Case No. CL-2019-000290

45.Lord Grabiner QC’s argument for Albion is as follows: i)The release of liability for past breaches in clauses 7.1 and 7.2 is unqualified. ii)The qualification made to clause 8.2 of the definition of Buyer Released Claims must therefore be interpreted as limited to such claims as may have existed before the Shareholders Agreement and Advisory Agreement were entered into. iii)In support of this latter argument, Lord Grabiner QC submitted that clauses 7 and 8 of the SpA had distinct subject-matters, such that there is nothing surprising in the settlement of claims in clause 8 being qualified, without this impacting on the scope of the release offered by clause 7. 46.Mr Morpuss QC submitted that: i)The releases in clause 7 had to be read subject to the qualification to the definition of Buyer Released Claims. ii)Clauses 7 and 8 were addressing different aspects of the same subject-matter, with clause 7 principally aimed at the release of obligations going forward, and clause 8 with the settlement of past claims. iii)(With rather less enthusiasm) if he was wrong on this point, then a claim for relief under statutory unfair prejudice provisions did not fall within clause 7 in any event. Analysis and conclusion 47.While the SpA is not particularly happily drafted in this respect, I am satisfied that Mr Morpuss QC’s submissions are to be preferred on this issue. 48.First, it is clear that clauses 7 and 8 substantially overlap. In particular the definitions of Buyer Released Claims and Seller Released Claims specifically refer to both the Shareholders Agreement and the Advisory Agreement, and the release of claims effected by clause 8 achieves exactly the same outcome as the release of “rights in respect of antecedent breaches” in clauses 7.1.3 and 7.2.3. Unless, therefore, the carve-out from the definition of Buyer Released Claims does not apply to the Shareholders Agreement and the Advisory Agreement, there is a clear conflict between the two provisions. 49.Lord Grabiner QC put forward an ingenious argument that the carve-out only applied to the words “or otherwise arising between the Parties in connection with the Company and its business” in the definition of Buyer Released Claims, and not to “any claim for breach of the Shareholders’ Agreement, the Advisory Agreement, the Main Counter Indemnity Agreement, the Supplemental Counter-Indemnity Agreement”. However, that argument is not persuasive: i)ii)While Lord Grabiner QC can point to clause 7 as a possible reason for the carve-out out not applying to the Shareholders and Advisory Agreements, no explanation has been offered as to why the carve-out did not apply to the other agreements which appear in the definition, which is the effect of Lord Grabiner QC’s construction. iii)In circumstances in which the carve-out specifically identified clause 8.3 of the Shareholders Agreement as the basis on which the Alvarez audit was being conducted, it is improbable that the parties did not intend the carve-out to apply to the release of claims under the Shareholders Agreement. 50.Second, I do not believe that the conflict can be resolved by treating the carve-out as an attempt to preserve pre-Shareholders Agreement and Advisory Agreement claims:i)This is not the natural reading of the definition of Buyer Released Claims, for the reasons set out above. ii)It was known to all parties that the Alvarez audit was being conducted under the Shareholders Agreement and had yet to be completed. It ought also to have been appreciated by all parties that EIGL’s principal interest was likely to concern the period after it invested in Heritage in June 2014, rather than the preceding period. In these circumstances, the suggestion that the parties were only seeking to preserve any claims which might be revealed by that audit to the extent they had arisen before and independently of the Shareholders Agreement or the Advisory Agreement is highly improbable. iii)It is clear from the appendices to the draft Alvarez report of 22 November 2017 and the body of the final report of 26 February 2018 that prior to the conclusion of the SpA, Alvarez had held two meetings with Heritage on 20 October 2017 and 15 November 2017 in connection with its review, made enquiries about Mr Buckingham’s expenses in respect of a period from 2014 to 2017 and had exchanges with Heritage on the subject of Mr Buckingham’s credit card expenditure and his use of the company jet. The fact that Mr Buckingham appears to have been aware (at least to some degree) of the chronological scope of the Alvarez investigation further tells against the suggestion that the carve-out was intended only to preserve pre-April or July 2014 claims. 51.In these circumstances, there is an obvious inconsistency between the scope of the release for breaches of the Shareholders Agreement and Advisory Agreement apparently offered by clauses 7.1.3 and 7.2.3, and the express carve-out of the settlement provisions for breaches of the same agreements so far as concerns the Alvarez investigation in clause 8. I am satisfied that the more specific consideration given to the issue in the carve-out should prevail over the more general provisions in clause 7. I agree with Mr Morpuss QC that clause 7 appears to have had its principal focus on terminating the primary obligations of the Shareholders and Advisory Agreements going forward, albeit (in the manner characteristic of the “saturation bombing” approach to the drafting of general provisions which Hoffmann LJ identified in