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Wecomm Ltd. v Rosenhoiz

[2004] EWHC 1854 (QB)

Neutral Citation Number: [2004] EWHC 1854 (QB)
Case No: HQ03X03515
IN THE HIGH COURT OF JUSTICE
QUEENS BENCH DIVISION

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 5th August 2004

Before :

THE HONOURABLE MR JUSTICE ROYCE

Between :

WECOMM LIMITED

Claimant/part 20 Defendant

- and -

GUY ROSENHOIZ

Defendant/Part 20 Claimant

Mr Robert Howe (instructed byCMS Cameron McKenna) for the Claimant

Mr Antony Thompson (instructed by Sherrards ) for the Defendant

Hearing dates: 7, 8, 9, 12, 13, 14, 15 & 16 July 2004

Judgment

Mr Justice Royce :

INTRODUCTION

1.

The Claimant seeks recovery of £68,640.00 charged to it by its former Chief Executive Officer, the Defendant, as well as the recovery of £10,000.00 of the Company’s cash entrusted to him. His employment commenced on 1st September 2001 and was terminated on 9th May 2003.

2.

The Defendant counterclaims for wrongful dismissal. The Claimant contends that (a) the Defendant was not dismissed, he resigned; (b) and even if he was dismissed, the Claimant was entitled to dismiss him for gross misconduct. He also counterclaims for notice pay, for 9 days’ unpaid salary and share warrant entitlement.

A brief background history

3.

The Claimant is a software development company established in December 1999. Its business is the development and marketing of software which facilitates the transfer of real time information by screening the information over a wireless network.

4.

The development of the Claimant’s business required substantial upfront investment. In the 16 months to 31st March 2001, the Company lost £2.26 million pounds; in the year to 31st March 2002 it lost £2.35 million pounds and in the year to 31st March 2003 it lost £2.64 million pounds. The main shareholders are venture capitalists specialising in investments in the communications technology field.

5.

The Defendant is an Israeli citizen and has been involved in the IT industry since 1992. He is 34 years old.

6.

By mid 2001 the Claimant’s investors were becoming concerned that the Claimant’s sales were not reaching expectations. They wanted to find a new chief executive with sales experience. The Defendant had been a vice president of Emblaze Systems plc a listed public company operating in a broadly similar field to the Claimant.

7.

Shortly after the Defendant joined the Claimant his wife also became an employee in a sales role (although they did not in fact marry until May 2002).

8.

The Defendant’s terms of employment were set out in a service agreement dated 1st September 2001. He was to be paid a salary of £115,000 per annum, to be increased to £150,000 if certain revenue conditions were met (clause 3). There was also a six month notice provision (clause 4.1).

Approval of the “milestone”

9.

At a meeting on the 24th of January 2002 the Claimant’s Board decided that sufficient progress had been made in relation to sales to recommend to the investors that they should deem the revenue “milestone” to have been met. Achievement of the milestone was important because it enabled the Claimant to draw down more money from its investors; it triggered the increase in the Defendant’s salary; and it triggered the Defendant’s entitlement to certain share warrants under a warrant agreement.

10.

On the 28th of January 2002 the Investors’ Committee agreed with the Board’s recommendation and deemed the milestone to have been achieved. In consequence on the 12th of February the Board agreed that the warrant condition had been met and the Defendant’s salary increase should apply. The Defendant in fact waived his increase until after the “fundraising exercise currently under way had been completed”.

11.

The Claimant contends that the Board’s agreement to deem the milestone as achieved was induced by representations by the Defendant which were false.

Mr Winter

12.

The Chief Financial Officer during this period was Mr Keith Winter. He resigned with effect from 26th June 2002 although he agreed to provide some assistance with handover to a successor up to 15th September 2002. There were difficulties in finding a replacement. His successor Mr Bechman did not join the Company until 10th March 2003.

New funding Autumn 2002

13.

Substantial efforts were made to attract new capital investors. This was in part successful. One of the investors was Elderstreet Limited (“Elderstreet”) a venture capital fund specialising in the UK software sector. They invested 1.5 million pounds on the 30th October 2002. Mr Frew of Elderstreet insisted that the Defendant’s service agreement be amended however so that a breach of the approved budget could be a ground for dismissal.

Events leading to the termination of employment on the 9th of May 2003.

14.

In early 2003 Mr Frew of Elderstreet was becoming increasingly concerned about the state of the Claimant’s finances. He wanted to bring in a new Chairman. Mr Graham Summers who had had a successful career in the relevant sector agreed to take up the post and eventually joined the Board on the 14th of March 2003.

15.

Mr Bechman having examined the Company’s financial state with some care concluded that it was very much worse off than the Board had thought. He also had concerns about the expenses that were being incurred and about £10,000 in cash used by the Defendant but inadequately accounted for.

16.

A meeting took place on the 9th May attended by the Defendant, Mr Summers and Mr Frew. The Defendant signed a letter of resignation. He maintains that he was intimidated into agreeing to resign by threats from Mr Summers.

Subsequent events.

17.

On the 30th of July 2003 the Defendant presented an application to the Employment Tribunal claiming that he had been unlawfully dismissed. Those proceedings have been stayed pending the outcome of the present action.

18.

On the same date Mrs Rosenhoiz ,who had resigned on the 2nd of May 2003, also made an application to the Employment Tribunal. She claimed the sum due under her resignation agreement, compensation for unfair dismissal, and damages for sex discrimination. On 4th June 2004 the Tribunal dismissed her claims for sex discrimination and unfair dismissal, but held she was entitled to be paid the termination sum gross of tax instead of net.

THE CLAIM FOR REPAYMENT OF EXPENSES.

19.

Clause 3.4 of the service agreement provided:-

“The Company shall by way of reimbursement pay or procure to be paid to the [Defendant] all reasonable expenses wholly, exclusively and necessarily incurred by him in the performance of his duties under this agreement on production of appropriate vouchers or receipts.”

20.

The service agreement also expressly provided that:-

The Defendant would during his employment under the agreement well and faithfully serve the Claimant and use his best endeavours to promote its interests but, so far as is reasonably possible, not in any way which might conflict with the interests of any other company in the Claimant’s group (“Group Company”), which interests the Defendant would use his best endeavours to promote (clause 2.2.2).

The Defendant would during his employment under the agreement devote himself exclusively to the performance of his duties during normal working hours at his place of employment and at all other times necessary for the proper performance of his duties, unless prevented by ill health from doing so (clause 2.4).

21.

It is common ground that as a Director and employee the Defendant owed to the Claimant:-

(i)

A duty of good faith and fidelity.

(ii)

A duty to act in the best interests of the Claimant.

(iii)

A duty not to misappropriate or permit or assist others to misappropriate the Claimant’s property or money.

(iv)

A duty to account to the Claimant in respect of his dealings with the Claimant’s property or money.

22.

It was accepted by Mr Thompson that the onus of proof where the Claimant is seeking an account from its former agent as to how the Claimant’s money has been spent lies on the Defendant to demonstrate that he has properly spent it.

This proposition is set out in Bowstead (17th edition) para 6 – 090 :-

“an agent is under an obligation to keep an accurate account of all transactions entered into on his principal’s behalf and he must be ready at all times to produce it to his principal. If he fails to keep and preserve correct accounts, everything is presumed against him.”

23.

The Claimant’s also relied on Gray v Haig [1855] 20 Beav. 219 per Romilly MR:-

“in such a case … I am compelled to act on the principle laid down in the well known case of Armory v Delamirie (1 Strange, 505) and presume … everything most unfavourable to him, which is consistent with the rest of the facts, which are either admitted or proved”.

24.

The Claimant alleges that between October 2001 and April 2003 the Defendant made and received payment from the Claimant in respect of, at least a 197 claims for alleged “expenses” totalling at least £68,640.00 which :-

(i)

were not wholly, or exclusively, or necessarily incurred by him in the performance of his duties under the agreement and / or

(ii)

were unreasonably incurred and / or unreasonable in amount and / or

(iii)

in many cases were not supported by appropriate vouchers or receipts.

25.

The sum of £68,640.00 is sub divided as follows :-

(i)

travel expenses £45,563.00 less £3,519.00 = £42,044.00

(ii)

entertaining £9,250.00

(iii)

chauffeur services £10,377.00

(iv)

other expenses £6,969.00

26.

In general terms the Defendant’s answer was as follows:-

“as the CEO of the Claimant I was charged with the responsibility, amongst other things, with the international expansion of the sales activity of the Claimant. This responsibility included building the Claimant’s sales force, engaging with new customers and partners across many countries, attending exhibitions and conferences in order to promote the Claimant’s business as well as managing the Claimant’s funding process across many countries. All of which in the course of the execution would have generated the need for extensive travel, entertainment and in certain cases the payment of “retainer or introductory” fees to third parties such as agents. The scope of my duties and the manner in which I was to perform them were openly discussed with the appropriate officers of the Claimant, throughout my engagement, i.e. my former colleagues, prior to being actioned. I have at all times acted responsibly, in good faith and in line with my fiduciary duties to the Claimant. I have made valid claims for reimbursement of bona fide expenses and have used Company funds and resources as and when necessary, with the full knowledge and consent of my fellow executive directors, in carrying out my duties and the wishes of the Board of Directors of the Claimant. Neither the Board nor my fellow executive directors, at any time during the course of my employment and while carrying out my duties ever complained or challenged my commitment, or the manner in which I carried out my duties.”

27.

Originally there were two signatories on the Claimant’s bank account. One was Mr Winter the CFO and the other was Mr Sturrock the Chief Operating Officer. Mr Sturrock was in reality an expert on the technology rather than a financial man. A young lady called Miss Fairburn joined the Claimant in July 2000 as a receptionist at the age of eighteen. She was later promoted to management assistant and she assisted in dealing with expense claims and invoices.

28.

Expenses were dealt with in one of three ways:-

i)

invoices directly paid by the Company

ii)

company Barclaycard

iii)

expense forms

29.

According to Mr Sturrock when an invoice was to be paid directly by the Claimant for a sum over a £100 a purchase order should have been drawn up to approve the purchase. He gave as an example the booking of a limousine through Prestige Cars. The Defendant would ask Miss Fairburn to book a car for him and subsequently the Claimant would receive an invoice for all trips taken in a particular month. If the cost of an individual expenditure was over the prescribed limit a purchase order should have been created and approved in advance of the expenditure by one of the senior management or two senior managers if the amount was over £10,000.00. He says:

“I do not believe this procedure was followed by Guy. While Keith Winter was employed by Wecomm he signed the cheques for these expenses, however, once Keith Winter had departed from Wecomm, it seems that Guy authorised the car expenses himself. I signed cheques only in the rare circumstances when Mr Winter was absent, or as a countersignee on large cheques, our payments to the Inland Revenue being the most frequent example.”

30.

Miss Fairburn said in relation to such invoices

“in my role as management assistant I opened these bills and documented when each bill was due. Whilst Keith Winter was CFO at Wecomm we had a schedule when to pay each bill. After he left I simply showed these bills to Mr Rosenhoiz, who signed the bills signifying authorisation. Once I had such authorisation I could enter these amounts onto the Bacs system.”

31.

So far as the Company Barclaycard was concerned Mr Sturrock described how the Defendant would use his:

“Each month the credit card statement would be sent to Guy who should have signed the bottom of the Barclaycard statement, then crossed out any personal expenses he had incurred on the card. However the Barclaycard was paid automatically by direct debit by Wecomm, so any adjustment for personal expenses should be made using expense forms submitted by Guy. Guy claims that he requested that certain deductions were made from his salary where he had used the Company credit card for personal expenses. However, I do not believe that Guy filled in the relevant forms to ensure that this deduction would take place, nor do I believe that requested deductions to be made for a large number of personal items paid for by the Company on the Company credit card.”

32.

Miss Fairburn said:

“I arranged for the payment of Mr Rosenhoiz’s credit card each month by matching up the receipts he gave me to the credit card statement. Mr Rosenhoiz would then go through the invoices and sign the credit card statement as authorisation of these expenses. Mr Rosenhoiz authorised this type of expenditure in his role as CEO. Once I had received Mr Rosenhoiz’s authorisation these expenses would be paid by direct debit.”

Expense forms

33.

According to Mr Sturrock the Defendant would have had to submit expense forms with the relevant receipt/voucher attached for any out of pocket expenses. He should have signed his own form and during Mr Winter’s time Mr Winter should have countersigned signifying the authorisation of the expenses. Miss Fairburn confirmed that is what happened.

34.

Mr Sturrock said that once Mr Winter left nothing was formalised about how expenses would be dealt with in the intervening period because no one envisaged such a significant period without a CFO. He says that during that period he only countersigned one expense form that being in November 2002. In all other cases the Defendant authorised the expense forms himself either with just one signature or a countersignature in addition to his original signature. He said:

“once the expenses were authorised they were paid by a Bacs run. This is a computer system whereby Miss Fairburn would create a list of invoices and bills to be paid directly into suppliers and employees accounts. I would then check that she had correctly entered the item’s values and recipients and sign a printout of the list to confirm that the details on the computer matched the paper list. I would then confirm the payment by our bank, again directly through the computer using a security card issued in Keith Winter’s name by our bank. At this point in the process it was not obvious how individuals’ expenses contributed towards bills being paid, since the amounts being paid represented the combined amounts due from all areas of the Company. For this reason it was not obvious to me either that Guy’s own expenses formed a disproportionately high percentage of overall expenses, nor did it include expense amounts that had not been properly authorised.”

35.

In most small companies such as this directors have to be trusted to incur and claim only proper expenses. In general if the CEO claims that he has incurred a business expense there is a natural tendency for that to be accepted.

36.

With some exceptions that appears to have been the situation with the Claimant. One exception was described by Mr Sturrock. According to him in early June 2002 Mr Winter had an argument with the Defendant about what he viewed as the Defendant’s excessive chauffeur driven limousine expenses. The Defendant refused to back down over the expenses and this led to Mr Winter resigning. Mr Sturrock concedes that he should have taken a much stronger stance over the matter than he did. It is clear to me having seen and heard him in the witness box that he is a far less robust personality than the Defendant and he was too concerned not to jeopardise his own position within the Company at that stage.

37.

On another occasion Miss Fairburn queried a claim for over a thousand pounds in respect of expenditure at the Funky Buddha Restaurant on the occasion of the Defendant’s birthday which he claimed from the Claimant. It will be necessary to refer this in more detail at a later stage.

Mr Bechman’s arrival.

38.

Mr Bechman found that as a result of the period without a CFO the financial procedures of the Company were sub-standard. Although he authorised the Defendant’s expenses for March and April 2003 he did delete some items that were obviously not claimable (for example rolling luggage). He also noticed that several entertainment expenses were claimed simply by stating the name of a restaurant and he asked the Defendant to note who had been entertained to prove that the expenses were legitimate.

39.

He said:

“after manuscript amending the expense form to the extent I was happy to approve, I sent the form back to the Defendant. Before doing so I took a copy of the form for my records. This is something I have never done before in any company I have worked for but I had a gut feeling something was wrong and I wanted to ensure that I had a copy of the expense forms as evidence in case my suspicions were confirmed and the Defendant disposed of the originals ”

40.

He also concluded soon after joining the Company that expenses on limousines could not be justified. He sent an email to the Defendant stating that he spent more money on limousines than he did on his Personal Assistant. In consequence Mr Bechman stopped the account with the limousine company. In early May he undertook a full financial review including the Defendant’s expenses. That revealed that ninety per cent of the Claimant’s expenses for the year to the 9th of May 2003 related to the Defendant.

41.

Mr Bechman put the matter this way:

“I do not agree with the Defendant’s claims that his expenses claims were justified. They were grossly excessive and disproportionate by any standards. Bluntly, the Defendant engaged in frequent and expensive foreign travel with his wife, went out to numerous restaurants, and made lavish use of chauffeur driven limousines all at the Company’s expense. I can find no evidence in the Company’s files that any of the Defendant’s numerous trips at the Company’s expense back to his home country Israel, produced any tangible benefit at all for the Company. Nor can I find any evidence of any documentation which could indicate the Defendant had any realistic expectation of making any sales which could have justified such travel.”

“Similarly I can think of no business justification for his frequent dining out on the Company, nor for the use of the limousines. Wecomm was and is a small start up software company. In this field, you do not secure business deals by lavish entertainment, nor do you impress anyone by using limousines. In all my experience in the finances of such companies, I have never before seen expenses claims of such a nature nor on such a scale. I believe that the Defendant’s expenses claims were at best unjustified and highly irresponsible, and at worst simply dishonest.”

Restaurant expenses and chauffeur driven limousines.

42.

The Defendant maintained that there was a culture of lavish entertaining in the Company. Mr Sturrock disputed that. It does not appear to be borne out by most of the other evidence put before me. I do not accept the Defendant’s contention.

43.

The Defendant held a birthday party at the Funky Buddha. This took place on the 8th/9th February 2003. He reclaimed expenditure of £857.75p and £215.63p. It was conceded on his behalf that this should not have been reclaimed.

44.

His evidence about this followed a curious path. Before the Employment Tribunal when he was giving evidence on behalf of his wife he was asked about this claim by the Chairman. His response was:

“The explanation is very simple:- that was my birthday, it should not be included in the Company’s expenses. On the other day, Monday, I went to Oliver and I told him “Oliver, I think that is either paid by the Company card or by Company cheque. I would like it to be excluded from my salary”. It was a birthday and I have explicitly asked like some other expenses here, that they would be taken out and put out of my salary and, as usual, Jodie did not do it.”

45.

In fact the Defendant had not used a Company credit card he had paid the bills on his private Amex card and then subsequently claimed it as a expense over two weeks later on the 27th February.

46.

What the Defendant said before me was:

“I did present a receipt in my expense forms because I really thought that it was an activity that was part of work. The birthday issue was just naming it a birthday issue. I had actually celebrated my birthday, four days before that. Oliver did come to me and did tell me that he thinks that this expense should not be on the Company, and I told him that I think it should because it was for promoting the Company’s business. And it was entered into my expenses. And I had a change of mind, I think, ten days or two weeks later, and I have come back and I have said “Jodie in the next expense form take it off”.

47.

Jodie Fairburn disputed that he had done any such thing. I found her to be a careful witness palpably honest in her evidence. I do not accept that the Defendant ever asked her to remove this claim. I am driven to the conclusion that he had decided that he would if he could get away with the Company paying for his birthday celebrations knowing that it was not a proper business expense.

48.

In respect of the other entertainment expenses claimed the Defendant contended that they were all legitimate. He had originally maintained:

“following a Claimant’s procedure, I have clearly written on the back of each receipt or invoice related to such activities, the names of the people that attended and as such it was approved”.

As he accepted in evidence that was not correct. On only some of the receipts did any names appear. A review of the invoices/receipts from Zuma (his favourite restaurant) and Funky Buddha (his favourite nightspot) revealed that out of the total of 29 visits only one receipt detailed the name of a person being entertained. Among those he said he entertained were Mr Sami Balass, Mr Otto Legerer and Mr Schiller. None of these were prospective customers. The Claimant contends there was no real justification for spending the Company’s money in the entertainment of them.

Mr Kotonou.

49.

There is no doubt that the Claimant’s Board was worried about a possible patent infringement action by Mr Kotonou’s Company Worldlink. The Defendant maintained that a significant part of his entertainment expenses resulted from attempts to negotiate with Mr Kotonou a satisfactory resolution to this possible action. There is no doubt that Mr Sturrock in particular was very pleased with the outcome achieved by the Defendant.

50.

Mr Kotonou’s name did appear on the back of a receipt for £174.15 at Zuma. He was also apparently at the birthday party. I accept that some entertainment of Mr Kotonou was necessary and was carried out for genuine business purposes. Mr Kotonou sat in court for much of the trial. It would appear that he was on good terms with the Defendant. He was not called to give evidence. I do not accept that entertaining Mr Kotonou for business purposes was on anything like the scale alleged by the Defendant.

51.

The Defendant attempted to set out in particular in his third witness statement a detailed analysis of each item of expenditure. Much of his evidence on this was however vague and unconvincing even accepting the difficulties caused by lapse of time and flimsy records. There were relatively few business dinner meetings in his “outlook calendar”.

52.

There is no doubt the Defendant enjoyed going to good restaurants and clubs. I have no doubt that sometimes there was a genuine business purpose for the wining and dining and that the expenditure was “wholly exclusively and necessarily incurred by him in the performance of his duties.” However I am satisfied that the majority of the expenditure was not so incurred. It was accepted on behalf of both the Claimant and the Defendant that it would be inappropriate to seek to look at each individual item of expenditure; the proper approach was to take a percentage of it. I am satisfied that no more than thirty per cent of the expenditure was properly reclaimable or incurred. Accordingly the Claimant is entitled to recover £6,475.00 under this head.

Limousines.

53.

The expenditure on private chauffeur driven limousines was very substantial. The Defendant liked to go to restaurants or clubs in particular in Mayfair or Knightsbridge. He arranged to be taken by chauffeur driven limousine and the chauffeur was required to remain for the duration of the visit. This resulted in expenditure quite regularly for five, six or seven hours of chauffeur time. Sometimes it was less sometimes it was more. For example on Thursday 6th March for a visit to Zuma in Knightsbridge for three and a half hours of chauffeuring there was a charge of £98.00. On the following day ten hours of chauffeur limousine time starting at 17.15 pm cost £280.00. That involved a visit to Attica nightclub. On the morning of Saturday the 8th of February 2003 for a visit to the club (James) five hours chauffeur time cost £228.20. On the evening of that day six hours chauffeur time cost £168.00 for a visit to Funky Buddha. This was the night of the birthday party and should not have been charged at all.

54.

There was also considerable expenditure on such limousines by the Defendant during office hours without any real justification. The total expenditure between December 2002 and the end of April 2003 amounted to £10,377 including VAT.

55.

It is not without significance that most of this type of expenditure occurred after new funding had arrived in the latter part of 2002 and after Mr Winter’s employment ceased. It was of course Mr Winter who earlier in the year, in June had had an argument with the Defendant about his limousine expenditure.

56.

I have no doubt that the use of the limousines flattered the Defendant’s ego. It may be as he said that it was his style. However I accept Mr Bechman’s evidence that it was a wholly unnecessary extravagance.

57.

A small portion may have been justifiably incurred for business purposes and it is likely that on some occasions had a limousine not been used a taxi would have been necessary. However I am satisfied that ninety per cent of the expenditure under this heading was not justified. Accordingly the Claimant is entitled to recover £9,339.30.

Travel expenses.

58.

These amounted to £45,563.00 less £3519.00 for which credit should have been given. Of the £45,563.00, £37,612.00 is attributable to visits to Israel. There were twenty five of these for a total in excess of seventy days.

59.

The Defendant maintains that the expenses were necessary to enable him to fulfil his duties as Chief Executive. He contends that the Claimant had significant business in Israel “ranging from engagement with sales and marketing channels to in depth progressed commercial discussions with potential customers.” He says “the Claimant had and still may have relations with many entities in Israel which include:

i)

HP Israel (formerly known as Compaq Israel) a strong partner of the Claimant, which signed an exclusive Agent and representation agreement with the Claimant in 2002 for selling the Claimant’s products and technology in Israel;

ii)

Microsoft Israel – discussions were held during 2002 to reach a partnership agreement with the Claimant in order to support its activities in Israel;

iii)

Orange Israel – discussions were held during 2002 and 2003 with Orange management representatives and involving HP Israel and Microsoft Israel;

iv)

Bank Hapoalim - the biggest bank in Israel which entered in-depth commercial and technical discussions with the Claimant for purchasing its solutions, led by the Bank’s management and involving other Claimant partners such as HP Israel and Orange Israel;

v)

Bank Leumi – discussions were led by HP Israel proposing the Claimant’s products to be purchased by the Bank. Such discussions and meetings took place during years 2002 and 2003;

vi)

Bank Mizrahi – discussions were led by HP Israel proposing the Claimants products to be purchased by the Bank. Such discussions took place during years 2002 and 2003;

vii)

Bank Ben-Leumi – discussions were led by HP Israel proposing the Claimant’s products to be purchased by the Bank. Such discussions and meetings took place during years 2002 and 2003;

viii)

Zone4Play – discussion took place during 2002 and 2003 in respect of selling the Claimant’s technology to this potential customer (a betting and gaming company) for the purposes of delivering wireless gaming solutions. The company’s directors and management visited the company several times in Israel;

ix)

Emblaze Systems – in depth commercial discussions were held on selling the Claimant’s technology and solutions. The Claimant’s directors, management and sales team were involved as well and visited this potential customer.

In addition he indicated that the Claimant dealt with Israeli venture capitalists as part of its funding round.

60.

Mr Sturrock comments on the particular customers the Defendant claims to have visited during the trips:-

i)

“HP Israel: There was a ‘Memorandum of Understanding’ which set out heads of terms for a reseller agreement between weComm and HP Israel. This was signed in May 2002 and expired 9 months later and granted HP the right to exclusively represent weComm and sell its products in the Israeli market. No business has resulted ever from this although some weComm personnel were involved in conversations with HP with regard to a specific opportunity at Bank Ha’poalim;

ii)

Microsoft Israel: There is no formal agreement nor were there any specific opportunities or discussions with them that I was aware of.

iii)

Orange: The Defendant’s uncle is (we have been led to believe by the Defendant anyway) a major shareholder in Partner Communications which operates the Orange franchise in Israel. However, so far as I am aware, no conversations with Orange Israel took place regarding weComm’s technology and no agreement was ever signed with them, either in a customer or partner capacity;

iv)

Bank Ha’poalim: There have been some discussions with them, largely facilitated and led by HP Israel. Bank Ha’poalim expressed a serious level of interest in purchasing and implementing weComm’s products in the period between approximately early 2002 and late 2003. To date, no business has been generated from Bank Ha’poalim and we are not forecasting any in the near future;

v)

Banks Leumi, Mizrahi and Ben-Leumie: Very little technical pre-sales activities took place and no technical proposals created. No commercial proposals created or sent to any of these to the best of my knowledge. To my knowledge, these were short-lived opportunities that did not progress and consumed very little of our time;

vi)

Zone4Play: Z4P were not at anytime, to my knowledge, a potential customer. We did, however, introduce them to Lewis Findlay, the Managing Director of Cantor Index, as potential supplier of a casino platform to Cantor Index, who are a customer of weComm’s. This took place at a single meeting in Tel Aviv in or around February 2002 following which Lewis decided not to proceed with Z4P. I am not aware of any other activities with them that would justify continued travel either on behalf of Cantor Index or weComm;

vii)

Emblaze: We have had a number of activities in partnership with Emblaze Systems but they were certainly never a potential customer. These activities took the form of investigation into producing an application which incorporated both companies’ technologies for demonstration to some potential joint customers. No application was ever produced ; no demonstrations were given and no business was generated.”

61.

According to Mr Bechman:

“the level of the Defendant’s travel expenses seemed excessive, particularly as a great deal of travel was to Israel (the Defendant’s home country) and Sarit (the Defendant’s wife) was taken on many trips that were at the least inappropriate for her to attend given her role as Head of Cellular Sales. Furthermore many of these business trips were conducted over weekends.

After the Defendant’s resignation on 9 May 2003 I conducted a search of the cupboards for any files relating to Israeli based companies and specifically for Bank Hapoalim. As the Defendant had stated on a number of occasions that weComm were “close to a deal” with Bank Hapoalim, it seemed likely that there would be a hard copy of any proposal. I was unsuccessful in finding any files.

In order to ensure that a proper search was performed, I thereafter asked my secretary, Emma Wescott, to perform a further search. Again this search did not yield any files for Bank Hapoalim or any other Israeli based companies.

The Company keeps back ups of data files. I was able to locate such a backup (attached at appendix TB1). As is common practice, e-mails are filed by folders. The Defendant created 90 folders. There are no folders for any the supposed Israeli “clients” claimed by the Defendant. It is possible that any e-mail correspondence could have been stored on the hard disk of the Defendant’s portable, although this can no longer be demonstrated as this portable has been reported stolen. There are folders for all other potential and actual weComm customers.

It appears from this search that there were no formal proposals to any Israeli customers. This clearly illustrates that the level of travel undertaken by the Defendant was excessive, particularly given that no business resulted from any of these trips.

In his Defence and Counterclaim the Defendant claims that he travelled to Israel on several occasions to enter into detailed technical discussions with Bank Hapoalim. I find this implausible as the Defendant did not have the relevant technical expertise. If this was the case then either Oliver Sturrock in his role as Chief Technology Officer should have been in attendance or there would have been extensive communications in this regard.

On the occasions that I was asked to authorise travel expenses by the Defendant , before doing so I would question who the Defendant was going to see and what stage weComm was at in negotiations with these entities. Often in response to these queries the Defendant would claim he was seeing Bank Ha’poalim and that they were on the verge of issuing a purchase order to buy a new licence. It is now clear that there was little or no business value to the Company of the Defendant travelling to Israel.”

62.

It transpired at the Employment Tribunal hearing that the Defendant did have a number of emails and other documents which he had backed up onto his home computer. He says these would not have included the folders with the emails with the Israeli contacts. The position appears therefore to be that they cannot be located on the Claimant’s copy of the backed up materials or such material as the Defendant has.

63.

The Claimant accepts that some of the business travel was justified. The Claimant’s contention however is that the Defendant’s travelling expenses were motivated primarily by personal considerations, rather than a genuine or reasonable belief that the travel was actually necessary for the purpose of the Claimant’s business. They point to the following:-

i)

the frequency and pattern of travel which was predominately to Israel;

ii)

the absence of any contemporaneous evidence of any substantial correspondence with any of the alleged potential customers in Israel;

iii)

the absence of any proper explanation from the Defendant about what precisely he was “discussing” in all these alleged “meetings” and why it was necessary to travel to these meetings at great expense to his employer;

iv)

the lack of any reports from the Defendant resulting from any of these trips; and

v)

the fact that the Defendant was clearly motivated by a desire to maintain his valuable tax concession.

64.

The last point above was based on evidence that emerged from Miss Fairburn. In January 2003 she was asked by the Defendant to go through his travel records and list all the days that he had been out of the country. He then asked her to add on days here and there to increase the total number of days he was allegedly out of the country. He wanted the document to submit to his accountants dishonestly to inflate the number of working days he was abroad. There were 18 false entries on the document setting out a number of trips he had never made and other trips where the number of days abroad were increased.

65.

The Defendant accepted in evidence that it was a dishonest document and part of the information on it was then submitted by his accountants to the Revenue although that was later corrected by him.

66.

It did demonstrate in my judgment that he regarded it as very important to be able to show that he spent a lot of working days out of the country. Furthermore it demonstrated that he was prepared to stoop to getting his young employee to produce a grossly dishonest document because it suited his financial book.

67.

A further matter relied upon by the Defendant for his expenditure on travel (and entertainment) was the knowledge of the Board. He said “the Board sees a budget, the Board gets management accounts, the Board knows exactly how much we spend, the Board knows exactly on what we spend it, on travel and entertainment, and it was never breached and never questioned”.

68.

Mr Schiller also said that during his time as an adviser and director no member of the Board or management team raised any issue regarding the Defendant’s expenses.

69.

Mr Frew denied that the Defendant’s expenses were claimed with the full knowledge and consent of his fellow directors. According to him the Defendant’s expenses were never discussed by the Board and the Board would not know the level of any employees’ expenses. Mr Sturrock also maintained that there was no discussion at board level of individuals’ expenses. The Board minutes do not reveal such discussion.

70.

So far as the budget was concerned Mr Bechman did not agree that the Defendant’s expenditure on travel had been within budget. For the period October 2002 to March 2003 the total travel budget was £70,000 split £24,000 to management and £46,000 to sales. The actual expenditure for the same period was £72,631.00. Management travel was £42,152.00 which was 75% over budget. The Defendant maintained that the budget was treated as a global budget and as one of his principal duties was on the sales side he was entitled to use part of the sales budget. Mr Bechman said in evidence “it is an absolute no - no to take budgets from other areas and reallocate them at will.”

71.

I prefer the evidence of Mr Frew, Mr Sturrock and Mr Bechman on this aspect of the matter. I am satisfied that the Board was not aware of the scale and detail of the Defendant’s expenditure on either travel or entertainment.

72.

I have no doubt that part of the Defendant’s travel expenditure was genuinely for the purposes of the Claimant’s business. The Defendant is a man of energy and drive and he will have used those qualities to further the Claimant’s interests in Israel, at least initially. However I believe that what drove him to visit Israel so often was a desire to spend a considerable time in his homeland at the same time increasing his number of days abroad to retain his valuable tax concession and that of his wife.

73.

I simply do not believe his evidence that all these trips were genuinely to further the Claimant’s business. It is highly unlikely that more than 40% of the expenditure was properly claimed. Accordingly I find that the Claimant is entitled to recover 60% of it.

Other expenses.

74.

These are set out in annex b to the Particulars of Claim items 156 to 197.

The Defendant accepts that the following items were a private expense and should not have been claimed:-

i)

item 164 Porsche pen £289.00;

ii)

item 165 earrings £482.00;

iii)

item 190 rolling luggage £560.00.

75.

He alleges he specifically asked Miss Fairburn to deduct these items from his salary. I do not accept that evidence. Had he done so she would have carried out that instruction.

76.

So far as the remaining items are concerned the Defendant maintains they were all acquired legitimately for the purposes of the Claimant’s business. Mr Sturrock set out a detailed response indicating why many of them were not. I accept Mr Sturrock’s evidence in relation to the following items 160, 164, 165, 168, 169, 175, 179, 185, 189, 190, 192 and 193.

77.

The value of those items is £2,458.38 I am satisfied they were not properly claimed expenses and the Claimant is entitled to recover that sum.

THE £10,000.00 TRANSACTION.

78.

In February 2003 the Defendant told Mr Sturrock that he urgently needed £10,000 in cash to pay expenses to an agent. Mr Sturrock thought this conversation took place on the 17th of February but it is apparent that the cheque stub was dated the 13th of February and that was completed by Miss Fairburn. It was on Monday 17th of February that the Defendant faxed the bank saying “please accept this fax as confirmation that Oliver Sturrock has been given permission to withdraw £10,000 on behalf of weComm Limited …….. I would appreciate it if you could see if the funds will be made available by this afternoon……”

79.

The bank records indicate that the cheque was cashed on the 18th February.

80.

According to Mr Sturrock he was anxious that there should be a proper invoice in relation to this transaction and the Defendant told him there would be. The cash was put in the company safe. The Defendant later telephoned Mr Sturrock and asked him to hand it to Mrs Rosenhoiz. Mr Sturrock did so. She took it home and later handed it to the Defendant on his return from Paris. According to the Defendant and Mr Legerer it was handed by the Defendant to Mr Legerer at Munich station on 28th February. Mr Legerer says he paid the agent Marek Schmit in Warsaw about 10 days later. No invoice or receipt was ever obtained from this “agent”.

81.

According to the Defendant it was in about December 2002 that he had a conversation with Mr Legerer who was the Claimant’s agent responsible for German speaking countries about a possible deal which could be struck in Poland with a Polish cellular operator. In that discussion he understood that a payment would have to be made to a person “related to the Polish cellular operator in order to process such a deal”. He said he spoke separately to Mr Sturrock and to Mr Bechman about this.

82.

Mr Bechman remembers him asking a general question about procedure if a foreign agent was paid £10,000. He advised the Defendant that if £10,000 was paid to an agent he must ensure that the company received an invoice. He, Mr Bechman, found out only later that a payment had been made on reviewing the cash book. He confronted the Defendant about this and the Defendant said that the money had been paid to a company called GH International Trading to be paid to a Russian agent. He asked the Defendant for the relevant paperwork that he told him would be necessary and the Defendant said the paperwork was on its way.

83.

According to Mr Summers and Mr Frew at their meeting with the Defendant on 19th May he told them that the money had been paid to GH International Trading Services Limited to secure an appointment with Siemens in Russia. After the Defendant’s employment was terminated a letter was sent to GH international asking about the £10,000. They said that they had never received it and knew nothing about it. In consequence on the 4th June 2003 the Claimant’s solicitors wrote to the Defendant’s solicitors referring to what the Defendant had told Mr Summers and Mr Frew and indicating the denial by GH International. The Defendant’s solicitors replied on the 10th June indicating that Mr Sturrock and Mr Bechman had been fully in the picture and concluding by saying “you mention a letter from a director of GH International Trading Services Limited denying the payment was ever received. Could you please furnish us with a copy of that letter.” It is noteworthy that there is no denial that the Defendant had said the £10,000 had gone to GH International.

84.

The police were called in to investigate and they took a statement from Mr Legerer. He told them that in May 2002 he had discussions with the Defendant and in consequence he had contacted a Mr Szmidt who had said that he could help but he would need £10,000 to help “open doors”. He had received the £10,000 from the Defendant at the end of February 2003 in Munich and had passed it on to Mr Szmidt in Warsaw about 10 days later. He said “no receipt was given or requested”. According to Mr Legerer’s witness statement he explained to the Defendant that Mr Szmidt could not provide an invoice but in his oral evidence he said he could provide a receipt and that it was “not a problem at all” for Mr Szmidt to provide either an invoice or a receipt. Mr Legerer in his oral evidence advanced a different reason namely that Mr Szmidt could not provide an invoice because he wanted to avoid tax.

85.

The Defendant said that the agent could not provide an invoice because he was not self-employed. He also said that the reason he could not issue an invoice was because he did not want to “expose himself”. He was not at all explicit as to what he meant by this. He would not accept what in reality was being asked for was money for a bribe. I am satisfied if the version of the Defendant and Mr Legerer is true the money was being requested for a bribe.

86.

As part of the police investigation there was obtained an email purporting to come from Mr Szmidt in support of the contention that he received £10,000 from Mr Legerer. In fact the email says that his company received 10,000 euro from Mr Legerer and the amount was then assigned as commissions for mobile phone businesses brokers selling products of weComm. Mr Szmidt was not called to give evidence before me.

87.

It is difficult looking through the murky waters of this transaction to decide exactly what took place. Mr Thompson realistically accepted that “in these circumstances this court may well find that the transaction was so unusual that the matter should have been raised with the Board.” I do and it was not. There is no suggestion that it was discussed with other members of the Board at the time, namely Sir Michael Jenkins, Nigel Spray and Paul Frew.

88.

The money was received by the Defendant. It has disappeared in dubious circumstances where it is said that it has gone to a shadowy figure. The Defendant is unable properly to account for it. The transaction was never authorised by the Board. In these circumstances the Claimant is entitled to recover it from the Defendant.

DID THE DEFENDANT RESIGN OR WAS HE DISMISSED?

89.

Shortly after Mr Bechman joined the Defendant on the 10th March 2003 he discovered that the Capital Financial Accounts had been produced on a cash basis with no allowance for creditors or accruals for services used but not invoiced. As a result it became clear to him that the net assets of the Company as detailed in the management accounts were misstated. The net asset position per the management accounts in February 2003 was £855,218.00. He found that that should have been £377,700. By April he concluded that unless further cash was received from customers or further funding was obtained the Company would soon be insolvent. This was raised with the Board.

90.

Mr Bechman was also disturbed by a request from the Defendant to transfer 4,800 euro to Mr Legerer for an exhibition. He queried why there was no appropriate paperwork for it.

91.

Mr Frew asked Mr Bechman to produce a reconciliation of actual expenditure against budget for the six months to 31 March 2003. That analysis revealed :-

i)

Revenue for the period was £212,000 below budget;

ii)

Costs were £192,000 over budget;

iii)

Cash was £584,000 below budget;

Mr Frew was very concerned by these issues and discussed them with Mr Summers.

92.

In early May Mr Bechman communicated to Mr Summers details of the Defendant’s expense claims and also concerns about the £10,000 payment. A meeting was arranged with the Defendant for 5. 30 pm on 9th May. Mr Frew, Mr Summers and the Defendant attended. Mr Frew wrote up notes of the meeting later that evening. According to Mr Frew, Mr Summers began the meeting by stating that during the budget process Elderstreet had requested a detailed financial analysis of the costs and that had revealed a number of things:-

i)

The Company had made losses of around £1,000,000 in the quarter to March 31st 2003.

ii)

Costs had overrun significantly against the budget approval in the subscription agreement.

iii)

A number of expense irregularities had come to light.

93.

Mr Summers went on to say these were extremely serious issues that threatened the survival of the Company and that an emergency board meeting would be called the following Monday or Tuesday to deal with the situation. The Defendant would be given an opportunity to explain all the issues and no decision had been taken at this point however the Defendant had the opportunity to resign if he so wished. Discussion took place concerning the £10,000 cash which had “gone missing from the Company’s safe”; the limousine costs in excess of £10,000; and the travel and hotel expenses to Israel.

94.

According to Mr Summers the Defendant claimed that all the expenditure was legitimate business expenditure. So far as the £10,000 was concerned he said that he had paid the money to get an appointment with a Russian telecommunications company and when Mr Summers asked him whether it was paid to G H International he said yes. Mr Summers went on to say that he told the Defendant “unless we can come up with a reasonable explanation of where this money went and get some sort of written documentation to support that, it may become a police matter. We actually asked him if he thought it was.”

95.

The Defendant left the meeting for a time. On his return Mr Summers asked him what he wished to do. He responded that he would resign and did not want to work for the Company any more.

96.

He did however wish to be promised the following:-

i)

A clean break.

ii)

That the Company would make no claims against him.

iii)

A reference.

iv)

Assistance with his residence permit.

v)

Any warrants due to him.

vi)

His legal costs paid.

97.

Mr Frew said that the Company would deal with him fairly and that any warrants or other property legally due to him would be honoured but there was no question of paying his legal costs.

98.

The Defendant then signed a resignation letter which had been prepared before the meeting.

99.

The Defendant’s version was different. He said Mr Summers adopted a very aggressive position throughout the entire meeting and that he started the conversation by making various direct, serious and insulting accusations about his management of the Company, that it was wrong and destructive. He said he felt very isolated and intimidated. He agrees there was discussion about the loss of the million pounds to the Claimant in the previous three months, that it was alleged that he had exceeded the budget during the period and that there were many personal unauthorised expenses. Reference was made to flights to Israel by him and his wife; £10,000 paid as a bribe; a 23 inch Apple computer screen bought by him for personal use; extensive use of limousine services; a payment of £20,000 to a company called Cartergena Capital; and a payment of 4,800 euros to an agent without documentation.

100.

He told them that all his expenses were directly related to the Company’s business. He said that no one had ever commented on his expenses or any misuse of funds and that he attempted to address as best he could in more detail the remarks about his expenses. He said that Mr Summers pushed a letter across the table together with a pen and told him in a forceful manner to sign it. He said he was in a state of shock and could not believe what was happening to him. Mr Summers he said went on to threaten should he not sign it he would call a Board meeting and embarrass him in front of the other Board members. The Board would dismiss him for gross misconduct. He also threatened to call clients and agents and inform them of his shameful acts and cause him further embarrassment. He said he would contact the police and request an investigation into the disappearance of £10,000. He said as a foreigner the police might expel him from the country. Mr Summers according to him threatened he would do whatever was within in his power to ruin his reputation and prevent him from doing any business in the United Kingdom and maybe in Israel.

101.

He asked Mr Summers and Mr Frew for confirmation that by signing the resignation letter he would not be waiving any of his rights or benefits including his 6 months compensation leave payment, his warrants, a reference letter and his May salary. He said Mr Frew stated that he would get what he was entitled to and Mr Summers agreed.

102.

Mr Schiller’s evidence was that in about June 2003 he met with Mr Summers and Mr Frew who told him about the Defendant’s departure. They explained that it was following a meeting with him where they pushed him to resign or they would go the police with allegations about the theft of £10,000 from the Company. They also told him about flights to Israel and taxi expenses which were not authorised. That version of their conversation was not accepted by Mr Summers and Mr Frew.

Whose version of the meeting is correct?

103.

Among the matters I take into account in considering this question are:-

i)

Mr Frew made notes of the meeting that evening. They were detailed and accorded very much with his evidence.

ii)

Mr Frew impressed me as a witness.

iii)

The note I made at the end of his evidence was “Careful. Thoughtful. Balanced.”

iv)

The Defendant made note of the meeting but not until December 2003 or January 2004. Those notes were made for the purpose of instructing his lawyers. They may have been coloured by lapse of time and what had taken place since he left the Claimant.

v)

There are matters of concern about the Defendant’s credibility. I bear in mind particularly the creation of the dishonest document about his days abroad which he got Miss Fairburn to produce. But there are other matters on which I have not accepted his evidence in some instances because I simply did not believe his evidence. I did not find him an impressive witness.

vi)

Mr Summers even before the meeting may well have decided that the Defendant had to go. My impression of him in the witness box is summarised by my note at the end of his evidence “Tough. Straight.”

vii)

Mr Schiller also impressed me as a witness in a number of respects. However he has clearly fallen out with the Claimant in a major way and feels that he has been very badly treated.

104.

I have little doubt that Mr Summers conducted the meeting in a fairly tough fashion. However I am satisfied that the version of the meeting advanced by him and Mr Frew is more likely to be correct. I do not accept that the Defendant was so intimidated or overborne as to be forced to resign. He had on his own evidence held various senior positions in a number of different companies over the course of eleven years. He was an experienced businessman. He left the meeting to consider his position for a time. He says it was about five minutes. Mr Frew says it was for about half an hour. He came back. It is clear from the way he dealt with cross-examination that he is not the sort of person who is likely to be pushed around.

105.

I have come to the conclusion that he realised he had substantial questions to answer and that he was going to be in difficulty in providing satisfactory answers to a number of them. He weighed up the advantages and disadvantages of taking the matter to a board meeting. He concluded that he would be better off resigning. That is what he did. This was not a case of constructive dismissal.

THE COUNTERCLAIM.

The claim for notice pay.

106.

The Defendant resigned and was not dismissed. Accordingly he was not entitled to notice pay.

Unpaid salary 9 days in May 2003.

107.

It is accepted by the Claimant that payment was not made for these 9 days. However the Claimant contends that it is clear that the Defendant did not devote himself to the Claimant’s business for a period in excess of that period for example on a number of his visits to Israel. It is contended the Claimant is entitled to set off against those unpaid days an equivalent number of paid days. I find that he did spend at least that number of days in Israel purportedly but not genuinely on the Claimant’s business which the Claimant is entitled to set off. Accordingly this aspect of the Defendant’s counterclaim fails.

Share warrant entitlement.

108.

In 2001 the Defendant entered into a warrant agreement with the Claimant.

The warrant conferred the right “exercisable on the terms and subject to the conditions hereinafter set out, to subscribe in cash at the warrant price for the warrant shares” (clause2.1).

Clause 5.1 provided “the warrants shall be exercisable in the event that the warrant condition is satisfied and clause 5.2 shall apply for the purposes of determining the satisfaction or otherwise of the warrant condition.”

Clause 5.2 provided “at any time the Company and the Board (with the consent of WIP Directors) may agree upon the satisfaction of the warrant condition …” The warrant condition was defined as “the revenue figure being £715,000 or more” “and revenue figure” meant the cumulative revenue of the Company.

Clause 5.6 provided “the warrant rights … shall be exercisable … by lodging a Notice of Exercise with the relevant certificate at any time during the warrant period at the registered office of the Company together with a remittance for the aggregate warrant price of the warrant shares…”

The warrant period was “the period commencing on the date of satisfaction of the warrant condition as determined pursuant to clause 5.2 and ending on the earlier of (i) the date of cessation of the warrant holders employment with the Company and (ii) the tenth anniversary of the date of this agreement.”

109.

The Defendant contends that although it is correct the Company had not received revenues equal to or greater than £715,000.00 the Board nevertheless on 12th February 2002 agreed that the warrant condition had been met.

110.

The minutes of the Board meeting record “equity; MZ (Mark Zerdin) confirmed that the WFP investment committee had approved unanimously the deemed achievement of the milestone as at 31 January 2002. Accordingly, the Board agreed that the warrant condition had been met as set out in certain warrant agreements…”

111.

According to Mr Spray of Frontiers Capital Limited at the investment committee meeting on 29th January 2002 Mr Zerdin who was at the time a principal at Frontiers Capital, presented a table of current and prospective deals as presented to him by the Defendant. Mr Zerdin made it clear that the milestone had not been achieved but good commercial progress had been made. On the basis of the Defendant’s report it was agreed by the committee that the milestones would be treated as having been met.

112.

Mr Spray went on to say that it later turned out that the information that the Defendant gave Mr Zerdin about current and proposed deals was not accurate and in fact the only deal contained in the report that made any progress was Cantor Index. Had the investment committee been aware of the correct facts it was most unlikely that the milestones would have been deemed to be met. I am satisfied that the Defendant did misrepresent the contracted revenues. They were substantially less than represented. This led to the investment committee’s approval of the deemed meeting of the milestone and to the Board agreeing that the warrant condition had been met.

113.

The Claimant is entitled to rely on the misrepresentations as a Defence. For these purposes it does not matter whether the representations were innocent or not.

114.

The Claimant also contends that the warrants lapsed upon termination of the Defendant’s employment and since he resigned he has no claim in respect of them. It is pointed out by Mr Howe that the discussion at the end of the meeting on 9th May 2003 is a red herring because:-

i)

No claim has been pleaded based on such an agreement

ii)

Mr Summers and Mr Frew did not promise the Defendant that he would receive his warrants come what may. They simply said he would receive anything to which he was legally entitled.

iii)

In any case the discussion at the conclusion of the 9th May meeting was that neither party would make any claim against the other. On the 30th July 2003 the Defendant presented an application at the Employment Tribunal claiming wrongful and unfair dismissal. That was inconsistent with reliance on any agreement reached at the 9th May meeting and indicated he did not intend to be bound by it.

115.

The Claimant’s contentions are well founded and the claim in relation to the warrants must fail.

116.

There was a good deal of evidence called or read to which I have not made specific reference. That does not mean I have not taken it into account. Part of it appeared to be directed more to the question of whether or not the Defendant was a good Chief Executive Officer than the particular issues which fell for my determination. What he achieved or did not achieve for the Claimant is not for me to judge. However I am satisfied that the claim succeeds to the extent I have set out and the counterclaim fails.

Wecomm Ltd. v Rosenhoiz

[2004] EWHC 1854 (QB)

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