Killen v Horseworld Ltd & Ors

A claim in quantum meruit may be pursued against individuals as well as corporate defendants where the pleaded facts arguably show that the individuals requested or accepted services in their personal capacities. The court must assess the parties’ intentions objectively, from the surrounding circumstances and evidence. On an application to strike out or for summary judgment, the court should not resolve substantial disputes about who requested the services, to whom they were supplied, or whether a binding contract existed. A claim should proceed where it discloses reasonable grounds and has a real prospect of success.

The claimant sought £380,000 and expenses for professional and consultancy services provided in connection with a proposed equestrian theme park and related businesses. She claimed that the services were provided to the individual defendants, in anticipation of a contract which was never concluded. The individual defendants maintained that they acted only as directors of the corporate defendants and that any obligation was owed by the companies.

The Deputy Master dismissed applications under CPR 3.4 and CPR 24.2 to strike out the claim or obtain summary judgment. One individual appealed. The other sought an extension of time and permission to appeal on the same grounds. The central issues were whether the claims against the individuals were legally arguable and whether the factual disputes could properly be resolved summarily.

1. Appeal dismissed. The claim against the individual defendants disclosed reasonable grounds and had a real prospect of success. The renewed application for permission to appeal by the fourth defendant was refused.
2. The Deputy Master had not applied a subjective test when referring to the parties’ intentions. The relevant question was the objective intention apparent from the nature and terms of the dealings, the surrounding circumstances and the evidence.
3. The principles governing a quantum meruit claim where an anticipated contract does not materialise require consideration of matters including whether the services would normally be supplied free, the terms of the request, the benefit received, and the circumstances in which the anticipated contract failed. The court agreed with the further guidance in MSM Consulting Ltd v United Republic of Tanzania [2009] EWHC 121 (QB), namely that an obligation is more readily imposed where the defendant received an incontrovertible benefit or requested or accepted services knowing that they were not intended to be free.
4. A quantum meruit claim is legally capable of being brought against an individual. The pleaded requests allegedly made by the individual defendants, together with the evidence concerning the developing business and its corporate structure, made personal liability arguable.
5. The documents relied on by the defendants, including the claimant’s invoice, statutory demand and later email, raised issues for trial but did not conclusively defeat the pleaded case. The evidence disclosed fundamental disputes about the nature of the services, their recipient, the parties’ intentions and whether a binding agreement had been made. Those issues required oral evidence and cross-examination.

• High Court (Queen’s Bench Division): The appeal from the Deputy Master’s judgment dated 19 November 2010 was dismissed. Time was extended for the fourth defendant’s renewed application, but permission to appeal was refused.