High Court Finds No Binding Contract For Commission For Introduction Of Valuable Formula One Sponsorship Deal But Awards Quantum Meruit

The High Court has rejected a company's claim for commission for the introduction of a sports sponsorship opportunity on the basis that there was no binding contract between the parties. However, the company's claim for unjust enrichment in respect of services provided in facilitating the sponsorship deal was allowed: AMP Advisory & Management Partners AG v Force India Formula One Team Limited [2019] EWHC 2426 (Comm).

The court rejected the claimant's contention that there was an oral contract or, in the alternative, that the parties had entered into a contract on the terms of an unsigned mandate agreement. Viewed objectively, the verbal exchange between the parties was not intended to create legal relations, and the mandate agreement provided that it would “take effect upon signature”, but had never been signed. Whilst an unequivocal agreement to waive a requirement for a signed agreement can in principle be inferred from communications between the parties, in this case, the claimant's repeated insistence for the mandate agreement to be signed showed that neither party had intended to waive that requirement.

As for the unjust enrichment claim, the evidence showed that a third party and not the claimant had introduced the sponsorship opportunity to the claimant. Therefore, the claimant could not claim a quantum meruit for introducing the sponsorship opportunity. Nevertheless, the court was satisfied that the claimant had made a contribution towards facilitating the sponsorship deal (albeit of a limited nature) and that the enrichment to the defendant in the form of the provision of those services was unjust. The court valued those services at £150,000 and awarded the claimant that sum.

The decision highlights the importance of ensuring that any agreement is clearly documented and signed so that there is no doubt that its terms are binding.

Tamsin Baird, a senior associate in our Disputes team, considers the decision further below.

Background

The defendant, a Formula One motor-racing team, entered into a major sponsorship agreement with an Austrian water company (BWT). The claimant, a sports marketing company, claimed to have introduced the sponsorship opportunity to the defendant and to have reached an agreement pursuant to which it would receive a percentage of the net receipts under the sponsorship agreement.

On 20 February 2017, the claimant's representative, Mr Ramos, had lunch with the defendant's team principal, Dr Mallya, at Dr Mallya's home...