later date that points to CCL being the correct contracting party were also unsuccessful.
6. Despite it being Cera Care’s positive case that CCL was the correct contracting party, Cera Care had not adduced any documentary evidence which “clearly and positively supported [its] case” in this regard. “CCL’s name does not appear in any of the relevant contracts”.
7. CRL and 1PS’ case, by contrast to Cera Care’s, “is clear and straightforward”. The identity of the parties in the relevant contractual documents “is tolerably clear”.
8. “On the plain reading of [the contractual documents], there is, in my judgment, no documentary ambiguity in the definition of Agency… Thus, the key question in this application, namely who is the Agency, is determined by the definition adopted by the parties in writing, which is plainly CRL”.

Key takeways

Ultimately, CRL and 1PS should never have been forced to have to litigate this case. But the unfortunate stance adopted by Cera Care forced their hand. Nevertheless, better attention to detail at the point of entering into the contract would have avoided the arguments that were ultimately left to the Court to determine. Had the contract not referred to “Colltech”, but instead “Coltech Recruitment Limited”, there would have been nothing to argue about. The mistaken use of the logo referring to “Coltech Consulting” was unfortunate and led to further needless arguments.

Sadly, it is all-too-common that lay persons who draft their own contractual documents make errors like this. Such is the way of the commercial world, where there is often reluctance to enlist the help of lawyers. We see the use of brand names on contracts all the time – “Coltech” rather than “Coltech Recruitment Limited”, for example – and this case is a paradigm example of how seemingly innocuous oversights like this can lead to an extremely costly legal battle.

When you next enter into a contract, pause and think to yourself “who are we contracting with?”, and make doubly-sure that the correct, full, parties’ names are set out. And, of course, if in doubt take legal advice.

To find out more about the case, or get advice contact Barney Laurence. 

In this case, Sherrards were engaged to act on behalf of a recruitment agency that specialised in supplying finance professionals into various types of finance companies. The recruiter was engaged by a global private equity investment firm (“Company A”) to source a finance operations professional for them. The recruiter fulfilled the brief and sent several CVs to Company A, some of which resulted in interviews.

As sometimes happens, the recruiter did not hear further and received no indication from Company A as to whether any of the candidates had been successful. After following up with each of the candidates, it transpired in conversation with one of them that they had been hired into another company that appeared to be related to Company A. After some further investigation, it further transpired that the candidate had been hired into another company within Company A’s corporate group (“Company B”). Upon discovering this, the recruiter sought to recover its introduction fee from Company A. However, Company A maintained, for various reasons, that there had been no introduction within the meaning of the recruiter’s terms of business and that it was not liable for a fee (separately Company B was also asserting that there was no contract in place between it and the recruiter).

Following Sherrards’ instruction, we reviewed the terms of business and the chain of events, and it was unequivocal that there was a contract in place between Company A and the recruiter. However, what required further analysis was whether Company A was still liable for the introduction fee in circumstances where it had effected a Third Party Introduction?

In the event, fortunately the recruiter’s terms of business had appropriate wording to cover off this situation and we were able to confidently assert that Company A would be liable for the fee in full where they have effectively made an onward introduction and the prospective candidate had subsequently been hired.

Furthermore, in this case, as Company B was a holding company of Company A, this meant it was part of its corporate group structure. This provided a second line of attack to recover the fee, as Company B was defined as an “Associated Company” within the recruiter’s terms, meaning it was as if the introduction had been made directly to Company A. The recruiter was able to recover its fee in full, swiftly, and avoided court proceedings.

Action Point

The case serves as a useful for reminder to all recruiters that terms of business are organic documents that should be regularly reviewed and refreshed to ensure that they offer as much protection as possible, particularly in circumstances where a backdoor hire has taken place. Poorly drafted terms of business could be the difference between recovering a fee or not.

If you would like to know more, please contact Aaron Heslop for a no obligation discussion.

Paul Marmor, Head of Litigation and International Services, recently visited the offices of our Alliott Global Alliance (“AGA”) correspondent law firms in Dallas and New York – Platt Richmond and Golenbock Eiseman Assor Bell & Peskoe – and gave a presentation to each on the topic of UK/USA relations post-Brexit, where Paul explained how the trading relationship has been affected in a post-Brexit world.

Paul set out the good, the bad and the ugly from all perspectives.  Paul also gave the same presentation to AGA’s North American annual meeting in Palm Springs, California, attended by over 70 members from the USA, Canada and Mexico.

Paul is pictured presenting a ceremonial gift to each law firm, with the Managing Partner of Platt Richmond, Bob Daniels, and a number of his colleague, and with Jeff Berger, the Managing Partner of Golenbocks.  Paul is presenting David Gauke’s book entitled The Case for the Centre Right, which is a collection of essays on politics in the UK at this time, with special emphasis on Brexit, including contributions from Rory Stewart, Daniel Finklestein  and Dominic Grieve and others.

For more information about our connectivity, clients and friends across the Americas, through our involvement in the AGA, the American Bar Association and the International Bar Association, and for our legal perspectives relating to Brexit, then please reach out to Paul Marmor on +44 20 7478 9010 or pdm@sherrards.com, or visit www.sherrards.com.

We took action to ensure that the Judgment was set aside and a solution reached, ensuring that the child was protected in terms of pastoral care and reputation of the child and the family more generally.

Sherrards acts for a number of schools, colleges, academies and academic institutions, including in relation to commercial, property and contentious matters as required.

For more information contact Paul Marmor, Head of Litigation & Dispute Resolution, or Jean-Paul da Costa, Head of our Commercial and Charities team.

The Rugby club, known for its facilities, faced a Covid-era-related dispute with another party regarding the maintenance of its facilities. This case, typical of pandemic-related claims, involved contractual obligations, cost accumulation, and force majeure considerations.

To find our more, or how our Dispute Resolution team can help you, contact Paul Marmor. 

In the ever-evolving landscape of legal proceedings, a new “intermediate track” has emerged as a valuable framework for case management within the court system. This track offers a balanced approach, ensuring cases are handled effectively while not overburdening the legal system and allows for greater predictability regarding the costs of litigation.  In this article, we’ll delve into what the intermediate track encompasses, the criteria for cases to be eligible, what it excludes, and the advantages of using this track.

Understanding the Intermediate Track

When a claim is issued, the judge will allocate the claim to a specific ‘track’. In allocating the case to a track, the court will have regard to the value and complexity of the claim.

On 1 October 2023, the new intermediate track was introduced to the system, designed to create a more efficient and responsive mechanism for handling cases. The intermediate track occupies a middle ground between the small claims track and the fast track and the multi-track.

Importantly, the fixed recoverable costs regime applies to the intermediate track meaning, the costs you can recover will be fixed. Recoverable costs will be dependent on which band of complexity the claim has been assigned to and the stage of litigation achieved. Generally, the higher the complexity band and the closer towards trial, the greater the cost recovery will be. To find out the amount of fixed costs that you will be able to recover, click here and look at Table 14, on pages 13-19.

Criteria for Intermediate Track

Cases eligible for the intermediate track must meet certain criteria:

1. The claim includes a claim for monetary relief, the of value of which is at least £25,000 but, no more than £100,000.
2. The trial will not last more than 3 days.
3. Oral expert evidence at trial is likely to be limited to two experts per party.
4. There are no more than 3 parties to the proceedings.

The cases that may be typically appropriate for the intermediate track include cases where liability is relatively straightforward, for example personal injury claims with clear evidence of fault, cases of moderate complexity not requiring extensive and time-consuming discovery proceedings and those where both parties are willing to engage in alternative dispute resolution.

Even where a case does not meet the outlined criteria, the court may allocate a claim to the intermediate track where it considers that it would be in the interest of justice to do so.

Exclusions from Intermediate Track

Not all cases are suited for the intermediate track. Cases which will be typically excluded from this track will include those involving great complexity, extensive discovery, or those with a history of contentious litigation. Cases in which the relief sought includes non-monetary relief, will not normally be allocated to the intermediate track unless the court considers it in the interest of justice to do so.

There are some specific exclusions for when a claim should not be allocated to the intermediate track including criminal offences such as felonies or a claim for damages in relation to harm, abuse or neglect of children or vulnerable adults. Similarly, a claim for clinical negligence would normally not be suitable for the intermediate track unless the claim is one which would normally be allocated to the intermediate track and both breach of duty and causation have been admitted.

Advantages of Using the Intermediate Track

The intermediate track offers several advantages, making it an attractive option for many claimants and legal professionals:

1. Resolution Focus: One of the most significant benefits is that this track encourages parties to focus on resolution rather than adversarial litigation, which can be beneficial in maintaining relationships and reducing legal expenses incurred.
2. Cost Savings: Since the fixed recoverable costs regime applies to the intermediate track, there is greater predictability regarding the amounts winning parties can recover.
3. Efficiency: Another significant benefit is the time saved. By avoiding lengthy trials, cases can be resolved more swiftly, reducing the burden on the court system.

In conclusion, the intermediate track has emerged as a valuable framework in the landscape of legal proceedings. It balances the need for efficient case resolution with the demand for thorough examination and encourages early settlement reducing legal expenses. Parties must strategically consider when to choose the intermediate track, as it can save time, money, and court resources.

This article has been fact-checked and authorised by the Head of the Real Estate Litigation team, and Training Partner Michael Lewis. If you have any questions or thoughts, please reach out to him by clicking here.

Paul Marmor spoke about his involvement in developing Sherrards’ international persona, passing on the benefit of his experiences to an audience predominantly from the legal profession, looking to expand their international footprint.

In particular, Paul used the international webinar to speak about our work with an international alliance (Alliott Global Alliance) and our connectivity with other first-class law firms through the International Bar Association and American Bar Association, as well as working alongside The Law Society’s International Division and the Department for International Trade, including becoming part of the UK investment support directory hosted by the DIT.

Marco Cillario, International Policy Manager of The Law Society commented, “We are ready and willing to shout about the legal profession and to help our members, whether to improve access to key markets, facilitate introductions to networking opportunities with contacts across the world, or to create the right environment to do so ”.

Paul Marmor of Sherrards comments, “It’s been quite a journey for the firm, but in 20 years we have helped our clients and contacts with their increasing needs overseas, as well as the burgeoning demand for use of the UK courts by foreign parties.  I have no doubt that our legal profession is supported by some brilliant institutions, whether it be the Ministry of Justice, the Department for Business and Trade or The Law Society’s International Division”.

To download the interntional webinar to watch, click here.

For more information about Sherrards’ international offering and our work with the IBA, ABA, Alliott Global Alliance and Law Society International Division, and how the Department for Business and Trade and Ministry of Justice can help you, please reach out to Paul Marmor.

The event was well attended by a variety of businesses be that within the construction industry, retail, or financial services to name a few and served as an excellent forum for companies, big and small, to promote their products and services, encouraging growth of business across the South Hertfordshire Business Community. 

Sarah met with local MP and Deputy Prime Minister Oliver Dowden CBE at the dinner, who absorbed the needs of various businesses throughout the evening.

The event served as a valuable reminder of the wide variety of impressive companies Hertfordshire is home to and provided an opportunity to reflect on what assists our local businesses to thrive.

Sarah predominately works out of Sherrards’ St Albans office and from time to time also finds herself in our London office.  

Should you have any queries relating to Dispute Resolution and your business, or require any advice in respect of the same, please do not hesitate to contact Sarah by following this link.

The client/Defendant to the claim is a Central European company specialising in the production of aluminium profiles. 

A dispute arose between the parties arising out of the contract for the supply of aluminium billets, in respect of which the Claimant sought payment which the client was resisting, on the basis that the contract mechanism for determining price had not been followed and that the billets delivered were not of satisfactory quality, which caused it loss.

Karen Dobson, Partner at Sherrards, managed to negotiate an early settlement of the dispute, following the commencement of arbitration proceedings.

The settlement was very favourable to the client and resulted in it avoiding significant legal costs which would have been incurred in a fully-contested arbitration.

This has been an ongoing debate in this area for many years, and one that the firm is familiar with, having interacted with Indian law firms and business interests passing back and forth between the UK and India for some time. 

Paul Marmor, our Head of International Services and the Litigation & Dispute Resolution Department, was asked for his views on the changes to India’s legal service, which are set out in this article published by the International Bar Association, which sets the scene with input from a number of commentators including Paul, as to what may happen over the next few years: click here to read the article. 

For more information on our work relating to Indian concerns, please reach out to Paul and the International team on the details below.