Green (t/a Green Denman & Co) v Skandia Life Assurance Company Ltd.

This is the hearing of an application under CPR Part 24 by the Defendant for summary judgment against the Claimant (or as it is sometimes called “reverse summary judgment”). CPR rule 24.2 provides that the Court may give summary judgment against a claimant on the whole of a claim or a particular issue if it considers that the claimant has “no real prospect of succeeding” on the claim or issue, and there is “no other compelling reason” why the case or issue should be disposed of at a trial. It is not suggested that there might in this case be any other compelling reason and it follows that what I have to decide is the familiar question whether the Claimant has any real prospect of success in his claims; or, to be more accurate whether the Defendant has established that he has no such prospect.

As appears below, it is well established that on an application such as this, it is inappropriate for the Court to conduct a mini-trial on the documents, but in order to make sense of what follows it is appropriate for me to summarise the facts as they appear from the evidence before me. I do so being very conscious that it is not the function of the Court at this stage to make findings of fact where there is any dispute, but to assess whether there is indeed any real prospect of the Claimant succeeding at trial.

The Defendant, Skandia Life Assurance Company Limited, (“Skandia Life”), is as its name indicates an insurance company. It is part of the Skandia UK Group and carries on long-term insurance business, including pension business. Mr Nick Poyntz-Wright, who is now Skandia Life’s Managing Director, says in his witness statement that Skandia Life (and other companies in the Skandia UK Group) only sell products through independent financial advisers (“IFAs”); in very general terms an insurance company can either sell its products though IFAs, who are independent of the insurance company, or through company representatives who are tied to the particular company. There is in fact an issue between the parties whether Skandia Life so conducted itself that some of its employees acted as company representatives, which I will have to consider later; but the general description of Skandia Life selling through IFAs is not disputed.

One such IFA is the Claimant, Mr Kenneth Green, who trades under the name of Green Denman. He established Green Denman in 1973, and he is evidently an IFA of very considerable experience. He has a long association with the Skandia group, having known Mr Alan Wilson (who by 1999 was the Managing Director of Skandia UK Holdings) for many years. He has been registered with Skandia Life to offer its products to his clients since 1979. One of his clients was Imagination Limited (“Imagination”) and Mr Green was giving pensions advice to Imagination at least as early as 1981. As a result of his advice, in 1982 Imagination established a pension scheme with Skandia Life (“the 1982 Scheme”), the Scheme being established with effect from 1 February 1982 by an interim Trust Deed dated 29 January 1982 under which Imagination appointed itself first Trustee. The deed recites that Imagination had proposed or was about to propose to Skandia Life for a policy or policies for securing the benefits of the Scheme, and provides that as Trustee it should hold such policies under trust and apply the contributions received in the payment of premiums to Skandia Life. The 1982 Scheme is an occupational pension scheme of the money purchase type, with earmarked assets for each member, a separate policy (or policies) being issued by Skandia Life in respect of each member.

Imagination was not the only client that Mr Green introduced to Skandia Life, but it became an important one; when the 1982 Scheme was set up, Imagination was a relatively small company with some 24 employees, but by the end of 1996 it had (according to the Company Secretary, Ms Joyce Powell, who was the person at Imagination responsible for administration of the Scheme) 232 employees. It would seem that about half were active members of the 1982 Scheme. Mr Green was typically, and certainly in the case of Imagination, remunerated for his advice by commission; this was paid to him by Skandia Life, and covered by the charges which Skandia Life levied on the policies. The precise rates and amounts do not matter but as Imagination grew and the number of employees and members of the 1982 Scheme grew with it, this became a significant source of income for Mr Green. Mr Green’s own figures (annexed to the Particulars of Claim) assume that if the 1982 Scheme had continued unchanged, he would have earned over £290,000 by way of commission in relation to the 1982 Scheme in 2000, and correspondingly larger figures thereafter, depending on the assumptions that are made about increases in the number of members and their salaries.

At the risk of oversimplification, Mr Green’s essential complaint in these proceedings is that Skandia Life was instrumental in causing Imagination in 2000 to change from the 1982 Scheme to new pension arrangements with Professional Life Assurance Company Limited (“Professional Life”), another insurance company within the Skandia UK Group. These new arrangements were on a nil commission basis with the result that Mr Green lost the benefit of the commission payable under the 1982 Scheme, and indeed had to repay some commission which had been paid to him in advance. Mr Green claims that in doing so Skandia Life acted in breach of terms to be implied into his contract, and conspired (with Imagination, with Professional Life and with another Skandia company, Skandia Life (Pensions Trustee) Limited (“Skandia Trustee”)) to use unlawful means to injure him. This is only a brief summary of his claims which I will have to consider in detail in due course.

To resume the history, Imagination as might be expected from time to time reviewed its pension arrangements; Mr Green refers in his evidence to two occasions in particular, one in 1992-3 when Imagination took advice from Pannell Kerr Foster and Skandia Life were asked to take part in a “beauty parade” competing with alternative providers; and one in 1997 when Imagination took advice from Mr Hyman Wolanski of Wolanski & Co, a firm of consulting actuaries. In each case Imagination in the event decided to stay with Skandia Life and retain the 1982 Scheme.

Mr Green points to what happened in 1997 as an illustration of how he and Skandia Life could successfully work together to persuade Imagination of the merits of its existing pension scheme. I do not think it is necessary for me to recount these events in any detail. Mr Wolanski had written a report in May 1997 addressed to Mr Richard Adams, the Finance Director of Imagination (which had by then apparently changed its name to The Imagination Group Limited) in which he made a number of criticisms of the existing pension arrangements, describing the charging structure as complicated, and the Skandia Life contract as relatively expensive; he set out a number of options, including moving to a nil commission basis with Skandia Life or Professional Life, or moving to other providers. This led to a meeting in July 1997, at which Mr Jim Roberts (Investment Director for the Skandia UK Group) made a presentation on behalf of Skandia Life which emphasised the financial performance of the Skandia funds, and Mr Green stressed the after sales service which he provided and the flexibility of the existing arrangements. Mr Green says that it was also demonstrated at that meeting that a transfer to a fee-based arrangement would not be in the interests of the members, and that this was accepted by both Mr Adams and Mr Wolanski.

In the event Imagination stayed with the existing scheme, albeit with some changes. One of these was a change of trusteeship: Mr Roberts had made the point in his presentation that the Pensions Act 1995 imposed a number of new responsibilities on trustees, which Imagination would not want. His suggested solution was to amend the rules to adopt the rules of the Skandia Master Trust and appoint Skandia Trustee as sole trustee and scheme administrator. The evidence before me does not deal with this in any detail. It does include a form of Deed of Appointment under which Skandia Trustee is appointed sole trustee of the 1982 Scheme in place of Imagination. This is undated and executed by Imagination alone; but Skandia Life accepts on the pleadings that Skandia Trustee became trustee on 1 September 1997. I do not think I have any clear evidence as to whether Mr Roberts’ other suggestion of amending the rules to adopt the Master Trust was taken up.

There were also some changes to improve the financial terms, but these do not appear to have entirely satisfied Mr Adams. In January 1998 he wrote to Mr Green mainly asking for further information but also saying that although he was pleased to have confirmation of the improved benefits they had not “translated as much as I guessed they would into £ value”, and that it seemed to him “there would still be at a reasonable disadvantage when compared to other pension providers”, referring back to Mr Wolanski’s report of May 1997. Mr Green replied pointing out various features of the new terms and saying that the new basis was better than other providers.

In January 1999 Mr Adams wrote again, this time saying that it seemed to him they were making insufficient progress in trying to rationalise the pension scheme into something that was manageable, understandable and provided good value for money. Mr Adams enclosed a letter from Mr Wolanski summarising a recent meeting between them and Ms Powell. The general tenor of this was that Mr Adams had difficulty obtaining suitable accounting information, found the different allocation rates confusing, and did not feel in control of the pension scheme. It records that Mr Adams was not specifically looking to move away from Skandia but would be prepared to consider this if the issues were not resolved; and recites Mr Wolanski’s advice that the difficulties with the charging structure and accounting information were tied in with the commission structure. The letter also recorded Mr Wolanski’s recommendation that Imagination move to a straightforward system with 100% allocation and nil commission; and that Imagination should ask Skandia Life if either they or Professional Life could do this; if not Mr Adams should seriously consider moving the scheme away from Skandia Life.

The evidence before me deals in some considerable detail with the process whereby the suggestion of moving to a nil commission scheme was first explored, then decided on by Imagination and finally implemented. I do not need to recite the entirety of this history but will pick out some of the more significant steps:

In his Amended Particulars of Claim Mr Green relies on six causes of action: (i) breach of implied terms; (ii) unlawful means conspiracy; (iii) interference with the Claimant’s interests by unlawful means; (iv) breach of the Financial Services Act 1986 (“FSA”); (v) improper clawback of commission; and (vi) a quantum meruit for work done.

Skandia Life says that none of these claims has any real prospect of success. I was referred in this connection by Mr James Dingemans QC, who appeared with Mr Thomas Roe for Mr Green, to the leading cases on the granting of summary judgment under Part 24 on the application of a defendant, that of the House of Lords in Three Rivers District Council v Governor and Company of the Bank of England [2003] 2 AC 1 (“Three Rivers”), and that of the Court of Appeal in Equitable Life Assurance Society v Ernst & Young [2003] EWCA Civ 1114 (“Equitable”), and two first instance decisions, that of Laddie J in Aston Barrett v Universal-Island Records Ltd [2003] EWHC 625 (Ch) (“Aston”) and that of Davis J in President of the State of Equatorial Guinea v Logo Ltd [2005] EWHC 2034 (“Equatorial Guinea”).

There was no significant dispute over the principles to be derived from these cases. I can I hope summarise them as follows:

Mr Dingemans suggested in his skeleton argument that the application should be stopped at the outset, drawing attention to the comments of Laddie J in Aston at paragraph [44] to the effect that whereas it was likely to be proportionate to spend a few days on a summary judgment application to short-circuit a trial due to last some months, it is likely to be disproportionate to spend that length of time when trying to short-circuit a trial due to last, say, two weeks. He suggested before me that a trial of this action might indeed last about two weeks whereas the application was listed with an estimate of 2-3 days (and in the event took over 3 days to hear). But he did not try and stop Mr Charles Hollander QC, who appeared for Skandia Life, opening his case and like Laddie J in Aston I think it is difficult in this situation for the Court to prevent the application being made at all, essentially for the same reasons that he gave (at paragraph [45]), namely that it is difficult to shut out the applicant without hearing him, and once the applicant has been heard, it is really impossible not to hear what the respondent to the application has to say, unless the Court is able at that stage to conclude that the application is ill-founded. But once full argument has been heard, it then seems wrong for the Court to decline to rule on the arguments that it has heard. In the event I did hear full argument and consider it appropriate, having done so, to rule on the application on its merits.

The first cause of action relied on by Mr Green is breach of terms to be implied into the contract between himself and Skandia Life. Mr Hollander’s argument is that Mr Green has no reasonable prospect either of establishing that the terms that are pleaded should be implied into the contract; or of establishing on the facts that Skandia Life acted in breach of such terms in the way alleged.

Mr Dingemans objected to Mr Hollander running the first part of this argument at all. He said that it had not been appreciated on the Claimant’s side that Mr Hollander was proposing to argue that the terms could not be implied at all (as well as arguing that there had been no breach) and pointed out that there had been no indication that this was going to be argued in either the application notice or the evidence served with it. He said this was contrary to paragraph 2(3) of the Practice Direction supplementing CPR Part 24 which provides:

“(3)

The application notice or the evidence contained or referred to in it or served with it must–

(a)

identify concisely any point of law or provision in a document on which the applicant relies, and/or

(b)

state that it is made because the applicant believes that on the evidence the respondent has no real prospect of succeeding on the claim or issue or (as the case may be) of successfully defending the claim or issue to which the application relates,

and in either case state that the applicant knows of no other reason why the disposal of the claim or issue should await trial.”

He said it was wrong for the application to be made on one basis and pursued on another. The purpose of the requirement in the Practice Direction was so that everyone knew where they were and what points they had to address; and it was unfair (and contrary to the overriding requirement of dealing with cases justly) for the respondent to come to court not knowing what points were to be taken.

I indicated at the hearing that I would permit Mr Hollander to argue the points he wished to on a provisional basis. Having done so, I do not think it right to prevent the argument from being run. I agree with Mr Dingemans that the Practice Direction plainly requires a point of law to be identified in advance, and that the evident purpose of this requirement is so that the respondent to the application knows what case he has to meet and can prepare accordingly. It is also correct that Mr Poyntz-Wright’s witness statement, although it deals in considerable detail with the facts relevant to the claim and why (he says) they do not support Mr Green’s allegations, does not identify any particular point of law on this aspect of the case (or indeed on some of the legal aspects of conspiracy where the same point arises). I have some doubt whether the question of what, if any, terms, should be implied into a contract is really a point of law within the meaning of the requirement; the traditional classification of implied terms distinguishes between terms implied as a matter of law (which operate as default rules for particular types of contract) and terms implied as a matter of fact (which turn on the particular contract in question), and the implication sought to be made here seems to me of the latter type. But the distinction between points of law and points of fact is notoriously elusive and I will assume I am wrong about this, and that Skandia Life’s application does include reliance on points of law that should have been identified.

On this assumption it failed to comply with the Practice Direction. But the Practice Direction does not specify any particular sanction for failing to comply with its requirements, which means that the failure to comply with it does not by itself invalidate any step taken in the proceedings unless the Court so orders (CPR rule 3.10). In considering whether to so order, or rather whether to prevent Mr Hollander making the argument, it seems to me that the most significant question is whether it has caused any prejudice to Mr Green.

I do not think it has. The Defence itself denies that the terms should be implied as being neither necessary, reasonable nor consistent with the obligations owed by Skandia Life or Mr Green to their clients. Mr Dingemans’ skeleton argument shows that he had appreciated that this was a point taken by the Defence, and it said that although it did not appear to him that the arguability of the implication of the terms was within the scope of the current application, he made some short submissions and that “if the Claimant is wrong about this further submissions (in addition to the short submissions set out below) will be made.” In the event he did make further submissions on the point, and helpfully supplied me with further authorities. The application took a number of days and Mr Dingemans accepted that he was in a position during the course of the application to research and deal with the points of law that were raised. It is often the case that counsel have to deal with matters of law that have not been fully anticipated, and while I accept entirely that it is important for the respondent to an application to know what is being said, I do not consider that Mr Green suffered any real prejudice or was at any disadvantage in his counsel having to prepare extra argument on a point which he knew was in issue between the parties, which he thought (but was not entirely sure) was probably not being run, and which he was fully capable of meeting.

Three implied terms are pleaded in the Amended Particulars of Claim:

Mr Hollander challenged the implication of any of these terms. For a convenient summary of the relevant principles he referred me to the judgment of the Court of Appeal in Philips Electronique Grand Public SA v British Sky Broadcasting Ltd [1995] 3 EMLR 472 at 480f where Sir Thomas Bingham MR recited the formulation of Lord Simon of Glaisdale on behalf of a majority of the Judicial Committee of the Privy Council in BP Refinery (Westernport) Pty Ltd v the President, Councillors and Ratepayers of Shire of Hastings (1978) 52 AJLR 20 at 26. That was in these terms:

“Their Lordships do not think it necessary to review exhaustively the authorities on the implication of a term in a contract which the parties have not thought fit to express. In their view, for a term to be implied, the following conditions (which may overlap) must be satisfied: (1) it must be reasonable and equitable; (2) it must be necessary to give business efficacy to the contract, so that no term will be implied if the contract is effective without it; (3) it must be so obvious that "it goes without saying"; (4) it must be capable of clear expression; (5) it must not contradict any express term of the contract.”

Sir Thomas Bingham MR recorded that both parties had accepted this as an accurate and comprehensive statement of the relevant law and himself described it as distilling the essence of much learning on implied terms.

Subject to one point, Mr Dingemans also accepted it before me as an accurate statement of the law. The one point on which he said that it was inaccurate was that it suggests that the second and third conditions (business efficacy and obviousness) are cumulative whereas the better view is that they are alternative grounds for implication. (It was not disputed that the other conditions, that the term should be reasonable, capable of clear expression, and not contradict the express terms, had to be satisfied in every case). I agree with Mr Dingemans that although the two tests are often applied cumulatively, or treated as two aspects of the same question, there are undoubtedly cases which treat them as two separate and alternative grounds for implication: see, for example, Mosvolds Rederi A/S v Food Corporation of India [1986] 2 Ll Rep 68 (a striking decision of Steyn J where he found that a term did not fall to be implied on the ground of business efficacy but did on the ground of obviousness), Ashmore v Corporation of Lloyd’s (No 2) [1992] 2 Ll Rep 620, 627 per Gatehouse J, Modahl v British Athletic Federation Ltd [2001] EWCA Civ 1447, [2002] 1 WLR 1192 at paragraph [119] per Mance LJ. Without deciding whether they are in fact alternative tests, I will assume they are for the purposes of this application.

Mr Hollander says that none of the terms satisfies either test, or indeed is a reasonable one. The starting point for considering this question is the nature of the contractual arrangements between the parties.

These are contained in two documents. The first takes the form of a letter from Skandia Life to Green Denman & Co headed “Terms and Conditions of Business” (“the Terms and Conditions letter”). The version of the letter in evidence is dated 3 August 2001; the Amended Particulars of Claim are pleaded with reference to a version dated 28 September 2000. It appears however that these dates are simply the dates on which the documents were generated, and there does not appear to be any dispute that these terms were standard terms which governed the relationship between Mr Green and Skandia Life at the material time.

The relevant provisions of the Terms and Conditions letter are as follows:

The second contractual document is an undated one-page document headed “Indemnity Conditions”. Although the Reply puts in issue whether these were the relevant conditions, Mr Dingemans accepted before me that these conditions did form part of the contractual relationship between Mr Green and Skandia Life. These provide for Skandia Life to pay commission on what is described as an indemnity basis; that is that commission will be paid in full within two months after the date of the issue of the policy to which the commission applies, but on the basis that there will be a recoupment of indemnity commission if premiums under a policy are discontinued for any reason within 2 years. Mr Dingemans accepted that this was the effect of paragraph (2)(a)(i) of the Indemnity Conditions.

Against this background I consider first whether the term pleaded at Paragraph 7 of the Amended Particulars of Claim is, or is arguably, to be implied into the contract. Mr Dingemans at one stage relied on the fact that Mr Green was a very long-standing agent of Skandia Life’s and suggested that the implication might be fact-specific and turn on the particular relationship that he personally had with Skandia Life. In a case where the parties’ contractual relationship is governed by written standard terms and conditions, I do not think this is right; in such a case, the process of implication, even if not strictly a question of construction of the written contract, is very similar to it. In essence the Court must look at the written contract, viewed against the background of the admissible matrix of fact, to determine if the suggested term is a necessary but unexpressed part of the bargain set out in the written contract. I do not see how that process can sensibly be affected by the question whether the relationship is a long-standing or a recent one, or has been a good working relationship or not. Indeed it raises impossible questions as to when the implied term might have first arisen. I therefore agree with Mr Hollander that none of the suggested implied terms turns on anything specific to Mr Green, and that they turn primarily on the relationship between the parties as revealed by the written terms of the contract.

Mr Hollander pointed out that a fundamental feature of the contract is that Mr Green is the agent of the client (Imagination in this case) and not of Skandia Life. Even in the case of principal and agent, there is no automatic implication that the principal will not take steps to prevent the agent earning remuneration: see the discussion in Bowstead & Reynolds (17^th edn, 2001) §7-032ff. It is, he says, entirely a matter for Imagination, not Skandia Life, whether it wishes to continue to use Mr Green as its agent, whether it wishes to continue with existing policies or not, whether it wishes to continue to use Skandia Life for its pension arrangements, or to switch to Professional Life or some other provider entirely, and whether it wishes to do so on a commission basis or nil commission basis. These are all matters between Imagination and Mr Green; Skandia Life’s only responsibility is to pay commission on such business as is in fact introduced by Mr Green to it, and then only if it chooses to accept it.

This last point in my judgment makes the full width of the term as pleaded impossible to sustain. Paragraph 1.2 of the Terms and Conditions letter reserves in terms the right for Skandia Life not to accept business from an intermediary. It follows that Skandia Life could indeed refuse in its discretion to accept any further business from Mr Green and thereby prevent him from earning commission on future business. It seems to me that this necessarily rules out what is pleaded at Paragraph 7(a) of the Amended Particulars of Claim (that Skandia Life would not take any steps to prevent Mr Green from earning commission in the future) on the basis that it is inconsistent with an express term of the contract. In any event, far from being required to make the contract work, or being so obvious as to go without saying, it seems to me that it would make Skandia Life’s business impossible to operate. It would appear to mean that Skandia Life would be in breach of contract with Mr Green (and presumably every other commission-based intermediary with whom it dealt) if it decided for reasons of its own that it would close its doors to new business, or cease to offer commission-based products, or that it no longer wanted to accept business from certain types of client. I think it would require very unusual circumstances before an agreement to remunerate agents of clients on a commission basis for business that had been introduced and accepted could be held impliedly to restrict an insurance company’s freedom to decide for itself what future business it was and was not willing to write and on what basis.

This reasoning does not apply to the terms pleaded at Paragraphs 7(b) and (c). Paragraph 7(c) is directed at the case where indemnity commission has been paid but become repayable under the Indemnity Conditions, that is the policy has been discontinued before two years’ premiums had been received. It is not clear to me quite what separate situation Paragraph 7(b) is directed at. It may be that it was meant to cover the (presumably rare) case where a policy lapses in the two months between being issued and the indemnity commission being paid; or to cover a case where for one reason or another commission is not paid on an indemnity basis. Whatever the explanation, both it and Paragraph 7(c) are as I understand it directed at a case where a policy has been duly taken out (and commission therefore earned) but the policy is discontinued early so that commission is no longer payable.

Here the argument for an implication (that the intermediary has done the work, introduced the business and it has been accepted, and it is not open to Skandia Life to prevent him earning remuneration accordingly) seems at first sight more promising. But in my judgment this part of the suggested term also fails. Once a policy has been taken out, Skandia Life is contractually committed to paying commission, but the amount of commission depends on how long the policy is kept up. This is a matter for the client, not for Skandia Life. And although as a matter of contract it is Skandia Life which is responsible for paying commission, the economic reality is that it is the client who pays for the commission, the commission being paid out of the various charges levied on the policy by Skandia Life. It follows that if the client chooses to discontinue a policy for whatever reason, there is nothing that the intermediary can complain of (unless his contract with the client precludes the client from discontinuing which I would think unlikely, even if permissible from a regulatory point of view). In these circumstances it seems to me that the suggested term is not needed to make the contract as between Skandia Life and the intermediary work. The contract works perfectly well on the basis that Skandia Life will pay if the client chooses to keep the policy up. I do not see that it is necessarily implicit in that contract that although the client is free to discontinue the policy, Skandia Life is not free to do anything which could be said to be taking steps to bring that about. And I regard it as very far from obvious, let alone so obvious that it goes without saying, that in such a situation the intermediary should have a remedy against Skandia Life. The reality is, as this case shows, that if a client indicates that it is contemplating changing its pension arrangements, the suggested implied term would make it very difficult if not impossible for Skandia Life to look after its own interests. If the intermediary cannot prevent the client from discontinuing a policy, I do not think it reasonable, obvious or necessary to give business efficacy to the commission arrangements that he should be able to complain if Skandia Life goes along with, and even, if it thinks it in its own commercial interests to do so, encourages that. If the intermediary does have a contractual right as against the client to prevent the policy being discontinued (which as I have said I think unlikely) I do not see that it is obvious or necessary that he should in addition have a contractual claim against Skandia Life.

I accept the submission of Mr Hollander that on these points nothing is going to change at trial, turning as they do on the nature of the contract between the parties rather than on the facts. In my judgment therefore the implied term pleaded at Paragraph 7 of the Amended Particulars of Claim does not have any reasonable prospect of success.

The next term which is pleaded is that at Paragraph 7A of the Amended Particulars of Claim. This is primarily directed at a complaint that Skandia Life did not keep Mr Green fully informed about a new policy which it introduced known as EP4. This was launched at the beginning of August 1999, and, although normally a commission-based product, was designed to be flexible so that the commission could be “rolled back” into the contract and could therefore be used as a nil commission product if desired.

Mr Dingemans says that it must be implicit that when Skandia Life introduce a new product it should inform IFAs such as Mr Green of the product, as otherwise the IFA is unable to discharge his duties to his client to give the best possible advice. As a general principle I can see the sense of this, and I certainly do not think I can conclude, as Mr Hollander invited me to, that it is unarguable. Whether an insurance company is under an implied obligation to volunteer information about new products to IFAs, or only to respond accurately to requests from IFAs, or is not under any contractual obligation at all, seem to me to be points of some difficulty, on which it may be relevant for the Court to take into account the way in which the relationship between insurance company and IFA works in practice and what sort of information an IFA in practice requires to advise his clients. I have very little information on this; and I do not feel the high degree of confidence necessary to conclude this point against Mr Green at a summary stage as Skandia Life ask me to.

The same goes for the wider general duty of co-operation in good faith that is sought to be implied. Mr Dingemans accepted that there is no general principle of English law that contracting parties owe each other duties of good faith; but the relationship between an insurance company that is dependent on IFAs selling its products and an IFA that is dependent on insurance companies making products available for him to sell is necessarily a close one that requires a degree of mutual co-operation and I do not think a general duty of good faith co-operation can be regarded in those circumstances as unarguable. But I would accept (as Mr Hollander suggested) that no such term even if implied could cut across the relationships between the parties so that if, for example, the client does not want the IFA at a meeting, or informed of something, the IFA cannot rely on an implied term of good faith co-operation to complain if the insurance company does what the client wants. Equally it seems to me plain that the insurance company must be able to pursue its own commercial interests even if they conflict with those of the IFA; an implied obligation of good faith co-operation is not to be equated with an obligation to put the IFA’s interests before its own or to look out for them.

The third term sought to be implied is that at Paragraph 8 of the Amended Particulars of Claim as to Skandia Life observing legal and regulatory requirements in its dealing with Mr Green. Further information given on behalf of Mr Green in response to a request clarifies that the relevant regulatory requirements are those pleaded at paragraphs 18D to 18L of the Amended Particulars of Claim. These allege breaches by Skandia Life of Lautro’s Code of Conduct as applicable to “company representatives” in a number of respects, the thrust of the allegation being that Skandia Life’s employees gave advice to Imagination that was not in compliance with the Code. I will have to consider this claim further in due course but for present purposes the question is whether, assuming that there was a breach of the Code by Skandia Life in dealing with Imagination, it was or arguably was a breach by Skandia Life of an implied term in the contract with Mr Green.

I do not consider Mr Green has any reasonable prospect of establishing this. The difficulty here is not so much with the implied term as pleaded, which refers to Skandia Life complying with legal and regulatory requirements “in its dealings with the Claimant”. I can see that expressed in this form it might well be arguable. Suppose for example there were a regulatory requirement that any projections supplied by an insurance company to an IFA should be calculated on a prescribed basis. It does not seem surprising to suggest that any insurance company contracting with an IFA would be impliedly undertaking to comply with such requirements.

But whether that would be so or not, I do not see that it has any possible application here. In none of the matters complained of was Skandia Life dealing with Mr Green in any meaningful sense at all. What is complained of is advice that is said to have been given to Imagination. Skandia Life denies giving any advice (as opposed to information) at all, but it is not disputed that if it did so, it did so at meetings at which Mr Green was not present; indeed part of his complaint is the way in which he was excluded from the process. The regulatory requirements which are said to have been broken are not concerned at all with the relationship between insurance company and IFA; they are indeed concerned with the selling of products to clients without an IFA. They are for the protection of clients (in this case Imagination) and not for the protection of someone such as Mr Green.

In these circumstances it seems to me that there is no possible basis for implying into the contract with Mr Green an obligation that Skandia Life will not act in breach of regulatory requirements in its dealings with other persons. It certainly does not seem to me to be obvious, or necessary to make the contract work. This is especially so where, as is the case here, the regulatory requirements are neither imposed for the protection of Mr Green nor, as I conclude below, is breach of them actionable at the suit of Mr Green. In my judgment therefore this term too, or rather the claim that is sought to be advanced on the basis of it, has no reasonable prospect of success.

In the light of my conclusions on the arguability of the implied terms, I can deal comparatively briefly with the submissions of Mr Hollander as to the particular breaches relied on. These are pleaded at Paragraph 18 of the Amended Particulars of Claim (as breaches of all three implied terms without distinguishing between them).

Paragraph 18(1) pleads that Skandia Life acted in breach by meeting representatives of Imagination in order to persuade it to transfer to the new scheme with Professional Life. Mr Poyntz-Wright says that Skandia was not advising or encouraging Imagination to transfer, but some of the evidence shows that at its lowest the transfer to Professional Life was being put forward as a “Proposed Way Forward” (the title of one of the slides at the presentation on 4 November 1999), and there is certainly material on which a trial judge could find that Skandia was actively seeking to persuade Imagination to transfer. But I do not see how this is arguably a breach of contract with Mr Green on its part. It is in fact an illustration of how the term pleaded at Paragraph 7 would, if implied, have prevented Skandia Life from acting in its own commercial interests: once Mr Adams had written to say that he was currently favouring the Professional Life option (as he did on 16 June 1999), I find it impossible to see why Skandia as a group should not have sought to persuade him to do just that.

Paragraph 18(2) pleads a breach by Skandia Life in meeting Imagination in the absence of Mr Green. Skandia Life did do this, and it was clearly something that caused a certain amount of unease – both Mr Ray Kuhler (then Regional Director for Skandia Life) and Mr Walker, who were invited to attend the meeting on 20 July 1999, declined to do so in the absence of Mr Green because of regulatory concerns – but again I do not see that this is even arguably a breach of contract. Skandia Life’s case (which does appear to be strongly supported by the documentary material I have seen) is that it was Mr Adams who decided that Mr Green should not be invited. If so, Skandia Life had little choice but to go along with his decision. Mr Green is however suspicious of this apparent decision by Mr Adams and believes that his exclusion was instigated by Skandia Life. Even if this could be established however, it seems to me that it would require compelling reasons to imply into a contract between an insurance company and the client’s agent an obligation on the insurance company not to meet the client without the agent being present, and none has been suggested.

Paragraph 18(3) pleads that Skandia Life told Imagination that a fee-based arrangement would be much less expensive than a commission-based one, when there was no reasonable justification for doing so. It is not clear what the factual basis for this allegation is and Mr Poyntz-Wright denies it; he suggests it is a misunderstanding of one of his slides used at the 4 November meeting to the effect that fee-based advice is “easier to monitor and compare cost with value added”, which is a different point and would appear to be true. But let it be supposed that this allegation could be established, along with those in Paragraphs 18(5), (7) and (8), the general thrust of which is that Skandia Life gave Imagination the erroneous impression that Mr Green’s commission-based arrangements were expensive and that they could save money by switching to the new scheme. None of these, singly or together, amount in my judgment to an arguable breach of contract with Mr Green. It is plain that Mr Green believes that commission-based arrangements are better value for the client than fee-based ones; there is also before me quite a lot of evidence as to whether this view is shared by Skandia Life, and in particular as to what Mr Roberts did or did not say to this effect in April 1999. I cannot possibly resolve these matters, although I would be quite ready to accept that Mr Green did provide a very high level of individual service to the members of the 1982 Scheme and that if such a level of service were replicated in a fee-based arrangement, it would prove more expensive. But that is not the question; the question is whether it was, or arguably was, a breach of contract for Skandia Life to discuss with Imagination the effect, and the perceived advantages, of switching to a nil-commission scheme. I cannot see that it was.

Paragraph 18(6) alleges a breach in Skandia Life offering enhanced terms if Imagination transferred but not making such enhanced terms available in respect of the existing Skandia policies. It is not disputed that this is what happened, but it seems to me plainly a matter for Skandia’s own commercial judgment as to what terms it is prepared to offer and in what circumstances.

Paragraph 18(4) pleads a breach in Skandia Life failing to conduct, or advise Imagination to conduct, a “transfer review” from which it is to be inferred that its concern was to persuade Imagination to transfer rather than enable it to make a properly informed decision whether to transfer or not. Paragraph 18(10) pleads an inference from various matters that Skandia Life had been engaged in an exercise to take the Imagination business away from Mr Green. Again these matters are disputed; Mr Poyntz-Wright in particular says that Skandia Life were anxious about Mr Green’s position and kept pressing Mr Adams to let him know what was happening. But let it be supposed that Skandia Life had decided to do what it could to persuade Imagination to transfer to the new scheme. None of this would so far as I can see amount to a breach of contract with Mr Green.

Paragraph 18(9) pleads a breach in Skandia Life acquiescing in Ms Powell telling Imagination members to transfer contrary to regulatory requirements (Ms Powell not being authorised to give such advice). This allegation does not directly concern the transfer by Imagination of its pension arrangements from the 1982 Scheme with Skandia Life to the new scheme with Professional Life. It concerns the separate and later exercise by which the members of the 1982 Scheme were able to transfer their accrued rights under the 1982 Scheme to the new scheme. It is one of Mr Green’s concerns that the members may not have had adequate advice for this exercise; but I do not see that it is a breach of regulatory requirements by Skandia Life, or, even if it were, that it would constitute a breach of its contract with him.

Paragraph 18(11) pleads as a breach of the implied term at Paragraph 8 (compliance with legal and regulatory requirements) the alleged breaches of the Lautro Code of Conduct. I have already dealt with this.

I have considered all the breaches of implied terms that are pleaded. In essence they amount to a case that Skandia Life set out to encourage Imagination to transfer its pension provision to the new scheme with Professional Life. If I stand back from the detail and ask whether that is something that Mr Green can complain of as a breach of his contract with Skandia Life as embodied in the Terms and Conditions letter and the Indemnity Conditions, it seems to me for the reasons I have given that it is not; and that he has no real prospect of succeeding in such a case at trial.

Mr Green also complains that he was not informed about EP4. This does not in fact appear to be pleaded as a breach of contract in itself (there may be some good reason for this or it may be an unintended consequence of the way the pleading was amended), but it is relied on as one of the unlawful means in support of the conspiracy claim.

Although the pleaded case is that Skandia Life did not give Mr Green any information about EP4, this seems very doubtful in the light of the available documentary evidence. In an internal e-mail from Mr Walker dated 1 July 1999 he pointed out that the Series 4 products (ie EP4) were targeted to launch at the beginning of August and would allow for full rebate of level commission and so provide a comparable contract to Professional Life. He added “Ken [ie Mr Green], I think, should be told as to the availability of the contract, given that it will be appropriate for his other pension clients at least.” Mr Walker says that he did speak to Mr Green in early August 1999 and supports this with a copy of a fax dated 3 August 1999 from his assistant to Mr Green enclosing for his comments a draft e-mail from Mr Walker to Mr Poyntz-Wright. The draft e-mail says that Mr Walker was speaking to Mr Green “yesterday” about the new series 4 products, and that from Mr Green’s viewpoint he had not been made fully aware of the new style contracts and recommended that “the special term EP3 remains open for Imagination members until Imagination have made a decision on the way forward.” Mr Green says that he does not recall any such conversation, although the copy of the draft e-mail in evidence has handwriting on it which I was told appeared to be his and which seems to concur with the recommendation.

In the light of this, the prospects of Mr Green establishing at trial that he was not informed about EP4 at all seem to me to be very small; so that at most this allegation is likely to amount to a failure to keep him fully informed. But Mr Green points out that he is recorded as not having been given full information, and it is not for me to resolve what he was told, so I must regard this claim as arguable. Whether it is worth pursuing is another matter; but is not a matter for me.

The second cause of action relied on by Mr Green is conspiracy to injure. As is well known, there are two types of conspiracy that may give rise to civil liability, a conspiracy to injure by lawful means and a conspiracy to injure by unlawful means: see Douglas v Hello! Ltd (No 3) [2005] EWCA Civ 595 [2006] QB 125 (“Douglas”) para [153]. A lawful means conspiracy is not alleged: it is clearly established that a defendant is only liable for this type of conspiracy if his predominant intention is to injure the claimant, and Mr Dingemans explained that he quite properly did not consider there was any material on which such an intention could be pleaded.

An unlawful means conspiracy requires a combination by two or more either to do an unlawful act or to do a lawful act by unlawful means; Mr Dingemans relies on the latter. (As he said, the word “combination” is preferable to the word “agreement” for the reasons given by Buckley LJ in Belmont Finance Corporation v Williams Furniture Ltd [1980] 1 AER 393 at 404b). What is alleged is that Mr Wilson, Mr Poyntz-Wright and Mr Roberts, acting on behalf of Skandia Life and/or Professional Life, conspired with each other and with Imagination and Skandia Trustee to effect the transfer of Imagination’s pension provision to a Professional Life scheme using unlawful means and with intent to damage Mr Green’s interests. Three categories of unlawful means are pleaded: (i) breach of the implied terms; (ii) breach of the Lautro Code of Conduct; and (iii) breach of fiduciary duty owed by Skandia Trustee to the members of the scheme.

Mr Hollander submitted that there were two fundamental problems with the claim in conspiracy. One concerns the mental element necessary to make a defendant liable, and whether a sufficient intention to injure is, or can realistically be, alleged against Skandia Life. The second is that the unlawful means relied on must, he submits, themselves be wrongs actionable by the claimant, and that neither the alleged breaches of the Lautro Code of Conduct nor the alleged breaches of fiduciary duty by Skandia Trustee are.

I will take the actionability point first. In my judgment Mr Hollander is right about this for the reasons that I will give in a moment. But by itself this is of limited practical utility to him. Precisely the same alleged unlawful means are also relied on by Mr Green in support of his third cause of action, that of interference with his interests by unlawful means, which to a very large extent overlaps the conspiracy claim. This tort, which I will call “unlawful interference” for short, was considered at length by the Court of Appeal in Douglas, and at paragraph [234] the Court of Appeal held that for the purposes of this tort, “it cannot be necessary for the unlawful means to amount to an actionable infringement of the claimant’s own rights”. This may have been strictly obiter but I could not possibly disregard this recent authoritative statement, and Mr Hollander did not suggest otherwise. It follows that whatever the effect of the actionability point on the conspiracy claim, it will have no effect on the parallel claim for unlawful interference.

Be that as it may, I will indicate as briefly as I can why Mr Hollander’s submission is in my judgment well founded. First the alleged breaches of fiduciary duty by Skandia Trustee are plainly not actionable by Mr Green: the duties of Skandia Trustee, whether as trustee of the 1982 Scheme or as trustee of the new scheme, are owed to the members and other beneficiaries of the scheme in question, which do not include Mr Green. Mr Dingemans did not suggest otherwise.

Second I agree with Mr Hollander that the alleged breaches of the Lautro Code of Conduct are not actionable by Mr Green. This is a slightly intricate point, but the essence of it is that although section 62 of the FSA makes such breaches actionable, this is confined to actions by a “private investor” and for the reasons I give below under the heading “Section 62 of the FSA – actionability”, it seems to me clear that Mr Green is not such a private investor.

Third, I further agree with Mr Hollander that I am bound by the decision of the Court of Appeal in Powell v Boldaz [1997] EWCA Civ 2002 to hold that the unlawful means in an unlawful means conspiracy must be actionable by the claimant. In that case the Court of Appeal dismissed an appeal from the striking out of various claims, one of which was a claim based in conspiracy. Stuart-Smith LJ gave three reasons why the pleaded conspiracy claim could not succeed, the first of which was that it was not pleaded, nor on the facts could it be, that the conspiracy was aimed or directed at the Plaintiffs, and the third of which was a causation point. But the second reason was expressed in these terms (at the last page but two of the transcript):

“Secondly the unlawful act relied upon must be actionable at the suit of the Plaintiff. It is not sufficient that it amounts to a crime or breach of contract with a third party. (See Clerk & Lindsell on Torts 17^th Ed. para 23-80, Marinan v Vibart [1963] 1 QB 234 & 528, Hargreaves v Bretherton [1959] 1 QB 45, Lonrho v Shell [1982] AC 173 per Lord Diplock at p 186 etc). For this reason this form of unlawful act conspiracy adds little to the remedies available to a plaintiff.”

Morritt and Schiemann LJJ agreed without adding any reasons of their own.

As one of three reasons given for this aspect of the decision, this is part of the ratio of the case and prima facie binding on me. I have the advantage of a very careful and detailed consideration of this very point in the judgment of Davis J in Equatorial Guinea: see paragraphs [51]-[87]. It is evident from this that he had a much fuller citation of authority and argument than I have had, at the end of which he concluded that the decision in Powell v Boldaz was binding on him as a first instance judge. He struck out an unlawful means conspiracy claim for this reason, although he would otherwise have regarded the point as arguable and left it to go to trial. I respectfully agree with his conclusion, however unsatisfactory the anomaly that it produces between the position in unlawful means conspiracy (where the decision in Powell v Boldaz means that the illegality must be actionable by the claimant) and the position in unlawful interference (where the decision in Douglas means that it need not).

Mr Hollander’s other fundamental answer to the conspiracy claim is that it is necessary to allege that the conduct complained of is aimed or directed at the claimant, and this either is not, or cannot realistically be, alleged here. I accept that the current state of the law requires this. The question of the necessary intention in the economic torts was considered at length by the Court of Appeal in Douglas. The Court held that the test for intention in the two torts of unlawful means conspiracy and unlawful interference is the same; that the intention required is an intention to injure; and that this itself requires that the conduct that causes the harm is aimed or directed at the claimant: see paragraphs [156], [159], [213-225]. At paragraph [159] the Court set out five possible contenders for the relevant state of mind of which (a) (intention to cause harm to the claimant as an end in itself) and (b) (intention to cause harm because it is a necessary means of achieving some ulterior motive) satisfy the requirement of being aimed or directed at the claimant whereas (c) (knowledge that the course of conduct will have the inevitable consequence of causing the claimant harm) does not, although it may be material from which a Court could infer that test (b) or even test (a) is satisfied: see paragraphs [159] and [223].

Mr Hollander says that the allegation here is of a classic type (c) state of mind not of a type (a) or (b) state of mind. What Paragraph 12A of the Amended Particulars of Claim pleads is that

“The persons who conspired as aforesaid did so with intent to damage the Claimant’s interests in that they knew that if Imagination’s pension provision were to be transferred to [Professional Life] this would prevent the Claimant from earning any further commission from the Defendant as a result of Imagination’s employees taking out and renewing their policies.”

Mr Dingemans said this could be read as a plea of a type (b) state of mind (he accepted that this was not a type (a) case); but I agree with Mr Hollander that it does not do more than allege a type (c) state of mind, namely knowledge that damage will be caused, and not a type (b) state of mind, which requires that the object or purpose of the conspiracy was to cause harm to Mr Green, albeit as a necessary means of achieving some ulterior motive. Mr Dingemans said that the Court in Douglas had indicated that proof of type (c) knowledge may well be evidence supporting a contention of a type (b) intention; no doubt this is so in an appropriate case, but there is a fundamental difference between the two and in some cases proof of the type (c) knowledge cannot be regarded as any support for an inference of type (b) intention. The present case is in my judgment a good example. Skandia Life undoubtedly appreciated that moving to the new scheme would lead both to Mr Green losing the opportunity to earn future commission and to a clawback of his past commission. It also appreciated that if this happened, it could use any such clawback to enhance the terms on offer. But this does not seem to me to form any basis at all for inferring that it set out to get hold of the commission in order to enable the transfer to take place. The latter simply does not follow from the former.

That conclusion means that on the basis of the decision in Douglas the conspiracy claim fails as a matter of law, as does the unlawful interference claim, which on this point stands or falls with it. But I would not want it to be thought that if only the claim had been pleaded differently Mr Green would have had a viable cause of action. In order to establish a type (b) intention, I think it would have to be alleged that Skandia Life set out with the object of depriving him of his commission. Mr Green comes close to suggesting this in his witness statement, although as far as I can see he does not say so in terms. But such an allegation would, it seems to me, be very difficult to sustain on the facts. I am as I have said very conscious of the limits to which the Court on an application of this type can go in investigating the facts when they are disputed, and I do not need to reach any conclusion whether the factual case is “fanciful” and “entirely without substance” (to use the words of Lord Hope in Three Rivers at paragraph [95]). But it does seem to me that all the documentary material that has been put before me indicates that it was not Skandia Life who set out to take the Imagination scheme away from Mr Green, but Mr Adams who decided to do so. Already by 16 June 1999, long before there was any mention of a clawback of commission, Mr Adams had, according to his own letter of that date, decided that he wanted a simpler way of dealing with Imagination’s pension arrangements (and there is little doubt that he saw the existing arrangements as complex and opaque); he had decided to retain Mr Wolanski to advise him; and he was already favouring the Professional Life option (something that Mr Green said in a draft reply of 18 June 1999 did not come as a surprise to him). I agree with Mr Hollander that the natural reading of that letter is that he was trying to let Mr Green down gently in circumstances where he was not going to continue to retain him for advice on the pension scheme; and that when on 13 July 1999 Mr Roberts wrote to Mr Adams to the effect that it was the latter’s decision not to invite Mr Green to the meeting on 20 July, there is no evidential basis to doubt what is there said. Mr Green was sceptical of Mr Wolanski’s understanding of executive schemes, and I have little doubt that Mr Green had far greater experience and understanding of them than Mr Wolanski, but the undeniable fact is that Mr Adams was taking advice from Mr Wolanski and Mr Wolanski was not keen on commission-based arrangements. It does seem to me that the overwhelming likelihood is that Skandia Life was reacting to Mr Adams’ expressed wish to move to simpler nil-commission arrangements rather than setting out to deprive Mr Green of his commission.

Although I was taken through the documents by both Mr Hollander and Mr Dingemans at some length, I do not think it necessary to go into the factual material any more than I have done, because I am satisfied that Mr Green’s case rests on an allegation of type (c) knowledge not type (b) intention, and that this is insufficient as a matter of law. I am conscious that I have not dealt with all the various points Mr Green would seek to deploy, many of which are heavily disputed: for example, he relies on the fact that he and Mr Wilson fell out over an unconnected complaint that Mr Green had; he alleges that senior executives of Skandia Life stood to gain personally from the transfer to Professional Life through the system of bonuses by which they were remunerated; he alleges that individual members did not receive the advice they were entitled to when deciding whether to transfer. I hope however I have said enough to show that I do not think that he is being deprived of a meritorious claim by a technical pleading point, but rather that the central allegation that would have to be made, namely that Skandia Life’s actions were aimed or directed at him, is not one that finds any support in the material that has been put before me. I have some sympathy for Mr Green who I think has some justification for thinking that Mr Adams failed to appreciate the level of service he had provided over many years to Imagination and its employees and who no doubt considers that if only he had been given an opportunity to advise on the proposed transfer he could have persuaded Mr Adams of what he so evidently believes, that it was not the right thing to do for the members. But I do not think an attempt to blame what has happened on a conspiracy by Skandia Life aimed at him would accord with what I have seen of the facts.

Mr Dingemans submitted that if, as I have decided, all that is alleged is a type (c) state of mind, this may yet prove to be enough to establish the tort, and that I ought to regard the point as still open on the basis that the House of Lords might come to a different view. He referred me to the fact that leave to appeal to the House of Lords has been granted in Douglas (see [2006] QB at 203) and told me that his inquiries revealed that two other appeals which concern the economic torts are also pending and are due to be heard together with the Douglas appeal, namely Mainstream Properties v Young [2005] EWCA Civ 861, [2005] IRLR 964 and OBG v Allan [2005] EWCA Civ 106, [2005] QB 762. I accept that although at trial a first instance judge is bound by the doctrine of precedent to apply the law as laid down by the Court of Appeal even if there is a possibility that it may be reversed, the same is not necessarily the case on an application to strike out a claim (or give summary judgment against a claimant) before trial. Here the Court can take into account the possibility that the Court of Appeal’s decision may be reversed; and has a discretion to refuse to strike out or dismiss the claim accordingly: see the decision of Vinelott J in Derby v Weldon (No 5) [1989] 1 WLR 1244, which was not cited to me but which is referred to, and distinguished by, Davis J in Equatorial Guinea at paragraph [86].

This submission seems to me to give rise to real practical problems. In Derby v Weldon (No 5),which also concerned a conspiracy claim, the striking out of that claim would not have significantly altered the course of the trial as substantially the same facts would have had to be investigated in relation to other heads of claim (see [1989] 1 WLR 1244 at 1255A-B). But that is not so here; if the conspiracy and unlawful interference claims are disposed of, the shape of any trial (if there is one) and the preparation for it will be radically different. It seems to me to be wrong and not in accordance with the overriding objective to require Skandia Life to defend a complex claim at no doubt considerable expense and trouble when on the law as it stands I have held that the claim fails, simply on the basis that it is possible that the House of Lords might change the law. But on the other hand if I give judgment now against Mr Green, it would in effect force Mr Green to appeal in the hope that the House of Lords might have changed the law in his favour before any such appeal could be heard. Neither course seems a very proportionate use of the Court’s, or the parties’, resources. Nor do I think that I ought to try and predict what the House of Lords might do; the very fact that leave to appeal has been granted shows that the point is arguable and it would be invidious for me to express my own views on what the law is likely to turn out to be.

In the circumstances what I am minded to do is to stay the claims in conspiracy and unlawful interference until after the appeal in Douglas has been either decided or abandoned. This will prevent Skandia Life from having to incur any further costs on these claims unless the law is changed; but will protect Mr Green’s position if that happens. I am very aware however that this is not a course that was canvassed in the course of the hearing before me, and I will give the parties an opportunity to address me on whether this is the most appropriate disposal in the light of my conclusions. I recognise in particular that if Mr Green intends to appeal my judgment in any event, it may be simpler to have all the claims dismissed now. It is I hope clear from what I have said that were it not for the possibility that the House of Lords might change the law, I would give judgment for Skandia Life on these claims and my intention is that if there is a stay and the law is not altered Skandia Life should be entitled to judgment without having to reargue the points I have decided.

I have already indicated that precisely the same considerations apply to the third cause of action pleaded, that of unlawful interference, where the mental element required is identical to that in unlawful means conspiracy.

That makes it unnecessary to deal at any length with the unlawful means relied on. I have already pointed out the anomaly that the decision in Powell v Boldaz does not apply to this tort, and that Douglas holds that it is not a requirement that the unlawful means be actionable at the suit of the claimant; it may be, as Mr Dingemans suggested, that this anomaly will itself be considered by the House of Lords when considering Douglas,although it is not obvious to me that it will arise on the appeal.

I will however deal with the main points argued before me. The unlawful means relied on are the same as for the conspiracy claim. I have already dealt with the alleged breaches of implied terms. The second class of unlawful means relied on is breach of the Lautro Code of Conduct applicable to company representatives. The pleaded claim is that three individual employees (Mr Poyntz-Wright, Mr Roberts and Mr Wilson) were company representatives of Skandia Life (or Professional Life) for the purposes of the relevant Code of Conduct. The Code relied on is headed “PIA – Adopted Rules: Lautar, Schedule L:2” and called “Code of Conduct for Members, Company Representatives and Introducers”. Mr Green’s claim relies on a number of duties imposed by the Code on company representatives such as a duty to deal fairly with investors (paragraph L2), a duty not to make unfair criticisms of other investment contracts (paragraph L6(c)) and others.

All the duties relied on are imposed on company representatives. This is a term defined by Part L:I of the Lautro Rules adopted by the PIA at paragraph L1.2.(1) as follows:

““company representative” means an individual who is appointed by a Product Provider Member of PIA or by an appointed representative of such a Member, to carry out in the course of relevant business any or all of the following activities:

(a)

advising customers on the merits of investment contracts offered by the Member (or by any other member of the marketing group to which the member belongs) or

(b)

procuring or endeavouring to procure the sale of such investment contracts.”

Mr Hollander’s point is that this definition was designed for companies who sell their products through tied advisers (where the adviser is restricted to the products of only one provider) and not for companies who sell their products through IFAs (where the adviser places business across the whole market); and that Skandia Life only used IFAs. He therefore said that even if the individuals concerned were in fact advising on the merits of investment contracts, or endeavouring to procure the sale of investment contracts (by extolling the advantages of the Professional Life policies and persuading Imagination to establish the new scheme with Professional Life) they were not company representatives as they were not appointed to do this.

I have little doubt that Mr Hollander is right that the intention behind the definition was to regulate the tied agents of those companies that chose to operate through tied agents rather than IFAs; and the evidence, not only from Mr Poyntz-Wright but from Mr Kuhler (who although formerly an employee of Skandia Life has made a witness statement on behalf of Mr Green), certainly suggests that Skandia Life had a policy of operating through IFAs alone. I can therefore see force in Mr Hollander’s submissions. But it seems to me at the lowest to be seriously arguable that a company which causes its employees to give advice on the merits of its products, or to try and sell its products, might be held to have informally appointed those employees to do this, even if it had no intention that they be formally appointed as tied agents. And if it is possible for an employee to become a company representative by an informal ad hoc appointment of this type, then it is pre-eminently a question of fact whether the Skandia Life employees who were involved in dealing with Imagination’s scheme could be said to have been so appointed, and it would be inappropriate for me to attempt to resolve it. I should make it clear that there is an issue between the parties whether Skandia Life was giving any advice to Imagination or its employees at all, but again I do not think this is something that it would be appropriate for me to try and resolve. On this basis therefore I consider it arguable that Skandia Life was in breach of the Lautro Code.

The third class of unlawful means relied on is breach of fiduciary duties by Skandia Trustee. I have some doubts whether for the purposes of this tort Skandia Life can be made liable for breaches of duty by another party, Skandia Trustee, but I did not hear any argument on this and I will assume it is possible. Nevertheless I think there are very real doubts whether the evidence discloses any basis at all for alleging a breach by Skandia Trustee. What is alleged is that it was party (by Mr Wilson, a common director with Skandia Life) to the persuasion of Imagination to transfer its provision to Professional Life which was contrary to the interests of employees; alternatively that it acquiesced in the transfer of policies to Professional Life by individual employees.

It seems to me that the starting point for any allegation of breach of fiduciary duty by Skandia Trustee is to identify the source of the duty in question and that for this purpose it is necessary to distinguish between its duty in its capacity as trustee of the 1982 Scheme and its duty in its capacity as trustee of the new scheme. It is no doubt the case that in both capacities it owed fiduciary duties to the members of the scheme in question to exercise its powers and discretions under the scheme in an appropriate way. But in general it is a matter for the employer not the trustee to decide whether to cease contributing to one scheme and start contributing to another. It is not clear to me that the evidence suggests that Skandia Trustee did anything other than accept the employer’s decision in relation to the 1982 Scheme and accept office as trustee under the new scheme; the notion that it was a party to persuasion by Skandia Life on the basis that it had a common director seems to me far-fetched and I would I think take some persuading that it had acted in breach of trust or fiduciary duty at all.

So far as the transfer by individual employees is concerned, members of an occupational pension scheme usually have a right to transfer their accrued rights to another scheme. Again this was not explored before me in any detail and I have not even seen the rules of either scheme; but an allegation that Skandia Trustee acted in breach of trust or fiduciary duty by giving effect to transfer forms signed by the members would I think have to focus in the first place on whether this was said to be a breach by it in its capacity as trustee of the transferring or receiving scheme and to identify in what respect it could properly have failed to give effect to the members’ requests.

For these reasons it seems to me that there would be very real difficulties on this aspect of the claim. But I need reach no conclusions on this as for the reasons I have given the claim in unlawful interference fails in any event as the law stands because it is not alleged that the conduct complained of was aimed or directed at Mr Green.

The fourth cause of action pleaded is a claim under section 62 of the FSA. This is based on the contention that the alleged breaches by Skandia Life of the Lautro Code of Conduct as applicable to company representatives are actionable at the suit of Mr Green under section 62. Mr Hollander, as well as contending that the relevant individuals were not company representatives, said that breach was not actionable at the suit of Mr Green. I have already indicated that I accept his submissions on the actionability point and I set out the reasons here.

The section itself (which has now been repealed but was in force at the relevant time) provided that breach of the relevant rules or regulations “shall be actionable at the suit of a person who suffers loss as a result of the contravention” (s. 62(1), 62(2)). But section 193 of the Companies Act 1989 added a new section 62A which provided as follows:

“(1)

No action in respect of a contravention to which section 62 above applies shall lie at the suit of a person other than a private investor, except in such circumstances as may be specified by regulation made by the Secretary of State.

(2)

The meaning of the expression “private investor” for the purposes of subsection (1) shall be defined by regulations made by the Secretary of State.

….”

The relevant regulations are the Financial Services Act 1986 (Restriction of Right of Action) Regulations 1991, SI 1991 No 489. Regulation 2 defines a private investor as follows:

“2(1) For the purposes of section 62A(1) of the Act, the expression “private investor” means an investor whose cause of action arises as a result of anything he has done or suffered–

(a)

in the case of an individual, otherwise than in the course of carrying on investment business

(b)

in the case of any other person, otherwise than in the course of carrying on business of any kind,

but does not include a government, local authority or public authority.”

Regulation 3 specifies the circumstances in which an action can be brought by someone who is not a private investor, but Mr Dingemans did not suggest that any of these exceptions were applicable. The question therefore is whether Mr Green is, or arguably is, a private investor as defined in regulation 2.

Mr Hollander submitted that there were two reasons why Mr Green could not be a private investor: first, that he was not an investor at all; and second, that any loss he suffered was in the course of carrying on investment business. On the first point I agree. The definition of private investor requires as a starting point that the claimant must be “an investor”. This is not so far as I am aware a defined term for the purposes of this legislation, but “investment” is: see section 1(1) and Part I of Schedule 1 which lists a number of classes of assets such as shares, debentures, government securities and the like. As a matter of ordinary language it seems to me that an investor is someone who invests in such an asset: this is consistent with the use of the term in paragraph 15 of Part II of Schedule 1, which includes as one of the activities constituting “investment business” the giving of investment advice in these terms:

“15.

Giving, or offering to agreeing to give, to persons in their capacity as investors or potential investors advice on the merits of their purchasing, selling, subscribing for or underwriting an investment, or exercising any right conferred by an investment.”

But in relation to Imagination’s pension scheme, Mr Green was not an investor, nor indeed a potential investor. He was not a member of the scheme, he had no rights under the scheme, and he was not in any sense investing in the scheme. In my judgment this is a complete answer to his claim to be a private investor. He may of course have other investments – indeed I would be surprised if he does not – but I regard it as obvious that when the definition of “private investor” requires a claimant to be an investor, this cannot be satisfied by the claimant showing that he has some other investment which has nothing to do with the claim. What the definition in effect requires is that the claim is brought by someone in his capacity as investor. Mr Green’s claim under section 62 is not.

This point is not one which turns on any question of fact which requires to be investigated at trial, and I see no reason not to give judgment against Mr Green on this claim accordingly.

This makes it unnecessary to consider Mr Hollander’s second point on the definition of private investor, which is a little more difficult. Mr Green is of course an individual, so the question is whether the loss which he claims arose in the course of his carrying on investment business. Mr Green’s claim is for loss of commission. The commission was paid to him in the course of his business as an IFA, which involved or included giving advice to Imagination and its employees in relation to its pension scheme. It seems to me that his cause of action, if he had one, would have arisen as a result of something suffered by him in the course of carrying on that business, namely the decision by Imagination to cease using commission-based arrangements for their scheme, which had a direct impact on the services he was asked to provide and hence on the commission he earned. So the question is whether that business was investment business as defined. I would find it surprising if the services that Mr Green provided as an IFA in relation to Imagination’s pension scheme did not constitute investment business regulated by the FSA; I would have expected them to be regulated and they would seem most naturally to fall within either paragraph 15 of Part II of Schedule 1 (investment advice) or paragraph 13 (arranging deals in investments). I have not however heard any argument on precisely how Schedule 1 applied to Mr Green’s services in relation to the 1982 Scheme and although long term insurance contracts are (by paragraph 10) investments and this would no doubt include the policies held by the scheme trustee, Mr Green was not advising or acting for the trustee, at any rate after the change of trusteeship; and I have not been addressed on the effect of the exclusion from the definition of investments (by Note (1) to paragraph 11) of interests under the trusts of an occupational pension scheme, which the 1982 Scheme was. In all the circumstances I do not find the question whether Mr Green was in this respect carrying on investment business entirely straightforward and since I do not have to decide it and have not heard argument directly on the point, I think it better not to do so.

The fifth claim pleaded is for wrongful clawback of commission. The pleaded claim is that Skandia Life recouped from Mr Green indemnity commission in the sum of £31,850 in circumstances where it had no contractual entitlement to do so, the pleading asserting that Skandia Life was only entitled to recoup commission if a client withdrew from a transaction under the cooling off provisions (under paragraph 2.4 of the Terms and Conditions letter). But Mr Dingemans accepted that paragraph (2)(a)(i) of the Indemnity Conditions provided for recoupment of indemnity commission if premiums under a policy were discontinued for any reason within 2 years. In the light of this he accepted that the claim could not survive as a separate cause of action; it really came down to the fact, he said, that it constituted another head of loss if Mr Green could establish a claim for damages. It follows from what Mr Dingemans says that the claim as pleaded as a separate head of claim is unsustainable.

The sixth and final claim pleaded is for a quantum meruit for work done. The basis for this claim, as explained by Mr Green, is that he carried out a considerable amount of work on what he describes as the consolidation process, that is an exercise to try and simplify the 1982 Scheme by transferring each member of the scheme to the EP3 policies (some members having earlier style policies with different terms attaching or indeed more than one policy). This was carried out in conjunction with Mr Walker and designed to help meet Imagination’s desire to simplify the scheme. It was a time-consuming process as each member had to be looked at individually, but Mr Green did not charge separately for this work as he expected in effect to be remunerated out of commission on future policies. His claim is that since he was expecting to be paid for the work by Skandia Life through the commission arrangements, he is entitled to be paid for the work by Skandia Life if, as happened, the anticipated commission arrangements did not materialise.

Mr Poyntz-Wright does not address this claim in his witness statement at all, and I heard very little argument on it. Mr Hollander submitted that the claim was unsustainable as to imply a whole contract requires meeting the same strict tests of necessity and obviousness as are applicable to implied terms. As a general statement of the law this may be true, but in the case of a contract to pay reasonable remuneration for work done, these general principles have been supplemented by much more specific decisions which map out the circumstances in which such a contract will be implied (or more realistically imposed). Thus such a contract may be implied where the claimant does work at the defendant’s request, or where the claimant does work to the defendant’s knowledge in anticipation of a contract which fails to materialise; the precise circumstances in which such a claim will be upheld can only be determined by a careful consideration of the principles established in those cases.

I was not in fact referred to any of these cases, both parties no doubt treating this claim as something of a tailpiece to the more important claims; but I do not think I can determine the claim against Mr Green as Mr Hollander invited me to without a good deal closer examination of the principles than they received. The claim does not seem to me an easy one as the work is pleaded to have been carried out at the request of Imagination, not at the request of Skandia Life; and it may well be said that both Mr Green’s and Skandia Life’s expectation was that he would be paid if and only if further policies were taken out. But I do not feel confident, on the basis of the very limited attention that this claim received, in concluding that it is bound to fail.

Of the pleaded claims, I have held that Mr Green has no real prospect of success on the following: the claims for breaches of implied terms, other than the claim in relation to failure to give full information about EP4, and the claim under section 62 of the FSA. In addition Mr Dingemans accepted that the claim as pleaded for clawback of commission is unsustainable. I will give judgment on those claims against Mr Green accordingly. I have also held that on the basis of the law as it currently stands, Mr Green has no real prospect of success on the conspiracy and unlawful interference claims; I propose, subject to hearing from counsel, to stay those claims pending the outcome of the appeal in Douglas.

I would like to thank both counsel for their lucid and helpful submissions. They covered a large amount of ground with great efficiency. I have no doubt my judgment will come as a disappointment to Mr Green; but if, as I have held, there are claims which are bound to fail it is in the end not only in Skandia Life’s interests but in his interests that no further time and costs are spent on them.