BL-2020-CDF-000003 - [2025] EWHC 2226 (Ch)

Mr Lloyd says that the Joint Venture was between himself and Mr Hayward personally. Mr Hayward says that it was between Mr Lloyd and Sirocco. I find that Mr Hayward is correct.

I think it unlikely that the discussions between Mr Lloyd and Mr Hayward on the matter involved any express reference either to Sirocco or, indeed, to the involvement of SA1 Ltd or any explicit statement in terms as to the identity of the parties to the Joint Venture (though no issue has ever been raised about Mr Lloyd’s personal involvement in the Joint Venture). However, I have already stated my finding that Mr Lloyd knew that SA1 was owned by Sirocco, not by Mr Hayward personally, and that Sirocco was to be the landlord under the proposed lease that was replaced by the Joint Venture. I do not accept his evidence that he first learned of Sirocco at some later date, during the operation of the Joint Venture. In the circumstances, I do not regard it as a sensible interpretation of the agreement to suppose that Sirocco had been replaced by Mr Hayward personally. Mr Lloyd knew very well that Mr Hayward was the man acting for Sirocco on the ground. The Joint Venture was being agreed as a way of achieving the benefits that had been intended to be achieved under the proposed lease. The agreement to cancel the Agreement for Lease and SA1 Ltd’s obligation to take the lease and to replace it with the Joint Venture can only have been made on behalf of Sirocco. (Miss Dzameh pointed to a number of omissions in the Agreement for Lease as meaning that there was no binding contract. In fact, I think that the common law has the tools to remedy any gaps. But I also regard the point as irrelevant; what matters is that the parties clearly understood themselves to be bound by the Agreement for Lease.) As a matter of common sense, this is confirmed by Mr Lloyd’s insistence that an attraction of the Joint Venture was that there was to be no rent payable, whereas he (or, at least, SA1 Ltd) would have had a liability for rent under the lease. The removal of the rent obligation makes sense only if it was the proposed landlord that was a party to the Joint Venture; otherwise, the owner of the Site would be deprived of the benefit of the user of the Site by reason of a deal struck between two other persons who would be taking the benefit for themselves. Mr Lloyd’s case makes good sense on, but only on, its own terms: that Mr Hayward owned the Site and was taking the benefit of the Joint Venture instead of the entire rent that would have fallen due under the proposed lease. If, however, Mr Lloyd knew that Sirocco was the landlord, his case ceases to make practical sense. Essentially the same point is highlighted, from a different angle, by the terms of paragraph 65 of Mr Lloyd’s witness statement:

“Richard did nothing personally in the joint venture other than facilitate the office and provide the administration services. I was doing all the work, and he was provid[ing] the administration involvement. He funded the £20,000 and nothing else. Apart from that, he never actually put any money in.”

This is entirely to gloss over the fact that the principal benefit being provided by the other side of the Joint Venture was the value of the use of the Site. The owner of the Site was providing Mr Lloyd with a share of the profit from letting the units to the individual tenants (plus a further £20,000 per annum). If Mr Hayward had been the owner of the Site, he would have been providing this benefit, though Mr Lloyd barely acknowledges it. As Sirocco was, and was known by Mr Lloyd to be, the owner of the Site, a Joint Venture between Mr Lloyd and Mr Hayward would have taken Sirocco’s profits. Although such an agreement might have been possible (whether or not lawful), it is much more likely that Sirocco was agreeing to share net profits by way of remunerating Mr Lloyd for his work.

The purely internal documents made by Mr Coates and Ms Crickmore can bear only modest weight, as they do not appear ever to have been seen by Mr Lloyd. They do, however, show that RHP was proceeding on the basis that it was simply acting for Sirocco. This is also apparent from Ms Crickmore’s email to South Wales Police on 25 June 2013, which stated in terms that the Joint Venture was with the landlord, Sirocco. As noted above, Ms Crickmore forwarded that email to Mr Lloyd immediately after sending it to the police. Mr Lloyd refers to the email in his witness statement, but neither when he received it nor subsequently did he express any concern or surprise at the assertion that his Joint Venture was with Sirocco.

Mr Lloyd placed reliance on an email sent to him by Mr Coates on 10 April 2019, in which Mr Coates referred to the joint venture being “between you [Mr Lloyd] and Richard personally”. When cross-examined about this, Mr Coates said that he had written the email without any reference to documents and without any expectation that he would be questioned on its wording in court, and he insisted that his own understanding was that the agreement was made by Mr Hayward in person but acting on behalf of Sirocco. I accept that oral evidence, which reflects the understanding manifest in the contemporaneous documents.