Peter Knox KC (instructed by Taylor Wessing) for the defendants.
Mr Justice Rajah:
The Claimant (“Faris”) is a 51-year-old Londoner who has worked in real estate and property for around 25 years. In the relevant period (2009 to 2015) Faris operated his property business through Waterbridge Estates Limited and Waterbridge Designs Limited (together “the Waterbridge companies”). Those companies were owned by him and another.
The First Defendant (“Sami”) is a businessman who splits his time between Abu Dhabi, where his construction company is based, and London, where his family is based. The Third Defendant (“Amal”) and the Second Defendant (“Wael”) are father and son (together “the Houranis”). They are close friends of Sami. Wael is a businessman based in Dubai while Amal is an engineer living in Beirut.
By these proceedings Faris claims he is contractually entitled to a share of the profits arising from the acquisition, redevelopment, and subsequent disposal of four prime real estate properties in central London. Faris introduced Sami to each of these investment opportunities. In relation to one of these projects, Sami involved Wael and Amal Hourani. If Faris has no contractual entitlement to a share of profits he brings in the alternative a claim for a quantum meruit.
The hearing was the trial of issues of liability pursuant to the order made by Master Pester on 25 March 2022.
At the end of the trial, I reserved judgment. I have reflected on the evidence and submissions I heard and revisited most of the documents referred to during the trial or in written skeletons and submissions. I have concluded that Faris’ claims fail. This judgment sets out why I have reached that conclusion.
I use first names in this judgment for brevity and convenience. I mean no disrespect to the parties or witnesses in so doing.
This judgment will be structured as follows:
a. Summary of issues
b. Approach to the evidence
c. Witnesses
d. The Facts and factual findings
e. Conclusion on the profit share agreements
f. Quantum meruit
g. Conclusion
Summary of issues
Key issues
The four projects in question are:
a. Draycott – 2 adjoining residential properties in Chelsea purchased by Sami in 2010 and redeveloped, some flats have been sold, some retained;
b. Thurloe – a house in South Kensington purchased by Sami in January 2011 and sold in August 2016, after redevelopment;
c. KHN – a car park in Kensington purchased by Sami and the Houranis (there is an issue as to which of the Houranis is a principal) in March 2011 and sold in January 2017 after redevelopment;
d. Cromwell – a house in South Kensington purchased by Sami in March 2014 and sold by him, without redevelopment, in December 2014.
In each case the property was purchased by an entity controlled by Sami (or in the case of KHN, by Sami and the Houranis). Sami generally relied upon his friend and advisor Radwan Al-Rawi (“Radwan”) to advise him on the appropriate structures to use. Radwan is Faris’ father (together “the Al-Rawis”). Radwan is a chartered accountant and the principal at Rawi & Co, which is based in Mayfair.
Faris says that he and Sami reached binding oral contracts that he would be paid a share of the profits of 15% from Draycott, 15% from Thurloe, and 50% from Cromwell. A key issue to be determined by the trial was whether there were such binding oral contracts. It is common ground that the identification and exploitation of opportunities by Faris and Sami proceeded on an ad hoc basis, differing from project to project. It is common ground that Faris or Radwan could acquire an equity share by making a monetary contribution. It is common ground that the Waterbridge companies could charge for any services they provided. Where the parties differ is that Faris says that in respect of each property a binding agreement was reached for him to be paid a profit share with no deduction for cost of capital, whereas Sami says that in relation to each project (except KHN) it was a matter for his discretion to pay what was effectively a bonus for a good job, in the shape of a profit share, and in each case after a deduction of 5% interest by way of cost of capital.
Continue reading this Judgment here.
Share:
