BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST
Fetter Lane London, EC4A 1NL |
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B e f o r e :
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YODEL DELIVERY NETWORK LIMITED |
Claimant |
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- and - |
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(1) JACOB CORLETT (2) YDLGP LIMITED (3) SHIFT GLOBAL HOLDINGS LIMITED (4) GREGORY CRANE LIMITED (a company incorporated under the laws of the Isle of Man) |
Defendants |
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- and - |
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MICHAEL JOHN HANCOX |
Third Party |
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- and - |
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CORJA HOLDINGS LIMITED (a company incorporated under the laws of the Isle and Man) |
Fourth Party |
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- and - |
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JUDGE LOGISTICS LIMITED |
Fifth Party |
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Mr Edward Davies KC and Mr Jack Rivett (instructed by Wordley Partnership) for the Third Defendant
Mr Edward Davies KC and Mr Jack Rivett (instructed by Richard Slade & Partners LLP) for the Fourth Party
Hearing date: 5 June 2025
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Crown Copyright ©
DAVID MOHYUDDIN KC:
This judgment
Introduction
4.1. Mr Corlett says that Shift Global Holdings Limited ('Shift'), of which he is a statutory director and shareholder, has the benefit of a Warrant Instrument issued by Yodel on 19 June 2024 ('Second Warrant Instrument'). A certificate of the same date states that Shift is entitled to subscribe for up to 1,469,795,088 Ordinary Shares of £0.0001 each at a price of £0.0001 per share subject to the terms of the Warrant Instrument and the Conditions.
4.2. Mr Corlett also says that Corja Holdings Limited ('Corja') has a similar entitlement, for 341,813,276 shares. Corja is wholly owned by Mr Corlett. Corja seeks permission to amend its statement of case to raise the Warrant Claim in its own name in materially identical terms to the way Shift expresses it.
4.3. It is then said that Shift and Corja exercised their subscription entitlements on 7 January 2025 (the delay being attributed to the need to obtain advice and to corral a number of Warrantholders to take action) but that Yodel has wrongfully and in breach of contract refused to allot and issue the shares. As such, Shift seeks and, if its proposed amendment is allowed, Corja will seek, specific performance of the warrant alternatively damages.
4.4. The effect of success on the specific performance claims would be to make Shift and Corja the majority shareholders in Yodel, displacing JLL.
Relevant procedural history
9.1. the First Defendant, Mr Corlett who was a statutory director of Yodel between 13 February 2024 and 21 June 2024;
9.2. the Second Defendant, YDLGP of which Mr Corlett has at all times been the sole statutory director and 100% shareholder and which was between 13 June 2024 and 21 June 2024 Yodel's immediate sole parent company;
9.3. the Third Defendant, Shift of which Mr Corlett is a statutory director and a shareholder; and
9.4. the Fourth Defendant, Gregory Crane Limited ('GCL') of which Mr Corlett and his mother Ms Tamara Lea Gregory are the directors; Ms Gregory is the sole shareholder.
15.1. the determination of the Warrant Claim as a preliminary issue;
15.2. the expedition of the trial of the Warrant Claim;
15.3. an injunction to restrain JLL from carrying out its intended transformation of Yodel's business.
16.1. permission to amend to bring the Warrant Claim in its own name ('Corja's Amendment Application');
16.2. the determination of the Warrant Claim as a preliminary issue;
16.3. the expedition of the trial of the Warrants claim;
16.4. an injunction to restrain JLL from carrying out its intended transformation of Yodel's business.
19.1. the applications for the determination of the Warrant Claim as a preliminary issue will be referred to as the 'Preliminary Issue Application';
19.2. the applications for the expedition of the trial of the Warrant Claim will be referred to as the 'Expedition Application'; and
19.3. the applications for the injunction will be referred to as the 'Injunction Application'.
20.1. on behalf of Shift and Corja:
20.1.1. Jacob Corlett dated 9 May 2025;
20.1.2. Mark Fishleigh dated 9 May 2025;
20.1.3. Tamara Lea Gregory dated 9 May 2025;
20.2. on behalf of Yodel:
20.2.1. Jeremy Paul Garson dated 22 May 2025;
20.2.2. Michael John Hancox dated 22 May 2025;
20.2.3. Paul Raymond Patrick McCourt dated 22 May 2025;
20.2.4. Neil Oliver Kuschel dated 22 May 2025;
20.2.5. Nicholas Wiles dated 22 May 2025;
20.2.6. Lyndsey Michelle Taylor dated 22 May 2025;
20.3. in reply on behalf of Shift and Corja:
20.3.1. Jacob Corlett dated 28 May 2025;
20.3.2. Jacob Corlett dated 30 May 2025;
20.3.3. Mark Fishleigh dated 28 May 2025;
20.3.4. Mark Pearson dated 28 May 2025.
Warrant Claim
"2. THE WARRANT
2.1 The Company [i.e. Yodel] hereby grants to the Warrantholder [defined as a person whose name is entered and appears in the Register as a holder of any Warrants] an option to subscribe for such number of Ordinary Shares as represent the issued share capital of the Company as at the date of this Instrument or as at the date of issue of the Warrant, whichever represents the lower shareholding, subject to the following conditions:
- Corja Holdings Ltd: no less than 10% or 341,813,276 shares…
- Shift Global Holdings Ltd: no less than 44% or 1,469,795,088 shares.
Where the shareholding percentage or number of shares listed above applies, the higher value shall prevail.
2.2 The Company shall perform and observe the Conditions [set out in Part 3 of the Schedule to the Second Warrant Instrument] and shall give effect to the subscription rights set out there in and the Warrant shall be held subject to and with the benefit of the Conditions and such subscription rights all of which shall be deemed to be incorporated in this Instrument and shall be binding on the Company and the Warrantholder and all persons claiming through or under them.
3. WARRANT CERTIFICATE
3.1 The Warrant Certificate shall have endorsed thereon or attached thereto the Conditions and an Exercise Notice.
3.2 A Warrant Certificate shall be issued to the Warrantholder, such certificate evidencing the Warrantholder's entitlement to the Warrant…
4. THE REGISTER
4.1 The Company shall at all times maintain a register in the United Kingdom showing the entitlement to the Warrant, the details of the Warrant held by the Warrantholder, the date of issue of the Warrant Certificate together with the name and address of the person entitled to be registered as the Warrantholder.
5. GENERAL
…5.4 Any notice to be given by the Warrantholder to the Company shall be delivered or sent to the Company at its registered office and shall be effective upon receipt."
"1.1 Definitions
In these Conditions except to the extent that the context otherwise requires:
'Exercise Event' means a Sale, Listing or disposal of the whole or substantially the whole of the shares or assets of the Company or its holding company or ultimate holding company, other than the acquisition of the entire issued share capital of the Company by YDL Technologies Ltd (Registered number 15598155) …
'Exercise Period' means the period from the date of the first Exercise Event to occur to the date on which the Warrants are exercised or lapse in accordance with Condition 5 …
'Sale' means the completion of any transaction whereby any person or group of persons acting in concert … acquires more than 75 per cent of the share capital of the Company other than a reorganisation for the imposition of a holding company with the same shareholders as the Company …"
"2. SUBSCRIPTION RIGHTS
Subject as provided in these Conditions, this Warrant shall entitle the Warrantholder to subscribe for up to the Relevant Number of Ordinary Shares at the Subscription Price. A Warrant may be exercised on any Business Day during the Exercise Period, provided that an Exercise Notice may only be issued during the Exercise Period.
3. EXERCISE OF WARRANT
3.1 The Warrant held by a Warrantholder may be exercised by such Warrantholder:
3.1.1 serving an Exercise Notice on the Company specifying (a) the number of Ordinary Shares to be allotted (which may be all or any number of the Ordinary Shares to which this Warrant applies); and (b) a date for the allotment and issue of the relevant Ordinary Shares which is a date not less than 7 days or more than 14 days after the date of the relevant Exercise Notice (or if the Exercise Notice is issued in respect of an Exercise Event, immediately prior to such Exercise Event occurring); and
3.1.2 enclosing with the Exercise Notice a cheque for the total Subscription Price payable in respect of the Ordinary Shares in respect of which the Warrant is being exercised or making such other form of payment as is agreed by the Company.
3.2 The Company shall promptly notify the Warrantholder of the principal terms (including the proposed price and, in the case of a Sale, the identity of the proposed purchaser) of any proposed Exercise Event at the same time as such terms are notified to the Company's shareholders and, in any event, not less than fifteen Business Days prior to the Exercise Event in question.
3.3 Upon receipt of the notice referred to in Condition 3.2 or on otherwise becoming aware of the proposed occurrence of an Exercise Event the Warrantholder may exercise its rights in accordance with the Conditions provided that all rights of the Warrantholder exercised in advance of an Exercise Event shall be deemed to be exercised conditionally upon the occurrence of the Exercise Event in question and the exercise will only take effect immediately prior to the occurrence of such Exercise Event.
3.4 Provided that each Warrantholder has been given notice in accordance with Condition 3.2 any rights of the Warrantholder which have not been exercised on completion of an Exercise Event shall automatically lapse upon completion of such Exercise Event and shall have no further effect from such date…
5. LAPSE OF WARRANT
5.1 The Warrants shall lapse on the earliest of the following dates …
5.1.2 upon completion of an Exercise Event (in the event that the rights of the Warrantholder have not been exercised in accordance with Condition 3 above) or, if later, the tenth Business Day after the Warrantholder shall have received notice of an Exercise Event upon Condition 3.2 …"
"3.1 The Sole Director noted that…
3.1.4 Other agreements to grant shares have been entered in to both formally and informally with partners including the company's management and investment partners…
3.2 After considering all of the above and to protect all parties in the case of a none merger event, the sole director resolved that the Company issue all warrants as referred to in the ASAs (over the number of shares required for the warrant to be equivalent to the value of the sum invested by each investor), alongside a warrant granted to SGH resulting in a similar holding to that under which shift shareholders would have in the proposed merger (43% of the company), alongside any further warrants reflecting the agreements that have taken place formal and informal with other parties and take all such action necessary to do so.
"I the undersigned, having the right as at the Circulation Date to attend and vote at General Meetings of the above Company hereby resolve the following resolutions, such resolutions to have effect as a Special Resolution as indicated:
SPECIAL RESOLUTION
1. THAT, it is hereby acknowledged that the articles of association of the Company (the "Articles") were put in place by Logistics Group Limited (the previous owner of the entire issued share capital in the Company defined as the "Parent Company" in the Articles) and that, notwithstanding the provisions of articles 52, 53, 58.3 of the Articles, and Model Articles (as defined in the Articles) 11(3)(b) and 38, since Friday 14th June 2024 that nothing shall require the Company to have more than one director, within the meaning of the Articles or otherwise, and a sole director of the Company be and is hereby generally and unconditionally authorised to take decisions.
2. THAT any decisions of the sole director of the Company made on and prior to the date of this resolution, be retrospectively approved and ratified, notwithstanding such decisions may not have been validly made in accordance with the Articles and/or the applicable regulations contained in the Model Articles."
Injunction Application
"pursuant to section 37(1) of the Senior Courts Act 1981, until the sealing of an order following the trial of the Preliminary Issue, [Yodel] should not conduct its business otherwise than in the ordinary course, as further detailed in the draft Order attached."
"Injunction
5. Pursuant to section 37(1) of the Senior Courts Act 1981, until the sealing of an order following the trial of the Preliminary Issue, the Claimant shall not conduct its business otherwise than in the ordinary course and in particular shall not, without the consent of the Applicants:
a. Incur a liability outside of the ordinary course of business of £50,000 or more;
b. Dispose of any asset with a market value of £25,000 or more;
c. Enter into any commitment (save in respect of employment) with a duration of six months or more;
d. Terminate the employment of any employees of the Claimant save for gross misconduct;
e. Register, approve or otherwise permit the transfer of any shares in the Claimant;
f. Permit its business, or any material part of its business, to be transferred to InPost S.A., PayPoint or any company associated with Inpost S.A. or PayPoint.
g. Permit or facilitate the transfer of any of its customers to, or the transfer to or recruitment of any of its employees by, InPost S.A., PayPoint or any company associated with Inpost S.A. or PayPoint;
h. Alter the branding of Yodel or otherwise permit the business of Yodel to be used to advertise the business of InPost S.A., PayPoint or any company associated with Inpost S.A. or PayPoint;
i. Merge or otherwise combine the business or any of its operations with those of InPost S.A., PayPoint or any company associated with Inpost S.A. or PayPoint.
6. For the purposes of paragraph 5, a company is associated with another company if one is the subsidiary of the other (within the meaning of section 1159 of the Companies Act 2006) or both companies are subsidiaries of a third company or is party to a joint venture with another company.
7. In the event that the Claimant considers that compliance with paragraph 5 of this Order would give rise to imminent material harm, it may apply to vary this Order on not less than 72 hours' notice to the Applicants."
Jurisdiction
"(1) The High Court may by order (whether interlocutory or final) grant an injunction or appoint a receiver in all cases in which it appears to the court to be just and convenient to do so.
(2) Any such order may be made unconditionally or on such terms and conditions at the court thinks just."
"I turn to the third and last topic which arises for decision. This concerns para 2 of the draft order, which I have already read. There appear to me to be two main topics that need to be addressed in this respect. The first is whether the court has any jurisdiction to make the order, and the second is whether the court should make that order. In his opening submissions, leading counsel for the claimant was not particularly clear as to the precise basis of the court's jurisdiction. Conversely, counsel for the Company submitted that the court had no such jurisdiction, and this application should be dismissed on that ground. In the course of the hearing, I consider that there emerged a basis for the court to hold that it did have jurisdiction to make an order pending trial of the claim so as to give the claimant relief which is ancillary to the final relief it claims and which, therefore, it might subsequently obtain. The substance of the underlying dispute is as to whether the claimant is a minority shareholder or a shareholder able to control the affairs and business of the Company. If the claimant wins at trial against the Company, the claimant will control the Company. On that basis, the claimant should already be in control of the Company. On that basis, the reason that the claimant does not already control the Company is attributable to the Company's past and continuing breach of its contract with the claimant. In those circumstances, I consider that it is open to the court on an interim basis, pending trial, to prevent, to an appropriate extent, the Company from taking advantage of its breach of contract. After all, the reason that the matter has not been rectified already is the inevitable delay in the matter coming to trial. That is on the assumption that the claimant succeeds at trial."
"On the question of the jurisdiction (the existence of which I perceive to be in issue between the parties) to grant the injunction sought by the Applicants, should you wish to make them I will be grateful to hear your oral submissions as to the effect of the decision in Convoy Collateral Ltd v Broad Idea International Ltd [2021] UKPC 24; [2023] AC 389."
"The Claimant and the Fifth Party do not contend that the court altogether lacks jurisdiction to make broadly the type of injunction sought by the Applicants in an appropriate case, i.e. that such an order is necessarily a legal impossibility.
Their position is rather that this is not an appropriate case and that the jurisdiction to grant any such order is to be exercised narrowly and carefully, and where that jurisdiction is exercised so as to prohibit the exercise of corporate powers in a novel manner, that the extension is a principled one."
44.1. Dilato was a case similar to this one, in that it was about control of a company and the need to control the extent to which the party in the incumbent position could do things before the question of control was resolved;
44.2. it was a good illustration of the Court's ability to give appropriate relief in this type of situation;
44.3. the decision in Convoy Collateral confirmed the breadth and flexibility of the jurisdiction which is not one in which the Court necessarily adopts a particularly cautious approach in the sense that it should not veer towards not making an order;
44.4. the guiding principle is to provide an effective remedy and routinely the Court has to fashion its own approach, the relief being sought being that necessary to provide an effective remedy.
45.1. it was not his case that there was no jurisdiction; the jurisdiction is enormously broad but in such an unusual case as this it must be exercised with great care and on a relatively narrow basis;
45.2. Dilato indicated the existence of a jurisdiction but was very factually different to this case in that the competing parties were each already shareholders; the company was not insolvent and was not in need of reorganisation in order to survive; the restraint imposed was very limited, requiring a particular director take part in certain decisions; rather than prohibiting any particular step, the Court's order required that director's participation in the decision-making process;
45.3. Morgan J had emphasised that any controls in this sort of situation must be realistic, clear and not over-intrusive and that the intervention sought by Shift and Corja was "about as intrusive as it could get" and was in no way about preventing Yodel from taking advantage of a breach of contract.
American Cyanamid approach
Serious issue to be tried
"The claimant's allegations of primary fact must be accepted as true, unless plainly fanciful. As Lord Diplock explained, the court must not try to resolve conflicts of evidence or law. That is for trial. But that does not mean that disputed questions are disregarded. The question is whether the material available to the court shows that the claimant has a real prospect of succeeding in its claim for a permanent injunction. If so, the court proceeds to consider the balance of convenience."
Authenticity
Want of authority
"38. The sole or predominant purposes of Mr Corlett creating, authorising and executing the Second Warrant Instrument and Warrant Certificates were:
a. not to promote the success of Yodel or in furtherance of any proper or legitimate commercial aim; but rather
b. to cause loss and damage to Judge Logistics by denuding it of the benefit of the 21 June SPA; and
c. to deliberately conceal the existence of the same from Judge Logistics and Yodel's new management until such time as Mr Corlett could improperly use them to destabilise Yodel and/or gain or threaten to gain control of the company after its acquisition by Judge Logistics."
59.1. Mr Corlett was not told about the proposed sale of Yodel to JLL until 20 June 2024 and JLL was not incorporated until 21 June 2024. On the basis that the Second Warrant Instrument was executed on 11 June 2024 (which is what Mr Corlett and his mother say) then Yodel's case on improper purpose must fail because he cannot have had the alleged improper purpose when he executed the Second Warrant Instrument. Mr Corlett's purpose in issuing the Second Warrant Instrument was a proper one in that it was for the benefit of Yodel in a broad sense;
59.2. the section 172 duty is a subjective one and, on the present state of the evidence, there can be no conclusion that Mr Corlett acted otherwise than in the way in which he considered, in good faith, would be most likely to promote the success of Yodel as whole. His motive was to incentivise key members of the management team (the Warrants granted to Corja and the individuals) and to encourage Mr Pearson (a venture capital investor) to provide funds to the company;
59.3. the creditors' duty had not arisen because Yodel was not insolvent or bordering on insolvency nor was it probable that it would enter insolvent liquidation or administration. Even if the creditors' duty had arisen, it remained a subjective one and, again, on the present state of the evidence there can be no conclusion that Mr Corlett breached it.
Warrants had lapsed
63.1. condition 5.1.2 of the Conditions of the Warrant Instrument provided for the warrant to lapse upon the completion of an Exercise Event or if later on the 10th Business Day after the Warrantholder received notice of an Exercise Event under Condition 3.2;
63.2. the sale of the shares in Yodel to JLL on 21 June 2024 was an Exercise Event (and such is common ground);
63.3. the question is therefore whether Shift and Corja are to be treated as having received notice of the Exercise Event under condition 3.2 on the true construction of condition 5.1.2 when Mr Corlett executed the 21 June SPA;
63.4. condition 3.2 does not require written notification only that the Company should promptly notify the Warrantholder of the principal terms of the proposed Exercise Event at the same time as such terms are notified to the Company's shareholders and in any event not less than 15 days prior to the Exercise Event in question;
63.5. by 21 June 2024, Shift and Corja knew that information and thus had notice of it because Mr Corlett knew that information when he executed the 21 June SPA at which moment he was the sole director of Yodel, the sole director of Corja and a director of Shift such that his knowledge is to be imputed to Shift and Corja, Yodel having a duty to provide the information to Shift and Corja and those companies having a duty to receive it;
63.6. the true construction of condition 5.1.2 does not require notice of the requisite information to be given by Yodel before the 10-day period is triggered; the only requirement is that the Warrantholders have the information (so that they can exercise their option as provided for in condition 3.3);
63.7. Shift and Corja therefore had the requisite notice on 21 June 2024 and the Warrants lapsed 10 business days thereafter.
64.1. Yodel's pleaded case is that the requirement to give notice was waived but that waiver argument was not relied upon in response to the Injunction Application;
64.2. the construction now contended for by Yodel is inconsistent with the express wording of the Conditions. Condition 3.3 expressly distinguishes between Yodel serving notice under condition 3.2 and the Warrantholder otherwise becoming aware of the Exercise Event;
64.3. condition 5.1.2 only applies where notice has been given under condition 3.2. That such is the true construction of the Conditions is supported by condition 3.4 which refers to condition 3.2;
64.4. where notice has not been given, the Warrants do not lapse;
64.5. the Conditions are not well-drafted; Yodel's case is a plea to the notion of commercial common sense. There is ambiguity about the wording of the Conditions.
Conclusion on serious issue to be tried
65.1. Mr Corlett did not breach his duties when he issued the Second Warrant Instrument and Warrant Certificates such that the question of ratification does not arise;
65.2. the requirement for Yodel to have a quorum of two directors was addressed by the resolution of 21 June 2024; and
65.3. the true construction of the Conditions does not mean that the Warrants lapsed before they were purportedly executed.
Adequacy of Damages
67.1. the imminent transformation of Yodel's business will result in it being completely dependent upon InPost for its survival;
67.2. Yodel's business will become unrecognisable from its current form in that customers will be encouraged to choose locker deliveries (InPost's model) rather than to-door deliveries (Yodel's model);
67.3. depots will be closed;
67.4. the "yodel" brand will be discarded;
67.5. contracts will be novated to InPost;
67.6. employees will be made redundant;
67.7. the transformation plan is not for the benefit of Yodel but for the benefit of InPost;
67.8. upon the execution of the transformation plan, Yodel will no longer be recognisable or able to operate as an independent entity;
67.9. when Shift and Corja succeed on the Warrant Claim, the intended Shift/Yodel merger, which is viable, will have been frustrated.
70.1. As I was told by Mr Thompson, there is not going to be a dismantling of the Yodel business.
70.2. It will, albeit in likely substantially modified form, continue to exist.
70.3. If Shift and Corja succeed on the Warrant Claim, there will still be a company with a business in which they will be the majority shareholders.
70.4. If they have suffered loss by having to wait for the Warrant Claim to be vindicated, they can be compensated in damages.
Adequacy of cross-undertaking offered
Balance Sheet | |
Consolidated Shift Global Holdings Ltd | |
As at 30 April 2025 | |
Fixed Assets | 30 April 2025 |
Intangible Assets: IP Purchase | £ 9,334,994 |
IP Purchase | £ 3,768,043 |
Tangible Assets | £ 96,817 |
Current Assets Debtors |
£ 8,141,315 |
Loan accounts Intragroup Loans |
£ 2,290,426 |
Yodel | £ 528,480 |
Cash and Cash Equivalents: | £ 1,024,562 |
Total Current Assets: | £ 11,984,783 |
Creditors: amounts falling due less than one year |
£ (4,455,832) |
Creditors: amounts falling due after more than one year |
|
Long-Term Loans including accrued interest: | £ (14,179,535) |
Total Liabilities: | £ (17,880,795) |
Net Assets | £ 2,751,194 |
Equity |
£ 2,748,103 |
Share Capital: | £ 3,091 |
Total Equity and Liabilities: | £ 2,751,194 |
£ - |
Balance of convenience
Disposal of Injunction Application
Amendments
Preliminary Issue and Expedition
SFC Application
Further directions
Order