Case No. CL-2019-000290

40.This issue arises as a result of the terms of clauses 7 and 8 of the SpA. Before introducing those clauses, it is first necessary to set out a little more background. As noted above, in 2014 EIGL acquire an 80% interest in Heritage. In anticipation of that acquisition, two agreements were entered into which were designed to address Mr Buckingham’s involvement in Heritage going forward: i)A Shareholders Agreement dated 29 April 2014 between Albion and EIGL, which dealt with the relationship between the two shareholders, including on such matters as the appointment of directors and the conduct of business. ii)An Advisory Agreement between Heritage, Mr Buckingham and Mr Buckingham’s company Sundance, which was agreed in principle in April 2014 but not signed until July 2014, under which Sundance agreed to provide the services of Mr Buckingham to Heritage. Under clause 5.7, Heritage agreed to make the company jet available to Mr Buckingham “for the purposes of providing the services” and under clause 8.1, there was an entitlement on Sundance’s part to be reimbursed “any reasonable travelling and accommodation expenses …. and reasonable entertaining expenses which are reasonably and properly incurred by or on behalf of [Sundance] or [Mr Buckingham]”. 41.When EIGL agreed to buy Albion’s remaining 20% stake in Heritage, clauses 7.1 and 7.2 of the SpA addressed the position of the Shareholders Agreement and the Advisory Agreement respectively, in materially identical terms. Under the heading “Terminations”, clause 7.1 provided: “In consideration of their mutual terminations, the Seller and the Buyer irrevocably and unconditionally agree for all purposes that with effect from and conditional on Completion: 7.1.1the Shareholders’ Agreement shall be hereby terminated and have no further effect. 7.1.2each party to the Shareholders’ Agreement shall be irrevocably and unconditionally discharged and released from all and any obligations (past present and future) arising under or resulting from the Shareholders’ Agreement; and 7.1.3any rights that each party to the Shareholders’ Agreement may have or has against any other such party thereunder (including any rights in respect of antecedent breaches) shall hereby be waived for all purposes and no such party shall be entitled to make any claim against any other such party or parties under or in relation to the Shareholders Agreement or its termination”. 42.Clause 8 of the SpA provided: “Settlement of claims 8.1In consideration of their mutual settlements, each of the Seller, Albion Resources, the Advisor and the Consultant hereby releases and forever discharges each of the Buyer and the Company in respect of the Seller Released Claims. 8.2In consideration of their mutual settlements, each of the Buyer and the Company hereby releases and forever discharges the Seller, Albion Resources, the Advisor and the Consultant in respect of the Buyer Released Claims”. 43.So far, so good. However, difficulties arise from the definition of Buyer Released Claims. Both the definitions of Buyer Released Claims and Seller Released Claims apply to “any Claim for breach of the Shareholders’ Agreement, the Advisory Agreement, the Main Counterindemnity Agreement, the Supplemental Agreement or otherwise arising between the Parties in connection with the Company and its business”, and do so “whether or not notified and/or in existence at the date of this Agreement”. However, immediately after the words “in connection with the Company and its business”, the definition of Buyer Released Claims provides: “other than any Claim which relates to any matter reported by Alvarez and Marsal Disputes and Investigations LLP in relation to their audit of the business and affairs of the Company currently in progress on behalf of the Seller (pursuant to clause 8.3 of the Shareholders’ Agreement)”. 44.By way of yet further background: i)Clause 8.3 of the Shareholders Agreement allowed any party “from time to time” to require an audit or review of the company. ii)In 2017, Alvarez was commissioned to undertake such a review. That review had not reached its endpoint in January 2018, with the result that the carve-out from the definition of Buyer Released Claims was included in the SpA. iii)It is common ground that the factual basis of EIGL’s alleged equitable set-off “relates to any matter reported by Alvarez and Marsal Disputes and Investigations LLP in relation to their audit of the business and affairs of the Company”. iv)However, an issue arises as to whether the carve-out qualifies the terms of clauses 7.1 and 7.2 of the SpA.