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England and Wales High Court (Queen's Bench Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Queen's Bench Division) Decisions >> Warren & Anor v Burns [2014] EWHC 3671 (QB) (13 November 2014)
URL: http://www.bailii.org/ew/cases/EWHC/QB/2014/3671.html
Cite as: [2014] EWHC 3671 (QB)
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QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL |
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B e f o r e :
____________________
| (1)Frank Warren (2) W. Promotions Limited |
Claimants |
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| - and – |
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| Ricky Burns |
Defendant |
____________________
Mark Simpson QC and Niamh Cleary (instructed by Mishcon de Reya LLP) for the Defendant
Hearing dates: 7th, 8th, 9th and 13th October 2014
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Crown Copyright ©
- The Defendant ("Mr Burns") is a boxer. The First Claimant ("Mr Warren") is a boxing manager and promoter. Each has acknowledged the considerable ability of the other as boxer and promoter respectively. Mr Burns is one of only eight British two-weight world champions in the history of boxing.
- The Second Claimant ("FWP") provided Mr Warren's boxing promoting services.
- Mr Warren and FWP say that Mr Burns owes them money and Mr Burns says that Mr Warren and FWP owe him money. The litigation attracted considerable publicity when it was launched.
- FWP is now in insolvent liquidation. Mr Warren has taken an assignment of FWP's claims against Mr Burns. Mr Burns takes no issue with the validity of that assignment.
- By an agreement in writing dated 12 May 2010 ("the Manager Agreement") Mr Burns appointed Mr Morrison as his manager for a period of three years. A separate agreement in writing dated 15 May 2010 ("the Additional Agreement"), and referring to the Manager Agreement, recorded that Mr Warren would also, with Mr Morrison, be Mr Burns' manager.
- The Manager Agreement was expressly governed by English law and included these terms (references to "the Board" are to the British Boxing Board of Control):
- work as a sparring partner
- contributions to publications or to radio, television or other broadcasts
- stage, cinema or other personal appearances
- advertisements or endorsements acceptable to, and honestly subscribed to by, the Boxer
- any other suitable activities whatsoever; and
- The Additional Agreement was in the form of a signed letter from Mr Burns, countersigned by Mr Morrison and Mr Warren. It included these terms:
- By an agreement in writing dated 30 July 2010 ("the Promoter Agreement") Mr Burns appointed FWP as his promoter. Two successive addenda to the Promoter Agreement were later agreed, the more recent on 16 September 2011. Each altered the sums ("purses") that Mr Burns was to be paid by FWP for fights.
- The Promoter Agreement included these terms:
- Mr Burns accepts that Mr Morrison was active as his manager, but says that is not true of Mr Warren. In my view the effect of the Manager Agreement and the Additional Agreement is that provided the work was done by one or other of them, Mr Burns would, subject to arguments on waiver, be liable to pay the commission agreed. In any event, though Mr Morrison undertook the lion's share of the total work involved I was satisfied on the evidence that Mr Warren did some work as manager. Mr Warren's work as manager included, for example, arranging sparring partners.
- The commission agreed was 25% of gross receipts less specified deductions. The case has been argued for Mr Warren as though commission was agreed in two amounts of 12.5% (one for Mr Morrison and one for Mr Warren). However I do not consider the agreements bear that meaning on their true construction. Mr Burns agreed to pay a commission of 25% and Mr Morrison and Mr Warren were together entitled to that commission. Without more, either could give a good receipt. How they divided the 25% between them was a matter for them.
- There were three arguments on waiver in relation to commission entitlement. First, that Mr Morrison deducted only 15% rather than 25% and this waived the balance. Second, that Mr Warren did not make any demand for payment until these proceedings began and this waived any entitlement on his part. Third, that Mr Warren made an express representation waiving his entitlement to commission.
- In my judgment none of these arguments succeeds.
- For present purposes two propositions of law are particularly engaged in an assessment of the arguments:
- On the first of the three arguments, Mr Burns points to the fact that Mr Morrison provided statements of account to Mr Warren. These deducted management commission at the rate of 15%. Relying on the terms of the Additional Agreement and of Clauses 7.1 and 10 of the Manager Agreement Mr Burns argues that in providing these accounts, Mr Morrison unequivocally represented on behalf of himself and Mr Warren that they did not intend to claim 25%. And even without the statements of account Mr Burns submits the deduction of 15% rather than 25% itself constituted an implied representation that no more than 15% would be deducted.
- In my view both these positions are untenable in the context of this case. 15% was deducted by Mr Morrison, and was accounted for. That said nothing unequivocal about what the position was in relation to the remaining 10%.
- On the second of the three arguments, Mr Burns contends that a continued failure to demand management commission for a period of almost six years is sufficiently unequivocal to constitute a representation that Mr Warren waived his entitlement to management commission. The reference to six years included the period of an earlier manager agreement. Mr Burns also refers to two emails. First, an email dated 18th December 2012 in which Mr Warren wrote to Mr Morrison in these terms: "I was also reminded by Andy [Ayling] that we have a joint management agreement which was signed on 10th May 2010. Up until now I have not taken my percentage of the management commission, which is a considerable sum. I am not asking for it but to make you aware of this." Second, an email dated 7th March 2013 in which Mr Warren wrote to Mr Burns in these terms: "At the time of writing, I have not yet claimed any management commission from your purses and I am sure that this shows my commitment and goodwill to you …".
- In the context of the present case I do not regard these matters, individually or together, as unequivocal. I have concluded that the failure to demand is consistent with an approach that involved postponing the time of collection of the outstanding portion of the management fees, i.e. the portion not collected by Mr Morrison, until earnings were greater.
- On the third of the three arguments, Mr Burns relies on Mr Warren's saying to him before entering into the Additional Agreement that he would not deduct management commission from Mr Burns until Mr Burns was "fighting in bigger fights and therefore earning more money".
- Taken in context, I see this statement as referring to the position I have just mentioned, that of postponement of time of collection, and not as amounting to a representation waiving entitlement altogether for a period. It is at the very least equivocal and therefore incapable of supporting a successful defence of waiver. I note that Mr Burns himself accepted in evidence that Mr Warren had never promised "that he wouldn't take his money on commission".
- In relation to the three arguments, I also draw attention, more generally, to the terms of Clause 16.2 of the Manager Agreement (set out above).
- So Mr Morrison has taken 15%, whilst 25% was payable. 10% is therefore outstanding from Mr Burns, whatever may be the accounting required between Mr Morrison and Mr Warren in relation to the 15%. The final calculation required depends also on the outcome of my findings below in relation to a fight against Kevin Mitchell, including the fact that Mr Burns only received part of the payment he was entitled to (from FWP) for that fight and the fact that FWP was insolvent and unable to pay him the balance. In light of my decision on these points, I understand the parties are making efforts to agree the correct figure for commission. If they cannot reach agreement I will hear argument and decide the figure.
- The Promoter Agreement, read with the second addendum, provided for Mr Burns to be paid a purse of £150,000 (plus tickets to the value of £10,000) for a fight against Kevin Mitchell. Ahead of the fight, Mr Burns sought an increase of £40,000 to that purse. An agreement to that increase was said to have been reached at a meeting in Glasgow on 20 June 2012.
- In my judgment, Mr Burns is not entitled to the increase. There was evidence, which I accept, that in boxing sometimes purses get renegotiated ahead of a big fight. This was a big fight. But I am not satisfied that the parties reached agreement in this case. They got near, that I do accept, and that fact accounts for some later paperwork showing a purse figure of £200,000.
- Further, the entitlement that was nearly agreed was, I find, an entitlement that was to be conditional on the entry into a new promotional agreement, and that condition was not fulfilled. Mr Warren contemplated, because of financial difficulties faced by FWP, that the new agreement would be with another company with which his family (and specifically his son) was associated.
- The company he contemplated was Queensberry Promotions Limited ("Queensberry"). Consistently, a written agreement in Queensberry's name was in due course sent to Mr Morrison for signature. I find that Mr Warren may not have named Queensberry on 20 June 2012, which would account for that part of Mr Burns' evidence that was to the effect that he had not heard of Queensberry at that point. It would also account for the absence of reference to Queensberry in a note taken by Mr Dean Powell at the time.
- It was argued on behalf of Mr Burns that there was no reason for Queensberry to agree to pay £40,000 "for the transfer to it because, as Mr Warren acknowledged, FWP[] was entitled to assign it to Queensberry pursuant to clause 29 of the [Promoter] Agreement". In my view this argument wrongly treats the £40,000 as a payment for transfer. It was an increased payment for the fight, but the negotiation brought in other elements and one was the condition to which I have referred. On the face of the Promoter Agreement there was no reason for FWP or Queensberry to pay £40,000 more, for either the fight or the transfer, but the evidence was, as I have said, that in boxing sometimes purses get renegotiated ahead of a big fight.
- On 22 September 2012 Mr Burns fought Mr Mitchell and won. Without the additional £40,000, Mr Burns was entitled to £150,000 and tickets to the value of £10,000. On the evidence £80,000 was paid by FWP to Mr Morrison in two instalments. I am quite satisfied that Mr Morrison, to whom Mr Burns left so much of the administration of his affairs, was able to and did give a good receipt for that money on Mr Burns' behalf. Any accounting between Mr Morrison and Mr Burns for those sums is a matter between them and not the responsibility of FWP or Mr Warren.
- However £70,000 remained still unpaid by FWP, and he was entitled to tickets to the value of £10,000. After various adjustments, I understand the figure to be agreed at £102,000. Interest is also claimed as damages, and to the extent relevant given the liquidation, I assess that at the rate of LIBOR plus 2%.
- On 18 December 2012 there was a telephone conversation between Mr Morrison and Mr Warren. It was later that day that Mr Warren sent the email to Mr Morrison already referred to above. But in it he also wrote:
- It was contended on behalf of Mr Burns that from this point Mr Warren was legally bound as a guarantor. I do not think that is correct. True, there was the reference to guarantee in the letter, but there was no contract of guarantee. If the statement was an offer, no evidence at trial satisfied me that that offer was ever accepted so as to make a contract. Nor did Mr Burns agree to wait until 20th January so as to provide the consideration needed for this to be a legally binding contract. He did wait in fact, but not because he had agreed to.
- The second of the two instalments of £40,000 towards the purse for the Mitchell fight did follow on 6 February 2013, but nothing more. FWP then received a letter dated 6 March 2013 and signed in Mr Burns' name. The letter claimed to terminate the Promoter Agreement. Mr Burns' own evidence was that the signature on the letter was not his and he did not know the letter was being sent or signed. I accept that evidence. On that ground alone the letter probably did not terminate the Promoter Agreement.
- However neither was Mr Burns entitled to terminate the Promoter Agreement by that letter. His argument was that FWP was in repudiatory breach of the Promoter Agreement because the payment by FWP of purses due from it under the Promoter Agreement had been made late, and a large amount of the purse from his latest fight against Mr Mitchell was still unpaid.
- If that was right, the argument went, then the role of the letter dated 6 March 2013 (had it been his letter) was to accept the repudiatory breach and terminate the Promoter Agreement. But in my judgement the instances of late and overdue payment did not amount to repudiatory breaches. The terms of the Promoter Agreement did not make time of payment something that was of the essence of that contract. Mr Burns did not take steps to make time of the essence.
- In Dalkia Utilities Services plc v Celltech International Ltd [2006] 1 Lloyd's Rep 599; EWHC 63 (Comm) at [131] Christopher Clarke J (as he then was) observed:
- That passage formed the first of five propositions formulated by Christopher Clarke J from authority relating to making time of the essence. The remaining four propositions were as follows:
- The assessment to be made was recently described as follows by Floyd LJ in Valilas v Januzaj [2014] EWCA Civ 436; [2014] 154 ConLR 38 at [53]:
- In the present case the instances of late and overdue payment were serious, created a very poor record, and did FWP no credit. I accept that context is important, but do not accept the submissions for Mr Burns that he was a de facto employee and that all he was to obtain from the Promoter Agreement were the agreed purses. He also contracted for substantial promoter services and these could help build his reputation and future earning potential. Clause 14 of the Promoter Agreement was said on Mr Warren's behalf to support his argument, but it deals with security for payment not payment at large. It also seeks to emphasise that the relationship is not intended to be that of employee and employer.
- Of course, Mr Burns was not to be required to wait indefinitely for the agreed purses, and I accept his evidence that he was being caused real personal difficulties. But the question is what was the position on 6 March 2013, and in my judgment as at 6 March the position had not reached the point of repudiatory breach. Mr Burns felt driven to end with Mr Warren at that point as much out of frustration on experiencing the postponements of fights as out of concern over the very poor payment record. On some of his own evidence he still believed he would be paid.
- Mr Burns advanced an alternative argument which was that the Promoter Agreement was determined because FWP had offered him the opportunity to contract with Queensberry to be his promoter. Mr Burns did not take up that offer. In the present context at least, the fact of the offer of a new contract with one company does not, in itself, bring about a termination of an existing contract with another company.
- Before going on to look at other aspects concerning FWP, I should first record the following findings, relating to the role of Queensberry, on the evidence I heard:
- By 6 March 2013 three further defences of the WBO World Lightweight Championship were still provided for under the terms of the Promoter Agreement, read with the second addendum. The purses were £175,000, £200,000 and £225,000 for the third, fourth and fifth defences. In each case the purse was in addition to tickets to the value of £10,000.
- Mr Andrew Ayling, called by Mr Warren, gave evidence that FWP made £299,683.21 profit from the fight against Kevin Mitchell. But that figure depended on income of £300,000 from domestic television. That income was payable by Boxing Channel Media Limited (known as "Box Nation") under a licence agreement it had entered into with FWP and Mr Warren. Box Nation was closely connected with Mr Warren.
- In evidence in chief given by witness statement Mr Warren's evidence on this aspect was, in summary:
- After careful consideration, and assessment of Mr Warren as a witness, I regret to say I regard this prediction, analysis and evidence as unrealistic and unreliable. In particular (for the avoidance of doubt, the subparagraphs below refer to the evidence as a whole and not to the individual subparagraphs of the summary at paragraph 44 above):
- I add that, even though Mr Burns was not entitled to terminate the Promoter Agreement as at 6 March 2013, I am quite clear he would have been entitled to shortly after that. On the evidence FWP was in fact insolvent and unable to pay him what was overdue from the Mitchell fight and what would become due to him by way of purse in any further fights. As for Queensberry, it had, according to its own unaudited financial statements to 31 March 2013, no resources at all. Having listened to the evidence of Mr George Warren, nominally the principal figure in Queensberry, I have no confidence at all in the accuracy of what were disclosed (after his evidence had been given) as draft financial statements for Queensberry for the year ended 31 March 2014.
- My conclusion is that on the balance of probabilities FWP has suffered no loss from Mr Burns not continuing after 6 March 2013 to perform his obligations under the Promoter Agreement. The suggestion that FWP or Mr Warren might be entitled to a seven figure sum, a suggestion that attracted publicity as the case was launched, was in my judgment always fanciful. It has simply, and unhappily, raised the temperature in the dispute and the pressure of the litigation. Even if I am wrong and the Promoter Agreement would have been modestly profitable, the outstanding unpaid liability due to Mr Burns from FWP in respect of the Mitchell fight would have exceeded the claim for lost profits and the claim for lost profits would have been wholly absorbed by the operation of set-off.
- In the circumstances, in my judgment:
- Mr Burns went on to work with another promoter. Mr Warren expressed the opinion in his evidence at trial that Mr Burns had been "tapped up" by that new promoter. But this case was never about that. FWP and Mr Warren did not sue on that basis. And put shortly, the evidence at trial showed simply that Mr Burns had had enough of FWP, had walked away from FWP believing he was entitled to do so, and had then found a new promoter.
MR JUSTICE KNOWLES :
The Manager Agreement and Additional Agreement
"APPOINTMENT AND AUTHORISATION OF MANAGER
2. The Boxer appoints the Manager, and the Manager agrees to act, as the Boxer's sole and exclusive Manager throughout the period of this Agreement. In this connection (and subject to the following clauses of the Agreement) the Boxer authorises the Manager to act as his agent and to enter into contracts on his behalf.
OBLIGATIONS OF THE MANAGER
General
3. The Manager will use reasonable skill and care in performing his obligations under this Agreement. In particular, and in any event, the Manager will:
(i) Supervise and take all reasonable steps to preserve the health and safety of the Boxer in the context of his profession,
(ii) Comply with, and do everything reasonable to ensure that the Boxer complies with, the Rules and Regulations of the Board,
(iii) Arrange and supervise an appropriate training programme for the Boxer, and
(iv) Arrange and supervise an appropriate programme of suitable boxing and other engagements for the Boxer, in addition to boxing contests those engagements may relate to:
(v) In performing his obligations as above, take into account any views the Boxer may have, and in particular to permit the Boxer the right to decline on reasonable grounds any opponent suggested to him by the Manager,
(vi) If the Boxer is not satisfied with the number of quality of Boxing or other engagements, arranged by, or opponents selected by, the Manager, the Boxer may, without prejudice to any other rights or remedies he may have, refer the matter to the Board in accordance with Clause 14 below, and the Board or relevant Area Council (as the case may be) shall decide whether the Boxer may be released from this Agreement.
The Terms to be obtained for a Boxer
4. The Manager will arrange the Boxer's professional affairs and engagements so as to secure for the boxer all due and proper profit and reward.
5. In particular, and subject to Clause 6 below, the Manager will ensure that, in relation to every engagement which he arranges on behalf of the Boxer, the Boxer obtains terms which are fair and reasonable and as advantageous to the Boxer as are reasonably obtainable.
…
Accounts and Receipts
7.1 The Manager will promptly and in any event within 14 working days after each contest,
(i) Render to the Boxer a full and accurate written account of any money which the Manager receives, and any reasonable and proper expenses which he incurs in connection with the performance of his obligations under this Agreement; and
(ii) Pay to the Boxer any money which the Manager receives and to which the Boxer is entitled.
…
OBLIGATIONS OF THE BOXER
8. The Boxer will:
…
(iv) Promptly pay to the Manager any money which the Boxer receives and to which the Manager is entitled.
9. Save as is hereinbefore expressly provided, except with the Manager's prior written permission, the Boxer will not:
(i) Arrange any engagements of the type which the Manager has undertaken to arrange, or
(ii) Authorise or permit any other person to arrange such engagements on his behalf.
The Manager will not withhold this permission unreasonably.
RECEIPTS, EXPENSES AND COMMISSION
10.1 Any money which the Boxer or the Manager receives
(i) As payment for engagement arranged by the Manager during the period of this Agreement: or
(ii) From a Testimonial or other event or transaction incidental to the Boxer's profession which take place during the period of this Agreement
shall be applied as follows:
10.2 (i) Any sums payable to the Board shall be paid to it.
(ii) Any proper, necessary and reasonable, training, travelling or other expenses incurred by the Boxer or the Manager shall be reimbursed to each of them.
(iii) 25 per cent of the balance shall be paid to or retained by the Manager by way of commission; and
(iv) The remainder shall be paid to or retained by the Boxer.
10.3 For the avoidance of doubt it is expressly agreed that:
(i) The Manager shall not be entitled to receive or deduct any other payment or sum in connection with the performance of his obligations under this Agreement, and
(ii) Any professional fees incurred in arranging non-boxing engagements for the Boxer shall be paid by the Manager out of his 25% commission; and
(iii) The Manager shall not be entitled to be paid 25% or any sum in respect of monies received by the Boxer for engagements which are arranged by or for the Boxer with permission of the Manager pursuant to Clause 9 hereof or where the permission referred to in clause 9 has been unreasonably refused.
DURATION
11. This Agreement shall continue in force for an initial period of 3 years (not being more than 3 years).
This period ("the Initial Period") may be extended in the circumstances set out in Clause 12 below.
…
DETERMINATION OF THIS AGREEMENT
13.1 The Boxer or the Manager may determine this Agreement by notice in writing if the other party:
(i) is guilty of any serious breach of his obligations under it; or
(ii) ceases for more than 60 days to be the holder of an appropriate current and unsuspended License issued by the Board.
13.2 The Boxer may determine this Agreement in the event of the Manager having a bankruptcy order made against him.
…
NON-ASSIGNMENT
15. The rights and obligations conferred and imposed by the agreement are personal to the parties and may not be assigned or transferred.
GENERAL
16.1 It is hereby agreed that nothing herein is intended to or shall constitute any partnership between the parties hereto.
16.2 Failure or neglect by either party to enforce at any time of the provisions hereof shall not be construed nor shall be deemed to be a waiver of that party's right hereunder nor in any way affect the validity of the whole or any part of this Agreement nor prejudice that party's right to take a subsequent action."
"I refer to the [Manager Agreement] between Alex Morrison and myself appointing Alex Morrison as my Manager.
I hereby give notice that I acknowledge that I will be co-managed by Licensed Managers Frank Warren and Alex Morrison and that the rights and obligation of the Manager under the said Agreement shall be the equal and joint rights and obligations of Frank Warren and Alex Morrison.
Accordingly for the avoidance of doubt Frank Warren and Alex Morrison shall have an equal say as my Manager in my boxing career and an equal right to share any monies due to the Manager under the said Agreement"
The Promoter Agreement
"1. In consideration of the mutual promises hereinafter set forth, the Boxer grants the Promoter the sole and exclusive right to promote the Boxer from the date of the Boxer's first contest (the "Bout") which shall be from the date of the contest against the boxer professionally known as Roman Martinez of Puerto Rico for the WBO Super-Featherweight Championship scheduled for 4th September 2010 at The Kelvin Hall, Glasgow (the "Bout") and all professional boxing contests in which the Boxer participates until the end of the period, as specifically set out in Clause 2. The Promoter shall use best efforts to promote the Boxer professionally throughout the world. For the avoidance of doubt, the Boxer will not participate in any bout whatsoever without the permission in writing of the Promoter, until this Agreement expires or is lawfully terminated.
…
2. The Agreement shall be legally binding upon signature, however, the period will commence on the date of the first contest and shall continue through Your next 6 professional Bouts which are promoted by the Promoter or otherwise permitted under this Agreement.
…
4.1 The Boxer shall only box in or otherwise exclusively engage in the Bouts arranged by the Promoter. Such Bouts shall be on dates, and at such sites as determined in the sole discretion of the Promoter and against such opponent as mutually agreed by the Promoter and the Boxer. The Promoter may alternatively declare that a later defence shall be against any other party that has challenged for the title for a purse to be agreed. In any event, the opponent proposed by the Promoter shall be subject to final approval of the Promoter's nominated Broadcaster ("Broadcaster"). If the Broadcaster does not agree with the choice of opponent or the date of a bout the Promoter shall choose another opponent or another date as soon as possible for the Broadcaster's approval.
…
5. The Boxer's schedule of gross purses for the next 6 fights covered by this Agreement shall be as follows:
(i)Contest Purses
Challenge …
Defence 1 …
Defence 2 …
Defence 3 …
Defence 4 …
Defence 5 …
…
6. In consideration of the obligation of the Promoter to secure, arrange for, and promote bouts requiring the Boxer's services and to pay the Boxer's purses, as provided herein within or no later than 30 days of the bout. The Boxer agrees that during the term hereof, the Boxer shall not participate in any bouts other than bouts promoted or co-promoted by the Promoter and shall not render the Boxer's services as a professional boxer to any person, firm or entity other than the Promoter.
…
14. Nothing herein contained shall be construed to constitute the Boxer as an employee of the Promoter and the Promoter shall have no financial interest in any compensation payable to the Boxer for engaging in any Bout hereunder. However, the Promoter does guarantee all of the purses enumerated in Clause 5. If there shall occur, during the term of this Agreement, any delay in payment to the Boxer, (defined as payment for any Bout not being paid within 21 working days of the Bout taking place) then all future payments required under the terms of this Agreement shall be secured by a letter of credit upon a commercial bank of the United Kingdom or the United States. The Boxer shall remain an independent contractor, responsible for his own actions and expenses, provided such expenses are not required to be paid by the Promoter under the terms of this Agreement.
…
19. This Agreement sets forth and integrates the entire understanding between the Boxer and the Promoter and supersedes any and all prior or contemporaneous written or oral agreements or representations between us. It may not be altered, amended, or discharged except by a subsequent written instrument signed by the parties hereto.
…
26. The Boxer acknowledges that the Promoter's obligations with respect to the said bouts are contingent upon the Promoter entering into an agreement satisfactory to the Promoter for the live television broadcast of the said bouts. In furtherance thereof the Boxer agrees that if the Promoter shall not enter into such Agreement(s) for the live television broadcasts for the said bouts for any reason or such Agreement(s) grant to the person or entity obtaining such television broadcast rights terminate such Agreement(s) by reason of any act or omission on the part of the Boxer or the Boxer's opponent or any other person and the person or entity exercises such rights the Promoter may at the Promoter's option postpone the bout the subject of the exercise of such rights to a mutually acceptable date to the Promoter and the Boxer, provided that it is hereby agreed by the parties hereto that nothing contained shall be deemed to grant to the Boxer any right of approval over any Agreement which the Promoter may negotiate with respect to the television broadcast of the said bout or bouts.
…
29. It is hereby agreed by all parties hereto that the Promoter shall have the right to assign, licence or transfer any or all of the rights granted to the Promoter herein to any one or more persons or entity of his choosing and it is further agreed that any rights granted hereby may be held jointly by the Promoter with another Promoter or entity.
…
32. The Boxer agrees with the Promoter that until this agreement is lawfully terminated the Boxer shall not enter into any new agreement with any other person or entity by which that person or entity obtains any of the rights of the Promoter in this agreement.
…
35. You and/or your Manager shall immediately notify the Promoter in the event of any third party approaches in respect of procuring your services or to interfere with the obligations of either party relating to this agreement which may or will cause you to be in breach of this agreement."
Commission entitlement
Waiver
i) Waiver of a contractual right by election or by estoppel requires "that the person who is alleged to have "waived" the relevant contractual right has made an unequivocal representation, by words or conduct, that he does not, in future, intend to enforce that legal right which he has as against the other party to the contract": Liberty Insurance Pte Ltd & Anor v Argo Systems FZE [2011] EWCA Civ 1572; [2012] 1 CLC 81 at [39] per Aikens LJ .
ii) "[I]n the absence of special circumstances, silence and inaction are, when objectively considered, equivocal and cannot, of themselves, constitute an unequivocal representation as to whether a person will or will not rely on a particular legal right in the future": Liberty Insurance (above) at [46]; and see Allied Marine Transport Ltd v Vale do Rio Doce Navegaccao SA (The Leonidas D) [1985] 1 WLR 925 at 936H-937E (per Robert Goff LJ, as he then was).
Increased purse for the Mitchell fight
Personal guarantee
"As discussed Ricky's payment will be made on or before 20th January 2013. Although the Promotional Agreement is with [FWP] I will personally guarantee the payment to him.
The new signed Promotional Agreement still hasn't been sent as promised. I would appreciate it by return"
Attempt to terminate the Promoter Agreement
"Equity, before the Judicature Acts, insisted that prima facie time for payment was not essential. But Equity's patience was exhaustible. It would allow the contract to be treated as repudiated if the party in default had been given the opportunity to mend his ways by the giving of a notice to comply within a reasonable time. Whilst this is described as making time of the essence in reality the notice is the means of bringing to an end equity's interference with the contract: Behzadi v Shaftesbury Hotels Ltd [1992] Ch 1"
"(b) Such a notice, which may be given in respect of any species of term, may not be served until the time for performance has expired; but it may be served as soon as that time arrives;
(c) Such a notice must state clearly what the other party is required to do and the consequence if he fails i.e. that the contract may be terminated; Afovos Shipping Co SA v Pagnan[1982] 1 Lloyd's Rep562, 565 col 2; [1982] 1 WLR 848, 854C;
(d) If the defaulting party fails to perform after service of such a notice, the failure is not automatically a repudiation of the contract, giving rise to a right to terminate. The breach must go to the root of the contract;
(e) The notice operates as evidence of the date by which the promisee considers it reasonable to require the contract to be performed, failure to perform by which is evidence of an intention not to perform: see Lord Simon of Glaisdale in United Scientific Holdings Ltd v Burnley Borough Council [1978] AC 904, 946E-947A; Astea (UK) Ltd v Time Group Ltd [2003] EWHC 725 (TCC) para 147. "
"Whether a breach or threatened breach does give rise to a right to terminate involves a multi-factorial assessment involving the nature of the contract and the relationship it creates, the nature of the term, the kind and degree of the breach and the consequences of the breach for the injured party"
Lost profits
i) Mr Burns would not, in my judgment, have gone on to sign a new promoter agreement with Queensberry.
ii) I am not satisfied, on the balance of probabilities, that FWP would have actually invoked, in favour of Queensberry, the assignment clause under the Promoter Agreement. It could have done so, but I do not consider it would have troubled to do so.
iii) I reject as untruthful, evidence from Mr Warren of an alleged oral agreement to the effect that Queensberry was to account to FWP for 50% of any profits it made from the promotion of Mr Burns. I recognise that the version of events was supported by the evidence of his son, George Warren, but think that in giving that evidence a son was accepting his father's account rather than giving his own. No such agreement was recorded. I cannot accept that Mr Warren would have seen any need for it at the time. It was argued on behalf of FWP and Mr Warren that the draft promoter agreement with Queensberry would have made no sense without a profit share in favour of FWP given the value of promoting Mr Burns. The answer to that point, in my judgment, is that neither Mr Warren nor his son were concerned to distinguish between the interests of FWP and those of Queensberry. They used both companies just as it suited them.
i) If Mr Burns had fought Miguel Vasquez, a boxer from Mexico, in what would have been a "unification" fight, American and other overseas television would have been secured for that fight.
ii) This was likely to have made the fight £100,000 more profitable than the Mitchell fight. That was "the sum we had secured from other fighters in similar circumstances and in my experience of boxing it was a reasonable sum to expect for the rights to a unification fight".
iii) In addition, it was likely that a fight against Mr Vasquez, which would have been at a larger venue, would have sold more tickets and at a higher price.
iv) This was likely to add another £300,000 to the profit. "Tickets for the show were already selling well before [Mr Burns] pulled out of the show." Given a London venue, an estimated additional £30,000 would have been "made in sponsorship".
v) Against this "the boxers' purses were likely to be a bit higher", by £25,000 in the case of Mr Burns and an unspecified figure in the case of Mr Vasquez.
vi) In the result the profit for a fight between Mr Burns and Mr Vasquez would likely have been "at least £600,000".
vii) Mr Burns would have beaten Mr Vasquez because Mr Vasquez "was a weak puncher" while Mr Burns "was a better boxer, had a more aggressive style and had home advantage."
viii) "Therefore it is likely that [FWP] would have made at least the same from his next two fights because he would have been a unified champion. This makes the total profit that [FWP] would have made from promoting Ricky Burns's next three fights at least £1.8 million".
i) I do not accept that the Mitchell fight was profitable in an objective sense. The figure for income from domestic television was not a figure reached between unconnected, arms-length, contracting parties.
ii) There is nowhere near enough detail in Mr Warren's evidence of how he calculates a projected £300,000 additional income from tickets (an increase of about 80% from the ticket sales income shown for the Mitchell fight) and sponsorship of £30,000 (an 8 fold increase from the Mitchell fight).
iii) There is no denying Mr Burns' abilities as a boxer. But I am not persuaded by the limited evidence I have that had Mr Burns fought Mr Vasquez Mr Burns would have won. I reach that conclusion independently of what happened, but I note that his career did not in the event proceed with its former level of success.
iv) Even if he had entered the next two fights as unified champion, I have been provided with no sufficient evidence to support Mr Warren's highly generalised assertion that "[FWP] would have made at least the same from" those next two fights. I am not prepared to rely on Mr Warren's view alone. Experienced though he is, he is not objective in this matter.
v) In any event, more broadly the evidence that I do have shows that FWP's endeavours in the field of boxing promotion were unprofitable overall. At this level the boxing world is a world in which large sums can be received and spent, but what matters in the present case, where the claim is for lost profits, is whether the endeavours were profitable. Mr Warren is, Mr Burns accepts, a promoter of considerable ability, but that is not a reference to his ability to make boxing promotion profitable.
vi) Most significantly, Box Nation would, I find, have failed to meet its obligations to FWP in respect of television rights. It was already not paying FWP all it owed FWP. A Business Plan Summary disclosed (late) showed Box Nation forecasting a very large cumulative deficit across the period 2013-2015 (with £7.4 million, negative, cumulative EBITDA projected by 31 December 2015). On the evidence before me, Box Nation was and would have remained insolvent at all material times. There was some reference on behalf of Mr Warren to a third party lending some sums to Box Nation to meet some amounts payable by Box Nation, but the evidence leaves me with no confidence at all that that would have continued; in fact in context it shows how low the prospects were of FWP actually making any money from Box Nation.
vii) Despite the duties of Mr Warren and FWP to give proper disclosure of documents relevant to this matter, the quality of the disclosure in fact given was shockingly poor. There was little that went to the issue of the profitability of promotion. A file of documents was disclosed by FWP and Mr Warren after the witnesses called on their behalf had given their evidence. Its contents reinforced my conclusions that FWP would have lost more money not made money under the Promoter Agreement. Examination of its contents showed that there was yet more that was still undisclosed. Without proper disclosure to enable Mr Warren's evidence to be fully tested my confidence in that evidence was further reduced.
viii) I completely reject the evidence of Mr Warren that was summarised in this way in closing submissions made on his behalf: "if the income generated from promoting Mr Burns' bouts had been available in the first half of 2013, [FWP] would have remained solvent and would have been able to meet its liabilities".
Outcome
i) Mr Burns owes Mr Warren (and Mr Morrison, together) unpaid commission under the Manager Agreement. The amount of the unpaid commission I shall decide if it is not agreed.
ii) FWP, but not Mr Warren, owes Mr Burns the unpaid balance of the purse from the Mitchell fight under the Promoter Agreement. I understand this to be agreed at £102,000, and I have dealt with interest above. Mr Burns will be left to prove for this sum in the insolvent liquidation of FWP. From what I heard in evidence about FWP and its liquidation it is unlikely that any sums will actually be paid by FWP to anyone, including Mr Burns.
iii) No sum is payable by Mr Burns to FWP or Mr Warren in respect of the Promoter Agreement. The figure ascribed to the claim in publicity when it was launched bears no relation to reality.