BL-2022-000438 - [2025] EWHC 2212 (Ch)

Fecha: 22-Ago-2025

The Contractual Arrangements

B.4.

The Contractual Arrangements

19.

Mr Dunn, Mr Kazolides and Mr Sylianou entered a joint venture agreement dated 29 August 2006 (the “JVA”) which was intended to govern the terms of their joint venture. The Company was also a party. The JVA was subsequently amended through a supplemental joint venture agreement dated 12 April 2007 (the “SJVA”). Mr Dunn, Mr Kazolides, Mr Stylianou and the Company were also parties to the SJVA.

20.

Despite being drafted by a law firm, the JVA and SJVA contain a number of defects and inadequacies which has fuelled the dispute between the parties.

21.

Under the JVA, the project was to be financed as follows:

(1)

The Company was deemed to have contributed what was described as the “Deemed Purchase Price” of CYP 330,000 for its provision of the land for the development;

(2)

Funding would be sought from a bank;

(3)

Mr Dunn would lend CYP 330,000 (or more, if so required) which was described as the “PD Loan”.

22.

The provisions of the JVA are considered in detail below. By way of introduction, I mention the following broad features:

(1)

First, the Company was required to use “all reasonable efforts” to dispose of the villas “[a]s soon as is practicable after the commencement of the [development]” (clause 14(1)).

(2)

Second, the PD Loan was repayable automatically on the occurrence of certain events including “the insolvency of the Company” (clause 5(c)). Beyond that the PD Loan was required to be repaid “as soon as the Company (acting reasonably) is able so to do” (clause 5(e)).

(3)

Third, there was a mechanism for the repayment of the PD Loan and the Deemed Purchase Price (clause 5(e)) and also an arrangement for sharing profits and losses (clause 6(e)).

(4)

Fourth, there was a guarantee provision (clause 18) which reads as follows:

18 In consideration of PD entering into this Agreement with the Company at the request of the Guarantor, the Guarantors HEREBY JOINTLY AND SEVERALLY GUARANTEE AND UNDERTAKE on their own behalf … with PD that the Company will duly and punctually perform all its obligations herein contained and will indemnify and keep indemnified PD from and against all actions proceedings claims and demands arising as a result of any breach thereof and further jointly and severally guarantee agree warrant and undertake as aforesaid with PD that the Company is the owner of the Property freed from all mortgages charges claims or the like and that the Property enjoys the benefit of Planning Permission without onerous conditions for the Development.

23.

I will address the construction issues in relation to clause 18 below. At this stage, I mention only that clause 18 is one of the provisions in the JVA where the drafting is unsatisfactory. In particular, it references both “the Guarantor” (singular) and “the Guarantors” (plural) without defining either term.

24.

The JVA was signed by or on behalf of each of the parties. In relation to Mr Kazolides, it was signed by his lawyer, Mr Michael, acting pursuant to a power of attorney. The JVA says that it has been executed as a deed but Mr Dunn’s signature was not witnessed.

25.

The SJVA was dated 12 April 2007. In essence the purpose of the SJVA was to reflect an agreed change to the JVA that funding would not be sought from a bank but that instead the PD Loan would be increased to CYP 800,000 to provide the additional funding required. The SJVA contained a number of provisions which sought to alter the terms of the JVA to achieve this purpose.

26.

An issue was raised during the course of trial regarding the versions of the SJVA in the trial bundle. The SJVA had been signed in counterparts with one version being signed by Mr Dunn and another version signed on behalf of the Company, Mr Stylianou and Mr Kazolides (with Mr Stylianou signing for the Company and Mr Michael signing for Mr Kazolides as his attorney). The latter version, which was apparently initialled by Mr Stylianou and by Mr Michael for Mr Kazolides was missing a block of text on page 3. It is obvious from reading the page that something has gone awry.

27.

Separately in the bundle, there was a further version of the SJVA which was in the correct format and had appended the counterparts with Mr Dunn’s signature page and also the signature page with signatures for the Company, Mr Stylianou and Mr Kazolides. This version includes the correct form of page 3 which appears to have been initialled by Mr Stylianou and by Mr Michael. I note that both Mr Dunn and Mr Kazolides were represented by law firms in the drafting and execution of the SJVA. Insofar as there was an issue with the version signed by Mr Kazolides, Mr Stylianou and the Company, this appears to have been corrected. I find that the complete version is the final executed version put in place by the parties and that this version of the document governs their relationship.