England and Wales High Court (Chancery Division) Decisions

IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)

		Royal Courts of Justice, Rolls Building Fetter Lane, London, EC4A 1NL
		30th July 2018

MR JUSTICE ZACAROLI

1. There are before me two applications: one for summary judgment by the defendants against one aspect of the claim and the second being an application seeking a response to a request for further information served by the defendants on the claimant.
2. The claimants are associated companies conducting business of research, development and engineering of technologies in the energy sector. The defendants are an Italian oil multinational and two of its subsidiaries.
3. These proceedings arise out of a project relating to the potential transportation of compressed natural gas, CNG, from an oil and gas field in the Barents Sea known as "Goliat". The first defendant is the operator and majority (65 per cent) licence-holder for Goliat; the minority (35 per cent) licence interest is held by the Norwegian oil company now called Equinor but formally known as "Statoil".
4. The defendants needed to find and implement a solution for dealing with and/or exploiting the gas released at the Goliat offshore floating platform. To this end, from early 2010, certain of the parties entered into a series of agreements, including an exclusive framework agreement (the "EFA") in March 2010, and various studies were carried out over approximately a three-year period in relation to the potential use of CNG export from Goliat.
5. Two gas export solutions were under consideration: firstly, export of CNG by carrier ships to an onshore gas plant in Norway; and, secondly, a potential subsea connection to an existing gas pipeline. The first, but not the second, involved the claimants.
6. In the end, neither solution was adopted. Instead, the defendants and Statoil implemented a solution involving the reinjection of gas at the Goliat offshore platform. The CNG export project was terminated because Statoil refused to give its consent to it.
7. The claimants' claims fall under three heads.
8. First, a claim for breaches of contractual obligations of exclusivity, relating to the first and second defendants' engagement of third parties to carry out work at Goliat that should have been awarded to the claimants.
9. Second, a claim against the first defendant for breaches of obligations in the EFA to use its best endeavours to obtain Statoil's consent to the CNG project and/or to promote the CNG option to Statoil, together with the breaches of related obligations to keep the claimants informed about various matters.
10. Third, claims for breach of obligations of confidence and/or database rights.
11. The second claim alone is relevant to this application for summary judgment.
12. By clause 3 of the EFA, the claimants acknowledged that the first defendant had existing contractual obligations to its licence partners, ie Statoil, which might prevent it from entering into the proposed arrangements with the claimant. The first defendant was obliged to "use its best endeavours to obtain, if possible, such consents whenever required".
13. By clause 6 of the EFA, the first defendants agreed to keep the claimants fully informed with respect to any project related to the potential applications of CNG in the territory, and to disclose (subject to any confidentiality undertakings toward third parties) to the claimants any information or data related to the feasibility and financial viability of such project, and to promptly inform the claimants if at any time the first defendant or any of its partners decided not to pursue a FEED -- that is a front-end engineering design phrase -- and/or a project solution.
14. The claimants plead on the basis of these two provisions that the first defendant owed duties to it: (1) to use its best endeavours actively to promote CNG technology to Statoil, specifically the claimants' CNG technology; (2) actively to persuade Statoil to use that technology and; (3) not to make representations or disclosures to Statoil which would or might undermine the attractiveness to Statoil of that technology, make Statoil less likely to support and/or consent to its use, or otherwise undermine the claimants' position as potential supplier of the technology.
15. The claimants then plead that by October 2012 at the latest, Statoil had reached a firm conclusion that CNG was not the best option for the Goliat field. Pending disclosure, the claimants contend that Statoil appeared to have three issues with the technology: first, it was immature; second, there were new uncertainties relating to gas containment systems; and, third, there was an anticipated substantial delay between the first oil production and the likely start date for the CNG export solution. The claimants contend that the CNG technology was available, technically and economically viable and cost effective, that funding was available and that it was environmentally attractive. Accordingly, it was in all circumstances a better option than either gas reinjection or any other option.
16. They plead that it is to be inferred from the fact that the CNG solution was the best for the Goliat field, and the fact that the first defendant had every opportunity to persuade Statoil of that, that the first defendant failed to use its best endeavours to obtain Statoil's consent to promote to Statoil the CNG technology of the claimants and to persuade Statoil to use that technology.
17. Some limited further particulars are provided of that allegation, focusing on the first defendant's failure to present the benefits of the CNG option to Statoil "accurately and/or expeditiously", the failure to change Statoil's mind when the first defendant first became aware of Statoil's negative view and the failure to persuade Statoil of the economic case, of the maturity of the CNG technology and of the lack of uncertainties.
18. Finally, the claimants plead that as a consequence of the first defendant's failure to use its best endeavours, they have suffered loss, being the profits they would have made (1) if the project had continued to the FEED stage (these are estimated at approximately 70 million Euros), or (2) if the CNG solution had been adopted (these are estimated as being in the region of 500 million Euros). Alternatively, they plead that they have lost the chance to make such profits.
19. It is now accepted that the only claim the claimants can pursue is one for the loss of the chance to make the profits. That chance depended upon the actions of a third party: Statoil. To succeed at trial, it is common ground, therefore, that they would need to establish that there was at least a real, as opposed to a speculative, prospect that Statoil would have consented. See, for example, Wellesley Partners LLP v Withers LLP [2016] Ch 529 at [44].
20. The first defendant contends the claimants have no real prospect of success in respect of this claim because there was no real chance that Statoil would have consented to the continuation of the CNG project in any event. Secondly, the first defendant contends that the claimants' only possible claim is for the loss of a chance of additional profits, so the alternative claim for loss of profits should be stuck out.
21. In relation to the claim for breach of the obligation to use best endeavours, the sole issue that arises on this application is one of causation. Irrespective of whether the first defendant failed to use its best endeavours in accordance with clause 3 of the EFA, the first defendant contends that the claimants must fail to establish that its breach caused any loss given that Statoil would in no circumstances have consented to the use of the claimant's CNG technology.
22. The law relating to applications for summary judgment is helpfully distilled into the following11 propositions by the claimants in their skeleton. These are not controversial but, not surprisingly, the first defendant lays emphasis on different aspects to those highlighted by the claimants.

(1) The Court may give summary judgment under CPR 24.2 in favour of a Defendant if (i) the Claimant has no real prospect of succeeding on the claim or issue and (ii) there is no other compelling reason why the case or issue should be disposed of at trial - White Book 2018, Vol. 1, p. 766.

(2) A claim with a real prospect of success is to be contrasted with one which is merely "fanciful", meaning that the case carries some degree of conviction and is more than merely arguable: Tesco Stores v Mastercard Inc [2015] EWHC 1145 (Ch) at [9].

(3) The court must not conduct a "mini-trial" and should avoid being drawn into an attempt to resolve conflicts of fact which are normally resolved by the trial process: Tesco Stores, supra, at [9]; and Three Rivers District Council v Bank of England (No.3) [2003] 2 AC 1, per Lord Hope at [95-99].

(4) More complex cases are unlikely to be capable of being resolved by summary judgment on the basis that the claim is fanciful; there is a danger of injustice in seeking to try such cases summarily on the documents and thus without disclosure and oral evidence tested by cross-examination; and this should not be done unless the court can be confident that all the relevant facts have already been satisfactorily investigated: Equitable Life v Ernst & Young [2003] PNLR 16 (CA), at [38]; Three Rivers at [97-98].

(5) In a case where liability must be assumed, caution is required, particularly in a complex case, before granting summary judgment on the basis of quantum or causation: Equitable Life, supra, at [57] and [59].

(6) Where the critical issue is what someone thought or believed, that issue ought normally to be determined at a trial, and therefore after disclosure and cross-examination, even if there is evidence before the court as to what the party did think or believe: Shah v HSBC Private Bank [2010] Bus LR 1514, at [22 – 25]; Three Rivers, supra, per Lord Hope at [98-99].

(7) In reaching its conclusion regarding whether the case is suitable for summary disposal, the Court should take into account not only the evidence actually placed before it, but the evidence which can reasonably be expected to be available at trial, after a fuller investigation into the facts: Tesco Stores, supra, at [9-10].

(8) The Court should hesitate to dismiss part of a claim summarily where this could lead to delay of the trial of the rest of the proceedings due to an appeal: Tesco Stores, at [10].

(9) The Court should not be influenced, in the application of the "real prospect of success" test, by the length or expense of the process required to litigate a claim (or issue) to trial: Three Rivers, supra, per Lord Hope at [106].

(10) Where a claim depends on the hypothetical actions of a third party, the test at trial is not what would have happened on the balance of probabilities, but whether the claimant has lost a real or substantial chance, as opposed to a merely speculative or fanciful chance. It is then for the Court to evaluate the chance, which could be anywhere between a non-fanciful but meagre chance, to something close to certainty: Equitable Life, supra, at [83].

(11) The Court is not bound to accept evidence from within the relevant third party organisation regarding what the third party would or would not have done in the relevant hypothetical circumstances; this is particularly so where the witness called is not the decision-maker: Wellesley Partners v Withers LLP [2016] Ch 529 at [116-122].

23. The first defendant points out that the injunction not to conduct a mini trial does not mean that the court must take at face value everything that a respondent contends in resisting the application.
24. It relies on the following passage from the judgment of Potter LJ in ED & F Man Liquid Products v Patel [2003] EWCA Civ 472, at [10]:

"In some cases, it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporary documents. If so, issues which are dependent upon those factual assertions may be susceptible to disposal at an early stage so as to save the cost and delay of trying an issue the outcome of which is inevitable."

25. It is pointed out that there are likely to be very considerable savings in terms of factual and expert evidence and length of trial, and thus costs, if the best endeavours claim is struck out.
26. Insofar as the risk of a successful appeal is concerned, the first defendants accept that this does raise a case management consideration in that, in this case, if the best endeavours claim is struck out but reinstated at some later date, then it would be practically unlikely that it could be heard at the same time as the main trial. Mr Miles QC for the first defendant submitted that this could be dealt with by the best endeavours claim, which is a self-contained point, being dealt with at a separate trial. I consider that, while this is of course possible, it would be an unattractive proposition given the degree of overlap in factual and expert evidence between the best endeavours claim and the remainder of the case. Nevertheless I accept that there are cases, where it is clear that a particular part of the claim has no prospect of success, in which that conclusion should outweigh the case management difficulties if the Court of Appeal later came to a different conclusion and reinstated the claim.
27. The defendants' evidence on this application consists of witness statements from two representatives of Statoil, Mr Solbakken and Mr Ravndal, and a witness statement in reply from a solicitor deposing to matters he has been told by Mr Solbakken.
28. Mr Ravndal's evidence deals principally with the issue as to the maturity and availability of the claimants' CNG technology. In the end, no reference was made to this in the defendants' submissions at the hearing and I do not consider it any further.
29. Mr Solbakken's evidence deals with the decision-making process within Statoil, insofar as he was concerned with it. He does three things.
30. First, he provides a commentary on the contemporaneous documents evidencing Statoil's decision-making processes and summarises the reasons for Statoil's decision.
31. Second, he supplements that by identifying what he says that "We", that is Statoil, thought at various points in the story.
32. Third, he gives evidence of his belief that Statoil would not have changed its view even if the defendants or claimants had taken additional steps to persuade them that they were wrong.
33. The claimants contend that this evidence fails to overcome the hurdle of establishing that the claimants have no real prospect of success for three principal reasons: first, Mr Solbakken was not the relevant decision-maker within Statoil; second, the assumptions underlying Statoil's decision are challenged on the basis of cogent evidence and, if it is assumed that Statoil's assumptions were wrong, then there is a real, as opposed to speculative prospect, that Statoil would have reached a different decision absent the first defendant's breaches of its obligations; third, the evidence addresses the wrong question and the wrong time period.
34. Mr Twigger QC for the claimant submits -- and I accept -- that I must assume for the purposes of this application that the claimants will establish at trial that the first defendant breached its obligations to use best endeavours to obtain Statoil's consent. I must assume, therefore, that there were steps the first defendant could have taken but failed to take in order to try to persuade Statoil to give its consent.
35. Prior to disclosure, the claimants are unaware of the details of all communications, or the opportunities for communications that were missed, between the first defendant and Statoil. Aside from the fact that in considering what steps the first defendant might be found at trial to have been required to take I must exclude the speculative or fanciful, the ways in which the first defendant may be found at trial to have breached its obligation to use best endeavours are somewhat open-ended and were not explored to any great depth in the hearing.
36. In essence, therefore, I must be satisfied that there is no realistic chance of the claimants establishing at trial that whatever the first defendant might realistically have done, Statoil would not have changed its mind. To express the test as it applies at this summary judgment stage: is there a real, as opposed to fanciful, prospect that at trial the claimants can show that there is a real, as opposed to speculative, prospect that Statoil would have consented?
37. If the first defendant's case rested on the evidence of Mr Solbakken alone, I would have no hesitation in concluding the matter is unsuitable for summary determination. Where the claim depends, as here, upon the actions a third party would have taken, then the court is not bound to accept, even at trial, the testimony of that third party as to what it would have done. Where that evidence is untested by cross-examination and is given before disclosure of documents which might be relevant to that cross-examination, it would be a rare case, if any, in which it was appropriate to conclude that there was no prospect of successfully challenging at trial assertions made by that party as to how it would have acted in different circumstances.
38. Recognising that difficulty, the first defendant contends that it can be seen, from the contemporaneous documents alone, that there is no realistic prospect that Statoil would have consented. It makes the following headline points based on the contemporaneous documents.
39. First, Statoil's preference throughout the relevant period was to reinject gas extracted at the Goliat field. This is demonstrated by the Goliat Plan for Development and Operation submitted by the first defendant and Statoil to the Norwegian authorities in February 2009. This was the preference notwithstanding that oil production might be accelerated if early gas export occurred. It was the Norwegian authorities that imposed the condition that the first defendant and Statoil investigate options for early export of gas.
40. Second, Statoil was aware that comparisons of production results that were prepared in 2009, 2010 and 2011 consistently showed that after 15 years full gas export would produce higher oil returns than reinjection of gas, although after 25 years the position was marginally reversed.
41. Third, from 2011 onwards, the first defendant made it clear to Statoil both that it favoured the CNG option and the reasons why it did so. This is most clearly demonstrated by a series of slides presented to Statoil by the first defendant at a meeting in October 2012. These were lifted from an internal review conducted by the first defendant called "Project Team Presentation Assurance Review 2". The economic results presented to Statoil showed a clear advantage for the CNG solution over the Melkoya option, the former resulting in substantially positive net present value for the oil produced, the latter in a significant negative net present value.
42. Fourth, Statoil indicated at a meeting of the management committee of the project on 17 October 2012 that it was unlikely to support a Concept Selection decision in favour of the CNG option in the first quarter of 2013. It gave its reasons as: the CNG technology was too immature; new uncertainties introduced by the first defendant by presenting new gas containment systems; and the start-up in 2016 was not likely.
43. They stated their preferred option was to send the gas to Melkoya or to contribute to a new gas export pipeline project. The minutes record that "Statoil further expressed that the socio-economic effects of the gas export solution for Goliat would become very important, and that the best overall solution would be export via Melkoya".
44. Fifth, and most importantly, Statoil at this point undertook its own analysis, resulting in the strategy paper dated 1 February 2013, which it did not share with the first defendant at the time. The paper was contributed to by, among others, Mr Solbakken. It appears that at least three departments within Statoil were responsible for its production. Its purpose was to recommend and request approval for Statoil's preferred gas export solution for the Goliat field and another field in the Barents Sea. That preferred solution was that Statoil would not currently support the CNG option. Instead, it proposed working towards a commercial arrangement with Snohvit in relation to the Melkoya option.
45. The first defendant relies in particular upon the following passages revealing Statoil's thinking at the time.

(1) It recognised that the first defendant's preference was for the CNG solution. It also noted, however, that the first defendant was believed to have interests internationally where CNG could be of use and this may well be driving its preference.

(2) Secondly, Statoil's own preliminary economic evaluation showed, in stark contrast to that presented to it by the first defendant, a negative NPV pursuant to the CNG solution, but a substantially positive NPV for the Melkoya option. The first defendant emphasised that these economic projections made the assumption that the CNG technology would be ready and available by 2016. The claimants pointed out in this respect that in the appendix to the paper it was stated that the main cost driver for the CNG negative NPV was the infrastructure and the cost of the vessels, and that it was expressly noted that the economy for the CNG case was very uncertain due to vessels costs: "It is understood that the methodology and assumptions used up to now were likely incorrect and need to be reviewed." There are later revisions internal to Statoil in evidence, but each of them continues to show that the Melkoya option was economically more favourable than the CNG option.

(3) The paper stated that although Statoil was in general positive to technology development, that was provided it enabled future opportunities and was based on a solid business case, which was not the case with CNG.

(4) It is stated that Statoil did not have a strategic interest in CNG.

(5) The paper acknowledged that early gas export would create an additional NPV due to increased oil production on either solution.

(6) Under the heading "Risk Evaluation", the report concluded that:

(a) selecting gas export by CNG represented a risk for future gas export conclusions from the Barents Sea (again, a reference to the wider strategic interests of Statoil);

(b) there was a significant risk of cost increase and scheduled delays was CNG; and

(c) the relationship with the first defendant could be negatively affected if Statoil stopped the first defendant's plans for establishing a CNG infrastructure.

(7) The paper noted in two places that the CNG technology was considered by Statoil to be relatively immature and had not at that date been implemented for large scale offshore applications.

46. The first defendant places significant reliance on the fact that this paper was not shared with it at the time: it demonstrated Statoil making up its own mind based on its own economic analysis and strategic interests. In those circumstances, the first defendant asks how it could have done anything to change the conclusions reached in the strategy paper.
47. The sixth point revealed by the contemporaneous documents and relied on by the first defendant is the reasons for Statoil's final decision to reject CNG. At a management committee meeting in October 2013, Statoil informed the first defendant of its decision. It was noted that the first defendant recommended supporting a resolution to continuing CNG studies in order to reach a "Gate 2" in 2014, but that Statoil did not support such continuation as the economy was poor, remaining technology qualification significant and there was no driver to have early gas export from the subsea point of view. It had made the decision therefore to terminate the work related to the development of a CNG option for export of gas.
48. The first defendant submits that against the backdrop of these contemporaneous documents, there are certain stark facts which make it fanciful to believe that Statoil would have given its consent.
49. First, Statoil's decision ultimately was to abandon early export of gas altogether. Much of the fire in the claimants' case, directed at showing how Statoil's conclusion as to the respective merits of Melkoya and CNG, is taken out once it is appreciated that Statoil concluded in favour of reinjection, which had been its preferred option from the beginning.
50. Second, to the extent that the claimant complains that Statoil's economic analysis was flawed, the documents show conclusively that the first defendant presented its own contrasting economic results to Statoil, which were much more favourable towards CNG. What else, it is asked, could the first defendant have realistically done?
51. Third, insofar as the claimants contend that the first defendant failed to persuade Statoil that the risks associated with early gas breakthrough were so great, given the propensity to fracturing of the subsea structures, that gas export should have been chosen over reinjection, the first defendant points out that it provided its engineering documents, including seismic studies, to Statoil. Those documents included reference to the fault lines in the subsea structure that gave rise to the risk of fracturing and thus early gas breakthrough. It is fanciful, it is said, to think that the first defendant should have (a) itself realised, whether by commissioning further studies or otherwise, that the risks of early gas breakthrough were greater than it and Statoil had perceived and (b) sought to persuade Statoil of that position.
52. Fourthly, Statoil had its own analysis, and although there are differences between its figures and the first defendant's on the economics, and indeed differences within Statoil's own papers, they all came down against CNG and in favour of reinjection, postponing the export of gas.
53. In the face of all this, the first defendant contends that there is no realistic prospect that the conclusions in the strategy paper would have been any different, whatever the first defendant had done, and thus there is no realistic prospect of establishing at trial that Statoil would have consented to the CNG solution proceeding at all, whether to the FEED stage or to its final adoption.
54. These are all powerful points well made, but I have concluded that they are insufficient to overcome the relatively high and double hurdle which exists at this stage, namely whether I can say there is no realistic prospect of the claimants being able to establish at trial that there is no realistic prospect that Statoil could have been persuaded to consent if the first defendant had taken as yet unidentified further steps.
55. The principal difficulty is that there is no evidence from the actual decision-makers at Statoil. Mr Solbakken's role was to assist in the preparation of the strategy paper of February 2013. That paper made recommendations to, and was presented to, unknown persons higher up in the organisation at Statoil. While the recommendations appear to have been accepted, it is not known who was involved in making the decision.
56. Apart from the fact, it is safe to assume, that the strategy paper was before the decision-makers, there is no evidence as to what factors they took into account or what weight they placed on those factors. It is not known, for example, to what extent, if at all, they looked at materials other than the strategy paper. There is also no evidence as to whether there was any discussion or debate between the decision-makers, whether some were in favour and some against, and if so how marginal was the decision. Without knowing these matters, it cannot be said with sufficient certainty that nothing the first defendant might have realistically done could have made a difference.
57. On any summary judgment application, it is relevant to ask what more, if anything, might be available to assist the court in determining the relevant issue at trial above and beyond that which is available now. There has been no disclosure yet. I am told disclosure will not produce any internal documents of Statoil, but it will produce documents passing between Statoil and the defendants. It is conceivable that those might shed further light on Statoil's decision-making insofar as it was revealed to the defendants.
58. More importantly, it is at least possible that third-party disclosure could be obtained from Statoil itself. The claimants say they are awaiting disclosure in the action before considering that step, partly because documents produced on disclosure would or might assist in refining the scope of any such application. In addition, it is at least possible there will be witness evidence from others involved in the decision-making in Statoil beyond Mr Solbakken. The parties are not yet in a position to identify which witnesses they will be calling at trial.
59. In short, at this stage it is premature to conclude that there would be no further evidence, either documentary or oral, at trial that would have a bearing on Statoil's decision-making process.
60. As to that decision-making process, I agree with the submissions of Mr Twigger for the claimants that the question is not simply what the first defendant could have done to change Statoil's mind, once it had been made up, following submission of the strategy paper to the decision-makers. I also have to consider the possibility that had something different been done in the years prior to the production of the strategy paper, then some of the concerns expressed by Statoil at meetings and in the strategy paper might never have arisen.
61. To take just one example, factors that were said by Statoil, in the meeting in October 2012, to be influencing its decision-making were: (1) CNG technology was too immature and; (2) new uncertainties had been introduced by the first defendant by presenting new gas containment systems. Both of these found an echo in the strategy paper. One of the claimant's complaints is that the first defendant failed to introduce the claimants to Statoil at an early enough stage, and had they done so, there would have been no "new" uncertainties by as late as October 2012 and Statoil's concerns as to immaturity could have been laid to rest.
62. Mr Miles countered by saying that the economic analysis in the strategy paper made the necessary assumptions in favour of the claimants in this regard, since the numbers were produced on the assumption that gas export would begin in 2016.
63. Without knowing, however, what weight was placed by the decision-makers on the references in the strategy paper (or in such other materials as the decision-makers had available to them) to the risks of delay and the risks connected with the maturity of the claimants' CNG technology, as opposed to reaching a decision purely on the basis of the economics contained in it, it is not possible to say with certainty that if Statoil had been persuaded at an early stage of the relative maturity of the CNG technology, it might not have reached a different conclusion.
64. While the claimants say that the question whether there is a real prospect of establishing that the strategy paper might have said something different is the wrong question to ask, they in any event say that there is such a prospect. They point to a number of factors contained in the strategy paper which they contend were wrong, for example, the economic analysis and the understatement of the risks associated with reinjection in terms of early gas breakthrough.
65. I agree with the first defendant that whether the conclusions on particular matters stated in the strategy report were right or wrong is in itself not the point; it is not any part of this case to challenge the correctness of Statoil's decision.
66. However, that is not a complete answer to the point that is raised for decision. If it is correct that one or more conclusions reached in the strategy paper was or were wrong, and if it could be demonstrated that had the first defendant done something different Statoil would not have reached that conclusion in the strategy paper, then there is a more than fanciful prospect of showing that Statoil's decision might have been different.
67. As Mr Miles submitted, in some respects – for example the suggestion that the first defendant could and should have done more at the time to demonstrate the risks of early gas breakthrough – it is difficult to see what else could possibly have been done. In view of my central conclusion, however, based on the absence of evidence as to what motivated the actual decision-makers, it is unnecessary to reach a conclusion on each of the claimants' detailed points of attack on the position paper, and it would be wrong to do so given the matter will be progressing to trial.
68. I turn then to the separate summary judgment claim in relation to the claim for loss of profits.
69. Paragraph 88 of the re-amended particulars of claim contains the pleading of loss and damage. It pleads that, as a result of the breaches identified in paragraph 87, the claimants have suffered loss represented by the profits they would have made, alternatively that there is a substantial chance that they would have made, in carrying out further work on the CNG project.
70. Paragraph 87 pleads the breaches both of the exclusivity obligation and the best endeavours obligation: the former would entitle the claimant to claim loss of profits, the latter would entitle them to claim only the loss of a chance to make profits.
71. As I have already noted, it is common ground that the claimants cannot claim loss of profits for the breach of the best endeavours obligation. The rolled-up pleading in paragraph 88 is therefore flawed to the extent that it pleads a loss of profits claim in relation to the breach of best endeavours claim. This is, in the end, a narrow pleading point. In a claim of this size and complexity, however, it is important that the pleading accurately reflects the claims being pursued. Accordingly, I would order that the parts of the pleading which appear to claim loss of profits for breach of best endeavours obligation be struck out. In reality, the problem can be addressed by a minor clarificatory amendment.
72. For those reasons, I dismiss the application for summary judgment in respect of the claim relating to the breach of the obligation to use best endeavours but allow it in relation to the pleading point.
73. Turning to the request for further information application. The defendants apply for an order that the claimants provide a response to a request for further information, originally served in April 2018 but recently slightly revised.
74. In the normal course, the recipient of a request would provide a response identifying those requests which are objectionable and answering those requests which are not. In this way, issues of disagreement which the court might need to resolve are identified. The claimants, however, have not done that. They contend that there is no need to provide a response at all at this stage, indeed that they should not be required to do so until December 2018, after the parties have had the chance to digest disclosure (which, following an agreed extension is due to be provided in September 2018).
75. Each side has pointed to certain of the requests which are either, per the claimants, flawed or, per the defendants, wholly unobjectionable.
76. In the time available and, more importantly, given that the necessary procedure has not been followed so as to enable the points of disagreement to be properly identified, the parties have not taken me through all 82 requests.
77. On the basis of what I have seen, there are clearly some requests, those relating to quantum in particular, where it is appropriate that such answers that can be given at this stage are given sooner rather than later. It is important – both so as to enable the defendants to prepare their defence and to encourage settlement – that the claimants' case on quantum is particularised now. There is the particular feature in this case that the areas of expert evidence have yet to be properly identified. A process has been put in place (commencing in October) to enable that to happen. The defendants are entitled to know the details of the case put against them in good time for them to have a proper input into that process.
78. At one point, it was suggested that there was no need to answer requests relating to quantum because the court has ordered sequential exchange of experts' reports. That is rightly no longer pursued. It is generally inappropriate that particulars of the claimants' case on quantum are revealed for the first time only in their experts' reports. That is particularly so here, given the process yet to be undertaken to identify the precise subject matter for those experts.
79. The claimants object that in some cases they cannot provide the information until after disclosure. If that is so, then that may be a proper and sufficient answer at this stage to such parts of the request to which it applies. It is not, however, a reason to refuse to answer the request at all.
80. In some cases, for example requests 27 and following (relating to causation and quantum in respect of the best endeavours claim), the claimants must be in a position to provide at least some particulars now even if disclosure might provide them with a different or better case. If their case at the moment is in truth based on no more than the inference that because CNG was the best option, Statoil's decision to refuse consent must have been due to the first defendant's failure to use its best endeavours, then (a) the request will not take much effort to answer, and (b) the defendants are entitled to know that the case is put solely on that basis, even if, as the claimants contend, they might be able to say more after disclosure.
81. I do not think their case is, however, that simple, even at the moment, and I consider that the defendants are entitled to know what facts and matters, already within the claimants' knowledge and not dependent on disclosure, the claimants rely upon.
82. Accordingly, I will direct that the claimants provide a response to the request now. The defendants asked that it be provided within four weeks. The claimants submit that it should be longer in view of the vacation and the fact that they are busy working on disclosure. In circumstances where the request has been outstanding since April, I have less sympathy with that submission. Nevertheless, it does seem to me that the defendants are not prejudiced by a few weeks' further delay. I also take into account that in relation to the request relating to the best endeavours claim, it was sensible to await the outcome of the summary judgment application which could have put an end to that part of the case altogether. In those circumstances, I propose to give the claimants until the middle of September to provide the response. I will direct the response to be provided by Monday, 17 September 2018.