LM-2023-000035 - [2025] EWHC 1989 (Comm)

There are 2 construction arguments: financing was provided by Macquarie Euro Limited to Psary Invest II sp. z o.o. The Defendant argues that in these circumstances the contractual pre-conditions for payment have not been triggered because first, the finance was not provided by “Macquarie Capital” and secondly, it was not provided to the Defendant.

The term “Macquarie Capital” is in my view plainly ambiguous because it has no plain and obvious single meaning. It follows, for the reasons explained above that I am entitled to apply commercial common sense. In my judgment, applying commercial sense and in any event, it includes Macquarie Euro Limited.

In reaching that conclusion I have had regard to the entirety of the Mandate and considered the relevant words in context. Macquarie Capital is mentioned at clause 7 (where it is defined as one of two “Potential Investors”) and at clause 6.3 and 6.4 where reference is made to “Potential Investors”. Clause 7 operates to prevent the Defendant from contacting “the institutions to which the Financing has been and will have been marketed by [Xtellus]”. Those institutions are then identified and include “Macquarie Capital.” Clause 6.3 provides that after termination, Xtellus would be entitled to its fee “if any of the Company completes” the Financing (or similar financing) with one or more of the “Potential Investors.” Clause 6.4 emphasises the Defendant’s right to approach other funders who are not “Potential Investors.”

The question is: would an informed bystander, considering the question when the Mandate was concluded, understand that Macquarie Capital would include Macquarie Euro Limited, a company within the Macquarie group. In my view they would.

First, commercial common sense makes it plain that the words should be read to include any entity within the Macquarie group of companies. Any other approach would require some entities within the group to be excluded but no basis for such exclusion has been advanced. Further any such exclusionary approach would be contrary to commercial common sense because it would render the application of two fundamental elements of the Mandate deeply uncertain: when Xtellus could expect to be paid and whom the Defendant would be entitled to approach after the Mandate was terminated.

Secondly, and in the alternative, if (contrary to my finding) commercial common sense cannot be taken into account because the meaning of the words is plain, Macquarie Euro Limited would still be included. A wide (non-exclusionary) understanding of the words is required because Macquarie Capital is defined as “an institution” and it would be understood that an “institution” is likely to have a complex structure and many parts.

The Macquarie Group is a global financial group headquartered and listed in Australia. I was taken to a “Macquarie Capital Principal Finance Real Estate” presentation. It defines “Macquarie Capital” as “Macquarie Corporate Holdings Pty Limited, its direct and indirect subsidiaries and the funds (and other investment vehicles) managed by such subsidiaries.”

Xtellus’ pleaded case is that Macquarie Euro Limited is part of the Macquarie Group. The unchallenged evidence of Mr Tomasz Rogalski (a partner at Norton Rose Fulbright Dyczkowski and Partners in Warsaw) was that Macquarie Euro Limited is “the European arm of Macquarie.”

The second issue arises from clause 6.3 of the Mandate. It deals with payment once the Mandate has been terminated. That clause therefore specifically addresses the facts of the present case. It is therefore sensible to first consider if that clause applies before looking at clause 4. The fee (calculated in accordance with clause 4) would fall due if “any ofthe Company completes (either wholly or in part) the Financing or any bilateral or analogous financing” with one or more of the “Potential Investors” (which I have found to include Macquarie Euro Limited).

The parties’ submissions focused on the correct construction of the words “any of the Company” but it is also important to consider what is meant by the word “completes.”

Dealing with the first point, and on the assumption that I have found that the Defendant is the correct counterparty, Mr Reay submits that the words “any of the Company” should be read as “the Defendant,” requiring me to ignore the words “any of” and to substitute in the Defendant. He submits (with some force) that a finding that DL Invest Group (the term defined as “the Company”) means the Defendant relates to the whole Mandate and each time the capitalised word “Company” appears. He submits the term cannot mean one thing in one section of the Mandate and another in a different section.

Mr Reay’s submission involves a 3-step process involving 2 substitutions and a removal: first, the defined term “the Company” is substituted out so the words become “any of the DL Invest Group”. Secondly, the term DL Invest Group is itself substituted and the counterparty to the Mandate inserted so the words become “any of DL Invest Group PM S.A.” Thirdly, the words “any of” are removed because DL Invest Group PM S.A. is a single entity.

Step 1 has the benefit of being a simple substitution using definitions contained in the Mandate. In other words, step 1 is in my judgment uncontroversial. Step 2 creates uncertainty and means the clause ceases to make sense. Step 3 creates a solution to the havoc caused by step 2.

In my judgment that approach is flawed for 2 reasons: first, I do not accept that every reference to “the Company” in the Mandate must be read as a reference to the Defendant. My finding that the Defendant was the counterparty to the Mandate is based on an exercise which is similar to (but not the same as) as the exercise of construction required to determine what the words “any of the Company” mean. Secondly, I can see no good reason at all to ignore the words “any of” when it is quite possible to construe the Mandate in a way that makes commercial sense.

Mr Brown KC pointed out in closing that the words “any of” make sense if the thing to which they relate (“the Company”) is plural or at least is capable of having several constituent parts.

It is clear that the meaning of clause 6.3 is ambiguous because it does not admit of one clear interpretation. It follows that I am entitled to consider commercial common sense when interpreting the Mandate through the eyes of the informed bystander.

I am satisfied that clause 6.3 of the Mandate is to be read as creating an obligation to pay if “any of the DL Invest Group completes (either wholly or in part) the Financing or any bilateral or analogous financing” with one or more of the “Potential Investors.”

Psary Invest II sp. z o.o. is part of the group and it has “completed” the relevant financing because it executed the final agreement with Macquarie Euro Limited.