3DM (3DMA) PTE Ltd. v 3DM 3DM Worldwide Plc

Was a contract entered into when Mr Hancock of the Defendants visited the home of Mr Hoyer Millar of the Claimant on 21 December 2004? That is the issue in this case.

The Claimant (“3DMA”) is a Singapore Company which was incorporated in July 2002 with, initially, two issued shares. One share each is held by Mr Christian Hoyer Millar and by Mr Kenneth Brooks, the protagonists in this case but there is litigation between them in Singapore about the validity of a later share issue.

The Defendant (“3DMW”) is a Public Company listed on the AIM. 3DMW claims the intellectual property rights to plastics technology known as Plastics Impression Moulding or PIM. Its Chairman is Mr Brooks.

3DM New World Technologies Inc. is a subsidiary of 3DMW based in Michigan which held some of the rights to the PIM process. 3DMA signed two licence agreements with this Company in June and September 2004 and has brought litigation in Michigan over them.

Mr Hoyer Millar is a Director of 3DMA as are Mr Richard Hancock, a business consultant who assists Mr Brook’s businesses, and Mr Michael Shone, an entrepreneur who has shown interest in investing. Mr Brooks resigned as a Director in December 2004.

Sibbasbridge Services plc which, like the parties, I will call “SBS” is an English company in which Mr Hoyer Millar has an interest and which is described in the papers as broadly his company. The shareholding in SBS has been the subject of litigation in the Chancery Division leading to a judgment a copy of which was sent to me after the Trial in this case. It appears that in June 2004 SBS signed a Consultancy Agreement with 3MDW under which it received £5,000 per month terminable on three months notice. It appears that a second Consultancy Agreement was entered into between these parties on 21 December 2004.

Although the parties are companies the dispute is really between Mr Hoyer Millar and Mr Brooks. Mr Hoyer Millar is an experienced and well qualified business consultant. Mr Brooks is a solicitor who founded a firm of which he is now a consultant. He practised in commercial and company transaction work and, since a serious motor accident has reduced that role, but is active as a chairman and director of 3DMW and of another AIM company as well as of various private companies. Mr Hoyer Millar and Mr Brooks were once close friends with a wide range of interests in common. In 2002 3DMW wanted to consider expansion in the far East. Mr Brooks knew that Mr Hoyer Millar had experience in the region and with his involvement in another business coming to an end would have time available.

3DMA claims that it entered into a Consultancy Agreement with 3DMW on 21 December 2004, effective from 1 December. 3DMA was to provide corporate finance advice and project management assistance in developing 3DMW's business in 3DMA and was to receive a retainer of £10,000 per month. Some £110,000 had built up, on 3DMA’s case, by the time this Action started. No less than six of the Bundles at the Trial are entitled, ominously, “Key Documents” but the central issue is a short one. Did the arrangements agreed between Mr Hoyer Millar and Mr Hancock on 21 December amount to an immediately binding contract or only to a set of terms to take binding effect if and when approved by 3DMW?

By the middle of 2004 Mr Hoyer Millar was doing work for SBS under its Consultancy Agreement with 3DMW. This led naturally, according to Mr Hoyer Millar, to the need for a new SBS Agreement and for a Consultancy between 3DMA and 3DMW. Mr Brooks also saw a role for such a Consultancy Agreement but only after the precise role of 3DMA had been resolved following a feasibility study, decisions about resources, agreement about what the share structure should be and how participation for introducers, managers or investors was to be set-up. The situation was complicated by a potential merger of the interests of 3DMW and 3DMA with another company LBC. It is clear from the papers that consideration was being given, within the context of existing contractual arrangements to how 3DMA was to be organised and developed within a structure to be discussed. 3DMW agreed to pay for Mr Hoyer Millar’s trips to 3DMA in October 2004 and January 2005. Nevertheless, it is clear that certainly from about October the parties had in mind a Consultancy Agreement of the kind that we find at the heart of this dispute. I will refer to the alleged agreement as “the Consultancy Agreement” from now on. Drafts were in circulation in November , the first one in the Papers is dated 24 November. The draft 3DMA Agreement was similar to that for SBS and provided for a fixed term of sixty months, renewable for the same period unless twelve month prior notice was given, a minimum fee of $1,000 per month payable in advance and reimbursement of “all expenses properly and reasonably incurred including business travel for all long-haul flights”. These drafts were sent by Mr Hoyer Millar to Mr Brooks on the 24 November.

There was a meeting on 30 November attended by Mr Hoyer Millar and Mr Caiger with Mr Brooks, his assistant Mr Livingston-Raper and Mr Hancock. There is disagreement about what if anything was agreed at it. Mr Caiger, who has a background in agricultural science, had been retained by 3DMW as a Consultant, apparently without a formal contract and had visited the US personnel, in particular Mr Linares in Detroit. Mr Caiger was assisting Mr Hoyer Millar in negotiating the Consultancy Agreement.

Numerous drafts appear to have been exchanged and the comments of solicitors, Charles Russell, were obtained on 6 December. On 12 December Mr Brooks emailed Mr Hoyer Millar about 3DMA shareholdings. He said that after a lot of negotiations there was a split of percentages among eight participants including SBS and 3DMW. On the following day a revised draft was sent to Mr Hoyer Millar by Mr Livingston-Raper. This reflected changes following discussion with Charles Russell. Some of the changes proposed were commercial using Charles Russell as a pretext, an approach which Mr King for 3DMA criticised, but one which is very widely adopted and usually fools no-one. By this stage the draft provided for a six-month probationary period followed by renewals of one-year with a renewal termination notice of at least one month, a fee of £10,000 a month in arrears and reimbursement of expenses without mention of business-class fares. Mr Hoyer Millar returned the draft on 16 December suggesting that the probationary period be nine months not six, that the renewal notice period be three months not one, that fees be paid in advance not in arrears and that express provision be made for business travel fares on long-haul flights. Mr Hoyer Millar was pressing to finalise matters, as he appears to have informed Mr Livingston-Raper, so that Mr Stephen Caiger could be persuaded to join.

On 16 December Mr Livingston-Raper emailed Mr Hoyer Millar to say that changes would have to be referred to Charles Russell and that matters would not therefore be resolved until the relevant partner returned in the New Year. On the same day Mr Hoyer Millar sent a further revision back to Mr Livingston-Raper. The probationary period of six months and the renewal period of one month were now, after all, accepted. So was payment of fees in arrears, not advance. As to travel however “It is agreed that all long-haul flights will be in business class”. A little later on 16 December Mr Hoyer Millar sent a further email stating “Why don’t we just sign as in no changes”. Thereupon Mr Livingston-Raper reported to Mr Brooks that “C” has agreed to sign contract with no changes. At this point Mr Hancock was proposing to call into 3DMW’s office the following day and “If Ken can sign taking it over to POD (a nickname for Mr Hoyer Millar) and getting him to sign if that is acceptable to all. Please advise”. Mr Hoyer Millar was finding it difficult to get hold of Mr Brooks by telephone but on 20 December he sent an email with a version of the draft which was the same as he had accepted on 16 December with 6 months probationary period and one month notice period. There is some disagreement on the evidence about this but there is no reason for me to doubt the accuracy of the attachments to the email. Mr Hancock also emailed Mr Brooks on the 20 December saying “Are we OK with POD, re his contract as when I last spoke with him he would sign anything to get this deal underway, which I find encouraging”. He also proposed to tell Mr Hoyer Millar about his disappointment about the level of commitment on a matter and added “Do you want to do this before Xmas or in the New Year”. Mr Brooks responded “I agree, perhaps it was to make the point that we hadn’t signed though he never said … Happy to leave to you”. At this point Mr Hoyer Millar was also pressing Mr Brooks for signatures on 3DMA’s statutory paperwork.

On 21 December Mr Hancock travelled to Mr Hoyer Millar’s home in Oxfordshire after having first visited 3DMW’s offices and collected a draft document. There are various disagreements about what happened at the meeting and about whether it was the morning or the afternoon. By the end of the meeting, however, Mr Hoyer Millar had signed a document on behalf of 3DMA and his signature had been witnessed by Mr Hancock. The space for signature on behalf of 3DMW remained blank. Four copies of the Agreement were signed as were four copies of the SBS draft.

Relevant features of the draft which Mr Hoyer Millar signed are that the probationary period was now nine months, the renewal period was three months, the Consultancy Fee of £10,000 is payable in advance and the expenses provision stated “It is agreed that all long-haul flights will be in business class”. The SBS Agreement is in similar terms. So things had apparently moved 3DMA’s way, the terms being similar to the first of the two drafts sent by Mr Hoyer Millar on 16 December. (A further complication is that the version of the Agreement Mr Hoyer Millar sent to his lawyers, Shearman and Sterling, is not the same as the one being executed. It is closer to the terms which were in play around 16 December).

There is a typewritten memo from Mr Hoyer Millar to Mr Caiger dated 21 December which states “Hancock came around and said that he had the authority to sign off on the two contracts from Ken Brooks – SBS 3DM (A) – they said no changes could be made so was not able to deal with the payment terms issue so I signed both which he witnessed. So we have a deal!” Both Mr Hoyer Millar and Mr Caiger say that this memo was sent and received on the 21 December by email and as an attachment. It is uncommon for short messages to be exchanged by the parties involved in this case by attachment as opposed to email itself. There are very large numbers of emails disclosed in the documents in this case. Mr Hoyer Millar’s email to Mr Caiger has not been produced by either person.

There is in the documents an 3DMA invoice to 3DMW dated 21 December for £10,000 for Consultancy Services from 21^st (not 1^st) December 2004 to 20 January 2005. The documents contain no evidence of the invoice being sent, received or chased-up until what is called a “replacement invoice” for the months 1^st December 2004 to 30 June 2005 is sent on 29 July 2005.

On 24 December Mr Brooks and Mr Hancock exchanged emails which refer to the unresolved issue of 3DMA shareholdings and distinguish the state of the SBS Agreement from that of 3DMA. Mr Hancock says “The SBS contracts can they be signed and sent as there would be no restrictions on those. Is that correct?” On 27 December Mr Hoyer Millar flew to Thailand for a holiday and for business. Mr Hancock and Mr Brooks were in touch by an email on 30 December which confirmed Mr Hancock had taken the signed documents into 3DMW’s offices. Mr Brooks says “When you send the SBS and 3DM Contracts through to be signed I will hold these until I have the paperwork back with confirmation of my appointment and also confirmation that the share split is acceptable and that has been implemented”. Mr Brooks replied that the actual date of both documents must be after he had signed and had been appointed and preferably when shares were issued. The dates were apparently Tippexed. On 28 December Mr Hancock emailed Mr Hoyer Millar to say that he “Will speak with Ken on Wednesday to get signed copies of the Contract”. Mr Hancock emailed Mr Hoyer Millar on 29 December double checking five points which he knew that Mr Hoyer Millar was “Going to say yes to”. The confirmations were that Mr Brooks had resigned ,that Mr Hancock had been appointed, that the SBS Contracts can be signed ,that the share split is “OK with you” and that the 3DMW Contracts can be signed on completion of paperwork. Mr Hoyer Millar’s reply on the share split was “Yes in principle as I have said subject to a conversation with Ken”. On 31 December Mr Hancock emailed Mr Hoyer Millar to say that he that he had the signed Contracts in his possession and that these could be released upon confirmation of two issues one being that “the share split is agreed”. On 5 January Mr Caiger who was assisting Mr Hoyer Millar from London, emailed Mr Hoyer Millar reporting on 3DMW’s plan not to release either Contract until after these terms were met. Mr Caiger expressed the view that it did not seem that there was a conditionality on the SBS Contract, as opposed to the 3DMW one. A day later Mr Caiger mentioned in an email to Mr Dinares, copied to Mr Hoyer Millar, that he was still waiting for the Consultancy Agreement to be agreed. There are further emails showing efforts by Mr Caiger and Mr Hoyer Millar to persuade Mr Hancock to agree terms leading to the release of the signed Consultancy Agreement( e.g. 13 January). On 15 January Mr Hancock released the SBS Contract but not that for 3DMW. On 17 January Mr Hoyer Millar emailed Mr Brooks about the 3DMA Agreement suggesting that the two of them could sort the matter out in ten minutes it being a relatively simple transaction where the others had been going back and forth to no avail. A further email to Mr Dinares and those which followed a meeting between Mr Hancock and Mr Hoyer Millar on the 27 January presuppose that the Contract will not being released until the share issues were resolved. Similarly on the 10 February Mr Hoyer Millar sent to Mr Hamilton an email with a list of items about 3DMA headed “Agreed”. The first item was a proposed revision in the allocation of shares. The seventh item described the Consultancy Agreement as “Implemented on completion of item 1 above”. Mr Hoyer Millar in evidence said that although headed “Agreed” it was in fact an agreed list of topics, a shopping list. There are documents in February and March in which both Mr Caiger and Mr Hoyer Millar refer to the Consultancy Agreement as a deal that was off and a contract not delivered. The matter lay low until 29 July when Mr Shone wrote to 3DMW with the invoice for £70,000 which was rejected on the grounds that the Consultancy Agreement did not exist having not got beyond negotiation. Mr Hancock wrote to Mr Shone on 31 August claiming that Mr Hoyer Millar was well aware that both Consultancy Agreements were conditional upon him implementing an agreed structure for 3DMA.

There is thus a closely documented picture of events from October 2004 until August 2005 to assist evaluation of what, if anything, was agreed on the 21 December. I now turn to the witnesses in the order in which they gave evidence. The most important evidence is that of Mr Hoyer Millar and of Mr Hancock because they were the only two at the meeting.

Mr Hoyer Millar said that he sought the Consultancy Agreement for 3DMA so that it could provide expertise to 3DMW in territories outside the licences, in particular India, Japan and China. 3DMA’s return for its work would be not just the monthly retainer but also shares in joint ventures set up to exploit the technology. Mr Hoyer Millar suggested that the confirmation he received from 3DMW on 25 October 2004 to travel to Asia that month and in January 2005 was for work to be conducted under the forthcoming Consultancy Agreements with 3DMA and with SBS. Mr Hoyer Millar said that agreed final versions of the Consultancy Agreement and the SBS Agreement were discussed at the meeting on 30 November and agreed in principle but with final details to be resolved. Mr Brooks had said that Mr Hancock had authority to do this on behalf of 3DMW. Mr Hoyer Millar saw the events of early December and the reference to Charles Russell as being steps towards obtaining sign-off on an agreed commercial deal. Mr Hancock was pressing for work to get underway. As he saw it, it was always clear that 3DMA share split was a completely separate and distinct issue from the Consultancy Agreement and subject to the involvement of, as yet unidentified, third party investors. By 20 December he believed, as he told Mr Brooks that the deal was only one ‘phone call away. The outstanding matters were a term of one year (which at times he recollected to be nine months) and invoicing monthly in advance. He said that on the morning of 21 December Mr Hancock came to his home bringing the SBS Agreement and the Consultancy Agreement. Mr Hancock told him that the Agreements were in their final form and refused the request from Mr Hoyer Millar for changes saying that the Consultancy Agreement was “Non-negotiable”. He says that Mr Hancock witnessed his signature, that they shook hands and that Mr Hancock said that he would now go to 3DMW’s offices to obtain Mr Brooks’ signature as a formality. Mr Hancock told him that nothing further needed to be done and wished him good luck in performing services in Asia on 3DMW’s behalf. He says that he believed that from that point 3DMA had a valid and binding contract with 3DMW there being no discussions about changing ownership of 3DMA or other issues. During the course of his trip to Asia which he saw to be, at least in part, to do work under the Consultancy Agreement Mr Hoyer Millar met Mr Shone and as the latter’s note shows the Consultancy Agreement was referred to. Mr Shone said that, subject to due diligence he might invest up to $2.5M.

Mr Hoyer Millar said that he sent an invoice for £10,000 to 3DMW on 23 December but there is no evidence to show that it was sent and none to indicate that it was received.

Mr Hoyer Millar sees the correspondence from the end of December through to February as being consistent with 3DMA’s attempts to give effect to the Consultancy Agreement and 3DMW’s efforts to renege on a Contract they had entered into.

In cross-examination Mr Hoyer Millar mentioned that some email entries were missing as a result of a personal computer becoming flooded with water. When asked about the inconsistency between the terms of the last drafts exchanged before the 21 December meeting and the document bearing his signature Mr Hoyer Millar at first appeared to challenge the authenticity of the attachments to the emails. He did not produce his own attachments. That challenge to authenticity receded. Mr Hoyer Millar’s recollections of what changes he was seeking on 20 December vary in his two witness statements and in his oral evidence. He was asked to explain how he could have signed on 21 December a document containing terms different from that which must have been brought to him by Mr Hancock. He was also challenged about the authenticity of the 21 December memo to Mr Caiger and the invoice. When taken to emails at the end of December and early January which might suggest that no contract was yet in existence, he emphasised that his concern was a commercial one to overcome the obstacles being erected. The fact that 3DMA chose to address issues to get things moving did not mean that they were in law obliged to do so.

Mr Caiger started working actively with Mr Hoyer Millar in early 2004. They had been colleagues in the past. He had a role supporting Mr Hoyer Millar in the negotiation of the Consultancy and SBS Agreement. He too said that at the meeting on 30 November two contracts were agreed in principle and that Mr Hancock was authorised to negotiate on behalf of 3DMW the fine details of both and to execute them. After that Mr Caiger was not directly involved but reviewed drafts that Mr Hoyer Millar received. He said that he received a memorandum from Mr Hoyer Millar on 21 December. Neither his statement, nor that of Mr Hoyer Millar, described the mechanics of communicating the memorandum. Mr Caiger said that it was attached to an email. Like Mr Hoyer Millar Mr Caiger was wary of Mr Hancock and had a low opinion of his abilities. Mr Caiger’s main work was to lie in the preparation of the technical dossiers, but as the emails show, he was involved to an extent in the discussions in December and January. In cross-examination Mr Caiger, like Mr Hoyer Millar, saw the correspondence in January and February as being consistent with trying to implement a concluded agreement.

Mr Michael Shone is Founder and Chief Executive of an investigative and consulting firm based in Singapore. He is a non-practising solicitor and a Director of 3DMA. He gave evidence about his contacts with Mr Hoyer Millar and of a meeting in January at which he had been shown a copy of an unsigned version of the Consultancy Agreement. Like other witnesses Mr Shone, who was a straightforward and obviously truthful witness, dealt with a variety of matters, which while helpful as background were not directly relevant to the issues.

3DMW’s evidence started with Mr Brooks. In the period leading up to the negotiations for the Consultancy Agreement, Mr Brooks said that he and Mr Hoyer Millar recognised that adjustments to the shares in 3DMA would be necessary to provide for new investors and partners and for Mr Brooks in turn to dispose of his shares because of his position in 3DMW, a public listed Company. He said that it was well-known to Mr Hoyer Millar that 3DMA was not to be activated until after a feasibility study, agreement on resources, settlement of the share structure and provision for participation of managers and investors. 3DMW did not intend to contract on 21 December. It would have been easy for 3DMW to have done so by simply signing, witnessing and exchanging a copy signed by Mr Hoyer Millar. As part of the overall process he was content for Mr Hoyer Millar to produce and sign a draft Consultancy Agreement which he, Mr Brooks, would then hold until resolution of other pre-conditions. He suggested that as Mr Hoyer Millar was a difficult man to pin down obtaining a signed version of an agreement would be the only way to stop the cycle by which further changes were sought whenever the issue was brought up. In his first witness statement Mr Brooks said that 3DMW never signed or witnessed the Consultancy Agreement. He corrected this shortly before the trial having seen the documents which I have mentioned above. He said in evidence that he recollected Mr Hancock bringing back to the offices of 3DMW the copy signed by Mr Hoyer Millar and saying that there had been changes. He said that he must have signed it around 30 December and returned it to Mr Hancock on the basis that it was not to be released until outstanding matters had been resolved. Mr Brooks said that he was unaware of Mr Shone’s proposal to invest up to $2.5M in 3DMA and that he should have been told of such a highly significant step particularly when this was said to be under the Consultancy Agreement. In cross-examination it was suggested to Mr Brooks that he had deliberately tried to suppress the signed copy of the Consultancy Agreement which had only been produced on 8 June. He denied this. It was suggested that it made no sense for Mr Brooks to fax a copy to Mr Hancock if the Agreement was to be held in escrow. It was suggested to him that the role of Mr Hancock described by Mr Brooks as that of an interface to ward off the forceful personality of Mr Hoyer Millar was not consistent with someone who was without authority. It was also suggested to him that if the Consultancy Agreement was to have preconditions these could easily have been inserted as had happened with the Licence. Mr Brooks suggested this would have made it unsuitable for marketing purposes. Mr Brooks was also cross-examined about a number of matters not directly relevant to this case which have given rise to antagonism and litigation between him and Mr Hoyer Millar. These questions were put as going to Mr Brooks’s credibility but did not seem to me to take matters much further since they would tell the Court nothing unless it investigated, which it could and should not do, the underlying and competing merits of these matters.

Mr Hancock also gave evidence. He used to work in sales and marketing but in 2000 started a business giving advice about grant funding and marketing in the UK and within the European Union. In time Mr Brooks appointed him as a Consultant as the principal liaison between 3DMW and 3DMA ;he was thus expecting to work closely with Mr Hoyer Millar. As he saw it he would be Project Manager on the 3DMW side and replace Mr Brooks as a Director of 3DMA. Mr Hancock became involved in resolving the technical difficulties in demonstrating the effectiveness of PIM technology and also with the complexities of the structure funding and shareholdings in 3DMA. He became the conduit in negotiations for the Consultancy Agreement partly because Mr Brooks was deluged with other work but also because Mr Hoyer Millar, as he saw it, was a bully. Mr Hancock saw Mr Hoyer Millar as prone to prolonging negotiations and always asking for more. He, therefore, suggested to Mr Brooks that he give Mr Hoyer Millar an ultimatum. So he went to see Mr Hoyer Millar at his home on 21 December. He recalled that the meeting was in the afternoon, not the morning. In his second statement he says that he took with him two draft Agreements from 3DMW’s offices. He says that Mr Hoyer Millar printed off two copies of the Consultancy Agreement from his own computer and told him that it was the latest version. Mr Hancock said that since he felt things had to be brought to an end he did not argue the points and Mr Hoyer Millar then signed the drafts which Mr Hancock witnessed. Mr Hancock did not suggest in evidence, as at least one of his witness statements did, that the final form of the document was the result of Mr Hoyer Millar claiming that his print outs were what had been agreed earlier rather than the result of frank discussion at the meeting. Mr Hancock was insistent that he did not regard the signed document as having led to a concluded Agreement. He had no mandate or authority from 3DMW. He simply wanted a document signed by Mr Hoyer Millar so that there would be no more re-negotiations or last minute further points. He was confident that 3DMW would agree and sign once an 3DMA structure and business plan had been negotiated.

Mr Hancock said that he returned with the signed document to 3DMW. Mr Brooks said that they now needed to sort out the share structure to move forward. Mr Brooks did not sign the documents but put them in a pending tray. He, like Mr Brooks, added when giving evidence that he had mentioned to Mr Brooks that the signed draft contained changes.

Mr Hancock gave evidence of his views of the correspondence in December, January and February and also, as other witnesses had, on a variety of controversies which are peripheral to this case. In cross-examination Mr Hancock had difficulty in recalling accurately his initial meeting with Mr Hoyer Millar or what the share ownership position was within 3DMA. Mr Hancock appeared to have more difficulty than other witnesses in coming to grips with the complexities of the legal relationships and documents. The gaps in his various recollections of how, at the meeting, the agreements had come to be signed were put to him. He also accepted that his relationship with Mr Brooks and other business interests meant that he was not really a disinterested or neutral party.

Mr Livingston-Raper, Mr Brooks’ assistant, gave evidence setting out the trail of emails leading to the meeting on 21 December. In particular he said that on the 16 December he had spoken to Mr Hoyer Millar on the phone and told him that the changes he had proposed would not be accepted by 3DMW and that he would have to revert to the earlier position. Mr Livingston-Raper said that it was only when the litigation began and he took a closer look at the Agreements that Mr Hoyer Millar had signed, that he noticed that Mr Hoyer Millar must have changed the terms back to those that he wanted, the nine months probationary period and three months termination notice in mid-December. As far as Mr Livingston-Raper was concerned the Agreement could not have been concluded until the New Year because the solicitor at Charles Russell was away. He too was under the impression that 3DMA was not to be activated as a concern until the share structure and investments strategy were resolved. In cross-examination Mr Livingston-Raper accepted, unsurprisingly, that he had no reliable memory of some of the detailed changes and was dependent upon reconstruction from the emails.

Before reaching conclusions on the evidence I summarise briefly the submissions of Mr King for the Claimant and Mr Hill-Smith for the Defendant. These submissions understandably concentrate on the facts there being no real issue of law in the case.

Mr King submits that the issue is principally whether Mr Hancock or Mr Hoyer-Miller gave the more credible account of what happened on 21 December. Mr Hancock was an unreliable witness who was confused about straightforward matters such as the distinction between a “spin-off” and a subsidiary. Mr Hancock went to the meeting with what he first described as an ultimatum which later became a “business man’s” ultimatum when he accepted that the signed agreement was the product of discussion and consent. Mr King suggested Mr Brooks was an unimpressive witness for the reasons which emerged in cross-examination. He had suppressed for a long period the fact that he had signed the Consultancy Agreement. Mr King also drew attention to credibility issues on what seemed to me to be peripheral matters. In contrast he commended the quality of Mr Hoyer Millar’s evidence. Mr King points out that it is perfectly common for a contract to come into existence even though a document which envisages signature by both parties only contains that of one of them. He submitted that Mr Hancock had authority to contract as was apparent from the email in which Mr Brooks said that he was happy to leave it to Mr Hancock to complete the matter (although this of course begs the question of quite what it was that Mr Hancock was being authorised to do).

Mr Hill-Smith for the Defendant submitted that this was not simply a credibility issue between Mr Hancock and Mr Hoyer Millar. The issue is whether the Claimant has satisfied the burden of proof by showing that a contract was entered into. The draft Agreement itself envisaged that it would become binding upon signature of both parties, not just one. The contents of the attachments to the parties emails prior to 21 December falsify the account given by Mr Hoyer Millar. All the latter correspondence proceeds on the basis that no contract had been entered into on 21 December. The only two exceptions are the alleged memo at 21 December and the invoice which were never sent. If the meeting between Mr Hoyer Millar and Mr Shone had taken place under the Consultancy Agreement the large proposed investment would have been mentioned to Mr Brooks by the Claimant between reaching an agreement and effective implementation.

In my judgment the Claimant has failed to establish that on 21 December 2004 it entered into a legally binding contract with the Defendant.

The Consultancy Agreement had been under discussion for some time and some progress forward may have been made at the meeting on the 30 November but no concluded agreement had been reached. That is obvious from the emails and the correspondence which were created from 1 December onwards. It is also clear that Mr Hancock was instructed to take matters forward but he was not given authority to conclude a contract on 3DMW’s behalf. It is true that the correspondence about the draft Consultancy Agreement does not explicitly link its conclusion with the investment and share structure to be agreed for 3DMA. It is equally clear, however, that those were live issues which had not been resolved in the period before Christmas. The Defendant was becoming impatient with progress in negotiating the Consultancy Agreement but the pressure upon the Claimant to finalise it was greater still. It is clear that by 16 December the Defendant was prepared to enter into a Consultancy Agreement on less good terms than it had first asked for. The Defendant was content if necessary to let the matter wait until the New Year but it seems that Mr Hancock saw an advantage in obtaining a document signed off by Mr Hoyer Millar and that Mr Brooks agreed with this tactic. When Mr Hancock went to Mr Hoyer Millar’s home on 21 December he must have had with him a draft with the six month/one month periods in it. Those provisions were in the draft of 16 December and also in the further version sent by Mr Hoyer Millar on 20 December. I reject the Claimant’s challenge to the authenticity of these drafts which disintegrated almost as soon as it was made. Mr Livingston-Raper has limited experience, is a loyal lieutenant of Mr Brooks and no friend of Mr Hoyer Millar. But I have no reason to doubt his evidence which is supported by and indeed is largely based upon the emails and other correspondence.

The Claimant’s case is based upon the evidence of Mr Hoyer Millar about what happened at the meeting. Mr Hoyer Millar’s recollection that he signed the document with which he was presented by Mr Hancock is contradicted by the fact that what he signed cannot have been the document Mr Hancock brought. Once it is clear that he is wrong about that fundamental point doubt is cast also on his recollection that he and Mr Hancock had shaken hands on a finalised deal and that Mr Hancock had told him that nothing further now remained to be done. Mr Hoyer Millar seemed unexpectedly vague and confused about these matters. The accounts given by Mr Hancock do not take matters much further. There are confusions and inconsistencies in his account about this and other matters. I do not consider that Mr Hancock had a good grasp of the legal or contractual complexities involved or indeed a reliable memory of events. However, Mr Hancock’s considered recollection, which Mr Hoyer Millar rejects, that the documents were printed on the spot following negotiation between the two of them is plausible and would reflect no discredit on either of the individuals present at the meeting. I accordingly have no reliable picture of what happened at the meeting beyond the facts that Mr Hoyer Millar’s recollection is mistaken and that Mr Hancock’s is confused. There is an additional reason why Mr Hoyer Millar’s recollection is unlikely to be right. I had the opportunity to see and hear both Mr Hoyer Millar and Mr Hancock being cross-examined at some length. I formed the view, as others have done, that Mr Hoyer Millar is an intelligent and forceful businessman. Mr Hancock’s strengths are quite different. It seems to me improbable that Mr Brooks,another intelligent and astute businessman would authorise Mr Hancock to negotiate and conclude with Mr Hoyer Millar an important and immediately binding contract. Mr Hancock was neither an employee not a director of the Defendant and I do not believe that he was authorised to contract on its behalf.

I place no reliance upon the memo of 21 December which Mr Hoyer Millar and Mr Caiger recall. The importance of this document, if it was prepared on 21 December, is obvious. It is very surprising, in a case where so many emails were sent and have been produced that neither Mr Hoyer Millar nor Mr Caiger have a copy. For similar reasons I place no reliance upon the invoice as there is no record of it ever having been received or pursued. It is not necessary for my decision to say anything further about the provenance of either document.

The correspondence after 21 December is either equivocal or supports the Defendant’s claim that the Consultancy Agreement would not take effect until after issues affecting 3DMA had been resolved. I do not accept that this was a case of the Defendant agreeing to something on 21 December and then reneging by seeking to introduce new conditions later. The lack of reaction of Mr Hoyer Millar and Mr Caiger, both of whom were able to make their views known, does not suggest this. Indeed Mr Caiger’s email to Mr Linares early in January suggests that they were still waiting for the Consultancy Agreement to be agreed. Mr Hoyer Millar, as the 10 February list of items shows,saw the Consultancy Agreement as being implemented once the issues affecting 3DMA were resolved. I do not accept the gloss he seeks to put upon that document or the recollection of Mr Caiger and himself that they were concentrating on commercial implementation not the legal position. Such approach would have been inconsistent both with that adopted in December and also with how these witnesses, whom I have seen and heard, would have been likely to react.

I have depended little upon the evidence of Mr Brooks because it is peripheral to the main issue. His account of the events leading up to and following 21 December is consistent with the documents and with common sense. His omission in bringing forward the signed copy of the draft so close to trial was regrettable but this does not undermine his account of what happened at the time .The other documents are consistent with what he says happened to the signed draft. I express no views about the other matters which arise in the acrimonious disputes between him and Mr Hoyer Millar except to say that I considered that that animosity coloured the reliability of what each of these individuals had to say about the other.

I therefore conclude that the Claimant has failed to establish the existence of the contract it alleges. I have no doubt that 3MDW were content with the wording as finally negotiated but that does not mean that it entered into a contract in those terms. This is a good illustration of the distinction drawn by Lord Justice Potter in Sun Life Assurance Company of Canada v CX Reinsurance Company Limited [2003] EWCA Civ 283 “between a party who indicates his agreement to the wording to be contained in the contract and his assent to be bound by the contract itself once drawn up and executed”.

There will, therefore, be judgment for the Defendant. I shall be grateful if the parties will let me have corrections of the usual kind, a draft order and a note explaining what if anything they seek, and why, at the handing down of this judgment.