This morning the High Court (Mr David Stone sitting as a Deputy High Court Judge) handed down judgment in Fulstow, Woods v Francis [2024] EWHC 2122 (ChD). Georgia Purnell acted for the successful Defendant, Mr Francis, instructed by John Bramhall, Lisa Skipp and Antonio Marino of DAC Beachcroft following a hotly contested 5-day trial in the Chancery Division in June.
The Claimants, Mr Fulstow and Mr Woods, valued their claim at £8million. The Claimants alleged that they had contracted with Mr Francis in 2015 to purchase 32% of the shares of a special purpose vehicle company (“Capital Land”) which acquired development land in Swindon for a purchase price of £32million, with the development potential to build 12,000 homes. The Claimants alleged the agreements were made in November 2015 and they paid £35,000 and £25,000 respectively to acquire the shares. The Claimants sought declarations of their respective beneficial interests in Capital Land and an order that Mr Francis executed a stock transfer form transferring to them the shares. The Claimants further claimed 25% and 7% respectively of B preferred ordinary shares issued to Mr Francis in June 2016.
Mr Francis denied the claims. His position was that the correspondence and conversations relied on were merely exploratory, no primary terms had been agreed and they related to a series of connected transactions the terms of which were never agreed, such that there was no contracts ever formed. In any event, Mr Francis alleged any interest was conditional on Mr Fulstow bringing further investment to Capital Land to fund the ongoing project, which he never did, and he had no standing to bring the claim since he was acting on behalf of a Marshall Islands company, Carina Limited (“Carina”), which had since been dissolved.
The Judge dismissed the Claimants’ claim in its entirety. The Judge found that the payments made by the Claimants were mere goodwill payments to show willingness to be involved in the project and the conversations and communications relied on with Mr Francis were exploratory, with there being no intention to create legal relations and no contractual terms ever agreed. The Judge believed Mr Francis’ evidence and rejected Mr Fulstow’s oral evidence as “evasive, contradictory and untruthful”, found Mr Woods to have been manipulated by Mr Fulstow and to have had “a blinkered determination to be faithful to [Mr Fulstow’s]… version of events” and found Mr Fulstow’s business consultant, Ms Rodrigues, to have acted as his “puppet”. The Judge further found Mr Fulstow to have been acting for Carina.
The case should be of particular general interest as to the consequences on the evidence at trial of failure to comply with PD57AC and the consequences on individual solicitors who sign declarations of compliance where statements do not comply, with the Judge reprimanding the Claimants’ solicitor and finding his declarations to have been “false”. The case was also extremely unusual in that the Claimants repeated waived privilege such that significant quantities of correspondence between the Claimants, their solicitors and their counsel formed part of the evidence.
Georgia Purnell is an experienced commercial junior who specialises in banking and financial services disputes, commercial fraud and company and insolvency litigation. She is regularly instructed in the specialist divisions of the High Court as sole counsel and has substantial High Court trial experience well beyond her year of call, as evidenced by Georgia’s success in this case. She is ranked as a “rising star – tier 1” in banking and financial services litigation by the Legal 500 who regard her as “very user friendly, commercial and client focused. Robust in submissions and doesn’t back off a tricky argument”. For any enquiries please do not hesitate to contact Georgia’s clerks, Darren Whitbread and Bradly Patterson.
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