Employment Cases Update

Montreux Capital Management (UK) Ltd & Ors v Godden & Ors [2018] EWHC 495 (Ch)

Date published: 23/03/2018

Application for summary judgment where the issue at stake was the interpretation of a settlement agreement. The application was dismissed.

The parties entered into a settlement agreement which contained clauses relating to the acquisition of another business and which obliged the defendant in these proceedings to pay the claimant a percentage of the purchase price. The 'deals' in the settlement agreement named 2 organisations who might have bought the business. The claimant was also entitled to a termination payment. The business was subsequently bought by a company of which the defendant was a director and shareholder, not the organisations defined in the deals. The defendant therefore alleged that no payment was due to the claimant. In turn the claimant did not pay the termination payment to the defendant. The claimant was seeking summary judgment against the defendant.

The court dismissed the application. On the basis of both the language of the document and business common sense, the defendant had a more than fanciful case that his interpretation of the definition of 'deals' was the correct one and the application for summary judgment was rejected.

Neutral Citation Number: [2018] EWHC 495 (Ch)

Case No: HC-2017-002625




7 Rolls Buildings

Fetter Lane

London, EC4A 1NL

Date: 21 March 2018



(sitting as a Deputy High Court Judge)

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(3) MR IAN MORLEY (Defendants)

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Dominic Chambers QC (instructed by Druces LLP ) for the Claimants

Mr Richard Hanke (instructed by Irwin Mitchell LLP) for the Defendants

Hearing date: 19 February 2018

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Judgment Approved

David Stone (sitting as Deputy High Court Judge):

1. In June 2016, John Godden left the employment of the Montreux Group. Shortly thereafter, on 27 September 2016, Mr Godden and Montreux entered into a settlement agreement (the "Settlement Agreement"). The interpretation of the Settlement Agreement gives rise to much of this dispute and to this application for summary judgment on part of the dispute.

2. The summary judgment application is brought by the First Claimant, Montreux Capital Management (UK) Limited, and the Second Claimant, MCM UK (Group) Holdings Limited, against the First Defendant, Mr Godden. The summary judgment application turns on the true construction of clauses 3.3 and 3.4 of the Settlement Agreement. The First and Second Claimants also seek early disclosure of certain information and a declaration that they are not liable to Mr Godden for certain payments, and an interim payment of sums they say are due under the Settlement Agreement.

3. Generally, nothing turns on the difference between the various Montreux entities. I shall therefore refer to them as Montreux.


4. The background facts are not in dispute and can be briefly stated.

5. Mr Godden was employed by Montreux under a service agreement dated 1 July 2015 which was replaced by a service agreement dated 16 January 2016 under which Mr Godden served as the CEO of the First Claimant. Montreux is a fund advisory business representing a group of investment firms specializing in boutique, alternative funds. Montreux specializes in identifying underperforming assets for funds to purchase.

6. From early 2015, Pathways Care Group Limited ("Pathways"), a specialist residential care home group, was being marketed by BDO UK LLP ("BDO"). The deal to acquire Pathways was known by those involved as Project Panama. It was valued at £43.25 million. Montreux worked on the proposed acquisition of Pathways. Outside investment was required. In 2015, two potential investors were considering financing the acquisition - Ibadar Bank ("Ibadar") and Shearman Financial ("Shearman") - but these investors eventually dropped out. Shearman made a substantial contribution towards the costs of the aborted proposed purchase.

7. In 2016, two new potential investors were considered - Kolaghassi Capital ("Kolaghassi") and Gulf Financial Holdings ("GFH"). It was part of Mr Godden's then role at Montreux to pursue Project Panama with Kolaghassi and/or GFH. GFH was also looking at other investment opportunities with Montreux in addition to Project Panama.

8. Mr Godden's employment with Montreux ended on 11 June 2016. At that time, either of Kolaghassi or GFH was considered the most likely investment partner for the proposed acquisition of Pathways. Following Mr Godden's departure, there were discussions between him and Montreux about Project Panama. With the apparent knowledge and consent of Montreux, Mr Godden established his own investment company, Salutem Healthcare Limited ("Salutem"). Initially, it was anticipated that Montreux would invest in Salutem, but this did not in the end occur.

9. By email of 5 September 2016, Mr Oliver Harris of Montreux wrote to Mr Godden stating it was:

"fine for you to move forward with the business and do the GFH deal, if the deal happens we would like a commission paid day one (No carry or on going fee's [sic]) … I will get Druce's [sic] to revise the documents and circulate so they can be signed this week."

10. Druces is a firm of solicitors acting for Montreux. It is agreed between the parties that it was intended by Monteux that Mr Godden was free to continue to pursue Project Panama, working with Kolaghassi and/or GFH. It is also agreed that Montreux stopped pursuing Project Panama at that time.

11. The Settlement Agreement was signed on 27 September 2016. Clauses 3.3 and 3.4 of the Settlement Agreement provide as follows:

"3.3 In the event of either or both of the Deals completing in any way whatsoever (including for the avoidance of doubt and without limitation, with different counterparties, with a different deal structure) [Mr Godden] undertakes to give notice in writing to Montreux of the details of any Deal at least 5 business days prior to completion.

3.4 [Mr Godden] agrees to pay to Montreux a fee of 1% of the gross value of any such Deal at the time of completion of any such Deal."

12. "Deals" is defined in clause 1.1 of the Settlement Agreement:

"Deals: means deal 1 - Kolaghassi Capital - Panama and deal 2 - Gulf Financial Holdings and all matters related to these two deals."

13. The Settlement Agreement also provided for payments to be made to Mr Godden (the "Termination Payments").

14. In the end, Mr Godden and Salutem did not manage to obtain agreement from Kolaghassi or GFH to invest in Project Panama. Rather, on 21 April 2017, Pathways was acquired by Salutem LD Bidco Limited ("Bidco"). Bidco is a subsidiary of Salutem. Mr Godden is a director and shareholder of Bidco. It is common ground that neither Kolaghassi nor GFH invested in Bidco's acquisition of Pathways. It is not disputed that Mr Godden was involved in the acquisition of Pathways by Bidco.

15. The Claimants filed this action on 6 September 2017. Pleadings have now closed, and the Particulars of Claim, Defence and Counterclaim and Reply and Defence to Counterclaim were all before me. This application for summary judgment was filed on 10 November 2017.

16. I understand the facts as set out above not to be in dispute. There are, however, other elements of the factual matrix that are in dispute. These include:

a. whether Montreux's primary interest lay in potential investors or the object of any acquisition;

b. whether Mr Godden used any confidential information belonging to Montreux;

c. whether it would have been possible for Kolaghassi and GFH both to complete the Pathways acquisition; and

d. whether or not Pathways was for sale on the open market.

17. To the extent it is necessary, I return to these issues below.

Parties' Contentions

18. In short, Montreux says that the acquisition of Pathways by Bidco was a "Deal" within the meaning of the Settlement Agreement (and more specifically, it is alleged to be "deal 1") and, hence, Mr Godden was, by virtue of clause 3.3 required to give to Montreux notice of completion of the acquisition of Pathways five days prior to completion (which would have been 14 April 2017). Further, Montreux says that Mr Godden was obliged to pay to Montreux a fee of 1% of the gross value of the acquisition, on the day of completion (21 April 2017). This would be in the order of £400,000. Mr Dominic Chambers QC who appeared for Montreux urged me to determine the point on the summary judgment application.

19. In addition, Montreux seeks a declaration that it is not obliged to pay the Termination Payments to Mr Godden because (1) Mr Godden has failed to pay the 1% of the value of the Deal that is said to be owed and (2) Mr Godden has allegedly used confidential information owned by Montreux and has represented that he has a continuing connection with Montreux.

20. Mr Godden denies the claims. His case is that the meaning of "Deals" is restricted to transactions involving two particular investors - Kolaghassi and/or GFH. As neither of these entities was involved in Bidco's acquisition of Pathways, the provisions of clauses 3.3 and 3.4 of the Settlement Agreement have not been triggered because there has been no "Deal". Mr Godden says that a fee would only have been payable under clause 3.4 if a transaction involving Kolaghassi and/or GFH had completed. Mr Richard Hanke, who appeared for Mr Godden, did not urge me to determine the interpretation point in his client's favour - rather, he said that all he needed to establish to defeat the summary judgment application was that, in the light of the relevant factual matrix, the interpretation of the Settlement Agreement which he put forward is, at the least, sufficiently arguable. Further, Mr Hanke said that even if Montreux's construction of the Settlement Agreement is correct, there are other claims that will require a full trial, and so summary judgment should be denied.

21. In the wider claim, Mr Godden has counterclaimed for the sum of £108,000, which he says is comprised of outstanding Termination Payments. Montreux has not made any further Termination Payments since January 2017.


22. I had before me the following witness statements:

a. Two witness statements of Mr Harris, a director of each of the Claimants, CEO of the First Claimant and the Managing Partner of the Monteux Group, the first dated 10 November 2017 and the second dated 13 February 2018; and

b. A witness statement of Mr Godden dated 9 February 2018.

23. Neither of the witnesses was cross-examined.

Applicable Law

24. Montreux's application for summary judgment is made under CPR 24.2. The applicable law is uncontroversial: Montreux must show that Mr Godden has no real prospect of successfully defending the claims. Mr Chambers referred me to the guidance helpfully set out by Lewison J (as he then was) in Easyair Limited (trading as Openair) v Opal Telecom Limited [2009] EWHC 339 (Ch). As Simon J sets out in Attrill v Dresdner Kleinwort [2010] EWHC 1249 (QB), the summary actually comes from Lewison J's judgment in The Federal Republic of Nigeria v Santolina Investment Corporation [2007] EWHC 437 (Ch) at [3] - [4], cited with approval by the Court of Appeal in Khatri v Cooperative Centrale Raiffeisen [2010] EWCA Civ 397:

"The relevant principles can be stated as follows:

a. The Court must consider whether the Claimants have a 'realistic' as opposed to a 'fanciful' prospect of success: Swain v Hillman [2001] All ER 91.

b. A realistic claim is one that is more than merely arguable: ED&F Man Liquid Products v Patel [2003] EWCA Civ 472 at [8].

c. In reaching its conclusion the court must not conduct a mini-trial: Swain v Hillman.

d. This does not mean that a court must take at face value everything that a claimant says in statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED&F Man Liquid Products v Patel at [10].

e. However, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No 5) [2001] EWCA Civ 550.

f. Although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on a summary judgment hearing. Thus the court should hesitate about making a final decision without a trial, even when there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical 100 Ltd [2007] FSR 63."

25. I was also referred to a decision of the Court of Appeal that specifically refers to summary judgment in cases involving the construction of contracts: Khatri v Cooperative Centrale Raiffeisen-Boerenleenbank BA [2010] EWCA Civ 397 per Jacob LJ (with whom Longmore and Rix LJJ agreed) at paragraphs [4]-[5]:

"4. I would only add this – that one has to be careful not to take the last point too far when the case concerns construction of a written contract. The factual matrix is key to understanding what the parties must have intended by the words they used. But it far from follows that the need to know what that matrix was requires a full trial with discovery, evidence and cross-examination of witnesses. If there is no actual conflict of evidence on a relevant point of background matrix, it is only when there really are reasonable grounds for supposing that a fuller investigation of the facts as to the background might make a difference to construction that the court should decline to construe the contract on a summary judgment (including strike out) application.

5. The court should not be over-astute to decline to deal with the construction of a contract summarily merely on the basis that something relevant to the matrix might turn up if there were a full trial. Most disputes as to "pure" construction of a contract will be suitable for summary determination because the factual matrix necessary for its construction will itself be determinable on that application.

26. I was also referred to a number of authorities in relation to contract construction: Chartbrook Limited v Persimmon Homes Limited [2009] 1 AC 1101, Rainy Sky v Koomin [2011] 1 WLR 2900, Arnold v Britton [2015] AC 1619 and Wood v Sureterm [2017] AC 1173. These cases have been helpfully summarised by Popplewell J in Lukoil Asia Pacific Pte Limited v Ocean Tankers (Pte) Limited [2018] EWHC 163 (Comm) as follows:

"8. There is an abundance of recent high authority on the principles applicable to the construction of commercial documents, including Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896; Chartbrook Ltd v Persimmon Homes Ltd [2009] 1 AC 1101; Re Sigma Finance Corp [2010] 1 All ER 571; Rainy Sky SA v Kookmin Bank [2011] 1 WLR 2900; Arnold v Britton [2015] AC 1619; and Wood v Capita Insurance Services Ltd [2017] AC 1173. The court's task is to ascertain the objective meaning of the language which the parties have chosen in which to express their agreement. The court must consider the language used and ascertain what a reasonable person, that is a person who has all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract, would have understood the parties to have meant. The court must consider the contract as a whole and, depending on the nature, formality and quality of drafting of the contract, give more or less weight to elements of the wider context in reaching its view as to the objective meaning of the language used. If there are two possible constructions, the court is entitled to prefer the construction which is consistent with business common sense and to reject the other. Interpretation is a unitary exercise; in striking a balance between the indications given by the language and the implications of the competing constructions, the court must consider the quality of drafting of the clause and it must also be alive to the possibility that one side may have agreed to something which with hindsight did not serve his interest; similarly, the court must not lose sight of the possibility that a provision may be a negotiated compromise or that the negotiators were not able to agree more precise terms. This unitary exercise involves an iterative process by which each suggested interpretation is checked against the provisions of the contract and its commercial consequences are investigated. It does not matter whether the more detailed analysis commences with the factual background and the implications of rival constructions or a close examination of the relevant language in the contract, so long as the court balances the indications given by each."

27. I have applied Popplewell J's helpful summary to the contract construction task before me.

Montreux's Contentions

28. Put very shortly, the dispute between Montreux and Mr Godden is whether Kolaghassi and/or GFH were required for there to be a "Deal".

29. On behalf of Montreux, Mr Chambers said that, as a matter of contractual interpretation and commercial common sense, the "deal 1' referred to in the Settlement Agreement is a reference to the acquisition of Pathways, and the identity of the financier is irrelevant. He submitted that the purpose of identifying Kolaghassi and GFH in the definition of "Deals" was "to help identify the deals in question, and to distinguish 'deal 1' from 'deal 2'". "Deal 1", he said, was any acquisition of Pathways regardless of the financier, and "deal 2" was an acquisition that GFH was working on at the time, other than an acquisition of Pathways.

30. Mr Chambers submitted that what mattered was the deal - not the particular financier - including because, as a matter of construction, the event which gives rise to the obligations under clauses 3.3 and 3.4 is the completion of the deal. The identity of the financier is of no relevance. Accordingly, he said that when construing what the parties meant by "deal 1 - Kolaghassi Capital - Panama" the key element in the definition is the word Panama - that identifies the acquisition target, allowing the acquisition price to be identified for the purposes of clause 3.4. The reference to Kolaghassi, he said, was merely another way of identifying the deal in question, and to distinguish it from "deal 2".

31. Mr Chambers said that there is no doubt as to what "Deals" means - it is therefore not necessary, he said, to look for which alternative construction is consistent with business common sense. In this regard, Mr Chambers said that any doubt (which he denied existed) would be extinguished by the first part of clause 3.3 of the Settlement Agreement, which states that the obligation to notify arises in the event of "deal 1" completing "in any way whatever". These, he said, are wide words, and are intended to cover any changes to the way in which the Panama deal finally completed. Mr Chambers said that the words in brackets in clause 3.3 are non-limited examples of how the acquisition of Pathways might be completed in a different form. Particularly, he said that the words "different deal structure" clearly contemplated the possibility that the lending arrangements and/or lenders might change, or that there might be no lenders at all. "Different counterparties", he said, is wide enough to cover a change to investors and financiers. Mr Chambers relied on Mr Harris' evidence that it is commonplace for financiers to come and go during a long acquisition.

32. Further, Mr Chambers said that the interpretation he put forward makes commercial sense. He referenced the following elements of the factual background:

a. Montreux had been working on the acquisition of Pathways since 2015 and had expended considerable time and money on that acquisition. In these circumstances, he said, Montreux agreed with Mr Godden that, instead of Montreux's pursuing Project Panama, Mr Godden could do so in return for the 1% fee. This, he said, made commercial sense - if the Pathways acquisition completed, Montreux would be compensated for the time and money it had spent;

b. It was Montreux who had first introduced Mr Godden to the Pathways acquisition. Mr Godden was employed by Montreux at the time, and became privy to a considerable amount of confidential information. Without the Settlement Agreement, Mr Godden would have been prevented from using that confidential information by the terms of his service agreement. The Settlement Agreement lifted that block, in return for the 1% fee should Mr Godden successfully complete the Pathways acquisition; and

c. Montreux's role in Project Panama extended beyond the introduction of investors, to identifying the target and negotiating with the sellers, providing a fund structure and undertaking due diligence. Mr Chambers submitted that Montreux's interest clearly went beyond merely identifying investors.

33. I should add for completeness that I was taken in detail by Mr Chambers to a number of references to the confidential nature of the information relating to Project Panama. These appeared to me to be the standard forms of confidentiality claims that one sees in transactions of this sort. Similarly, the limited access to the data room seemed to me to be a standard circumstance. Further still, the confidentiality undertakings in Mr Godden's service agreement were utterly standard. Mr Hanke conceded that there was confidential information available to Mr Godden – but, in any event, I do not need to determine the extent of the confidentiality of the information that Mr Godden had. By the Settlement Agreement, Montreux allowed Mr Godden to use confidential information in relation to Project Panama in pursuit of Kolaghassi and GFH as investors. I therefore do not need to say anything further about it.

Mr Godden's Contentions

34. Mr Hanke responded, saying that for Montreux to succeed on its summary judgment application, I must find that it is fanciful to conclude, in light of the factual matrix, that the definition of "Deals" required the involvement of Kolaghassi or GFH. Put differently, he submitted that if it is more than merely arguable that "Deals", by definition, must include one or other of the named financiers, Montreux's summary judgment application must fail.

35. Mr Hanke turned first to the language of the Settlement Agreement. He said that the consequences of clauses 3.3 and 3.4 depend on the occurrence of a "Deal" as defined in clause 1.1. Mr Hanke noted the following from the language of clause 1.1:

a. "Deals" is specified as covering two possible transactions - "deal 1" and "deal 2". Indeed, the definition of "Deals" includes the words "and all matters related to these two deals". "Deals", Mr Hanke said, therefore does not seek to encompass any transactions other than the two defined;

b. The two transactions set out in the definition of "Deals" are, he said, primarily identified by reference to the investing entity – Kolaghassi ("deal 1") or GFH ("deal 2"). Some meaning must be attributed to use of these entities' names, he said. They are not mere surplussage. The most natural meaning is that the role of one of these entities in a transaction is determinative of whether or not that transaction constitutes a "Deal";

c. There is a distinction between the two deals - and the distinguishing feature is the identity of the investor - Kolaghassi in the case of "deal 1" and GFH in the case of "deal 2";

d. There is an additional identifying factor in "deal 1", he said - the reference to Panama. Mr Hanke submitted that the position of the word "Panama" in the definition and the contrast with the definition of "deal 2" indicate that "Panama" is subsidiary to the identity of the investor. Further, he said, the additional reference to "Panama" offers no basis upon which the target of the investment should be regarded as subsuming the distinction between the two deals, or rendering the reference to the investors otiose; and

e. There is no language indicating that the references to Kolaghassi and GFH are merely illustrative of a broader concept of "Deals".

36. Mr Hanke therefore submitted, in light of the above, that the definition of "Deals" contemplates two potential deals:

a. Kolaghassi making an investment in Pathways (Project Panama); or

b. GFH making any investment (including in Pathways).

37. Mr Hanke rejected the interpretation put forwarded by Montreux. He said the language of the Settlement Agreement should not be overlooked - there are references to Kolaghassi and GFH and they must be given a meaning.

38. Mr Hanke also rejected the support that counsel for Montreux sought to draw from clause 3.3. He said this was because clause 3.3 cannot modify the definition of "Deals" because it was entirely dependent on it. It is only if there is a "Deal" that one then turns to clause 3.3. If there is no "Deal", clause 3.3 doesn't arise in the first place. Clause 3.3, he said, cannot therefore be understood as detracting from the primacy of the investor as set out in the definition of "Deals".

39. Further, he suggested an alternative view of what the bracketed expression in clause 3.3 meant. He said that "in any way whatever" can easily be understood as a reference to investments frequently being structured to use special purpose vehicles. Clause 3.3, he said, enables Montreux to claim its 1% if, for example, the Panama deal went ahead with Kolaghassi, but Kolaghassi used an SPV or other entity to make the investment.

40. Mr Hanke also submitted that, on the basis of the two alternative interpretations put forward, it was appropriate for the court to look at which is consistent with business common sense. He gave the following examples:

a. The Montreux business is structured around the identification of investors - Kolaghassi and GFH were both potential investors in the funds that Montreux advised;

b. Therefore, at the time of entering into the Settlement Agreement, Montreux's commercial interest lay in protecting the identity of its possible investors, and ensuring that they invested in Montreux's funds;

c. This, Mr Hanke said, provided a sound commercial justification for the requirement in the Settlement Agreement that Mr Godden pay a fee if Kolaghassi or GFH made an investment - this would compensate Montreux for having identified Kolaghassi or GFH as investors, and for the work carried out to structure the investment, as well as for the loss of any introduction fees;

d. This role of the investor in the Montreux business (which Mr Henke described as "key") is illustrated by Shearman having paid compensation to Montreux when it aborted its investment; and

e. By contrast, Mr Hanke said that there is no sound commercial justification for the payment of a fee by Mr Godden should Project Panama complete with other investors:

i. Montreux was not selling Pathways - Pathways was being marketed by BDO;

ii. Montreux did not have any property in any information relating to Pathways, which was publicly available from BDO; and

iii. If investors other than Kolaghassi and GFH were found, Mr Godden would have to pay the finder a fee for introducing those investors.

41. Mr Hanke also submitted that the construction of the Settlement Agreement put forward by Montreux could lead to commercially unreasonable outcomes, including Mr Godden being responsible to Montreux for 1% of the value of the sale of Pathways even if he was not involved in any deal at all.

42. In his oral arguments, Mr Hanke also put forward areas in which the factual matrix needs further explanation by evidence, including:

a. the business of Montreux;

b. the general structuring of the market;

c. the treatment of the confidential information;

d. the interest of Kolaghassi and GFH in Pathways; and

e. the typical means of structuring investment.

Mr Hanke said that the need for evidence on these aspects of the factual matrix necessitated disclosure and evidence making summary judgment inappropriate.


43. The court's task is to ascertain the objective meaning of the language which the parties have used to express their agreement. I must consider the language used and ascertain what a reasonable person with all the background knowledge which would reasonably have been available to the parties would have understood the parties to have meant. On the basis of the evidence and arguments before me, I am not satisfied that the interpretation put forward by Mr Chambers is the correct one. It is not obvious to me on the words of the Settlement Agreement that "deal 1" is any acquisition of Pathways by anyone, and "deal 2" is an acquisition that GFH was working on at the time, other than the acquisition of Pathways. I agree with Mr Hanke that Mr Chambers' interpretation does require the court to ignore the references in the definition of "Deals" to Kolaghassi and GFH (or, more correctly in my judgment, it is more than arguable that it does). In my judgment, it is at least arguable that a reasonable person with all the background knowledge agreed between the parties in this case would have understood the parties to have meant that the definition of "Deals" requires the involvement of Kolaghassi in "deal 1" and GFH in "deal 2". I take this from:

a. the clear words in the definition of "Deals" in mentioning both Kolaghassi and GFH;

b. the reference in the definition of "Deals" to "two deals", and the identification of those deals as "deal 1" and "deal 2";

c. the reference to "Panama" only in relation to "deal 1" - and the coupling of that reference with a reference to Kolaghassi; and

d. the absence of any indication that GFH or Kolaghassi were merely illustrative of a broader class of investors who might qualify for "Deals".

44. I do not accept that the names of the two financiers in the definition of "Deals" can simply be ignored (or, more correctly, I consider that it is more than unarguable that they cannot be ignored). On the language of the Settlement Agreement, I do not accept that it is arguable that "deal 1" is any acquisition of Pathways and "deal 2" is any acquisition by GFH other than an acquisition of Pathways. It is more than arguable that such an interpretation artificially limits the language of the definition.

45. I also accept Mr Hanke's position that it is more than arguable that the correct interpretation of the Settlement Agreement as a whole first requires a transaction to fall within the definition of "Deal". It is only then that one turns to clauses 3.3 and 3.4. It is, in my view, more than arguable that a transaction that is not a "Deal" cannot be made a "Deal" by the language in clauses 3.3 and 3.4. In any event, I accept Mr Hanke's submission that it is more than arguable that the words in brackets in clause 3.3 refer to different ways of substantiating a "Deal" involving Kolaghassi or GFH.

46. Therefore, in my judgment, Montreux's preferred meaning of the words used in the Settlement Agreement is not the only non-fanciful one: Mr Godden's interpretation is more than arguable.

47. Further, I consider that it is more than arguable that Mr Hanke's interpretation is more consistent with business common sense. It is more than arguable that Montreux's interest was in the two investors in which it had itself invested time and money, and it wished to protect that investment by ensuring that it received some payment should deals with those investors eventuate. In thus finding, I am alive to the possibility that Montreux may have agreed to something which, with hindsight, did not serve its best interests.

48. I consider that it is more than arguable that the identity of the financier is relevant: this is where Montreux had invested time and resources, and would have wanted to see return on that investment. Business common sense also requires that Mr Godden not be liable for 1% of a transaction with which he had no involvement: it is more than merely arguable that Montreux's interpretation would have required Mr Godden to pay out even if he obtained no benefit were an unknown third party to acquire Pathways. I accept Mr Hanke's position, at least to the level its being more than merely arguable.

49. All in all, I do not consider that it can rightly be said that Mr Godden's position is fanciful - quite to the contrary. There is, in my judgment, a real prospect of the court at trial concluding that the involvement of Kolaghassi or GFH was required to trigger the obligations under clauses 3.3 and 3.4 of the Settlement Agreement. I reach this conclusion based on a close examination of the language of the Settlement Agreement, balanced against the factual matrix and the implication of the rival constructions.

50. In light of these findings, I do not need to rely on Mr Hanke's submissions that further information is required in order properly to establish the factual matrix. I am satisfied, on the basis of both the language of the document and business common sense, that Mr Godden has a more than fanciful case that his interpretation of the definition of "Deals" is the correct one.

51. I therefore reject Montreux's application for summary judgment.

52. If I were against him, Mr Godden through his counsel sought leave to amend his defence to plead estoppel by convention. In light of my finding above, I do not need to consider this request further. But I will say that any alleged estoppel will be very much fact-dependent, and therefore unlikely to be appropriate for determination on summary judgment.

53. There was a second part to Montreux's summary judgment application - this was for a declaration that Montreux has no liability to Mr Godden in respect of unpaid monthly installments under the Settlement Agreement, since April 2017. However, Mr Chambers conceded that if I did not find for Montreux in relation to the 1% payment, there would be no breach on which the First and Second Claimants could rely for such a declaration. I therefore say nothing further about it. The remainder of the application, including in relation to an interim payment and indemnity costs, also falls away.

54. At the hearing, Mr Chambers pressed for me to make the disclosure order he sought, even if I denied his request for summary judgment. The order sought is that Mr Godden disclose to Montreux the gross value of the Pathways acquisition and/or give disclosure of documents relevant to that acquisition. He submitted that this would assist in encouraging settlement. Mr Hanke indicated in court the maximum value for the Pathways acquisition. That amount was marginally less than the value that was being discussed when Montreux was still leading on the deal and which I have set out above at paragraph 6. I therefore do not consider it appropriate in all the circumstances to make the disclosure order sought. If the matter cannot be settled, then disclosure will follow in the usual way. Montreux has had all the indication it needs should it now wish to try to settle the proceedings.


55. The application is dismissed.