Lady Justice Falk:
This is an appeal by Astra Asset Management UK Limited (“Astra UK”) and Astra Asset Management LLP (“Astra LLP”, and together “Astra”). They appeal against decisions by Freedman J that a contract originally entered into by the claimant Musst Holdings Limited (“Musst”) with two other entities (the “Octave Contract”) had been novated to Astra, that as a result Astra UK was obliged to share certain investment management fees with Musst, and further that it was required to do so on an ongoing basis. There are two relevant judgments, a principal judgment dated 17 December 2021 (the “Judgment”) and a further judgment dated 18 March 2022 which followed hearings of consequential matters (the “Consequentials Judgment”).
The Judgment, which runs to 200 pages, followed a 13-day trial in Spring 2021. It was circulated to the parties in draft in late October 2021, although as already indicated it was only formally handed down in December of that year. The judgment covers a number of issues that are not the subject of appeal. These include a claim for defamation by Astra UK and its parent company Astra Capital International Limited (“Astra Capital”) and a related counterclaim seeking termination of the Octave Contract for breach, both of which were dismissed. There is also no appeal against the judge’s rejection of Astra’s arguments that the fee sharing that had occurred was pursuant to a voluntary arrangement entered into in November 2012 (the “November Arrangement”) rather than pursuant to the Octave Contract, that the relevant introductions were in any event not made by Musst or alternatively were made before the “Effective Date” under that contract, or that Musst’s claim for fees was precluded because it acted in breach of US securities law.
The two grounds on which the decision is challenged are, first, the judge’s acceptance of Musst’s arguments that the Octave Contract had been novated, initially to Astra LLP and then to Astra UK, or alternatively that there was an estoppel to like effect (the “Novation” issue) and, secondly, the judge’s rejection of Astra’s arguments that any ongoing liability to pay was dependent on certain strategic characteristics of the funds to which the fees related continuing to exist, rather than (as Musst claimed) the relevant characteristics being required to be in place solely at the point of investment (the “Strategy” issue). Astra claimed that the investment strategy had changed by 31 December 2014 or at the latest by 31 December 2015.
The Consequentials Judgment largely addressed issues related to costs but also dealt with the issue of interim payment in respect of the fees owed, and in doing so rejected Astra’s argument that Musst’s entitlement ceased with effect from 31 December 2015, when it says a fund restructuring occurred (the “Funds” issue). Astra challenges that conclusion. There is a significant overlap between the Strategy and Funds issues.
The total amount now in issue has been calculated by Astra as being around US$3.8m. If Astra succeeded on the Funds issue alone it says that figure would reduce to around US$2.3m.
References below in square brackets to paragraphs of the judge’s decision are, unless otherwise indicated, references to paragraphs of the Judgment.