Eurofi Ltd v Teletech UK Ltd

In a contingency-fee agreement for grants consultancy, “grants” ordinarily means monetary awards by a public authority. It does not extend automatically to benefits in kind or to every form of financial incentive. A payment reimbursing training expenditure may nevertheless constitute a grant where the statutory scheme describes it as such and it is obtained through application and negotiation. Contractual wording concerning when a contingency is satisfied must be read with the agreement as a whole. An appellate court will generally refuse a late cross-appeal raising a new construction point requiring facts not determined below.

Eurofi Ltd advised Teletech UK Ltd on obtaining public-sector investment incentives for call-centre projects in Scotland under a written consultancy agreement providing for commission on grants offered. The deputy High Court judge awarded commission on regional selective assistance but excluded other incentives, including benefits in kind and training support. He also treated successive projects as sufficiently connected for calculating the award.

Eurofi appealed the exclusion of the other incentives. Teletech sought permission to cross-appeal out of time, relying on a later and smaller grant offer. The central issues were the contractual meaning of “grants”, whether direct training support fell within that term, whether a composite letter from Locate in Scotland signified an intention by the relevant authority to award grants, and whether the late cross-appeal should be entertained.

1. Disposition. The appeal was allowed in part. Eurofi was entitled to additional commission referable to £245,000 direct training support. The claim concerning the other incentives was dismissed. Teletech’s application for permission to cross-appeal out of time was refused. There was no order as to costs.
2. Meaning of “grants”. The agreement did not equate grants with all financial incentives. In context, and supported by references to grant, loan and equity monies, “grants” meant monetary awards. Rent-free accommodation, fit-out works and car-parking facilities were benefits in kind and fell outside the commission provision. Any remaining ambiguity would be construed against Eurofi as drafter.
3. Direct training support. Under the Enterprise and New Towns (Scotland) Act 1990, arrangements could include payments by way of grant, loan or otherwise. Direct training support was applied for, involved a business case, and reimbursed training expenditure. It could properly be characterised as a grant and therefore fell within the agreement.
4. Locate in Scotland letter. The 7 April 1998 letter did not itself signify an intention by the relevant authority to award the remaining grants. It was subject to necessary approvals and stated that the incentives would be recommended by the applicable governmental entities. It therefore did not satisfy the contractual trigger.
5. Cross-appeal. The proposed challenge depended on a construction point which Teletech had elected not to appeal and which required factual findings not made below. Entertaining it at that stage would be unfair and inappropriate for an appellate court exercising review jurisdiction.

• Court of Appeal (Civil Division): [2000] EWCA Civ 245. Appeal allowed in part; Teletech’s application for permission to cross-appeal out of time refused.
• High Court, Chancery Division: On 9 October 1998, the deputy judge awarded Eurofi £199,162.50 plus interest for commission on RSA, but rejected commission claims relating to other financial incentives.