Scriven v Scriven & Ors

Oral family arrangements concerning separate business ventures must be established on the evidence relating to the particular venture. The court will not infer an overarching agreement governing all family businesses where the parties’ conduct shows that ventures were treated individually. A professional adviser’s close association with a related company does not, without more, establish an agency relationship. Nor is a company’s professional adviser ordinarily the personal adviser or client of its directors, shareholders or beneficial owners absent a separate retainer or special factor.

The claimant, Edward Scriven, brought a substantial claim against his sons, his nephew, an accountancy company and related companies. He alleged that he retained beneficial interests in property and in a London attraction operated through London Tombs Limited and London Bridge Experience Limited. He also alleged that an overarching Family Business Agreement and a specific Company Agreement entitled him to equal ownership and management participation, and that Evans Mockler Limited owed him fiduciary and contractual duties.

The defendants denied those agreements and maintained that Edward had agreed to surrender his interest in the property and not to participate in the new attraction. The issues included the terms of the Purchase Agreement, the existence of the alleged family and company agreements, the effect of the LTL Family Meeting, and the alleged agency and professional duties of Evans Mockler Limited.

1. Claim dismissed. The court found that the Purchase Agreement transferred Edward’s interest in the E&C property and South Central Holdings Limited to Danny and Lee immediately, in return for their promise to provide £200,000 to Donna by weekly payments after Edward’s death. Edward therefore had no continuing interest in the property or the Multiplex payments ([2015] EWHC 1690 (Ch), [118]-[119], [253]-[254]).
2. No overarching Family Business Agreement existed. The evidence showed that the family treated different ventures according to their individual arrangements. The alleged Company Agreement concerning equal ownership of London Tombs Limited was also not established ([129]-[140]).
3. At the LTL Family Meeting, probably in March 2007, Edward agreed that he would have no interest or management role in the new Tooley Street project. The subsequent allotment of shares and changes to the company offices carried through that agreement. The alleged fiduciary and contractual breaches therefore did not occur ([231]-[252]).
4. The claim against Evans Mockler Limited failed because the factual foundations for the alleged duties were absent. Highstone’s close corporate association with Evans Mockler did not itself establish agency. A wholly-owned subsidiary is not necessarily an agent of its parent: Ebbw Vale UDC v South Wales Licensing Authority [1951] 2 KB 366, at p. 373-4. The evidence did not establish agency in the transactions relied upon ([264]-[274]).
5. Edward was not a personal client of Evans Mockler at the material time. Any personal retainer had ended, and no separate retainer or special factor made him a client as promoter, director, shareholder or beneficial owner. The role of promoter generally ends once directors are appointed: Twycross v Grant (1877) 2 CPD 469, at p. 541 ([275]-[285]).
6. The claim failed against every defendant. The parties were directed to seek agreement on the consequential order and, failing agreement, to provide rival drafts ([298]-[299]).