Lissack v Manhattan Loft Corporation Ltd

A claimant seeking a commission for introducing a development opportunity must establish the contractual or restitutionary basis of the entitlement. Contractual terms are construed objectively, having regard to the parties’ prior dealings and the capacity in which they conducted business. An entitlement based on an introduction does not extend to a later project that is fundamentally different from the opportunity originally introduced. A quantum meruit is restitutionary and arises only where justice requires payment for services that were not provided gratuitously. The claimant must show both an expectation of payment and that the defendant reasonably ought to have known of that expectation.

Charles Lissack claimed a share of the profits earned by Manhattan Loft Corporation Ltd from the redevelopment of St Pancras Chambers. He alleged an oral agreement under which he was entitled to 25 per cent of the net profit from development opportunities introduced to the defendant. Alternatively, he claimed a quantum meruit for introducing the opportunity.

The defendant denied that any agreement existed and disputed the identity of any contracting party, the causal significance of the introduction, the relevance of the substantially altered project ultimately undertaken, and any restitutionary entitlement.

1. Contractual claim dismissed. The alleged oral agreement was not made. The claimant’s evidence was inconsistent with the contemporary documents, the parties’ dealings, the 2000 settlement between the defendant’s principals, his failure to raise any financial interest while the project developed, and his response when the remuneration issue was discussed in 1999.
2. Alternatively, the alleged agreement would have been made by the claimant on behalf of Lonsdome Ltd, not personally. The identity of the contracting party was determined objectively. The claimant had conducted his professional activities through Lonsdome and had signed the preceding development agreements in that capacity.
3. On the assumed terms of the agreement, the claimant’s role was sufficient to constitute an introduction of the opportunity and to satisfy any necessary causal requirement. Entitlement did not depend on whether the opportunity would have reached the defendant in his absence or whether the claimant had persuaded the defendant to proceed. The parties’ particular contract governed the question.
4. Nevertheless, the project ultimately undertaken was fundamentally different from the limited residential-development opportunity originally introduced. Once the defendant assumed responsibility for the entire development, including the hotel and West Wing, the claimant could not be treated as having introduced that project or as accepting liability for its losses. He was therefore not entitled to a share of its profits.
5. No implied contractual obligation to perform substantial post-introduction work was established. The issue was unnecessary to decide because the claim failed on several independent grounds.
6. The quantum meruit claim also failed. Quantum meruit is a restitutionary remedy available only where justice requires payment for a non-gratuitous benefit. The claimant neither established that the final project was the opportunity he introduced nor that, in 1996–97, he expected payment for his limited involvement and that the defendant reasonably ought to have known of that expectation. The claim could not properly be assessed as a percentage of profit in the absence of corresponding liability for loss.
7. The claim was dismissed in its entirety.

First-instance decision. No appellate history is stated in the judgment.