England and Wales High Court (Chancery Division) Decisions

HIGH COURT OF JUSTICE BUSINESS AND PROPERTY COURT
NEWCASTLE UPON TYNE

		7 September 2018

JUDGE MARTIN RODGER QC:

Introduction

1. The claimant, Mr Gurdip Singh, claims restitution of £139,800 being the balance, not yet returned, of a total of £160,000 which he and members of his family paid to the defendant, Mr George Redford, to acquire the business of a fish & chip shop which Mr Redford operated from leasehold premises on the Swann Industrial Estate at Washington in Sunderland. The payments were made in instalments between April and July 2012 after the parties had reached an informal agreement for the sale of the business in March that year. In all five, payments were paid towards the agreed purchase price of £165,000, the largest of which, £105,000, was transferred on 8 June 2012. The following day full conduct of the business was taken over by the claimant's brother-in-law, Mr Sukhbinder Singh Chahal (known to his family as Suki, and whom I will call Mr Chahal), who had been responsible for the negotiations. He then ran the business, paid the staff and outgoings, including the rent of the premises and rates and received the takings for his own and Mr Singh's benefit.
2. Despite all but £6,600 of the purchase price having been paid by the middle of July 2012 and solicitors having been instructed on both sides, no agreement embodying the terms on which the business was to change hands was ever entered into. Detailed terms were negotiated but not finalised. The agreement in principle of the landlord of the premises was obtained for a surrender of Mr Redford's lease and the grant of a new longer lease to Mr Singh, and drafts were prepared but never executed.
3. By November 2012 the parties had begun to fall out. There was disagreement over the use of Mr Redford's trading name, and the business was not as successful as Mr Chahal had expected. The claimant's solicitor advised that the premises did not have planning permission for the sale of hot food (although the defendant says this was well known to Mr Chahal at a much earlier stage). In November Mr Chahal stopped paying rent to the landlord, he says to exert pressure on Mr Redford, while Mr Redford alleges that the business was getting into serious financial difficulty and could not meet its liabilities.
4. In January 2013 solicitors instructed by Mr Chahal on behalf of Mr Singh sent a letter before action asserting that a contract for the purchase of the business had been entered into on the basis of misrepresentations concerning the planning status of the premises. They asserted an entitlement to rescind the contract and recover the purchase price but indicated a willingness to give credit for net profits of trading. These assertions were refuted by Mr Redford's solicitors, who also complained of threats which had been made against their client by Mr Chahal.
5. In January 2013 Mr Chahal went to India and did not return until March 2013. While he was away Mr Redford paid off the rent arrears, unpaid staff wages and outstanding bills to suppliers and resumed occupation of the premises. On Mr Chahal's return the parties negotiated with the assistance of an intermediary for the return of some proportion of the purchase price and for Mr Redford to remain in control of the business, such as it was by then. The terms of that compromise were never finalised but in anticipation of it, Mr Redford made a series of payments totalling £20,000 between August 2013 and February 2014. Mr Redford said that these payments were made in response to threats of violence directed against him and his family by Mr Chahal.
6. Against that background the claimant's case is now that the payments he made were in the expectation of a contract of sale of the business, and on the understanding that the premises could be used for the purpose of a fish & chip shop. Consideration for the payments is said to have failed totally because contracts were never exchanged and no lease was obtained, and because the planning status of the premises meant they could not lawfully be used for the business. The defendant is said to have been unjustly enriched by the payments made to him such that it would be unjust for him to be permitted to retain them.
7. Mr Redford, for his part, accepts that he received payments totalling £158,400 but denies any liability to restore that sum to the claimant on the grounds that the claimant received what he had paid for as far as Mr Redford was able to provide it, and because the business failed due to mismanagement by Mr Chahal and his staff. Mr Redford counter claims the balance of the agreed sale price of the business, £6,600, together with the sum of £20,200 paid in anticipation of the settlement agreement and which he claims to have paid under duress. He also seeks reimbursement of £4,300 paid out in rent to the landlord of the premises together with bailiff's charges and legal costs of a further £750.

The principal witnesses

8. The claimant, Mr Gurdip Singh, was born in India and came to the United Kingdom in 1990. He has only a limited understanding of English, his first language being Punjabi. He therefore gave his evidence with the assistance of an interpreter. His main employment since his arrival in this country has been in the preparation of food; he lives in Telford, but since 2011 he and his sister, Mrs Kashmir Kaur, have jointly owned and run a fish & chip shop in Banbury in Oxfordshire.
9. Mr Singh did not claim to be an experienced business man, and he acknowledged that he left commercial matters to others. He gave his evidence hesitantly and was uncomfortable in the witness box; it was clear that he had little clear recollection or grasp of the details of the events he was being asked about. The explanation he gave of his role was consistent, credible, and largely uncontroversial, but in matters of detail I do not feel confident in placing any weight on his evidence.
10. I came to the clear conclusion that Mr Singh's role in the business venture was nominal. The negotiations were notionally conducted by others on his behalf and it was intended that his name would be on the documents. He advanced money which he borrowed, but which was secured on property belonging to Mr Chahal. There is no evidence of his having had any involvement in the Washington business after he and Mr Chahal first viewed the premises; he left the court immediately after giving his evidence on the first day of a four day trial and did not return.
11. Mr Singh's sister, Mrs Kashmir Kaur, had a slightly greater role in the business. She has lived in this country for 20 years but has limited English (though more than her brother, and sufficient to conduct basic conversations). She also gave evidence with the assistance of an interpreter. Mrs Kaur's involvement was peripheral in the early stages and she was not involved in any relevant negotiation until after the parties had fallen out. While Mr Chahal was in India she supervised the business from a distance. She provided the funds for the first two instalments of the purchase price from a business account in her own name, and she regarded the enterprise as a family business. Her evidence was intended to corroborate that of her husband, Mr Chahal, but did not touch on the points of greatest contention. Nevertheless, because of her obvious interest in supporting her family, I treat her evidence with caution.
12. By far the greatest part in the enterprise, as far as the purchasers were concerned, was played by Mr Chahal who is the husband of Mrs Kashmir Kaur (the couple have been separated since before 2012). He is an experienced businessman with property interests in the West Midlands, and lives in Coventry. Mr Chahal speaks excellent English and took the lead in all business dealings on behalf of his wife and brother in law. He provided security for the major part of the purchase price borrowed by Mr Singh, and assumed full responsibility for the conduct of the business, moving to Washington during the week and returning to see his family in Coventry at weekends.
13. Mr Chahal was ambitious and impatient. He presents himself as a larger than life character and a number of witnesses mentioned how charming he could be, or what a good impression he made on customers. He went out of his way to praise Mr Redford to his staff, and made a sufficiently good impression on him that, within a few months of their first meeting, they agreed to go into business together in another fish and chip shop in Hartlepool. Mr Chahal is a big man and by his own admission can be short tempered and abusive, as he accepts he was to Mr Redford. Despite his charm there is evidence from a number of sources that he has resorted to threats in connection with his business dealings, and I can well believe him capable of being intimidating if he chose to be.
14. Mr Chahal gave his evidence consistently and with a good deal of detail. On some points of detail he insisted on his version of events despite clear evidence to the contrary from other less partial witnesses; his insistence that there had been no sharing of stock between his business and that of Mr Redford was an example, where the evidence of Mrs Banks, an employee of his, which I accept, was to the contrary. Mr Chahal seemed to me to be more concerned to avoid giving ground in cross examination than in providing an accurate account of events. Points of detail concerning negotiations which happened six years ago could easily be remembered differently by the participants, but the allegations made against him of explicit and repeated threats of violence are in a different category and could not be misremembered. On those allegations, as I will explain, I have found Mr Chahal's evidence to be untruthful. Although not the claimant, he clearly has a very substantial financial interest in these proceedings, and I do not find him to be a reliable witness.
15. The other witness called on behalf of the claimant was Mr Craig Sykes. He had worked at the Washington premises first for Mr Redford and later for Mr Chahal, in whose absence he acted as manager. He did not play a role in negotiations but gave helpful evidence about how the shop was run. He supported Mr Chahal's evidence on points of detail on which I have preferred the evidence of Mrs Banks, and I do not regard him as reliable. He did give helpful evidence of what he understood to be the cause of the falling out between Mr Chahal and Mr Redford, which he thought was to do with the use of the original trading name, and about the extent of his own and Mr Chahal's knowledge of a second shop opened by Mr Redford in the locality after the negotiations had commenced.
16. Mr Redford was in his late 40's when he was made redundant in 2007 after a career working on oil rigs. He then became involved in running fish and chip shops in the north east, opening one of his own in Newton Aycliffe which he established, ran for a period of time, then sold off. The premises at Washington were his second such venture and he hoped to repeat the previous pattern.
17. Mr Redford gave his evidence clearly and confidently. He has a substantial interest in embellishing his account and there were examples of exaggeration or hyperbole in his witness statement. He made a number of lurid allegations about Mr Chahal's private life, which were not put to Mr Chahal in cross examination and which I disregard. His willingness to make such allegations detracted from the credibility of his testimony, as did his unwillingness to speculate on why his own agent may have substantially understated the agreed purchase price in heads of terms drawn up and provided to solicitors after Mr Redford had already received a significant advance payment in cash. I approach his evidence with considerable caution, but in relation to the most significant point of disagreement, his allegation of intimidation by Mr Chahal, I have found it to be supported by contemporaneous accounts and by the evidence of others, in particular Mr Doyle, who was an employee of Mr Redford's at another shop and who became involved at the Starr Estate shop after Mr Redford resumed possession.
18. Evidence was also given by Mr Sukhjinder Singh Jagpal, of NEY Commercial, the agent through whom the business had been advertised. His recollection was very limited and there were only two matters on which he gave evidence of note. The first was the total purchase price, which he understood to have been £95,000 as recorded in the heads of agreement (he did not rise to the invitation to suggest that additional sums might have been payable for fixtures and fittings or goodwill which had not been recorded in that document). The second was that he claimed to have received a series of threatening phone calls from Mr Chahal four or five years ago, some of which had been left as messages on his office answering machine, and some of which were in person. Mr Chahal had threatened him and his family saying he would send people round to hurt him if he did not receive money back for the business Mr Jagpal had sold him, which was not doing well. One of these messages had been reported to the police.
19. Mr Jagpal seemed to be a straightforward witness whose last business dealings with Mr Redford had been in 2013 or 2014, when he sold the business at Barmston on his behalf. His recollection of the details of the transaction was limited, but he was clear about the threats made against him. He said he still had recordings of the messages left at his office, but he had not been asked to bring these. There is no obvious reason for him to lie about the calls, or to suggest that they were still available if he was lying, and I accept his evidence.
20. The final witness called on the defendant's behalf was Mr Antonio Fernandez, who described himself as a debt counsellor and mediator but whose business is debt collecting and process serving. He had been introduced to Mr Chahal by clients in Birmingham in early 2013, although his first contact had been a phone call from Mrs Kaur while her husband was in India. She requested help with recovering money owed in connection with a shop in the north-east and when Mr Chahal returned from India they travelled together to Washington and met Mr Redford and Mr Doyle. Although he described his role as being to calm things down and negotiate a settlement of the outstanding debt which Mr Chahal claimed he was owed, he also volunteered that Mr Redford may have felt intimidated by his presence. Mr Fernandez described himself as "into fitness and martial arts". I can well believe that he might cause a debtor to feel intimidated and I think it likely that he was brought to meetings by Mr Chahal for his physicality rather than his skills as a mediator.
21. Mr Fernandez fell out with Mr Chahal after he brokered an agreement for the repayment by Mr Redford of £140,000. Mr Chahal had never returned Mr Fernandez's terms of business, which entitled him to a commission of 35% of the sum recovered, and when they met to discuss payment of a fee they did not agree on a figure. The result has been that Mr Fernandez has never been paid, and has switched sides to give evidence on behalf of Mr Redford. He told me that he and Mr Chahal had gone to a chip shop where Mr Redford's daughter had been working and that Mr Chahal had told her to call her father to meet them outside, where he is said to have threatened to rape Mr Redford's daughter unless he was repaid. The police attended but took no action when Mr Fernandez drove Mr Chahal away from the incident. Mr Doyle gave evidence that he had been called by Mr Redford's daughter during this incident and had arrived to witness Mr Chahal threatening to kill Mr Redford and terrorise his family. Mr Redford himself gave evidence to the same effect.
22. Mr Fernandez has good reason to dislike Mr Chahal and were it not for the fact that his evidence is consistent with the evidence of other witnesses and contemporaneous records I would find it difficult to accept him as credible. However, his account, and that given by Mr Doyle, are consistent with and therefore supplement and support the evidence of a pattern of conduct by Mr Chahal and I accept the thrust of it on that issue.

The facts in more detail

23. The second fish and chip business which Mr Redford established was from the premises at Unit 4 on the Swann Industrial Estate at Eddison Road in Washington ("the Premises"), which he operated (as he did with his other businesses) under the name Redz Traditional Fish & Chips. Although described as traditional, the business was not a traditional retail operation. It was located on an industrial estate along with a number of other food preparation outlets and the greater part of its trade was in home deliveries sourced through advertising in the local press and leaflet drops. Mr Redford estimated that between 75% and 95% of the trade was in deliveries, and Mrs Banks confirmed that that was the general nature of the business. That is an important point of detail when considering the most likely cause of the breakdown in relations between Mr Chahal and Mr Redford.
24. Mr Redford took a tenancy of the Premises on 25 March 2011 for a term of 3 years from 1 April 2011, at a rent of £6,600 a year payable by quarterly instalments in April, July, October and January. The tenancy agreement was in writing and stipulated that the "Permitted Use" was for "preparation & delivery of hot food" and other uses within use classes B1 B2 and B8 (i.e. general industrial, storage or distribution) or as the landlord might permit. The tenancy included a covenant by Mr Redford not to use the Premises except for the Permitted Use. Although there were other food preparation and delivery businesses on the estate, the Premises had not previously been used for that purpose (it was suggested they had been used as a garage) and they were fitted out for the Permitted Use by Mr Redford. It is common ground that they did not have the benefit of planning permission for the sale of hot food for consumption off the premises (use class A5).
25. Although Mr Singh and Mrs Kaur had acquired their interest in their own fish & chip shop in Banbury only in 2011, by the beginning of the following year Mr Singh and Mr Chahal had begun to view a number of other takeaway shops in the Midlands with a view to making a further purchase. Mr Chahal soon became aware that in Washington, more than 200 miles away, a similar business was being offered for sale. The business was advertised by agents, NEY Commercial, on the Dalton's Weekly website and was spotted by Mr Chahal very soon after the advertisement first appeared. The advertisement itself is not in evidence, but according to Mr Chahal it provided brief details of the turnover and profit at the shop (£7,000 and £3,000 or £3,500 per week respectively), and mentioned the rent payable; the claimant's January 2013 letter before action asserted that an asking price of £189,950 was also mentioned.
26. No explanation was ever given why Mr Chahal and Mr Singh were so interested in acquiring a business on an industrial estate 200 miles away on the strength of such limited information, but it is clear that something sparked their interest. Having contacted the agent on the same day, they made a 4 hour journey by car to Washington the following day to view the Premises. The viewing took place on 5 March 2012, less than a year after Mr Redford had first opened the business.
27. Mr Chahal and Mr Singh met Mr Redford at the premises and were shown round. According to Mr Singh the whole visit lasted no more than 15 minutes, which was enough for them to see the style of trading and receive basic information about the turnover and profitability of the business. Mr Chahal did all of the talking and, although he introduced Mr Singh, he left Mr Redford with the impression that he, Mr Chahal, was the intending purchaser. I do not know whether this confusion was the result of a deliberate misrepresentation by Mr Chahal, or was due simply to his prominent role, the similarity of his and Mr Singh's names and the fact that they introduced themselves and were known throughout as Suki and Gary. I do not consider anything turns on this. It would have been clear to Mr Redford in any event that Mr Chahal was the person with whom he was negotiating.
28. During the first meeting there was discussion between Mr Chahal and Mr Redford about the permitted use of the Premises. Both agree that Mr Chahal was shown the lease and that it was explained that the remaining term was only about 2 years. The term is stated on the front page of the document, as is the Permitted Use. Mr Redford explained that the use was food preparation and distribution, rather than a conventional takeaway, as would have been obvious to anyone visiting the Premises. I reject Mr Chahal's evidence that he looked at the lease and was given confirmation by Mr Redford that the permitted planning use was as a takeaway. He said that in his oral evidence in chief, and suggested his question was prompted by seeing the Permitted Use in the tenancy agreement, but that is not what the tenancy agreement itself says. Nor was it suggested in the letter before action of 14 January 2013, when the complaint was, I assume on Mr Chahal's instructions, that "there was no statement that the business had the appropriate planning use, i.e. A5 (hot food takeaway)" and that this had amounted to misrepresentation by omission. I doubt very much that anything specific was said about use classes but I accept that either at the first visit or later in the same month Mr Redford explained that he had never had any difficulty with the local authority over the use. The local authority (by its environmental health and food hygiene officers) had visited the Premises and given them a positive hygiene certificate. There is no suggestion that a planning officer had visited, and I find that nothing specific was said about planning status. It is possible that Mr Chahal misunderstood the significance of the reference in the tenancy to the Permitted Use (which had nothing to do with planning permission) but I think that unlikely.
29. Although Mr Singh thought that a purchase price of £165,000 was agreed there and then at the end of the first visit to the Premises, and sealed with a handshake, I prefer the account given by Mr Chahal and Mr Redford, both of whom said that an offer at that level was made by Mr Chahal but refused at the initial meeting, before being accepted in a telephone call between Mr Chahal and the agent later the same day. The price was agreed on the understanding that the details of the sale and the necessary paperwork would all be sorted out by the parties' solicitors.
30. Although the parties agreed a purchase price of £165,000 very soon after their first meeting, this was on the basis that Mr Chahal would have the opportunity to spend time at the business observing it in operation, to satisfy himself that the sales figures he had been given were correct. Mr Chahal went to Washington and attended the premises between 19 and 26 March 2012. He said he was at the premises constantly while they were open for trading during this period and concluded from his own observations that the Premises were busy and that a good business was conducted from them. By the end of his visit he wanted to continue with the purchase, with his only apparent concern being the shortness of the term remaining on the lease. Mr Redford reassured him that the landlord would agree to extend the lease.
31. Mr Redford was also agreeable to proceeding with the sale but asked for a deposit as a condition of taking the business off the market. At first he requested that £20,000 be paid to him in cash straight away but agreed to accept an initial instalment which I am satisfied was of £10,000, (although Mr Redford thought it was only £9,000). He received this sum in cash when he visited the West Midlands either at the end of March or the beginning of April. The money was withdrawn by Mrs Kaur from her own bank account and handed over in the bank. At this stage no document had come into existence and no professional had been involved other than Mr Jagpal, the agent at NEY Commercial (who is not said to have been informed of the deposit).
32. Mr Chahal was unwilling to pay a second instalment of the deposit until he had first spoken to the landlord to confirm that the tenancy of the premises could be extended. There is some doubt about when that confirmation was obtained (it was probably in early April) but in any event Mr Chahal and one of the two joint landlords met and agreed that a lease of tenancy of 7 years was available.
33. A second payment of £10,000 was made to Mr Redford, and on 21 May a third in the same amount. On the second occasion, as on the first, the funds were provided by Mrs Kaur. Mr Chahal drove to Washington to hand over the cash.
34. After the first instalment details of the solicitors who would be acting for the buyers, the sellers, and the landlord were collected by Mr Jagpal of the selling agents, NEY Commercial, and on 10 April he sent draft heads of terms to Mr Redford's solicitor, Miss Helen Campbell of John Donkin Solicitors. The heads of terms specified that the purchase price was £95,000 for the leasehold interest in the property at a rent of £6,500 pa on the basis of a seven year lease. The landlord's solicitor, Mr Sword of McKenzie Bell Solicitors, was named, the purchaser was identified as Mr Singh, and his solicitor, Jeremy Briars of Rutherford's Legal LLP was also specified. The only other terms included in the draft heads of terms were that each party was to pay their own legal fees and that all parties were to work towards an eight-week completion (which would have seen the matter concluded in early June 2012).
35. In his oral evidence Mr Chahal said that despite making the first payment of £10,000 to secure the removal of the business from the market "we did not have a firm agreement". His expectation at that stage was that if a final agreement was not concluded Mr Redford would repay the deposit. For his part Mr Redford considered that the payment of the deposit signified that a deal had been struck. I am satisfied that by the time the payment was made both parties wanted the sale to proceed but appreciated that formal steps had to be taken to document what they had agreed and to resolve the position with the landlord. That is reflected both in the heads of terms which refer to a seven-year lease (which did not yet exist) and bear a further manuscript note, the provenance of which is unknown, that this was "to be granted to new tenant".
36. Solicitors were instructed by mid-April and on 16 April Miss Campbell (Mr Redford's solicitor) contacted McKenzie Bell (the landlord's solicitors) requesting confirmation that it was agreed that the existing lease would be surrendered and a new seven-year lease granted to the buyer. Miss Campbell also emailed Mr Briars, the solicitor acting for Mr Singh, introducing herself and asking for confirmation that the purchase price which had been agreed was £95,000. In his response on 18 April Mr Briars did not confirm that those were his instructions but asked for responses to standard commercial property sale enquiries.
37. Nothing further appears to have passed between solicitors until 27 June 2012 when Miss Campbell returned replies to the standard enquiries. In response to questions about planning permission the replies made it clear that the purchaser should rely on his own inquiries, but added that: "We understand the landlord obtained consent for the change of use from a garage to a fish and chip shop".
38. Despite the absence of activity between the solicitors, matters had progressed much more quickly on the ground, and by 9 June at the latest Mr Chahal had begun operating the business from the premises on his own and his family's behalf. The claimant's pleaded case is that Mr Chahal first began to conduct the business during the week commencing 28 May. In his witness statement Mr Chahal said that he had provided the information contained in the claimant's statement of case, but in his oral evidence he was adamant that he had not assumed control of the business until 9 June when the keys were handed over to him. He suggested that Mr Singh had been responsible for the mistake in the statement of case. I am sure that Mr Singh had little or nothing to do with the statement of case, other than to sign the statement of truth, and that the disagreement over when exactly he took over is an example of Mr Chahal modifying his evidence to plug a suspected gap in the claimant's case.
39. It is clear that on 8 June 2012 a payment of £105,000 was made by bank transfer from Mr Singh's bank, which had advanced a business loan to Mr Singh secured on property belonging to Mr Chahal, to the joint account of Mr Redford and his wife. No solicitors were involved in (nor even informed of) the making or receipt of this payment ; they were still not yet at the stage of having exchanged preliminary inquiries. It was Mr Chahal's evidence that the payment was made because Mr Redford was considering selling the business to someone else for the same price, and that that person was a cash buyer who was not seeking a new lease and so could proceed to completion more quickly. According to Mr Chahal Mr Redford told him that the money paid to keep the property off the market would be returned if the purchase could not be completed, but that if a further substantial payment was made Mr Redford would hand over the keys to the Premises. It was this ultimatum and inducement which caused the payment of £105,000 to be made on 8 June 2012.
40. Mr Redford's account was somewhat different, and he denied having threatened to sell the business elsewhere unless a large further payment was made. He explained that it had been Mr Chahal who was most anxious to begin running the business on his own account and the payment had been made to enable him to do so. Mr Redford did not suggest that Mr Chahal had been in occupation before the payment was made (although Mr Chahal was cross examined to that effect). I do not accept that Mr Redford threatened to sell the business to a third party. The whole point of the £20,000 which had already been paid was to induce him to take the property off the market. At this stage he and Mr Chahal are agreed to have been on very friendly terms, which would be difficult to understand if Mr Redford had gone back on his word so quickly, despite the second instalment of the deposit having been paid. I therefore find that the payment of £105,000, which brought the total paid so far to £135,000, was made in return for the release of the keys to the Premises, which were handed over the following day, and to allow Mr Chahal to commence trading on his own behalf.
41. There is no evidence that Mr Singh himself was involved in the business in any way, nor even that he visited the shop after his initial trip in March, but Mr Chahal was at the premises on most days during the week, returning to Coventry to see his family most weekends. From 9 June onward Mr Chahal received the takings, was given the code to the security and surveillance systems, paid the staff and suppliers, and assumed responsibility for the rent and rates payable for the Premises. By agreement with Mr Redford he continued to use the name "Redz traditional fish and chips".
42. Exchanges between the parties' solicitors continued on an entirely separate track. A draft sale agreement was provided by Miss Campbell to Mr Briars on 28 June and on 2 July they spoke over the telephone. Miss Campbell's note was that Mr Briars had been told by his client that he was to take a new lease for a term of 3 years. Mr Briars himself wrote to the landlord's solicitor, Mr Sword, in the same terms on 2 July so Miss Campbell's note seems to have been an accurate account of what she had been told. This was the first letter passing between Mr Briars and Mr Sword and it suggested that Mr Singh was to purchase the business and take a new lease for a term of three years at a rent of £6,500 pa, subject to contract and subject to lease. Mr Briars understood that Mr Redford was to surrender the existing lease to the landlord and asked for a simple form of agreement for lease which could tie in with Mr Singh's purchase of the business from Mr Redford together with a draft lease. It is clear, therefore, that the parties' solicitors anticipated that the transaction would proceed in a conventional manner. It is also clear that the agreement was not for an assignment of the existing lease to Mr Singh, but was for a surrender of it by Mr Redford, followed by the grant of a new lease by the landlord.
43. A further payment of £15,000 was made by bank transfer by the claimant to the defendant on 4 July 2012 followed by a payment in cash £10,000 on 16 July. Nothing in the communications passing between the solicitors at that time suggest that they were aware that these payments had been made.
44. On 30 July Miss Campbell received a telephone call from Mr Sword of which she made an attendance note. Mr Sword reported that "the proposed buyer" had threatened the landlord who had been considering whether to proceed as a result. No questions were asked of Mr Chahar about the incident alluded to by Mr Sword. Nevertheless, I take this reference to the proposed buyer to be to Mr Chahal, as there is no suggestion that Mr Singh had any contact with the landlord. It is the first of a number of indications that Mr Chahal was inclined to use threats to get his own way in business negotiations. Importantly, it is a contemporaneous record originating from a source not directly concerned with these proceedings, being reported by the landlord to his own solicitor. Whatever the nature of the threat, or the issue between the landlord and Mr Chahar at that stage, the difficulty seems to have been short lived because on 6 August Mr Sword confirmed that the landlord was agreeable to granting a lease of the premises and enclosing a draft. Apparently as an afterthought, Mr Sword wrote again on 10 August asking for confirmation that the buyer would be responsible for the landlord's costs of £510.
45. It is not clear whether the draft lease provided by Mr Sword (no copy of which was produced at trial) was for three years or seven years. Puzzlingly, on 21 August, Miss Campbell told Mr Sword that she had arranged an appointment with her client to discuss matters and to execute the lease. It is not clear what she meant by that, nor is the letter from Mr Sword to which her email of 21 August was a reply in evidence. It seems likely that she intended to meet her client to discuss the surrender of the lease and to execute deed of surrender which may by then have been provided by Mr Sword.
46. On 4 September Mr Briars informed Miss Campbell that there were a number of issues with the lease which he needed to discuss with his client before the document could be approved. He also suggested for the first time that the contract for the sale of the business should include non-competition clauses and a provision for the transfer of the employment rights of at least one employee in the business. In a follow-up letter on 5 September he suggested a number of other amendments to the draft contract and proposed that exchange and completion of the agreement should be simultaneous with the grant of the new lease and the surrender of the existing lease. He asked for details of the apportionment of the purchase price between goodwill, equipment and property.
47. In her response on 11 September Miss Campbell said that her client's accountant had suggested that the price be apportioned as to £61,000 for the equipment, £41,000 for goodwill and £23,000 for fixtures and fittings. The aggregate of these figures came to £125,000, which was £35,000 less than the sum already paid, and not a figure previously mentioned between solicitors or in the heads of terms. Mr Briars pointed this out in a letter of 20 September from which it is clear that he understood the purchase price to be £95,000.
48. By this time the landlord solicitors, McKenzie Bell, were becoming impatient to receive the undertaking for their costs requested on 10 August. On 2 October Mr Briars wrote saying that he had been instructed that the agreed contribution to legal costs was £200. On 5 October McKenzie Bell rejected this suggestion and said that they had been instructed to undertake no further work until an undertaking for the full sum originally requested had been provided.
49. Meanwhile, discussion of an appropriate non-competition clause continued between Mr Briars and Miss Campbell.
50. The issue of competition, and more importantly, the issue of the use of the business name, became a subject of dispute. Although he denied it, I am satisfied that both Mr Sykes and Mr Chahar were aware by early April that Mr Redford was about to open, and then had opened a new takeaway fish and chip shop at a shopping centre in Barmston, which I was told was about a five-minute drive from the Premises. Mr Sykes was photographed at the new premises on the day they opened in April, and he said he understood Mr Chahal was also aware of them. Mr Chahal was in Washington at the end of March at a time when the new premises would have been fitted out.
51. Mr Redford's evidence on this point, which I accept, was that he had taken Mr Chahal to see the new shop during his familiarisation visit in March. They had agreed that Mr Chahal would continue to use the name Redz for a short period (either 2 or 3 months) when it would revert to him, and presumably would be used at the Barmston shop. According to Mr Chahal, however, he had been unaware of Mr Redford's new business until the day on which the payment of £105,000 was made. His evidence was that on that day he was informed by his manager, Mr Sykes, that a number of members of staff had not turned up and had been redeployed by Mr Redford to Barmston. He gave an account in his witness statement of driving to Barmston to confront Mr Redford about competition, but if any confrontation took place it appears to have ended in his being reassured by Mr Redford that the new shop would not damage the takings at the Premises. In his oral evidence Mr Chahal said that this reassurance had turned out to be correct. I think that is credible, since the style of trading at the two premises was very different.
52. Once again, the suggestion that Mr Redford had cheated Mr Chahal by not revealing his intention to open a competing business is inconsistent with what is agreed to have been the warm relationship between the two throughout the summer of 2012. Relations were sufficiently strong that in June they agreed to a joint venture to open another fish & chip shop in Hartlepool which Mr Chahal had found and negotiated terms for.
53. In about September the relationship began to deteriorate. There are rival explanations for this, but I am satisfied that the cause was a disagreement over the continued use by Mr Chahal of the "Redz" trading name. Mr Redford turned up at the premises very angry one day with a piece of paper which I think likely to have been a flyer or newspaper advertisement. The three-month period of grace which had been agreed when the keys were handed over had come to an end at the start of September and Mr Redford wanted to stop what he saw as misuse of his family brand.
54. Mr Chahal gives an alternative explanation of the disagreement and places it a little later in the year. On 9 November 2012 Mr Briars finally gave the undertaking in costs which had been requested by the landlord's solicitor and returned the travelling draft lease with amendments. Those were agreed on 13 November but Mr Sword suggested a further amendment to make it clear that, in planning terms, the property only had a B2 use rather than A5 and to stipulate that the landlord did not warrant that the permitted use was lawful. Mr Briars himself was relaxed about this in his response on 15 November, and agreed the amendment asking only how long the premises had been in use as a fish & chip shop.
55. I am satisfied that, by November 2012, the business at the Premises had begun to deteriorate under the new management. I was told by Mrs Banks that there had been a decent trade until a relaunch and renaming of the business, (which I take to have been in September following Mr Redford's objection to the continued use of his branding) but that by November and increasingly after Christmas the trade became mediocre and a number of staff had their hours reduced or left due to lack of trade.
56. It is possible that Mr Chahal was advised by his solicitor at about that time that the retail takeaway part of the trade was vulnerable to an objection on planning grounds, but there is no hint of that in the correspondence between the transactional solicitors; in any event, he had no reason to believe that the planning position had been or would become a source of difficulty in practice. There was never any suggestion that the local authority objected to the use of the Premises or to the other units trading in similar style on the industrial estate. I am satisfied that Mr Chahal had not been misinformed by Mr Redford that planning permission existed for a takeaway. Either he took the news from his solicitor as a pretext to escape what was turning into a bad bargain, or he may genuinely have misunderstood the reference in the lease to a "Permitted Use" (which has no connotation of planning permission). In either case I am satisfied that, without justification, Mr Chahal alighted on the absence of A5 planning permission as a legal grievance against Mr Redford only after the business began to disappoint him and he no longer wished to be involved in it.
57. I find that Mr Chahal first began to make threats against Mr Redford and his family in December 2012 or January 2013. Mr Redford said he reported these to the police and received a slip with an incident number and victim support contact details, which he produced; the document is dated 21 January and was issued by Washington police station. Unfortunately no attempt has been made to obtain information from the police of what was reported to them, but Mr Redford said that in a series of phone calls, messages and meetings he had been threatened with assault, told that he and his wife would be killed, and that his older daughter would be raped and his younger daughter molested. At different times he had been shouted at in the street and cars had pulled up beside him in a way he took to be intimidating. In March 2013 Mr Chahal had come to his shop and threatened his daughter and himself in the incident witnessed by Mr Fernandez and Mr Doyle. He moved house to rented accommodation after he was visited at home by Mr Chahal.
58. While Mr Chahal was in India, and probably by the end of January 2013, Mr Redford took back the Premises and once again began to run them for himself. This occurred after bailiffs attended his own shop in Barmston to collect the rent for the Premises, the lease of which remained in his name. He installed Mr Doyle as manager. It is possible that Mr Doyle was chosen because he would not be easily intimidated; Mr Fernandez told me that he and Mr Doyle shared an interest in martial arts, and that Mr Doyle accompanied Mr Redford to meetings at which Mr Chahal was verbally aggressive. Mr Redford paid the rent which had been due on 1 January, and paid staff Christmas bonuses. He ran the business for a number of months but closed it by the middle of 2013 and gave up his interest in the Premises either by giving the three months' notice of termination permitted by the lease or when it expired at the end of March 2014.
59. Mr Redford told me he had reported some of the incidents in which he had been threatened by Mr Chahal to his solicitor. This was confirmed by an attendance note by Mr Briars (Mr Chahal's solicitor) of a conversation between the parties' solicitors on 27 September 2013 in which it was stated that "Suki Chahal … had made various threats to Mr Redford". In the same attendance note Mr Redford's solicitor, Mr Donkin, is recorded as saying that he now had instructions to propose a settlement in which Mr Redford would take back the shop and business, which by then was no longer trading, and repay £140,000 from the sale of another business. This was, in outline, the arrangement brokered by Mr Fernandez in about May or June 2013. Fixtures from the Premises were to be transferred to the new shop in Hartlepool which Mr Chahal and Mr Redford had once intended to run in partnership, but which had not yet opened. It would be built up by Mr Redford who would eventually sell it and repay Mr Chahal. In the meantime, Mr Redford would agree to pay £2,500 a month on account.
60. Mr Redford's evidence was that he was willing to agree to this proposal because of his fear of Mr Chahal, and of what he might do to him and his family if the money was not repaid. I accept that evidence.
61. By the time solicitors were instructed to document the settlement agreement in September 2013 at least two payments of £2,525 had already been made by Mr Redford into Mr Chahal's bank account. In total, £20,200 was paid in this way between 1 August 2013 and 28 February 2014, but the payments then stopped. No evidence was given by either side why the deal broke down in this way, and the correspondence between solicitors simply petered out without the document having been formalised. There is no claim in the proceedings to enforce the terms of a compromise as an alternative to restitution.

The claimant's case

62. On behalf of the claimant Mr Simon Clegg invited me to conclude on the basis of the evidence that no contract had ever been entered into between the parties and that payments had been made in the expectation that a contract being concluded only after the involvement of solicitors. Secondly, Mr Clegg submitted that the defendant had clearly been unjustly enriched by the payments he had received and should repay the full amount to Mr Singh. Thirdly, he argued that the payments made Mr Redford to Mr Chahal, which he had received on behalf of Mr Singh, were made pursuant to the proposed settlement agreement, although he recognised that no concluded compromise had been entered into; they were not, Mr Clegg submitted, made as a consequence of threats.
63. Mr Clegg suggested that the principle issue in the case was whether the parties had reached a legally binding agreement. On the assumption that they had not, it would follow almost as a matter of course that Mr Redford had been unjustly enriched and must be required to make restitution. He referred to the speech of Lord Clarke in RTS Limited v Molkerei Alois Muller GMBH [2010] 1 WLR 753 at [45], in which the general principles concerning the creation of a binding contract were summarised as follows:

"Whether there is a binding contract between the parties and, if so, upon what terms depends upon what they have agreed. It depends not upon their subjective state of mind, but upon a consideration of what was communicated between them by words or conduct, and whether that leads objectively to a conclusion that they intended to create legal relations and had agreed upon all the terms which they regarded or the law requires as essential for the formation of legally binding relations. Even if certain terms of economic or other significance to the parties had not been finalised, an objective appraisal of their words and conduct may lead to the conclusion that they did not intend agreement of such terms to be a precondition to a concluded and legally binding agreement."

At [47] Lord Clarke continued:

"We agree with Mr Catchpole's submission that, in a case where a contract is being negotiated subject to contract and work begins before the formal contract is executed, it cannot be said that there will always or even usually be a contract on the terms that were agreed subject to contract. That would be too simplistic and dogmatic an approach. The court should not impose binding contracts on the parties which they have not reached. All would depend upon the circumstances."

64. The existence of an expectation that a concluded agreement would be formally documented is an important consideration, although it is not determinative of an absence of contractual intention. Mr Clegg referred to the decision of the Court of Appeal in Whitehead Mann Limited v Cheverney Consulting Limited [2006] EWCA Civ 1303 in which the Chancellor, Sir Andrew Morritt, reviewed authorities on the question whether a contract in the course of negotiation might give rise to binding legal relations and said, at [45]:

"Obviously each case depends on its own facts but in my view where, as here, solicitors are involved on both sides, formal written agreements are to be produced and arrangements made for their execution, the normal inference will be that the parties are not bound unless and until both of them sign the agreement."

65. Mr Clegg submitted that it was clearly the intention of the parties that any agreement reached in March or April 2012 was to be subject to contract, in the sense that it would require to be documented before it become binding. The only document created at that stage was the heads of terms, which were incomplete and which, in any event, required the agreement of the landlord to the grant of a longer lease. The correspondence between solicitors beginning in the middle of April 2012 referred to a "proposed sale". I agree that the solicitors certainly anticipated that the sale of the business would proceed on the conventional basis that neither party would be bound until contracts were exchanged, and although they did not routinely mark their correspondence "subject to contract" this was clearly implicit.
66. Mr Clegg reminded me that in cross examination Mr Redford had acknowledged that the matter would not be complete until all the terms were documented and executed. He had accepted that the reason he had let Mr Chahal into the shop and allowed him to conduct business was that he had trusted him and expected that the agreement would be implemented. He was, Mr Clegg submitted, prepared to take a risk that it might not be. It might also have been convenient for him to have Mr Chahal running the Premises while he concentrated on the recently established Barmston business.
67. As for the position of the landlord, Mr Clegg did not invoke section 2(1) of the Law of Property (Miscellaneous Provisions) Act 1989 which provides that no agreement can be made for the disposition of an interest in land except by writing signed by all parties, but he pointed out that it was necessary to the deal for the terms of a new lease to be agreed with the landlord, for that document to be executed and for the surrender of the defendant's original lease to be completed before effect could be given to the arrangements which had been discussed between the parties in March 2012.
68. On the basis that no agreement with contractual force had ever been entered into, Mr Clegg submitted that the claimant was entitled to recover the balance of the purchase price, £139,800. He referred to the decision of the Supreme Court in Benedetti v Sawiris [2014] AC 938 in which Lord Clarke, at paragraph [10] identified four questions which a court must first ask when faced with a claim for unjust enrichment, namely:

"(1) Has the defendant been enriched? (2) Was the enrichment at the claimant's expense? (3) Was the enrichment unjust? (4) Are there any defences available to the defendant?"

These requirements are not to be construed as a statute and nor are they to be viewed in isolation from each other. The first three questions, in particular, may overlap.

69. Mr Clegg's case on restitution was very simple. It was obvious and was admitted that the defendant had been enriched by payments received from the claimant. Thus, the first and second requirement were satisfied. The payments were made in the expectation of a contract which had never eventuated and therefore, without more, their retention by the defendant was unjust. If it was necessary to find any additional element, he relied on the fact that the contract had gone off because the true planning status of the Premises had not been made clear to Mr Chahal until November 2012, and had he known earlier, he would not have been interested in the Premises at all. That factor, which had been in the power of the defendant to disclose at a much earlier date, made it unjust for the contract sum to be retained by him.
70. In my judgment Mr Clegg is clearly correct that no contract for the sale of the business was formed in March or April 2012. At most there was a contract that Mr Redford would no longer market the business, in return for which he received the first payment of £10,000. Neither side suggested that the payment of the first £10,000 was agreed on the condition that it would be returned if formal documents were not completed or an agreement was not reached with the landlord (although Mr Chahal said he assumed that). Nevertheless, the making of that agreement demonstrated that at that stage the parties did not yet regard themselves as being bound; their expectation was that completion of the paperwork by the solicitors and the reaching of an agreement with the landlord were necessary preconditions to Mr Chahal and Mr Singh's acquisition of the business. It was because neither party was yet bound that it was necessary for Mr Redford to be persuaded by a significant payment to stop marketing the business to other potential purchasers. The question is, however, whether that absence of contractual intention persisted, or whether there came a point at which the parties formed a different intention.
71. As the passage from Lord Clarke's speech in RTS cited above makes clear, the existence of a contractual intention depends not upon the parties' subjective states of mind, but whether, objectively, what was communicated between them by words or conduct demonstrates that they intended to create legal relations and "had agreed upon all the terms which they regarded or the law requires as essential for the formation of legally binding relations". The fact that other potentially important terms may not yet have been finalised may not prevent the formation of a concluded and legally binding agreement if an objective appraisal of what passed between the parties shows that they did not intend those terms to be a precondition.
72. Neither Mr Redford nor Mr Chahal (whose intention was what mattered on the purchasers' side) was concerned about the contents of the formal documents and I am satisfied that that would have been obvious to them both. Apart from the price, the only matters of significance to Mr Chahal were the performance of the business, which he satisfied himself of in March by spending time observing it in operation, and the willingness of the landlord to extend the lease to seven years. He made the first payment of £10,000 on the strength of Mr Redford's assurances that the landlord would be willing to grant a longer lease, and the second instalment was handed after he had met the landlord at the beginning of April and received confirmation that he could have a new lease for a term of seven years.
73. For Mr Redford's part, the matters of most importance were the price and the use of his "Redz" trading name and branding, which he was using at his new Barmston shop. The price was agreed within a few days of the first meeting. By the time Mr Chahal took over running the Premises on 9 June 2012 it had been agreed that he would continue to use the original branding for a period of two or three months and would then cease doing so and rebrand the business. It was for that reason that Mr Redford was so angry in September when he arrived at the shop to confront Mr Chahal over flyers or advertising which continued to style the business as Redz traditional fish and chips.
74. The arrangement as far as the lease of the Premises themselves was concerned was not addressed in detail, except that it was essential that the landlord be willing to allow a term of seven years. At a very early stage, and by 16 April at the latest, it had been settled between all three parties that the mechanism for securing occupation for seven years would be the grant of a new lease by the landlord to Mr Singh, rather than an assignment of Mr Redford's existing lease. I reach that conclusion on the basis of two documents. The copy of the heads of terms which I have seen was produced from the files of Mr Redford's solicitors. The printed text describes the lease terms as "seven year lease" and the manuscript annotation, which appears next to the name of the landlord's solicitor, refers to "7yr lease to be granted to new tenant". When Miss Campbell contacted the landlord's solicitor on 16 April 2012, she said her instructions were that the landlord had already agreed to a surrender of the existing lease and to grant a new seven year lease to the buyer of the business.
75. At no stage, therefore, was there proposed to be an agreement for the disposition of an interest in land by Mr Redford to Mr Singh. The lease was not to be assigned, it was to be surrendered. I was not addressed on the application of section 2(1) of the 1989 Act to an agreement between A and B that A will surrender his lease to C leaving B then to take a new lease from C. I do not regard an agreement of that type between A and B as an agreement for the disposition of an interest in land falling within section 2(1). No disposition of any interest in land was to take place between the parties to the agreement, Mr Redford and Mr Chahal. Nor was it necessary that Mr Redford enter into an agreement in writing with the landlord before the intended new lease could be acquired by Mr Singh, since the effect of Mr Redford's acquiescence in the grant by the landlord of the term of seven years would be that his own tenancy would terminate by operation of law. The surrender of his tenancy would be capable of being achieved without any disposition caught by section 2(1) (a surrender by operation of law taking effect by estoppel). I am satisfied therefore that section 2(1) presents no legal obstacle to the formation of a binding contract on the terms agreed between the parties.
76. I do not accept Mr Clegg's submission that the involvement of solicitors demonstrated that the parties did not intend to enter into binding commitments until formal documents were executed. It is striking that the parties provided their solicitors with so little information about what was actually going on and, I am satisfied, deliberately kept them in the dark about the real terms of the agreement (presumably to avoid tax). The heads of terms stated that the purchase price was to be £95,000, rather than £165,000, a figure which Miss Campbell was told was the purchase price of the business and which appeared in the draft contract of sale. By September a figure of £125,000 was mentioned by Miss Campbell, apparently on instructions from Mr Redford's accountant, but it is clear that even at that stage Mr Briars, acting for Mr Singh and Mr Chahal was still under the impression that the agreed price was £95,000.
77. Mr Clegg acknowledged that Mr Redford's acceptance in cross examination, six years after the event, that the deal would not be "completed" until formal contracts were exchanged, is not determinative of his intention, assessed objectively, in 2012, and I place little weight on it. I regard it as of much more significance that on 8 June 2012 Mr Redford and Mr Chahal agreed that the keys would be handed over and Mr Chahal would be allowed to run the business in return for a further payment of £105,000, which brought the total paid so far to £135,000. I am satisfied that it was intended at that point that the business would belong to Mr Chahal and the important commercial terms which the parties had already agreed between themselves would be implemented. Mr Chahal would be entitled to the income of the business and would be responsible for its outgoings; he would have possession of the premises and would be left to make his arrangement for a new lease with the landlord. Mr Redford would have no further part in the business, and his trading name would cease to be used within three months. He would receive further payments to complete the purchase price, but these were not conditional on documents being executed and further instalments of £15,000 and £10,000 (cash) were paid in July 2012 without the parties' solicitors being informed. The only risk Mr Redford took by allowing Mr Chahal in was that these payments might not be forthcoming, but at that time the two men were already investigating further opportunities to do business together and I do not regard the existence of a risk on either side as a matter preventing them from having an intention to conclude a binding agreement. The making of the additional payments is therefore a further confirmation that, in this unusual case, the conclusion of negotiations between solicitors of more detailed terms was not treated by the parties as a precondition of their bargain becoming binding. Nor was the conclusion of negotiations with the landlord for a new seven year lease a precondition. Both sides were content that the landlord would cooperate (and terms of a new lease were agreed without difficulty, but never signed) and that Mr Chahal would occupy the premises and assume responsibility for payments due under the tenancy agreement without any formalities.
78. I therefore answer the first question posed by Mr Clegg against the claimant. I am satisfied that there was a binding agreement for the sale of the business for £165,000, with Mr Chahal to negotiate for a new lease with the landlord. The claim for restitution of the purchase price of the business therefore fails.
79. If I am wrong about the existence of a binding agreement by 9 June 2012 I would nevertheless refuse restitution. In the absence of argument to the contrary I am prepared to assume that Mr Redford is to be regarded as having been enriched by the claimant in circumstances where he handed over the operation of a business and remained willing to cooperate in the termination of his own tenancy to allow a new tenancy to be granted to the claimant, (benefits which the parties agreed were worth £165,000) in return for payments totalling £160,000. What I do not accept is that the retention of those payments by Mr Redford in the circumstances of this case can be regarded as unjust. For the retention of a benefit received by a defendant to be unjust, for the purpose of the third requirement, it must be shown that the enrichment occurred in circumstances analogous to those in which the remedy of restitution has been recognised as being available in earlier cases. I was shown no such cases.
80. My reasons for not regarding the retention of the purchase price by Mr Redford as unjust have nothing to do with the unsavoury tactics adopted by Mr Chahal in his efforts to secure the return of the money. Those are, I think, irrelevant. When awarding a restitutionary remedy the court seeks to secure a fair and just determination of the rights of the parties concerned in the case. The remedy is not discretionary in its application so as to allow restitution to be withheld where all the necessary elements for its satisfaction have been established (see the speech of Lord Clyde in Banque Financiere De La Cite v. Parc (Battersea) Ltd [1999] 1 AC 221).
81. My reasons for regarding the retention of the purchase price as not being unjust are as follows.
82. First, that Mr Redford no longer has the business which in March 2012 the parties agreed was worth £165,000 and which, I accept, was so diminished under the management of Mr Chahal that by April or May 2013 it had been closed. Looked at over the period of a year following his handing over control to Mr Chahal, and leaving aside the payments made under the proposed settlement agreement, Mr Redford comes out of the episode no better than even.
83. Secondly, whether it was done in a contractually binding form or not, the payment was made in exchange for the opportunity to take on a business venture involving all the usual business risks. Mr Chahal willingly assumed those risks until the business became so unsuccessful that he effectively abandoned it, going to India for three months, leaving rent, bills and staff unpaid and the shop under the management of Mr Doyle who had no relevant experience. I do not see why fairness requires that the business risk transferred from Mr Redford to Mr Chahal should be reallocated to Mr Redford after the event. Nor do I consider that the fact Mr Redford resumed control of the business in the final few months makes any difference to that assessment; he remained liable on the lease and his stock was being borrowed by his former employees to keep the business going; moreover, as the correspondence between solicitors in March and April 2013 makes clear, following Mr Chahal's return from India Mr Redford was keen for Mr Chahal to resume control, and agreed to unpick the bargain only as a result of the threats made against him.
84. Thirdly, I am satisfied that Mr Redford was not at fault in the negotiations and did not cause the difficulties which led to the failure of the business. There was no misrepresentation concerning the planning status of the Premises which, in any event, had nothing to do with the difficulties experienced by Mr Chahal. Nor did Mr Redford engage in unfair competition. I am satisfied that Mr Chahal was made aware that the new shop was about to open in Barmston before he took over the business, and, in any event, Mr Redford was right in his expectation that the new shop would not damage trade at the Premises, as Mr Chahal agreed.
85. For these additional reasons I would also dismiss the claim to restitution.

The counterclaim

86. It remains only to deal with the counterclaim.
87. I have already explained why I accept Mr Redford's evidence that he agreed to pay £20,200 back to Mr Chahal because he was fearful for himself and his family as a result of the threats made to him by Mr Chahal. It is established, and not disputed, that duress is a ground on which restitution may be ordered. Mr Clegg submitted that before restitution could be ordered it would first have to be shown that the payment had been caused by the threats made, and that in this case that was not so, because Mr Redford had accepted that there was no binding contract and he was not entitled to retain the money. I do not accept either submission. It is enough that duress be a contributory cause of the transfer of a benefit by a claimant to a defendant, without it being the sole or operative cause (Barton v Armstrong [1976] AC 104; Virgo, Principles of The Law of Restitution, third edition, pp.210-211). I am satisfied that but for the threats, Mr Redford would have instructed his solicitors to continue to resist Mr Chahal's claims.
88. I therefore find that Mr Redford is entitled to the return of the £20,200 paid in pursuance of the abortive settlement proposals.
89. It follows from my conclusion that the parties reached a binding agreement for the sale of the business, that Mr Redford is also entitled to the balance of the purchase price, which I find to be £5,000.
90. The only evidence I can find of a payment of rent having been made by Mr Redford, at a time when he was not in occupation, is of the January 2013 instalment totalling £1,650, which is referred to in a letter from the landlord's solicitor of 11 June 2013. He is entitled to that sum, because it was part of the bargain made at the beginning of June that the rent would be paid by Mr Chahal. Although other sums are claimed, there is no evidence that these were paid, and I make no determination in relation to them.
91. The total sum payable by the claimant to the defendant on the counterclaim is therefore £26,850, and I will enter judgment for that sum, plus interest to be agreed. I am told that the parties have agreed a figure for interest of £2,015, and that the claimant has agreed to pay the defendant's costs of the proceedings assessed in the sum of £22,000. The order of the \court will include those figures, which will be payable by the claimant, as agreed, within 28 days.