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You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Express Newspapers v. Telegraph Group Ltd [2001] EWHC Ch 2 (31st July, 2001) URL: http://www.bailii.org/ew/cases/EWHC/Ch/2001/2.html Cite as: [2001] EWHC Ch 2

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Express Newspapers v. Telegraph Group Ltd [2001] EWHC Ch 2 (31st July, 2001)

Case No: HC 0101719 2573 of 2001

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 31st July 2001 B e f o r e :

THE VICE-CHANCELLOR

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Mr. John Brisby QC and Mr. Richard Hill (instructed by Messrs Rosenblatt for the Claimant)

Mr. Charles Flint QC and Mr. Matthew Collings (instructed by Messrs Simmons & Simmons for the Defendants)

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Approved Judgment

I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.

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The Vice-Chancellor :

Introduction

1. West Ferry Printers Ltd ("West Ferry") has, since 1987, been operated by Express Newspapers ("EN") and Telegraph Group Ltd ("DT") as a joint venture for the purpose of printing and publishing their respective newspapers. The operation of the joint venture and the relationship between the joint venturers are regulated by the Articles of Association of West Ferry, a Restated Agreement dated 29th June 1990 ("the Restated Agreement") as amended by a further agreement ("the Amending Agreement") dated 4th August 1992 and a printing agreement dated 30th December 1987.
2. Article 10 of the Articles of Association and clause 15 of the Restated Agreement make detailed provision for what is to happen if, amongst other events, control of one or other of the parties changes. In that event the second party is entitled, in prescribed circumstances, to acquire the shares in West Ferry held by the first party. If it seeks to acquire such shares then it is also bound to acquire assets associated with the operation of West Ferry owned by the first party but leased or licensed to West Ferry. The Restated Agreement as amended by the Amending Agreement provides a formula for the valuation of those assets and, if the parties cannot agree, for an arbitrator to determine the values in accordance with the formula.
3. At the risk of sacrificing accuracy for simplicity the procedure for the acquisition of the shares and associated assets of the first party by the second party may be summarised as follows:

a) on the occurrence of a change in the control of the first party that party is deemed to have served a transfer notice on the directors of West Ferry for the purposes of Article 10 of the Articles of Association (clause 15.3),

b) such notice constitutes the directors of West Ferry agents of the first party for the sale of its shares to other shareholders at their par value (Article 10(b)),

c) within seven days from the receipt of the transfer notice the directors of West Ferry must offer the shares of the first party to the other members by a notice in writing specifying the number of shares, their par value and limiting a time (not being less than 28 days) during which the offer if not accepted will be deemed to have been declined (Article 10(c)),

d) if the first party is deemed to have served a transfer notice under clause 15.3 then the second party may at any time within 42 days serve a default notice on the first party (clause 15.4),

e) such a default notice may specify and require, amongst other matters, that the voting powers of the nominee directors appointed by the first party be suspended (whereupon the second party is entitled to remove those directors) and that the first party is thereby deemed to have served a transfer notice under Article 10 (clause 15.4.1 and 15.4.2.1),

f) no shareholder is entitled to buy shares pursuant to clause 15 without also buying the associated assets (clause 15.8),

g) such assets are deemed to be offered for sale by the shareholder serving or deemed to serve a transfer notice and are to be valued in accordance with the formula, in the event of disagreement, by an arbitrator (clauses 5 and 6 of the 1992 Amending Agreement),

h) completion is to be effected within seven days of the date on which the obligation to make the transfer first arose or the value of the associated assets is agreed (clause 15.9).

4. On 22nd November 2000 control of EN passed from United News and Media Group Ltd to Northern and Shell Media Holdings Ltd. It is not disputed that, pursuant to clause 15.3, a transfer notice for the purpose of Article 10(a) was deemed to have been served by EN on the directors of West Ferry. The new owner of EN was entitled under Article 16(c) to appoint its own nominees to the board of West Ferry and did so on 1st December 2000. On 14th December 2000 Mr. Colson, the deputy chairman and chief executive of DT, met Mr. Ellice, the joint group managing director of EN. They discussed Mr. Colson's suggestion that the period of 42 days within which any default notice had to be served should be extended by 30 days. Later that day, Mr. Ellice having discussed the matter with his chairman, Mr. Desmond, told Mr. Colson on the telephone that EN would not agree to such an extension. Mr. Ellice contends and Mr. Colson denies that Mr. Colson told him that DT would buy the shares and associated assets anyway.
5. On 27th December 2000 DT served on EN a default notice under clause 15.4. It specified and required that (1) the voting powers of the directors appointed by EN were suspended, with the consequence that (2) DT was entitled to exercise the power of EN to remove them and that (3) EN was thereby deemed to have served a transfer notice for the purpose of Article 10 of West Ferry's Articles and to have offered its associated assets for sale. On 29th December 2000 DT served a further notice under clause 15.4 and Article 16(c) removing from the board of West Ferry the new directors appointed by EN on 1st December 2000. On 3rd January 2001 the directors of West Ferry sent to DT and EN a notice under Article 10(c) offering the EN shares in West Ferry to DT at their par value. They pointed out that EN was deemed also to have offered to sell the associated assets. They stated that the offer remained open for acceptance until the earlier of the date on which DT and EN notified West Ferry that they had agreed the value of the assets or the date on which the determination of their value by the arbitrator became final. EN says that it never received this notice.
6. Thereafter there were meetings and correspondence between the parties to which I shall refer in detail later. For present purposes it is sufficient to record that the parties were unable to agree the value of the associated assets. On 9th February 2001 EN served notice requesting the appointment of an arbitrator to determine their value. On 13th March 2001 they applied for his appointment by the court. An order appointing Sir Anthony Evans was made on 6th July 2001. In the meantime, on 4th April 2001, EN demanded the reappointment of its nominee directors.
7. On 19th April 2001 EN commenced two sets of proceedings against DT. The first is an action for specific performance of a contract for the sale by EN of its shares and its associated assets to DT. EN claims that the contract arose from (1) an offer arising from the transfer notice deemed to have been given on 22nd November 2000 and (2) the acceptance thereof constituted or evidenced by (a) the telephone conversation between Mr. Ellice and Mr. Colson on 14th December 2000, (b) the Default Notice served on 27th December 2000 and the letter from DT accompanying the same, (c) DT's letter dated 29th December 2000, (d) a further letter from DT dated 11th January 2001, (e) DT's participation in the arbitration and (f) its continuing refusal to permit the reinstatement of EN's nominee directors of West Ferry. In the alternative EN contends that DT is estopped from contending that it has not accepted the offer of EN deemed to have been made.
8. The second set of proceedings is a petition in respect of West Ferry presented under s.459 Companies Act 1985. The relief sought is an order requiring DT to purchase EN's shares in West Ferry and its associated assets at a price ascertained in accordance with the formula prescribed by the Restated Agreement as amended by the Amending Agreement. The grounds for such relief are that DT has wrongly excluded EN from the management of West Ferry and has destroyed the mutual trust and confidence between DT and EN on the basis of which the affairs of West Ferry were conducted.
9. The petition was presented on 19th April 2001. On 20th April 2001 there appeared an article in the Business Section of The Times in which reference was made to the presentation of the petition and the Media Editor's understanding of the underlying dispute. On 4th May 2001 DT applied to strike out the petition on the grounds that (1) it was not presented on reasonable grounds and has no real prospect of success and (2) its premature advertisement in The Times is an abuse of the process of the court.
10. The hearing before me was of the trial of the action and the application to strike out the petition. The issues I have to determine are (1) whether the change in the control of EN and the notices subsequently given or deemed to be given constituted an offer by EN for the sale of its shares and associated assets to DT capable of acceptance by DT and, if so, what were its terms; (2) whether such offer was in fact accepted by DT, which includes the resolution of the dispute as to what was said by Mr. Colson to Mr. Ellice on 14th December 2000; (3) whether DT is estopped from contending that it did not accept any such offer and (4) whether the Petition should be struck out on all or any of the grounds relied on by DT. I will deal with those issues in that order.

The Offer

11. The identification of the offer and its terms is crucial to the claim of EN. It depends on the proper construction and effect of Article 10 of the Articles of Association of West Ferry and clause 15 of the Restated Agreement as amended by the Amending Agreement. Accordingly it is necessary to set out their relevant terms in some detail.
12. The original articles of association of West Ferry were replaced on 26th July 1996 by a new set necessitated by a change in the capital structure of West Ferry. It is common ground that the relevant new article is Article 10 so that references in the Restated Agreement to Article 9 should be read as references to Article 10. It is also common ground that the differences between old article 9 and new article 10 are immaterial to the issues I have to determine. Accordingly I shall refer to the terms of Article 10 and will read references in the Restated Agreement to Article 9 as references to Article 10.

"10. The right to transfer Ordinary Shares in the Company shall, prior to Flotation, be subject to the following restrictions:-

(a) A member who intends to transfer Ordinary Shares in the Company (hereinafter called the "Vendor") shall give notice in writing to the directors of his intention (hereinafter called the "Transfer Notice") specifying the shares concerned (hereinafter together called the "Sale Shares"), and shall offer to sell the Sales Shares at their par value. The Transfer Notice shall not be revocable. A transfer by a member shall be of all of his Ordinary Shares and not some only.

(b) The Transfer Notice shall constitute the directors the agents of the Vendor for sale of the Sale Shares to the other holders of the Ordinary Shares in the Company (hereinafter referred to as "holders") at their par value.

(c) Subject to the provisions of the last sentence of this paragraph (c), within seven days after the receipt of the Transfer Notice the directors shall offer the Sale Shares to the other holders of shares of the same class as the Sale Shares in proportion as nearly as the circumstances will admit to the numbers of shares of that class in the Company held by them respectively. Each such offer shall be made by notice in writing specifying the number and their par value and shall limit a time (not less than 28 days) during which the offer if not accepted by notice in writing to the directors will be deemed to have been declined. At the expiration of that time any Sale Shares not so accepted shall be re-offered in like manner and upon the same terms to those of the other holders of shares of that class who accepted all the Sale Shares previously offered to them and such re-offering shall be repeated until such time as all the Sale Shares have been accepted or unt[il] all the other holders of shares of that class shall have declined it to accept any more of them. Within seven days after the expiration of the final re-offering the directors shall offer any Sale Shares which have not been accepted by the holders of the same class of shares as the Sales Shares (in the case of "C" Ordinary Shares or "D" Ordinary Shares) to the holders of the "A" Ordinary Shares and "B" Ordinary Shares, (in the case of "A" Ordinary Shares) to the holders of "B" Ordinary Shares, and (in the case of "B" Ordinary Shares) to the holders of "A" Ordinary Shares, in each such case, in like manner and so that the foregoing provisions of this paragraph (c) shall mutatis mutandis apply thereto. If the Sale Shares constitute all the shares of a class the directors shall within seven days of receipt of the Transfer Notice make the offer referred to in the preceding sentence......

(d) If by the foregoing procedure the directors shall receive acceptances in respect of any of the Sale Shares they shall give notice thereof to the Vendor and he shall thereupon become bound upon payment of the appropriate price to transfer the accepted Sale Shares to the person or persons who have accepted the same and if in any case the Vendor having become so bound makes default in so doing the Company shall receive the price and the directors shall appoint some person to execute instruments of transfer of those of the Sale Shares concerned in favour of the relevant transferee and shall thereupon subject to such instruments being duly stamped cause the name of the relevant transferee to be entered in the Register of Members as the holder thereof and shall hold the price in trust for the Vendor. The receipt of the Company shall be a good discharge to any such transferee.

(e) If by the foregoing procedure the directors shall not receive acceptances in respect of all the Sale Shares they shall give notice thereof to the Vendor and the Vendor shall be at liberty within 90 days thereafter to transfer all or any of the unaccepted Sale Shares to any person or persons at any price not less than their par value."

Paragraph (f) entitles all the holders of the A Ordinary and B Ordinary shares to waive the provisions of Article 10 in any particular case.

14. By November 2000 the issued ordinary share capital of West Ferry consisted of 5000 A shares and 5000 B shares of 1p each. The A shares were held by DT and the B shares by EN. Thus the effect of Article 10(c) was to require the directors of West Ferry to offer the B shares of EN to DT as the holder of all the A shares.
15. Article 10 was the context in which EN and DT entered into the relevant provisions of the Joint Venture Agreement in 1987, which became clause 15 of the Restated Agreement. Clause 15 is complicated. By clause 15.1 each shareholder is required to comply with the provisions of Article 10 in relation to any transfer or deemed transfer of its shares. Clause 15.2 is not relevant.
16. So far as material clause 15.3 to 15.5 provide as follows:

"15.3 A Shareholder shall be deemed to have served a transfer notice for the purpose of Article [10] simultaneously with the occurrence of any of the following events in relation to that Shareholder:-"

[15.3.1 and .2 prescribe as relevant events winding up, the appointment of a receiver or manager, making a composition with creditors or the commission of a material and irremediable or unremedied breach of the Restated Agreement, the printing agreement or certain leases]

"15.3.3 it becomes ultimately controlled by any person (which for the purpose of this clause 15.3.3 shall be deemed to include any person who is a connected person within the meaning of Section 533 of the Income and Corporation Taxes Act, 1970) or group of persons who, at the date of this Agreement, does not possess such control...."

[15.3.4 and .5 prescribe as relevant events the disposal of the whole or any interest in one of the titles of that shareholder or if the printing charges payable by that shareholder are less than one third of the printing charges payable by the other.]

"15.4 In the event of a Shareholder hereinafter in this sub-clause called "the defaulting Shareholder") being deemed to have served a transfer notice by reason of clause 15.3 the other Shareholder may at any time within 42 days thereof serve notice in writing (hereinafter called "the default Notice") on the defaulting Shareholder specifying and requiring:-

15.4.1 that the voting powers of the directors appointed by the defaulting Shareholder are forthwith suspended and the other Shareholder is thereby entitled to exercise the defaulting Shareholder's power of appointing and removing directors as provided in the Articles; and/or 15.4.2 either:-

15.4.2.1 that the defaulting Shareholder is thereby deemed to have served a transfer notice for the purpose of Article 9 to which all the subsequent provisions of that Article shall be applicable, save so far as is hereinafter otherwise provided and save that the defaulting Shareholder shall not be entitled to withdraw such transfer notice, or 15.4.2.2 that the JVC forthwith cease to trade and within 3 calendar months thereafter be placed in voluntary liquidation and be liquidated by a Liquidator specified in such notice.

15.5 If the other Shareholder has not become bound to purchase the Shares in accordance with Article [10] by reason of a transfer notice deemed to have been served in accordance with clause 15.3 (and for the purposes of Article 9 such transfer notice shall be deemed to be capable of being accepted within the 42 day period provided in clause 15.4 and Article [10](e) shall not apply) and the other Shareholder has not given notice to liquidate in accordance with the provisions of clause 15.4.2.2, then the Default Notice served by that Shareholder under clause 15.4 shall cease to have effect and the voting powers of the defaulting Shareholder and its entitlement to exercise the power of appointing and removing Directors shall revive and the transfer notice in respect of its Shares shall be deemed to have lapsed and the defaulting Shareholder shall not be at liberty to transfer its Shares to a third party."

17. Clause 15.6 deals with the termination of the Printing Agreement by one or other shareholder. In that event, which is not one of those prescribed by Clause 15.3 and for which there is no requirement for a default notice, the shareholder who determines it is deemed to have served a transfer notice pursuant to Article 10. In that case it is specifically provided that "the transfer notice shall be capable of being accepted by the offeree". If the offeree "does not accept the offer comprised in the aforesaid deemed transfer notice" then West Ferry is to be put into liquidation.
18. Clause 15.7 was replaced by clauses 5 and 6 of the Amending Agreement. Clause 5.1 provides that

"in the event of a shareholder serving or being deemed to have served a transfer notice pursuant to the terms of this Agreement or the Articles it shall be deemed that [that] shareholder ("the offeror") shall also have offered for sale to the other shareholder [the associated assets]".

Clause 5 goes on to provide that if the offeror is EN the associated assets include three leases and many other assets itemised in a schedule thereto. The associated assets (cl.5.3)

"shall be deemed to be offered at a price assessed in accordance with clause 6.."

Clause 6 prescribes a formula for valuation by reference to original cost after applying straight-line depreciation at percentages varying with the type of asset. If the parties are unable to agree then either of them is entitled to refer the valuation to the determination of an arbitrator pursuant to clauses 17.3 and 24 of the Restated Agreement.

19. Clause 15.8 of the Restated Agreement stipulates that no shareholder may purchase shares without agreeing to buy the associated assets. Clause 15.9 provides

"15.9 Any transfer by either Shareholder of its Shares under this Agreement shall be effected by the transferor selling such Shares as beneficial owner free and clear of all claims, charges, liens, encumbrances and equities of any description and together with all rights attaching thereto. Any such transfer shall be completed at the registered office of the JVC within seven days from the date on which the obligation to make the transfer first arises (or, if later, the date on which the value of the Sale Assets is agreed under [clause 6 of the Amending Agreement) when the transferring shareholder shall...."

20. EN claims that on the change of control of EN occurring on 22nd November 2000 it was deemed to have served a transfer notice under Article 10(a) by virtue of the provisions of clause 15.3. It submits that there were two consequences; the first was that DT then had 42 days in which both to serve a default notice and to accept the offer; the second was that the directors of West Ferry had 7 days in which to serve an offer notice under Article 10(c). On these bases the default notice would have to be served on or before 3rd January 2001 and the directors offer notice on or before 29th November 2000. In accordance with Article 10(c) the directors would be bound to allow not less than 28 days for acceptance, that is until at least 29th December 2000. In either event the offer made on 22nd November 2000 was open to acceptance down to but not after 3rd January 2001.
21. During the course of the hearing I was invited to conclude that the directors of West Ferry had indeed sent out an offer document on or before 29th November 2000. The basis for this submission is that Mr. Colson made plain in his oral evidence that DT had been concerned throughout that the procedure laid down by Clause 15 and Article 10 should be strictly adhered to. EN also relied on a letter dated 28th November 2000 from Mr. Deedes, the managing director of DT, to a director of West Ferry pointing out to him that the change of control of EN had led to the requirement under Article 10(c) that the directors send out a notice to DT. He suggested that they and the other directors should "make appropriate arrangements for the necessary notices to be issued". In addition EN relied on the well-known presumption of regularity.
22. I see no sufficient ground for making any such finding. If this point was to be properly pursued it should have been alleged in the particulars of claim that the directors of West Ferry had given notice to DT in accordance with Article 10(c) as applied by clause 15.3. EN might then have compelled oral or documentary evidence from West Ferry to prove the allegation. As it is there was no such pleading or evidence, whether from West Ferry or anyone else. The desire of DT to adhere to the procedure laid down by clause 15 and Article 10 and the presumption of regularity can only be of assistance to EN if the proper construction of those provisions is that for which EN contends. If it is there is no need to presume any such notice. If it is not there is no ground for doing so.
23. The default notice was served within the 42 day period on 27th December 2000. By virtue of clause 15.4.2.1 EN was thereby deemed to have served a transfer notice for the purposes of Article 10. In these circumstances EN contends that the relevant offer was made on and by virtue of the change of control on 22nd November as confirmed by the default notice served on 27th December 2000. The offer had to be accepted on or before 3rd January 2001.
24. If this contention is correct then the letter from the directors of West Ferry dated 3rd January 2001 was too late to have any effect. But I note at this stage, for it is relevant to the fourth issue, that EN submits that the letter of 3rd January 2001 was of no effect for two reasons. The first reason is that in allowing DT time to accept the offer by reference to the agreement or final determination of the value of the associated assets the directors of West Ferry failed to

"limit a time (not being less than 28 days) during which the offer if not accepted by notice in writing to the directors will be deemed to have been declined". The second reason is that the directors of West Ferry failed properly to exercise their powers as directors of West Ferry or as agents of EN in allowing so indeterminate and potentially long a time for acceptance.

25. In support of this contention EN relies on the provisions of clause 15.3 which deem the service of a transfer notice under Article 10 to be "simultaneous" with the change in control. EN also relies on clause 15.4 as recognising that the relevant notice was that deemed to be served by clause 15.3 and that the period of 42 days runs from that deemed service and not the service of the default notice. EN relies on the provisions of clause 15.5 and 15.6 as confirming that the deemed transfer notice is an offer capable of acceptance and on the parenthesis in clause 15.5 as showing that the 42 days to be allowed for acceptance runs from the initial deemed transfer notice. Counsel for EN suggests that the provisions of clause 15.4.2.1 are unnecessary and serve only to point out to the other shareholder the consequences of the events that have happened. Counsel for EN submits that the alternative construction advanced by DT leads to the absurd and uncommercial result that EN may be obliged to undergo an expensive and long drawn out arbitration and without any representation on the board of West Ferry only to find that DT refuses to proceed if it loses.
26. These submissions are challenged by Counsel for DT. The case for DT is that when clause 15 is read as a whole against the background of Article 10 it can be seen that there is one seamless process. Counsel for DT contends that it originated in the change of control and the consequential deemed service of a transfer notice on 22nd November 2000 but was triggered and made effective by the service of the default notice on 27th December 2000. That notice authorised the letter of 3rd January 2001 the offer in which is still open to acceptance. He submitted clause 15 and Article 10 to a detailed analysis to show how they may and should be construed to produce a consistent and workable procedure.
27. The arguments focussed attention on the detailed provisions of clause 15 and Article 10. This is necessary at some stage but I think that it is sensible to precede a detailed consideration of the words used with a consideration of what exactly is the point of difference between the parties and what was the object of the draftsman. The material points of difference are the identification of the offer and the time limited for its acceptance. EN contends that the offer is the product of the change of control, the provision of Clause 15.3 deeming EN to have served a Transfer Notice and Article 10, which prescribes the nature and effect of such a notice. It submits that such offer must be accepted within 42 days of the change of control. DT accepts that the change of control gives rise to a deemed transfer notice but submits that it has no effect unless and until triggered by the service of a default notice within 42 days. On DT's case the offer open to acceptance then comes in the form of a letter from the directors of West Ferry given under Article 10(c) and that the time for acceptance is that limited by those directors in such letter. Thus the simple question is whether and if so where in clause 15 or Article 10 is there any provision limiting the time for acceptance to 42 days from the change of control. The answer to that simple question is that there is no clear provision to that effect. EN relies on the words in parentheses in clause 15.5

"(and for the purposes of Article 10 such transfer notice shall be deemed to be capable of being accepted within the 42 day period provided in clause 15.4 and article 9(e) shall not apply)"

28. The purpose of the draftsman of clause 15 is to be ascertained from all the provisions of that clause against the background of Article 10. Article 10 contains a normal pre-emption provision commonly found in companies with a limited number of shareholders, particularly those carrying on a joint venture. Its operation commences if a member intends to transfer ordinary shares. In that event the offer is made by the directors of the company as agent for that member and is accepted by notice in writing to those directors as such agent. By clause 15 those provisions are applied generally to intended transfers by members. But clauses 15.3 to 15.5 deal with the different situations in which an event has occurred in respect of one shareholder which may lead the other shareholder to reconsider whether and if so how to continue the company in operation. Thus the shareholder in respect of whom the event in question has occurred is defined in clause 15.4 as "the defaulting shareholder". It would be surprising if the default should of itself give rise to a process by which the innocent shareholder had to commit himself to a purchase within 42 days of the event in question and before the price for the associated assets had been ascertained.
29. It is common ground that the event in question gives rise to a deemed service of a transfer notice for the purposes of Article 10. Thus such a notice is deemed to have been given by EN on 22nd November 2000. In consequence, by virtue of Article 10(a), EN is obliged to offer to sell its shares. There is nothing in clause 15.3 expressly applying the provisions of Article 10(b)-(d) whereby the directors of West Ferry are deemed to be the agents of EN for offering the shares to DT and receiving its acceptance. Clause 15.4 envisages that the process commenced by Clause 15.3 is not automatic. It provides that on the deemed service of a transfer notice under clause 15.3 the other shareholder is to have an option. One of the options is that conferred by clause 15.4.2.1. This entitles the non-defaulting shareholder to specify that the defaulting shareholder is deemed to have served a transfer notice "to which all the subsequent provisions of [Article 10] shall be applicable". This provision clearly triggers the provisions of Article 10(b)-(d). It is to be contrasted with the other options of suspending and removing nominee directors under clause 15.4.1 and winding up under clause 15.4.2.2 neither of which has any connection with Article 10.
30. Thus I accept the submission of counsel for DT that unless and until DT serves a default notice under clause 15.4 specifying the purchase option under clause 15.4.2.1 the provisions of Article 10(b)-(d) have not come into operation. If, as in this case, such a default notice is served within the time prescribed in clause 15.4 then those paragraphs of the Article must then be operated. The seven days allowed to the directors of West Ferry have to be computed from the service of the default notice because they cannot be computed from the original event if the innocent shareholder is to be allowed the full 42 days permitted by clause 15.4 for considering whether and if so how to exercise his option.
31. I do not accept the submission of counsel for EN that clause 15.4.2.1 has no purpose and is merely declaratory of the effect of clause 15.3. It is quite clear that clause 15.3 does not commence a process under Article 10 that is to continue irrespective of the wish of the innocent shareholder. I also reject the submission that the transfer notice deemed to have been given is the only offer capable of acceptance. It is true that clause 15.6 contemplates that in the case of a termination of the printing agreement the deemed transfer notice is capable of being accepted. Likewise the parenthetical provision in clause 15.5 deems a deemed transfer notice given under clause 15.3 to be acceptable within the 42 period allowed by clause 15.4. But none of them excludes the provisions of article 10(c) expressly applied by clause 15.4.2.1. I also reject the submission of counsel for EN that the parenthetical provision in clause 15.5 is such as to limit the time within which an offer, whether comprised in the deemed transfer notice or in a letter from the directors of West Ferry, is to be accepted. The fact that the deemed notice under clause 15.3 is deemed to be acceptable within the 42 period provided in clause 15.4 does not mean that it must be. The argument for EN involves the interpolation of the word "only". I see no justification for it. The 42 day period was for the exercise of the options conferred on the innocent shareholder. The relevant option was not the acceptance of an offer already made but the commencement of a process that requires the offer to be made by the directors of West Ferry as agent for EN.
32. It is also necessary to bear in mind that the process with regard to the shares must also accommodate the provisions regarding the sale of the associated assets without which, pursuant to clause 15.8, the sale of the shares is not permissible. By virtue of clause 5.1 of the Amending Agreement a shareholder deemed to have served a transfer notice is also deemed to have offered to sell to the other shareholder the associated assets. There is no requirement for a default notice and there is no period of 42 days prescribed for any purpose. By clause 5.3 the associated assets are deemed to be offered at a price assessed in accordance with a formula in the absence of agreement by an arbitrator. In my view these express provisions contemplate that the offer is to remain open to acceptance until such time as the price has been assessed. This accords with both clause 15.8, which distinguishes between a purchase of the shares and an agreement to purchase the associated assets. It also fits in with clause 15.9, which contemplates that the defaulting shareholder may be bound to transfer the shares at a time when the value of the associated assets has not been agreed or determined.
33. For all these reasons I conclude that the default notice was properly served on 27th December, the directors of West Ferry were then bound to operate the provisions of Article 10(b)-(d) and DT was not bound to accept the offer to be made pursuant to Article 10(c) (or any offer contained in the deemed transfer notice) before 3rd January 2001.

Acceptance

34. My conclusion on the proper construction and application of clause 15 and Article 10 largely disposes of the issue of acceptance too. But as this issue involves questions of fact I should make findings in respect of them in case this action goes further. In addition it is necessary to give fuller consideration to the facts so as to deal with the third and fourth issues as well. It is convenient to do so in the context of the question of acceptance. Evidence in the form of witness statements was given for EN by Mr. Desmond, the chairman of the purchaser of EN, Mr. Ellice and Lord Stevens of Ludgate and for DT by Mr. Benwell, a partner in the firm of solicitors acting for DT, Mr. Colson and Mr. Noakes, a driver employed by DT. Only Mr. Ellice and Mr. Colson gave oral evidence and were cross-examined.
35. As I have already indicated the change in the control of EN occurred on 22nd November 2000. It is not disputed that DT knew of the occurrence of that event more or less immediately. I have already referred to the letter from Mr. Deedes to his fellow director of West Ferry dated 28th November. He did not consult with Mr. Colson before sending it and its terms do not reflect an understanding of the effect of clause 15 and Article 10 in accordance with my conclusions. But, as I have already concluded, the directors of West Ferry did not serve any offer notice in accordance with Article 10(c) until 3rd Janary 2001. On 29th November 2000 the board of DT considered the matter. It was reported that the change in control "triggered a right for [DT] to reacquire the Express' 50% interest in [West Ferry] at a price calculated on the basis of a formula set out in the joint venture agreement".
36. Mr. Colson and Mr. Ellice first met on 11th December 2000 in connection with the affairs of another associated company. They first met in connection with the affairs of West Ferry on 14th December 2000 at a board meeting and a finance meeting of West Ferry. Mr. Colson attended with Mr. Deedes and the finance director for DT. He met Mr. Ellice when waiting for the lift and indicated that he wished to speak to him regarding the 42 day time limit. At a break in the meeting Mr. Colson suggested that the limit should be extended by agreement. Mr. Ellice told Mr. Colson that he would have to consult Mr. Desmond. After the meeting Mr. Ellice contacted Mr. Desmond. He then telephoned Mr. Colson. According to Mr. Ellice he asked Mr. Colson "Do you intend to buy us out of the agreement? If so why extend." He recalls that Mr. Colson answered "Irrespective of an extension to the 42 day period DT want to buy. The extension would simply help us, as we do not want to upset our Christmas holidays." Mr. Ellice produced a contemporaneous note he claimed to support his version. That states

"Dan Colson - Telegraph

*[42 days notice buy out our share

Expires on 2/1/2001 ]* *[want to extend the notice period to have a informal conversation A) what our plans are B) ]"  

37. Mr. Colson denied that he had ever said words to the effect that DT wanted to buy EN's interest irrespective of an extension. He pointed out that he had never met Mr. Desmond and this was only his second meeting with Mr. Ellice. He did not know and had not had an opportunity to find out what the new owners of EN wished to do with regard to West Ferry. Both he and Mr. Desmond were going abroad for Christmas and the New Year yet a default notice would have to be served by 3rd January 2001 if DT wished to exercise any of the options conferred by clause 15.4. He knew of the provisions of clause 15 and Article 10 and, as a Canadian barrister and solicitor experienced in mergers and acquisitions, appreciated their complications. Mr. Colson was extensively cross-examined by counsel for EN. For reasons, which I will explain later, I have no hesitation in accepting the evidence of Mr. Colson and rejecting that of Mr. Ellice on this point. I find as a fact that Mr. Colson did not say to Mr. Ellice then or at any other time that DT wished to buy EN's shares in West Ferry irrespective of whether an extension to the period of 42 days was agreed.

38. On 20th December 2000 Mr. Colson sent a fax to Mr. Ellice recording his unsuccessful attempts to make contact with him. He continued

"As you know, there are certain deadlines and procedures set out in the agreement between [EN] and [DT] with respect to [West Ferry]. As I mentioned to you at the recent West Ferry Board meeting, I think it would make sense to extend the 42 day deadline so that we could discuss this matter when your chairman returns to London following his holiday. If you would like to discuss this matter, my telephone number in the US is shown above and I look forward to hearing from you."

39. Mr. Ellice did not contact Mr. Colson. On 27th December 2000 Mr. Colson wrote again, this time enclosing the default notice. He said

"As you know, I thought that it would be useful to extend the 42 day notice period to give us both some time to discuss the implications of the change of control of [EN]. As the notice period has not been extended and in order to protect our position, attached is a copy of the default notice which we have issued in accordance with clause 15.4 of the shareholder's agreement in relation to [West Ferry]. I would be happy to speak to you about where we go from here."

As I have already indicated the default notice specified and required the suspension of the voting powers of the directors of West Ferry appointed by EN and that EN was thereby deemed to have served a transfer notice for the purpose of Article 10 in respect of its entire holding of B shares. Receipt of the default notice was acknowledged on 29th December 2000 by solicitors acting for EN. On the same day DT served on EN a further notice under clause 15.4 this time electing to remove the directors of West Ferry appointed by EN and appointing their own nominees.

40. The letter from the directors of West Ferry in implementation of Article 10(c) is dated 3rd January 2001. It offers the B shares to DT at their par value and notes the deemed offer for the sale of the associated assets. It states that the offer is open to acceptance in the period commencing on the date of the letter to the day and ending on the day 10 days after the earlier of notification to the directors of West Ferry that the parties had agreed the value of the associated assets or the final determination of their value by arbitration. It stipulates that the offer may only be accepted by notice in writing to the directors of West Ferry within that period failing which the offer would be deemed to have been declined.

41. As I have indicated EN denies receiving a copy of that letter notwithstanding that it was properly addressed to both EN and DT. It is not clear that receipt by EN is relevant to any issue now before me. But in case it is I should make it clear that I am satisfied that it was duly sent to and received by EN. The evidence includes a witness statement of the driver employed by DT who, on the instructions of Mr. Deedes, personally delivered the letter to the post room at the address of EN and obtained a receipt for it. He was not cross-examined on his witness statement. Mr. Ellice suggested that the post room was that of the former holding company of EN, which held the head lease and sublet certain floors to EN. He contended that receipt in the post room was not the receipt by EN. I do not accept that. Those staffing the post room were evidently authorized by EN to receive mail on its behalf. The receipt obtained by Mr. Noakes, though somewhat informal, bore the imprint of an EN date stamp. But, of more significance, when on 29th January 2001 DT wrote to EN expressly referring to the letter of 3rd January 2001 and enclosing a valuation of the associated assets the reply from the solicitors for EN the following day made no reference to that letter. If it had not been received by EN it is inconceivable that their solicitors would not have made some comment or enquiry as to what the letter was or contained. I find as a fact that the letter of 3rd January 2001 was received by EN at the time it was delivered to the post room by DT's driver.

42. On 10th January 2001 there was a meeting at the offices of Mr. Desmond between Mr. Desmond and Mr. Ellice of EN and Mr. Colson and Mr. Deedes of DT. This was the first occasion Mr. Colson had met Mr. Desmond. He was concerned to ascertain what Mr. Desmond planned to do about West Ferry. But Mr. Desmond started the meeting by asking how much DT was prepared to pay. Mr. Colson said that it was not simply a matter of how much; there were a number of possibilities and the default notice had been served to protect the position of DT. According to Mr. Colson there was no discussion about price or valuation. Mr. Ellice said that prices were mentioned and indicated a wide margin between Mr. Desmond's suggestion of £84m and Mr. Colson's of £18m. It is common ground that Mr. Desmond indicated that he would take an aggressive approach to the management of West Ferry. The meeting did not reach any conclusion but left Mr. Colson with the clear impression both that Mr. Desmond did not favour any joint venture and that he would not be an acceptable partner to DT anyway.

43. The same day the solicitors for EN wrote to Mr. Colson. They said

"Following that meeting we understand that you no longer wish to acquire the 50% of [West Ferry] owned by our clients and that accordingly you intend to revoke the default notice served by you on 27th December 2000." The solicitors suggested that the revocation of the notice would render the notice to remove the EN nominee directors obsolete and requested their reinstatement forthwith. They went on to suggest that Mr. Desmond intended to ensure that EN became an active partner in West Ferry and looked forward to meeting the key management at the earliest opportunity. The letter has been described by Mr. Ellice and Mr Desmond as "shadow-boxing" or a means of "teasing out the position of" DT. Its justification is said to be that the events of the meeting indicated some uncertainty whether DT accepted that they were obliged to pay the price ascertained in accordance with the Restated Agreement as amended by the Amending Agreement. In my view the euphemisms should be recognised for what they are. The statement I have quoted was false and Mr. Ellice knew it was. In so far as there is any material difference between the account of the meeting given by Mr. Colson and that given by Mr. Desmond and Mr. Ellice, for the reasons I shall give later, I accept that given by Mr. Colson and reject that given by Mr. Desmond and Mr. Ellice.

44. On 11th January 2001 Mr. Colson replied to the solicitors for EN refuting the suggestion that he had stated that DT no longer wished to acquire EN's interest in West Ferry. He summarised his version of the meeting, which I accept to be accurate, and stated that

"at no time was there any suggestion that DT intended to revoke or cancel the notices served on EN on 27th and 29th December 2000 and I confirm we have no intention of doing so."

45. The remainder of the correspondence is of little relevance. On 12th and 16th January 2001 the solicitors for EN wrote asking when EN might expect payment. On 29th January 2001 DT sent their proposals by reference to the letter of 3rd January. The letter indicated that DT would be prepared to pay £18.8m. for the associated assets. It asked for confirmation of EN's acceptance of that offer by 7th February and continued

"Assuming we accept the offer of the shares in West Ferry we will need to instruct lawyers to consider the mechanics of the transfer of the [associated] assets." As I have already recorded this offer was rejected by a letter dated 30th January 2001 from the solicitors for EN. They suggested a valuation of £83.5m. There was then a debate in correspondence as to the meaning and application of the valuation formula. On 9th February 2001 the solicitors for EN gave notice to DT seeking their agreement to the appointment of Sir Anthony Evans as an arbitrator. DT thought that an accountant would be more suitable. I have already recorded that the outcome was the eventual appointment by the court of Sir Anthony Evans.

46. On 22nd March 2001 Mr. Colson met Mr. Ellice at a private meeting after the Finance Meeting of West Ferry. Mr. Ellice suggested as it was "a given" that DT would shortly hold all the ordinary shares in West Ferry it should take full responsibility for working capital and other finances. Mr. Colson told Mr. Ellice that DT had no obligation to buy EN's 50% interest and would not do so unless it was satisfied that it was not paying too much. The contemporaneous note Mr. Colson prepared records that

"This clearly came as a complete surprise if not a shock to Ellice. According to Ellice the arbitration procedure merely determines the price which DT will be obliged to pay." On 4th April 2001 the solicitors for EN demanded the immediate reinstatement of its nominees to the board of West Ferry. Letters before action were sent by the solicitors for EN on 9th April 2001. Save that neither of them suggested that any offer for the shares of EN was accepted during or in consequence of the telephone conversation between Mr. Ellice and Mr. Colson held on 14th December 2000 their contents do not call for express mention. The claim form in this action was issued on 19th April 2001 and the s.459 Petition was presented to the court on the same day.

47. In paragraphs 37 and 43 I indicated that I would give my reasons for preferring the evidence of Mr. Colson to that of Mr. Ellice later. There are three. First, the account of Mr. Colson is consistent with all the contemporary documents, in particular his letters of 20th and 27th December 2000. If he had indicated in the conversation on 14th December that DT would be buying EN's shares any way and irrespective of whether or not an extension was agreed neither letter would be in the form that it was. As Mr. Ellice himself pointed out if DT was going to buy anyway why ask for an extension. Mr Ellice's note can be read as consistent with either party's version. Second, in giving his oral evidence Mr. Ellice demonstrated on at least three important occasions either an inability to see the point of the question or a determination not to answer it. The time he took to answer questions by reference to a document was far greater than that needed to read and understand both the document and the question. He gave me the clear impression of one determined at all costs to stick to a predetermined script. Third, I was told by counsel for EN, when I enquired how the letter of 10th January 2001 referred to in paragraph 43 could have been properly written, that it was sent on the express instructions of the client immediately following the meeting. As I have already concluded, the statement I have quoted was false and Mr. Ellice knew it was. Whilst statements may be made by businessmen during their conduct of negotiations which they would not repeat in their sworn evidence I do not have sufficient confidence in Mr. Ellice's recollection or veracity to place reliance on his uncorroborated evidence. I have no such doubts about the evidence of Mr. Colson. 48. It follows from my construction of clause 15 and Article 10 and my findings as to the content of the telephone conversation between Mr. Ellice and Mr. Colson on 14th December 2000 that EN has failed to prove any acceptance of any offer to buy the shares of EN or the associated assets. Mr. Colson did not say that DT would buy them in any event, neither the notices nor the correspondence occurring before 3rd January 2001 purported to accept anything and the participation in the arbitral process and the refusal to reinstate EN's nominee directors are consistent only with the rights of DT as I have found them to be. There is no ground for the implication into the words or deeds of DT any acceptance of an offer to buy EN's shares or associated assets.

Estoppel

49. The estoppel claim depends on the same matters alleged to constitute acceptance. It is suggested that "DT is estopped from contending that it has not accepted EN's deemed offer for the purposes of clause 15 of the Restated Agreement". This claim must fail too. In the light of my construction of clause 15 and Article 10 there was no such deemed offer. Similarly for the same reasons that the correspondence and conduct of DT cannot be regarded as an acceptance it cannot give rise to any sufficiently certain representation by DT. EN relied on a passage in Spry on Equitable Remedies 5th Edition p.140 but on the facts as I have found them the principles there enunciated cannot apply.    

The Petition

50. The application to strike out the petition is made by DT under CPR Rule 3.4(2) and 24.2 and the inherent jurisdiction of the court. It is contended that EN had no reasonable ground for bringing the petition and that it has no real prospect of success. Counsel for DT submitted that in the light of my conclusions on the first three issues the petition must fail and should be struck out without further ado. Counsel for EN disputed this. He submitted, and I agree, that there are allegations in the petition relating to the letter from the directors of West Ferry dated 3rd January 2001 which are not concluded by my findings so far.

51. In paragraphs 29 to 36 of the petition EN sets out its contentions concerning the offer letter dated 3rd January 2001 from the directors of West Ferry to DT of which a copy was, in accordance with my findings in paragraph 41 above, served on EN as well. In paragraph 30 it is contended that the time for acceptance prescribed in the letter was contrary to the provisions of Article 10 and clause 15 of the Restated Agreement in providing both "for so long a period" and a period in excess of 42 days. In paragraph 32 it is asserted that in providing for such an excessive period

"the directors of [West Ferry] failed to give consideration to the interests of EN (which inter alia required completion of any sale of its shares and [associated assets] as soon as practicable...and/or gave consideration to the conflicting interests of DT....in breach of their fiduciary duty to EN as its agent in making the said "offer" and/or in breach of their obligations as directors to act bona fide in the interests of [West Ferry] as a whole." If that allegation is arguable then the remaining paragraphs of the petition contain sufficient further averments to justify allowing the petition to continue.

52. Thus it is necessary to consider whether EN's case in respect of the letter of 3rd January 2001 is made on reasonable grounds and has a real prospect of success. Counsel for EN submits that the letter of 3rd January 2001 is not a proper exercise by the directors of West Ferry of the power given to them by Article 10(c) because (a) it did not limit a time, alternatively (b) the time limited was excessive, alternatively (c) the directors did not consult with or consider the interests of EN. Though the requirement to limit a time arises from Article 10(c) in relation to the sale of the shares it was not contended that the time must not also be such as to accommodate the sale of the associated assets without which the sale of the shares cannot proceed.

53. The time for acceptance was prescribed as the period commencing on the date of the letter (3rd January 2001) and ending 10 days after the value of the associated assets had been agreed or finally determined by the arbitrator. The first objection is that the Article obliges the directors of West Ferry "to limit a time" for acceptance. It is suggested, not unprompted by me, that the formula adopted by the directors of West Ferry does not do so because neither the agreement of the parties nor the determination of the arbitrator is a limit. It is submitted that on the date of service the recipients must know the date on which the offer expires, otherwise the offeror will not know when he may sell the shares to others. I do not accept this submission. It is clear that the formula is sufficiently certain and when applied will provide a fixed limit. That limit, when it has arrived, will be apparent to the parties. I consider that the Article must embrace a limit fixed by a formula as well as one identified by reference to a specific date.

54. The suggestion that the time so limited is excessive is based on the proposition that the offer deemed to be made in respect of the associated assets pursuant to clause 5 of the Amending Agreement must be accepted before the value has been determined. I have already rejected that submission in paragraph 32 above. Clause 5.3 specifically provides that the associated assets are deemed to be "offered" not "sold" at a price assessed in accordance with the terms of clause 6". It is not uncommon for pre-emption provisions to require that the fair value shall have been determined before the offeree is required to decide whether or not to buy. In this case it is to be borne in mind that the right to buy arises from an offer deemed to have been made by one who is to be treated as a defaulter. I see no justification in that context for construing the word "offered" as if it meant "sold".

55. If DT is entitled to know the price before deciding whether or not to accept the offer then the question is whether 10 days is too long. The answer must be in the negative. Accordingly I reject the second objection to the validity of the notice.

56. The third objection is based on the proposition that under Article 10(b) the directors of West Ferry are constituted the agents for EN. In addition counsel for EN relies on the proposition that the directors of West Ferry must exercise their powers and discretions in the interests of West Ferry as a whole, thereby including EN. The extent to which the duties of an agent are imported into an agency of the sort imposed by Article 10(b) is a matter for debate. Likewise the extent to which the duties of directors exercising a power such as that contained in Article 10(c) must have regard to the competing interests of its two shareholders is also a matter for further argument. Thus I would not strike out these allegations if there were reasonable grounds for making the claim or reasonable prospects of success on a claim so based.

57. The ultimate conclusion to which the claim must, arguably, lead is the allegation in paragraph 38.6 that in this respect the affairs of West Ferry have been conducted in a manner which is unfairly prejudicial to EN. But in my view it cannot. Unless it can be said that to allow 10 days from the determination of the price to be paid for the associated assets is arguably too long the alleged breaches of duty do not have an unfairly prejudicial consequence. In my view the contention that ten days was too long is quite simply unarguable.

58. For these reasons I conclude that though my findings in the action do not determine all the issues on the Petition those issues which remain open are not brought on reasonable grounds and do not have any real prospect of success.

59. In these circumstances the alternative ground for striking out the petition, namely abuse of process, does not arise. But in case this matter goes further I should make the necessary findings of fact. The contention is that EN advertised the petition by causing the article to appear in The Times.

60. It is not disputed that in the case of a winding up petition its premature advertisement may be an abuse of the process of the court because of its effect on the ability of the company to continue to trade. In Re a Company [1997] 2 BCLC 1 Mr. Roger Kaye QC held that the same principles applied to a petition under s.459 Companies Act 1985. This is somewhat surprising because an independent action for the same relief may be publicised by the claimant without impediment. For present purposes I will assume without deciding that the principles applicable to winding up petitions do apply to a s.459 petition which does not seek a winding-up.

61. The question is whether it is proved that EN had any responsibility for the article, which appeared in The Times on 20th April 2001. DT contends that the timing and content of the article including reference to matters that only appeared in the letter accompanying the petition leads to the inevitable inference that EN was responsible for the article.

62. I do not accept that contention. The article itself indicates that the author had spoken to Mr. Deedes, the managing director of DT; but there is no evidence from him. It was for DT to prove this allegation. There is no evidence to support it and without any evidence it would be dangerous too readily to draw inferences as the identity of the informant responsible for an article in a newspaper.  

Postscript

63. The trial concluded on 12th July 2001. I reserved my judgment. On Monday 23rd July 2001 counsel for EN indicated that he wished to apply for permission to adduce further evidence. I heard that application on Tuesday 24th July. At the conclusion of that hearing I refused the application for the reasons to be given in the judgment in the action. My reasons are set out in paragraphs 64 to 73 below.

64. The further evidence sought to be adduced is a document printed out from the Guardian Newspaper website entitled "Desmond hits hurdle in Westferry sale. Special Report: Express takeover." It is an article by Dan Milmo dated 6th February 2001 and contains quotations of statements attributed to Mr Colson. One of them is

"We have served notice of our intention to buy them out. We have our views as to what the plant is worth" Counsel for EN seeks to adduce the document in evidence because of this statement and then to have Mr Colson recalled so that he may cross-examine him on it. Mr Colson is now abroad in USA and Canada and would not be available for further cross-examination in this country until after 8th August 2001.

65. The evidence in support of the application is a witness statement from a partner in EN's solicitors. She states that her firm first found the article on Friday 20th July 2001 when following an internet link in an article in the Financial Times of that day. She then wrote to the solicitors for DT seeking their consent to the admission of the statement in evidence. On Monday 23rd July the solicitors for DT replied to the effect that they did not consider that the press coverage merited reopening the hearing.

66. Counsel for EN contends that the evidence has only recently become available. He submits that it is consistent with the minute of the meeting of DT's directors held on 29th November 2000 referred to in paragraph 35 above and with the evidence of Mr Ellice as to what Mr Colson said to him on the telephone on 14th December 2000 as recounted in paragraph 36 above. He suggests that justice and the overriding objective require that his application be allowed.

67. Counsel for DT opposes the application for a number of reasons. First, he points out, there has been no explanation why the article was not found earlier. Second, he questions both its credibility and relevance on the grounds that the attribution of the statement to Mr Colson is not established and that when read as a whole the document is capable of a different explanation to that on which counsel for EN relies. Third, he points out that the underlying subject matter was extensively canvassed in the cross-examination of Mr Colson and that there are numerous other press cuttings from the same period to a materially different effect.

68. In reply counsel for EN submitted that the rules in Ladd v Marshall do not apply at this stage of the proceedings. He pointed out that the letter from DT's solicitors of 23rd July did not suggest that the statement attributed to Mr Colson was incorrect.

69. There is no doubt that I may, in my discretion, accede to the application. Equally it is undoubted that in exercising it I must have regard to the overriding objective. That enjoins expedition and the saving of expense in the pursuit of justice. In addition there is the need to allot no more than an appropriate share of the court's resources and the considerable public interest in finality. In my view it is incumbent on EN to show good reason why, now, I should reopen the trial with all that that entails. It is true that the rules of Ladd v Marshall do not apply as such, but they are not a mere ritual; they are designed to see whether it would be just to admit further evidence after the completion of the stage at which the normal procedure requires it to be deployed; and they provide useful pointers to the considerations which should weigh with me in the exercise of my discretion.

70. I am not satisfied that this article could not reasonably have been available at the trial. The only evidence is that of the partner in the solicitors acting for EN to the effect that her firm had not found it before. It would be astonishing if it had not been available to EN, a national newspaper directly concerned with the subject matter of the article; and there is no evidence that it was not.

71. I am prepared to assume that the attribution of the statement to Mr Colson was properly made by the author of the article, but the context in which and time when the statement was made is relevant to the meaning to be attributed to the words used. By 6th February 2000 Mr Colson was at least doubtful, see paragraph 42 above, whether he wanted EN as a partner anyway. The relevant issue is whether DT had accepted the offer which, according to EN, was to be found in the deemed notice arising from the change in control. Even if Mr Colson had said all that was attributed to him in February 2000 I do not see any good reason to conclude that the offer, assumed by EN to have been made, had been accepted on or before 3rd January. And if this press cutting is admitted what about all the others which the parties sensibly did not use at the trial?

72. It is not as though the topic is new. Counsel for EN cross-examined Mr Colson for more than half a day on the issue to which I have referred in paragraph 37 above. I have reached a clear conclusion on that issue in the sense and for the reasons I have already given. I am unable to see any way in which the admission of this statement together with the further cross-examination of Mr Colson in respect of it could advance the matter.

73. The powers of the court now include those conferred by CPR rule 32.1. They enable the court to control the evidence by excluding evidence otherwise admissible and limiting cross-examination. Had counsel for EN sought to prolong the cross-examination of Mr Colson by reference to this or any other press cutting I would have given serious consideration to exercising those powers. The occasion never arose because there was no such cross-examination. I see no reason now to create such an occasion. For all those reasons I dismissed the application.

Conclusion

74. Notwithstanding that I have dismissed the application I have, nevertheless, reconsidered all my findings in the light of the fact that the application was made. I see no reason to change or qualify any of them. For all these reasons I dismiss the action and strike out the petition.