Renpower Investments Ltd v Clark Willmott LLP & Anor

This judgment is given on the oral hearing of an application for permission to appeal from the order of Master Fontaine dated 29 June 2012. This application is made out of time and on the basis of what is said to be fresh evidence. No criticism is made of the judgment of the Master. The reasons of the Master are set out in an unimpeachable judgment of some 30 pages. The point that it is sought to raise on this application is a point that was conceded before the Master. The fresh evidence is said to be in the form of correspondence between the Applicant and Ofgem.

The dispute relates to a share purchase agreement (“SPA”) by which the Applicant bought from the Respondent the shares in Limes Farm Renewables Ltd (“the Company”). The Company had been established for the purpose of obtaining accreditation from Ofgem for the solar generation of electricity. By cl. 2.1 of the SPA completion was subject to a number of conditions being satisfied or waived by a specific date, and the first such condition was “receipt by the Company of a Successful Accreditation Confirmation”. The Accreditation in question related to a photo-voltaic solar installation at Limes Farm, Bourne Lincolnshire, which the Company held under a lease.

The Order of the Master included a declaration that the condition specified in clause 2 of the SPA was satisfied on 7 November 2011, and consequential orders. The substantive order was that the Claimant pay the Respondent’s solicitors £500,000, being the purchase price payable under the SPA which the Claimant had been holding. The order that the Applicant is now asking for is that the declaration made by the Master ought to be reversed. But the Applicant does not seek any order relating to money, no doubt because the money has been paid by the Claimant to the Respondent.

It is not clear how these proceeding could result in the repayment of the money or any other order, but I have not had to explore the procedural position. In substance what the Applicant is asking is that proceedings started by the Claimant for directions as to how they should dispose of the fund that they held should be converted into proceedings in which the Claimant has no role, and in which there is no disputed fund. There are no statements of the case advanced by the Applicant, or sought to be advanced on any appeal.

There is no dispute that the installation was accredited by Ofgem by the specified time. But it is said that the fresh evidence shows that the Successful Accreditation Confirmation required by the SPA was received, not by the Claimant, but by a sister company Lark Energy Ltd (“Lark Energy”). These two companies are subsidiaries of the Respondent, and share a registered office and a common director, Mr Selwyn.

The confirmation was in the form of a letter dated 4 November 2011 addressed to “Mr Jonathan Selwyn, Lark Energy” at the address of both Lark Energy and the Company.

The Applicant’s concession is recorded by the Master at para 11 of her judgment:

“There is no dispute that the Company received a ‘written confirmation from Ofgem that Accreditation has been successful’ at the latest by Ofgem’s letter of 4 November 2011. The issue is whether such accreditation was registered by [the contractual date]”.

The Master also recorded at para 20 of her judgment that Lark Energy had applied to Ofgem for the accreditation.

After the decision of the Master, from which there was no application for permission to appeal, the SPA was completed. The £500,000 which had been held by the Claimant solicitors as stakeholders was paid to the Respondent.

On 19 July 2012 the Applicant applied to Ofgem “to arrange the transfer of this station from the ‘Lark Energy’ account on the … Register to the [Applicant’s] account”. I note that what was sought was not transfer from the Lark Energy account to the Company’s account.

The project has proved a disappointment to the Applicant. On 2 August 2012 the Applicant informed Ofgem that:

“Due process has commenced to wind up [the Company] and we will be disconnecting and dismantling the pilot facility installed on this location due termination of the land lease and sub-lease for the accredited pilot project and the unviability of the extensions project envisaged at this location. Please therefore cancel the registration and accreditation of this project”.

It was in the course of correspondence, including a letter of 25 October 2012, that Ofgem informed the Applicant that it did not have the Company registered on the Register. Ofgem stated it was for the Applicant to prove that it was the owner of the installation (as opposed to the shares in the Company).

By that time it was not possible for the Applicant to do that, because the Company was in liquidation and had not transferred the property in question to the Applicant.

The Applicant’s case is that the fact that Ofgem had no record of the Company as the owner of the installation was not apparent from the information which the Applicant had had available at the time of the Master’s judgment, and that new information meant that the condition under cl.2.1 of the SPA had never been satisfied.

The evidence said to be fresh evidence is the correspondence between Ofgem and the Applicant in which Ofgem stated that it has no record of the Company as the owner of the installation, and evidence that the declarations that had been required for the Accreditation to be confirmed (as it was on 4 November 2011) had been made by Lark Energy.

There is no dispute about the facts. The Respondent accepts that Ofgem had no record of the Company as the owner of the property in question. The explanation is that Mr Selwyn, in applying for accreditation, used a website which he had previously used for the accreditation of an installation of Lark Energy. Lark Energy had no rights, and claimed no rights, in respect of the installation at Limes Farm. But for the liquidation of the Company, there could have been no difficulty in establishing that the Company was indeed the owner of the installation, and would be entitled to any payments that might become due in respect of the installation. And if the Applicant had wished to be registered as the owner of the installation (as it was attempting after completion of the SPA), no doubt that could have been arranged as well.

The Respondent submits that there is no fresh evidence. The Applicant knew (as recorded in the judgment) that what it conceded to be the contractual confirmation of accreditation had been in a letter addressed to Mr Selwyn and Lark Energy. The process of applying for accreditation had also been one in which the Applicant had been monitoring by agreement between the parties. For example, the Applicant’s solicitor had been sent copies of e-mails on the topic.

In my judgment the Respondent is correct that this is not fresh evidence in any relevant sense. If the Applicant had wanted to take the point that the letter of 4 November 2011 was not received by the Company, then the information to support that point was apparent on the face of the letter, namely the fact that it was addressed to the sister company Lark Energy. There was an obvious explanation for why the point was not taken: it appeared to be purely technical. There was never any dispute that the Company, not Lark Energy, was the owner of the installation. But the point that emerges from the correspondence with Ofgem subsequent to completion is a different point. It does not impact on whether the letter of 4 November 2011 was or was not received by the Company. It relates to whether Ofgem had a record of the Company as the owner of the installation. That is not a condition specified in the SPA cl. 2.1 or at all.

Accordingly, the Applicant fails to persuade me that there is any relevant fresh evidence.

The Applicant submits that in any event the court should grant an extension of time in the interests of justice. The Respondent submits that the point has no merit in any event, because accreditation is of the installation and not of the owner of the installation. Alternatively, if there was a breach of cl. 2.1, then it was waived by the Applicant, since the Applicant knew the confirmation letter had been addressed to Lark Energy, and nevertheless proceeded without taking the point up to and including completion after the judgment of the Master.

I shall assume, as Mr Malek submits, that the SPA contemplates that it was to be the Company that would apply for and receive the confirmation of accreditation of the installation. Lark Energy is not the Company, and so receipt by Lark Energy could not be receipt by the Company unless Lark Energy was the agent of the Company.

However, even if I were to give permission to appeal, and extend time, in my judgment the Applicant has no real prospect of persuading the court that it was a condition of the SPA that the Company (rather than the installation) be named on the Register, or that it did not waive the condition that it be the Company that be in receipt of the confirmation from Ofgem (rather than Lake Energy).

For these reasons permission to appeal is refused, and no extension of time granted.