Claim Nos: HQ09X04007 & HQ09X05230
Appeal Refs: A2/2010/1599, A2/2010/1612 & A2/2010/1613

Neutral Citation Number: [2011] EWCA Civ 229
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEEN'S BENCH DIVISION
The Hon Mr Justice Simon
[2010] EWHC 1249 (QB)
Royal Courts of Justice
Strand, London, WC2A 2LL
Date: 08/03/2011
Before :

THE CHANCELLOR OF THE HIGH COURT
LADY JUSTICE SMITH
and
LADY JUSTICE BLACK
- - - - - - - - - - - - - - - - - - - - -
Between :
	Attrill and others	Claimants	
	- and -		
	(1) Dresdner Kleinwort Ltd 
(2) Commerzbank AG	Defendants	

Nigel Tozzi QC and Kate Livesey (instructed by Stewarts Law LLP) for the Claimants
Jonathan Sumption QC and Martin Chamberlain (instructed by Linklaters LLP) for the Defendants

AND Between :
	Fahmi Anar & others	Claimants	
	- and -		
	(1) Dresdner Kleinwort Ltd 
(2) Commerzbank AG

(Transcript of the Handed Down Judgment of
WordWave International Limited
A Merrill Communications Company
190 Fleet Street, London EC4A 2AG
Tel No:  020 7404 1400, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
	Defendants	

Andrew Hochhauser QC and David Craig (instructed by Mishcon de Reya) for the Claimants
Jonathan Sumption QC and Martin Chamberlain (instructed by Linklaters LLP) for the Defendants

Hearing dates: 16th and 17th February 2011
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Judgment

The Chancellor : 
Introduction
1.	In early 2008 Dresdner Bank AG (“DBAG”) was a wholly owned subsidiary of Allianz SE until its sale to the second defendant Commerzbank AG announced on 31st August 2008 and completed on 12th January 2009.  A division of its business, called Dresdner Kleinwort or DKIB (“DK”) carried on business as a global investment bank.  The first defendant, Dresdner Kleinwort Ltd (“DKL”) was a wholly owned subsidiary of DBAG and carried on business as a service company for the other companies in the group.  Those who worked in DK were employed by or seconded to DKL.  Each of the claimants is such a person.  It was the established practice of DK to allocate a bonus pool and individual bonuses in November each year, communicate the allocation to its employees in December and pay the cash element of any such bonus in January the next year provided that the employee was then still employed by DKL and not under notice to leave.
2.	At a board meeting of DBAG held on 12th August 2008 Dr Jentzsch, the chief executive of DK, explained the need to define a 2008 bonus pool for DK to ensure employee stability.  The minimum pool of €400m, to be announced the following week, should be guaranteed and allocated on a discretionary basis.  On 18th August 2008 there was what was known in DK as a ‘Town Hall’ meeting.  This was a pre-arranged meeting of employees in each of the offices of DK in London, Moscow, Frankfurt and New York which was addressed by the Chief Executive or others by means of a conference call or video-link.  This meeting was addressed by Dr Jentzsch.  He informed those employed in DK that there would be a guaranteed minimum bonus pool of €400m to be allocated to individuals on a discretionary basis according to individual performance.   The decision to set up a minimum bonus pool of €400m for those employed in DK was confirmed on a number of occasions including in answers to ‘frequently asked questions’ posted on DBAG’s intranet between 18th August and 12th September 2008.
3.	On 19th December 2008 there was sent to each employee in DK by the Human Resource department of DKL a letter (“the bonus letter”) in the following form:
“Dear [ ]
A discretionary bonus for 2008 under the arrangements given below has been provisionally awarded at 
€ [€ ] 
The provisional bonus award stated above is subject to review in the event that additional material deviations in Dresdner Kleinwort's revenue and earnings, as against the forecast for the months of November and December 2008, are identified during the preparation of the annual financial statements for 2008 i.e. that Dresdner Kleinwort's earnings position does not deteriorate materially in this period. This will be reviewed in January 2009 by Stefan Jentzsch. In the event that such additional material deviations are identified, the Company reserves the right to review the provisional award and, if necessary, to reduce the provisional award.”
4.	On the same day there was a further Town Hall meeting during which Dr Jentzsch reassured those working in DK that it was very unlikely that DBAG would seek to rely on the proviso relating to material deviations, known as the material adverse change clause (“MAC clause”), and that if there was a further review it would be done by him or under his leadership.   On 12th January 2009, on completion of the sale of DBAG by Allianz SE to Commerzbank AG, Dr Jentzsch was replaced by Mr Michael Reuther as chief executive of DK.  On 18th February 2009 Mr Reuther sent an email to all employees in DK informing them that:
“bonus awards for all front and middle office employees who received a letter in December stating their provisional award, which was subject to Dresdner Kleinwort’s financial performance targets, will be cut by 90% pro rata to the stated provisional amount.”
In the event the guaranteed bonus pool €400m was applied in payment of €152.2m to those with guaranteed bonuses, €120.4m, approximately €25m, being 10% of the allocation made in December, to those eligible for discretionary bonuses and the balance of €222.8m was retained by DBAG.
5.	On 8th September and 27th November 2009 the proceedings to which these appeals relate were commenced.  There are 104 claimants.  Each of them was employed in the front or middle offices of DK.  Each of them received a bonus letter dated 19th December 2008 in the form set out in paragraph 3 above.  They claim from DKL the unpaid 90% of the bonuses there specified in the aggregate sum of €51,855,474 and interest from the 29th January 2009 and from Commerzbank AG the like sum as damages for inducing such breaches of contract.    Defences were duly served on 3rd November 2009 and 19th January 2010.  
6.	On 28th January 2010 DKL and Commerzbank AG issued applications seeking orders under CPR Rule 24.2 summarily dismissing the actions against them on the grounds that the claimants have no real prospect of success and there is no other reason why the claims should be disposed of at a trial. The applications were heard by Simon J on 4th and 5th May 2010.   By his order made on 28th May 2010, for the reasons given in his judgment handed down the same day, Simon J summarily dismissed any part of the claims which relied on the announcement made on 18th August 2008 on the ground that it did not create any enforceable contractual rights on which the claimants could rely but concluded that the claims based on the bonus letters raised issues of fact which should go to trial.   Both sides now appeal with the permission of Elias LJ.   Accordingly these appeals fall into two parts, the first relating to the announcement of 18th August 2008 and the second relating to the bonus letters.  In due course I will deal with those issues in that order but first it is necessary to set out the facts in a good deal more detail and to note the principles to be applied in applications such as these.
The Facts
7.	The contracts of employment between DKL and each of the claimants include a formal letter of appointment and the parts of the Dresdner Kleinwort Employment Handbook incorporated therein.  Though the form of letter varied, each of them stated that the employee would be eligible for consideration by the employer for such discretionary awards as in the employer’s absolute discretion it saw fit to award. Sections 1 to 20 of the Handbook were incorporated in the contracts of employment.  Section 1.4 provides:
“The Company reserves the right to vary the terms and conditions described in this handbook and the terms and conditions of your employment generally.  Such changes can only be made by a member of the Human Resource Department and must be communicated to you in writing.  When the change affects a group of employees, notification may be by display on notice boards or Company Intranet.”
Section 15.1 provides that in the absence of any specific provision to the contrary the notice period for any employee below the level of director is not less than one week’s notice for each year of continuous service subject to a minimum of one calendar month and maximum of 12 weeks.  Sections 21 to 38 give details of benefits or facilities provided by DKL for its employees.
8.	Section 33 deals with “Discretionary Bonus Awards”.  So far as relevant it provides:
“33.1 You may be eligible to be considered for the payment of an annual discretionary award if, but only if, on the day bonus awards are actually paid (which is usually in the first quarter of the calendar year), you are both employed by the Company and not within a period of notice of termination of your employment.
33.2 Whether an award is made and the amount of such award, if any, is at the absolute discretion of the Company.
33.3 Many factors influence the Company's decision to make a discretionary award and, if awarded, the amount paid to an individual employee. There is no formula for calculating the level of awards which may be paid in any given year. The Company makes awards to support its commercial objectives at the given time and is likely to take into account many different and competing factors. These are likely to include but are not limited to:
•	the financial performance of the Company and its associated companies
•	...
•	the aggregate sum made available for discretionary awards by management
•	the need perceived by management to incentivise employees to achieve superior and preferably market-leading performance and to recognise such performance when it occurs
•	...
•	the particular need to retain key individuals regardless of their relative achievements during a period.
•	market trends and conditions
•	the strategic needs and relative priorities of the business and its various constituent activities
•	....

Many of these criteria have elements of subjectivity within them.  Achievement of a particular level of performance by itself does not entitle you to an award or a particular award.
33.4 Not all of these criteria may be applicable to the consideration of any or every employee's discretionary award and different criteria may be applied and/or emphasised for a specific individual depending on the particular circumstances. The criteria and reasons for making a discretionary award... may change from year to year.
33.5 if you are absent during a bonus year, for example, including but not limited to sickness absence ..., any discretionary award is likely to be pro-rated to reflect the period of your absence unless exceptional circumstances prevail. In any event, your overall contribution during the relevant year will be considered. 
33.6 While the fact that you may have received a discretionary award in a previous year and its amount are factors which the Company may consider they are neither an indication nor a commitment that an award or a similar level of award will be made in any future year.”
9.	It is common ground that each claimant had a contractual entitlement under his contract of employment to be considered each year for a bonus.  That is made clear by the form of letter of appointment to which I have referred.  Similarly there is no dispute that the established procedure, followed in many previous years was to allocate a bonus pool and award individual bonuses in November, communicate the allocation and award in December and pay the cash element in January provided that the employee was still employed and not under notice.  There was no prescribed size of bonus pool.  Theoretically it could be any amount between nothing and the maximum the directors could, in accordance with their duties, properly allocate for the purpose.  Similarly, it is common ground that in deciding whether to award a bonus and, if so, its amount DKL should act in good faith and in a manner which was neither irrational nor perverse.
10.	On 17th March 2008 DBAG announced its intention to separate its two “customer facing divisions”, namely the private and corporate client division and the investment banking division by hiving off the first into a legally separate organisation.  This would leave DK as the only customer facing division of DBAG.  The announcement continued:
“Any press reports you may have read describing this as a sale of Dresdner Kleinwort are spurious and simply speculation.”
Seemingly speculation continued because on 23rd May 2008 the Financial Services Authority wrote to Dr Jentzsch as the Chief Executive Officer referring to the proposed restructuring of DBAG and expressing the concern of the FSA that this left DBAG with an uncertain future.  The FSA referred in particular to:
“…the continuing uncertainty among management and staff [which] could lead to a significant number of key individuals leaving or becoming disaffected…”
11.	At a meeting of the Management Committee Operating Committee of DBAG on 11th June 2008 one of the matters noted for consideration with Dr Jentzsch was “some kind of staff retention scheme”.  In his reply to the FSA dated 30th June 2008, Dr Jentzsch acknowledged that one of the key risks of the DBAG restructuring scheme was loss of staff.  After setting out certain statistics he accepted that: 
“the risk of defections has risen considerably. A retention programme is therefore being discussed internally as well as with Allianz and we expect its terms to be finalised shortly.”
A draft of the retention plan dated 10th July 2008 was produced and discussed within DBAG.  The FSA asked for a copy of it on 23rd July 2008.  A further proposal was formulated on 25th July 2008.  The latter proposed that:
“for 2008 a de minimus [sic] pool of €400m (75% of 2007) be set aside for [DK].”
At a meeting with FSA on 5th August 2008 Dr Jentzsch indicated that he would shortly announce a minimum bonus pool for DK to be guaranteed by Allianz.
12.	A further version of the bonus pool scheme dated 12th August 2008 was discussed at a meeting of the board of directors of DBAG on the same day.   The relevant paper noted that: 
“In order to stabilise the DK business it is essential and necessary to formally communicate the pool that has been secured for the staff base.
If agreed it would be our intention to formally communicate to the entire staff base of [DK] via a business update that Allianz have recognised the uncertainty and impact the strategic discussions are having on the staff base and have agreed to set aside a de minimus [sic] overall [DK] bonus pool for 2008 at €400m.”
At the board meeting Dr Jentzsch explained the proposal in these terms:
“A minimum bonus pool, which should be announced in the coming week, is needed to ensure employee stability. All risk policies must be strictly observed in order to prevent the pool being 'generated' by taking excessive risks. The minimum bonus pool should be guaranteed and allocated on a discretionary basis. Revenues of 2,327.5 million formed the basis of the cash pool of 400 million, with corresponding increases.  Independently of the minimum pool, but related to it at a content level, approximately 60 front office staff should receive individual bonus guarantees.”
In fact, as the judge noted, individual bonus guarantees were allocated from the €400 million bonus pool. None of the Claimants was given an individual bonus guarantee.
13.	The Town Hall meeting followed on 18th August 2008.  As the judge recorded:
“…Dr Jentzsch announced the creation of the minimum bonus pool at a business update or Town Hall meeting, held at [DK]'s offices in London and simultaneously broadcast to its offices in Frankfurt, Moscow and New York. The announcement was also broadcast over [DK]'s intranet. As pleaded in the Attrill Particulars of Claim, Dr Jentzsch said: 
(i) …a guaranteed minimum bonus pool of €400m had been created for distribution to front and middle office staff of [DK] for the 2008 financial year; 
(ii) There was potential for the size of that pool to be increased if revenue exceeded targets; and 
(iii) Individual bonus allocations from the bonus pool would be made in the usual way and would be communicated to employees in December 2008.”
As the judge added:
“…the announcement of a bonus pool at such an early stage in the year was unprecedented. It is plain that it was made in August with the express purpose of encouraging employees to remain with [DK]. Although a hand-written note of what Dr Jentzsch said was taken and this referred to a promise that the bonus pool would remain, 'no matter what', it is right to note the Claimants' concern that there is now no available recording of the precise words used.”
14.	A bonus pool of €400m was confirmed on a number of subsequent occasions.  Thus:
i)	From 18th to 31st August 2008 the intranet of DBAG recorded without qualification that Allianz had agreed and supported DBAG’s Management Board in setting a minimum bonus pool of €400m.
ii)	On 12th September 2008 the answer to a ‘frequently asked question’, similarly recorded, was that the minimum bonus pool remained in place and would be awarded on a performance basis.
iii)	The same message was conveyed by the same method on 2nd October 2008.
In the meantime, on 31st August 2008, the sale of DBAG by Allianz to Commerzbank AG was announced by Dr Jentzsch and, on 15th September 2008, the insolvency of Lehman Brothers was publicised.
15.	On 20th October 2008 Mark Hindle, the head of Human Resources of DK sent an email to all employees stating:
“The communication date for bonus awards for both [DK] (Front Office employees) and Aligned Functions (support employees) will be Friday 19 December 2008.
The bonus pool for the Front Office has already been communicated by Stefan Jentzsch in his updates. The bonus pool for Functions will be comparable with last year's, adjusted for headcount movements. Individual bonus awards continue to be discretionary and determined by the relevant management. And last year's award should not be taken as any indication of the level of any bonus award for 2008.
Bonuses communicated on 19 December 2008 will be paid in full with January salaries through the January payroll. The 2008 bonus awards will be awarded in cash and subject to statutory deductions ...”
16.	On 4th December 2008 there was a meeting of the board of DBAG.  Those present agreed that the bonus pool then being reviewed was a key measure for ensuring stability at DK.  They then considered a draft of the bonus letter and discussed changes to it.  They resolved:
“... to leave the volume of the [DK] bonus pool resolved on August 12, 2008 unchanged at present. However, this resolution is subject to the proviso that a clause is included in the bonus letter stating that the bonus payment will be adjusted if material negative deviations in DKIB's revenue and earnings as against the existing forecast for the months of November and December 2008 are established during the preparation of the annual financial statements for 2008. The review of this issue will be conducted in January 2009 under the leadership of Stefan Jentzsch.”
On 8th December 2008 Dr Jentzsch wrote to his fellow directors of DBAG concerning the discussions to reduce the bonus pool.  He said:
“I expect and apprehend that a retraction of the commitments will destroy the trust of the employees in the executive management fundamentally, finally and irrevocably, with the risk of high operating instability and corresponding consequences for the income and capital of the bank.”
17.	I have set out in paragraph 3 above the terms of the bonus letter sent on 19th December 2008 to each employee of DKL working in the business of DK.   The topic was also addressed by Dr Jentzsch at a Town Hall meeting the same day.   He concluded his statement with the observation that:
“nevertheless I remain confident that in the end we will deliver on the overall bonus pool amount for [DK] and the individual promises made to each of you.”
18.	The acquisition of DBAG by Commerzbank AG was completed on 12th January 2009 and Dr Jentzsch was replaced by Mr Reuther.  Two days later there was a Town Hall meeting addressed by Martin Blessing, chief executive of Commerzbank AG, to explain the problems that that bank faced.  On 10th February 2009 Dr Jentzsch met with new members of the board of DBAG to discuss a document dated 9th January 2009 and entitled “Bonus Pool [DK] Business Performance”.  They noted that the figures in it were preliminary.   The minute of the meeting concludes:
“After taking note of and discussing the figures, the participants in the meeting came to the conclusion that the Board after taking the business lines / units in line with page 6 of the document into account is able to make differentiated adjustments to the preliminary individual bonus figures communicated in the bonus letters.”
The figures on page 6 of that document appear to record the actual and budget figures for 2008 and the variances.  The full board of DBAG met later that day with Dr Jentzsch in attendance.  They discussed three possible alternatives, namely payment according to the distribution mechanism as submitted, payment on the basis of a reduced bonus pool and payment on the basis of individually agreed legal obligations only.
19.	On 17th February 2009 there was an extraordinary meeting of the board of DBAG.  It started by discussing the bonus decisions taken in relation to Commerzbank AG. There was then an in depth discussion of the bonus pool for DK.  The minute of the meeting records:
“The Board resolves a differentiated reduction in the discretionary bonus volume of approximately 80% on the basis of scenario C; in the case of [DK] Front Office, the reduction of 90% of the initial discretionary volume of €250m results in a bonus volume of €25m, which is to be distributed without floors and with a pro rata cap.”
This decision was communicated by Mr Reuther to the employees in DK in the terms I have already quoted in paragraph 4 above.
20.	In the event some of the claimants received 10% of the bonus allocated to them in the bonus letters in February 2009, but some received nothing.  Apparently the decision to reduce bonuses was not applied uniformly because some of those involved in ‘Aligned Functions’ were paid the whole of the bonus allocated to them by the bonus letters.   It was in these circumstances that the claim forms, with particulars of claim attached, were issued by the claimants on 8th September and 27th November 2009.
21.	The applications for summary judgment issued by the banks on 28th January 2010 are supported by a witness statement of Mr John Benson.  He is a solicitor and head of legal in London of Commerzbank AG.  It is not suggested that he had any personal knowledge of the events giving rise to the claims.   Further there has been no discovery of documents.  Those to which I have referred have been selected by the banks and voluntarily produced.  By contrast the evidence for the claimants in opposition to the applications are witness statements of Dr Jentzsch, Mr Simon Dunn, one of the claimants, and Mr Andrew Shaw, a solicitor acting for the claimants in one of the actions.  The only evidence in reply is a further witness statement of Mr John Benson.
The principles to be applied
22.	They were summarised by the judge in paragraph 14 of his judgment, in terms which have not been criticised, as follows:
“a. The Court must consider whether the Claimants have a 'realistic' as opposed to a 'fanciful' prospect of success: Swain v Hillman [2001] 1 All ER 91.
b. A realistic claim is one that is more than merely arguable: ED&F Man Liquid Products v Patel [2003] EWCA Civ 472 at [8].
c. In reaching its conclusion the court must not conduct a mini-trial: Swain v Hillman.
d. This does not mean that a court must take at face value everything that a claimant says in statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED&F Man Liquid Products v Patel [2002] EWCA Civ 1550 at [10].
e. However, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No 5) [2001] EWCA Civ 550.
f. Although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on a summary judgment hearing. Thus the court should hesitate about making a final decision without a trial, even when there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical 100 Ltd[2007] FSR 3 .”
23.	To that summary I would add a reference to paragraph 107 of the speech of Lord Hope in Three Rivers DC v Bank of England No 3 [2003] 2 AC 1, 264 where he said:
“Conversely, I consider that if one part of the claim is to go to trial it would be unreasonable to divide the history up and strike out other parts of it. A great deal of time and money has now been expended in the examination of the preliminary issues, and I think that this exercise must now be brought to an end. I would reject the Bank's application for summary judgment.”
24.	Counsel for the claimants criticise the judge for, amongst other errors, doing just that.  They contend that giving summary judgment dismissing that part of their claims which relied on the Town Hall meeting on 18th August 2008 so as to divorce that part of the history of the dispute from the other part relating to the bonus letters which will go to trial is to create an artificial straitjacket.   It will not save costs and may unjustifiably inhibit the trial judge.  In those circumstances, they contend that there is at least some other reason why the issues in relation to the Town Hall meeting on 18th August should be determined at a trial.  I will revert to that contention as and when I have considered the appeal and cross appeal to the extent that it then arises.

The claimants’ appeal
25.	The claimants’ appeal is against that part of the judge’s judgment as summarily dismissed their claims in relation to the Town Hall meeting held on 18th August 2008 in so far as they depend on contract, the other claims based on misrepresentation and estoppel having been abandoned.   The particulars of claim are not the same in the two actions but no point was taken by any party on any differences between them.   In slightly different terms each claimant contended that the statements made by Dr Jentzsch and other senior employees between 18th August and 18th December 2008 (both inclusive) gave rise to contractually binding promises that:
i)	there was a guaranteed minimum bonus pool of €400m,
ii)	bonuses for 2008 would be paid from that pool to eligible employees, including the claimants, regardless of the performance of DK.
26.	Simon J summarily dismissed this part of the claims.  He did so for four cumulative reasons, namely: (1) informality [67], (2) the absence at that stage of any allocation of any specific bonus [64], (3) uncertainty as to who would qualify [65] and (4) the construction of the promise in the context of section 33 of the Employee Handbook [66].   Counsel for the claimants contends that he was wrong in each respect.  Counsel for the banks support the judge’s conclusions.  In addition they rely on: (5) the lack of acceptance and (6) the absence of any consideration.  I will deal with each of those points in turn.
27.	The judge dealt with what he saw as the informality of the announcement in paragraph 67.  He said:
“..there is the relative informality of the way in which the announcement was made. It is no answer to say that it was not unusual, or even that it was usual, to communicate information to employees at a 'Town Hall' meeting. What is striking about making the announcement is that not all of those affected by it were present or were asked to be present. In addition, the relative informality in which people were informed of what was intended was reflected in the lack of any formal note of what was said or any formal communication to the employees. If this were intended to be an irrevocable and legally binding commitment it was, at the very least, an unconventional way to enter into such a commitment.”
No doubt, by some standards, the announcement was made informally, but the judge did not appear to pay regard to the terms of section 1.4 of the Handbook which I have quoted in paragraph 7 above.  That provision expressly recognises that changes to employees’ contracts of employment may be notified on the company intranet.  Nor did the judge note, in that context, that the method of communication by means of the Town Hall meeting had been specifically approved by the board of DBAG on 12th August 2008.   The announcement was not informal in the sense of being casual.
28.	The absence of any allocation of a specific amount was considered by the judge in paragraph 64.  He said:
“..the claim proceeds on the assumption that individual employees could enforce a promise to pay from the minimum bonus pool without any stipulation about how much any individual would receive, or the basis on which they were to receive it. Paragraph 33 of the Handbook indicated the type of factors which might apply to the size of an individual employee's bonus. Although 'the aggregate sum made available for discretionary awards by management' was one of the factors, there were others factors which might properly be taken into account, for example, the need to incentivise employees and to recognise market-leading performance. Any assessment of an individual's bonus would involve a highly subjective exercise of discretion involving judgements of the relative merits of a number of individuals. It is no answer to say that the Court has shown itself willing and able to assess damages for breach of a contractual term to award a bonus. The case which is relied on by the Claimants, Clark v. Nomura International Plc [2000] IRLR 766, illustrates some of the difficulties that might arise in the present case. In the Clark case there was a single claimant, whose entitlement to damages for breach of the obligation could be calculated in the light of clear contractual criteria following the hearing of evidence. In the present case the award of damages would involve interdependent calculations of a large number of claims. Not only would the Court have to calculate damages on the basis of a wide commercial discretion, it would have to do so in relation to a number of criteria.”
29.	These are points going to the claim as a whole.  They do not seem to me to be determinative in relation to the part of the claim I have summarised in paragraph 25 above.  The essence of the Town Hall meeting held on 18th August was that it quantified and qualified one uncertainty in the bonus procedure, namely the size of the bonus pool.   Theoretically it could be any amount between nothing and the maximum the directors might properly so apply.  Given the uncertainties which the directors of DBAG and the FSA had been discussing in May and June 2008, to set up a guaranteed minimum bonus pool of a specific amount was, and was intended to be, a substantial benefit to all those who might be eligible for the future award of bonuses and an inducement to stay.  I see no reason why a promise of a guaranteed minimum bonus pool cannot be contractually binding even though individual employees cannot at that time point to an entitlement to a specific bonus payable out of it.  At the very least each of them would be entitled to nominal damages for its breach.  I cannot regard this consideration as determinative either.
30.	The question of uncertainty was dealt with by the judge in paragraph 65 where he said:
“..there is the uncertainty about who might qualify for a bonus. The hope was that the announcement would result in all the employees staying; but the legal effect of the announcement can properly be judged on the basis that the hope might have been disappointed. It is legitimate to ask what would have been the result if all but a handful (or even half the employees) had left? Would those who remained have been entitled to be paid consequentially larger amounts? Mr Sumption rightly described such a result as a commercial tontine. The Claimants' response appeared to be to accept the logical relevance of the question, but to evade the conclusion by pointing out that in practice the situation was unlikely to arise. A question might be posed as to the entitlement of those who joined after the announcement was made, and whether they were entitled to participate in the fund, so as to dilute the entitlement of others? There are no clear answers to such questions.”
31.	I accept, as the judge said, that there are no clear answers to the questions he has posed but I do not consider that that is in any way determinative.   There is no conceptual uncertainty as to those with whom the alleged contract was made or those entitled to share in the guaranteed minimum pool, see Re Baden’s Trusts (No.2) [1973] Ch 9.  The class of the former clearly includes all those to whom the promise was made, namely the employees at the time of the Town Hall meeting held on 18th August 2008.  It may also, if material, include those who became employed later and to whom the promise was repeated by the subsequent announcements.  The class of the latter includes those employed by DKL in the business of DK and not under notice on the date of payment of the 2008 bonus.   In my view problems in clearly identifying some members of either class is no reason summarily to dismiss the contractual claim of those who can be identified.
32.	The perceived problems arising from section 33 of the Employee’s Handbook were considered by the judge in paragraph 66 in these terms:
“there are difficulties in construing the announcement as being the establishment of a sum which would be unaffected by any other consideration set out in §33 of the Handbook: for example, market trends and the financial performance of the company.”
The particular contract under consideration is that alleged to arise from the Town Hall meeting on 18th August.  That was the establishment of a guaranteed minimum bonus pool.  It is not clear that section 33 applies to that part of the bonus award process rather than the later stage of allocating the pool amongst eligible employees.  But if it does section 33.4 expressly provides that not all the criteria will be considered in all cases.  Accordingly, this alleged contract can be construed and applied consistently with section 33. 
33.	I turn then to the two points relied on by the banks, namely absence of acceptance or consideration.   In relation to the former counsel for the banks relies on the judgment of Elias J in Solectron Scotland Ltd v Roper [2004] IRLR 4, 7 paragraph 30.  In that paragraph Elias J said:
“The fundamental question is this: is the employee's conduct, by continuing to work, only referable to his having accepted the new terms imposed by the employer? That may sometimes be the case. For example, if an employer varies the contractual terms by, for example, changing the wage or perhaps altering job duties and the employees go along with that without protest, then in those circumstances it may be possible to infer that they have by their conduct after a period of time accepted the change in terms and conditions. If they reject the change they must either refuse to implement it or make it plain that by acceding to it, they are doing so without prejudice to their contractual rights. But sometimes the alleged variation does not require any response from the employee at all. In such a case if the employee does nothing, his conduct is entirely consistent with the original contract containing; it is not only referable to his having accepted the new terms. Accordingly, he cannot be taken to have accepted the variation by conduct.”
This proposition was applied by the Court of Appeal in Khatri v Cooperatieve Centrale Raffeisen-Boerenleen Bank BA [2010] EWCA Civ 397 paragraphs 50 and 51.
34.	Counsel for the claimants suggest that there is a distinction to be drawn between changes which are wholly advantageous to the employee, as in this case, and those which are not, as in Solectron and Khatri.  In addition they contend that section 1.4 of the Employee Handbook dispensed with the need for any communication of acceptance and the circumstances of the case and practice of DKL and DBAG entitled the court to infer a waiver by the banks of any requirement for the employee’s acceptance to be communicated.   In my view none of these points should be determined summarily.
35.	Similar points arise in relation to the contention that there was no consideration for the promise of a guaranteed minimum bonus pool.   But the internal company documents to which I have referred earlier demonstrate quite clearly that the purpose of DKL and DBAG in establishing a guaranteed minimum bonus pool was to retain their staff.   The evidence suggests that it was largely successful.  The continued work of the employee is, at least arguably, adequate consideration for the establishment of the guaranteed minimum bonus pool.
36.	For these reasons I do not consider that the six points on which the banks rely either individually or collectively justify a conclusion that this part of the claimants’ case has no real prospect of success.  It is clear from the evidence, as to which there is no dispute, that the boards of DKL and DBAG intended to establish a guaranteed minimum bonus pool.  Their intention was communicated by the approved and conventional method of communication to all those eligible for allocation and payment of a bonus out of such pool if their employment continued until the bonus payment date.   The employment of the claimants did so continue.   In my view the judge was wrong to grant the banks summary judgment on this part of the claim.  I would set aside his order in that respect.
The Banks’ appeal
37.	The banks appeal from that part of the order of Simon J as refused summary judgment in their favour in relation to the remaining part of the claim.   The issues in that respect are: (1) whether DKL was entitled to insert the MAC clause into the bonus letters and, if so, (2) whether DKL observed and performed its terms in reducing or withholding the bonus allocated to individual claimants by the relevant bonus letter.   Counsel for the banks accepted that if this court disagreed with the judge in relation to the claimants’ appeals then it should dismiss the banks’ appeals.  This is evidently correct because if the claimants are entitled to rely on a contract establishing a guaranteed minimum bonus pool then the insertion of the MAC clause into the bonus letters, prima facie, broke that contract and could not justify the non-payment of the bonuses otherwise allocated by those letters.   Accordingly, for that reason alone the appeal of the banks should, in my view, be dismissed.
38.	However as it was fully argued I should add briefly why I consider that the judge was right.   The argument for the banks involved the proposition that the MAC clause involved a simple comparison between the earnings of DK for the months of November and December as forecast for those months and the actual outturn as identified during the preparation of the annual statements for 2008 for DK.  If such comparison shows a material deviation or deterioration in those months then, subject to a review by Dr Jentzsch in January 2009, the bonus awards made in the bonus allocation letters might be reduced.  Counsel took us through the “Bonus Pool [DK] Business Performance” before the board of DBAG at the meeting on 10th February 2009 to which I have referred in paragraph 18 above to demonstrate that there had been such a deviation or deterioration.   But the pages which are said to demonstrate such a deterioration are pages 2 and 3.  Page 6 on which the board relied compares the annual results for 2008 against the forecast, not just those for November and December. 
39.	There are a number of further points on which the judge relied.   It is not necessary to go through all of them.  They include ascertaining to what the word ‘additional’ in the MAC clause referred and whether any such condition was satisfied.  Did Dr Jentzsch properly carry out the review for which the bonus allocation letters provided?   These and other points could, as the judge recognised, only be decided at a trial following disclosure of documents by the banks.
40.	For these short reasons I would dismiss the banks’ appeal.
Conclusion
41.	For all these reasons I would set aside the judge’s order made on 28th May 2010 and dismiss both applications for summary judgment.   I would invite counsel to consider and if possible agree directions for the future conduct of the actions.
Lady Justice Smith
42.	I agree.
Lady Justice Black
43.	I also agree.