Middlesborough Football & Athletic Company (1986) Ltd v Liverpool Football & Athletic Grounds Plc

Summary judgment is inappropriate where deciding the claim would require the court to resolve disputed evidence, assess untested witness statements or conduct a mini-trial. A claim for contractual damages is not fanciful merely because loss is difficult to quantify or may require assessment on a loss-of-chance basis. This applies both to a possible lost opportunity to obtain a higher price and to consequential financial loss caused by the wrongful loss of a valuable asset. Claims should be struck out on the basis that only nominal damages are recoverable in exceptional cases, particularly where liability is admitted or assumed but disclosure and evidence have not yet occurred.

Middlesborough claimed damages from Liverpool for alleged breaches of the Football Association Premier League Rules arising from Liverpool’s acquisition of Christian Ziege. Liability was assumed for the summary judgment application. Middlesborough alleged that Liverpool had misused confidential contractual information and had approached Ziege without the required consent.

The claim was advanced both as a loss of the opportunity to obtain more than the £5.5 million transfer fee and as financial loss suffered because Ziege left before the 2000/2001 season. Master Eyre dismissed Liverpool’s application for summary judgment, but Astill J allowed Liverpool’s appeal and dismissed the claim. The issue was whether the damages claims had no real prospect of success.

1. Appeal allowed. The order of Astill J was set aside and part of the Master’s order was reinstated. The appellant’s costs were subject to detailed assessment.
2. Under Civil Procedure Rules 1998, Part 24, summary judgment is not intended to involve a mini-trial. The court should not determine disputed factual issues by evaluating untested written statements, before disclosure or cross-examination, where the evidence might reasonably be altered or rejected at trial.
3. The judge below had wrongly treated the claims as fanciful or nonexistent. The evidence did not establish conclusively that Liverpool would not have offered more than £5.5 million, or that Ziege would have moved to Liverpool regardless of any earlier approach. Those were matters requiring disclosure and evidence.
4. The alternative claim was also capable of being advanced. Middlesborough might establish a loss of a chance of achieving greater financial success had Ziege remained, notwithstanding the difficulty of proving the effect of one player on a football club’s performance and finances.
5. Difficulty in quantifying loss does not make it legally irrecoverable. Professional football is a business, and financial consequences may be assessed using the ordinary processes of litigation. Cases in which a claim is properly struck out because only nominal damages could be recovered, despite assumed liability, will be exceptional.

• Court of Appeal (Civil Division): Allowed the appeal, set aside Astill J’s order and reinstated part of Master Eyre’s order.
• High Court, Queen’s Bench Division: Astill J allowed Liverpool’s appeal from Master Eyre and dismissed the claim on the basis that the damages claims had no real prospect of success.
• Master’s decision: Master Eyre dismissed Liverpool’s application for summary judgment.