Help Needed for Court Case. Claimant ignoring Directions and Witness Statement needed by Friday

[Desperate Daniella]

Any ideas on what would be a good weekly rate to charge her for the 17 months of work I spent on this company before we got our first client? I spent at least 10 hours a week on it if I average it out because everything was so dragged out.

 

I'm charging client time at £50 per hour which is the amount she herself suggested.

 

DD

[Desperate Daniella]

£500 from one, and £250 each from two.

 

Also she said she was charging one £500 for a very specialised report I did so I am going to include that on my invoice. As she won't provide the accounts I don't know if she did or didn't, and have said in my WS that if she didn't she failed to mitigate part of her loss.

[the_shadow]

Morning, just looking back over the previous posts...

 

As to your counterclaim query, as you have passed the defence stage I believe you would need the courts permission via an application to put in a counter claim.

 

S.

[Desperate Daniella]

I may have to do that. I have already told the court that I haven't been able to counterclaim because of not being able to afford it, but would if I could.

 

I still can't afford it, but if send the invoice to her solicitor I think I will ask him to advise me if she has no intention of paying it.

 

The court has given her a lot of leeway. I think it would be very unfair if they did not allow me to counterclaim, because I am having to counterclaim because she will not acknowledge my contribution to her company, but I think I need to do this quickly.

[Desperate Daniella]

They know she only delivered her Witness Statement weeks late, so that could be my reason for putting in the counterclaim based on the stuff in her WS.

[Undercover-Elsa]

Figure how many hours was client time x £50, then based on say 720 total hours, set a rate for the other work bearing in mind the national minimum, then add the two together.

Eg: 100 hours @ £50 = £5000

620 hours @ £15 = £9300

Total £14,300

[Undercover-Elsa]

Thats just an example-you'd need to research similar jobs rate of pay of course

[lexis200]

Morning Lexis,

 

Yes. The first I knew that I had not been a shareholder was when she put that in the statement she sent in with the Allocation Questionnaire. She told me when she set up the company that it was 50/50. When I downloaded the info from Companies House it confirmed that she held all 100 shares, but I was named as a Director.

 

This estoppel stuff is great because it goes back to my reliance on her statements but of course in her Witness Statement they are just ignoring anything I did for the company, just saying my account is highly partisan.

 

Although I provided a lot of copies of email correspondence between us which backs up what I have said, I also have loads of copy letters I sent to potential clients' advisors which is more proof of what I was doing.

 

Morning Elsa and Shadow!

 

DD

 

Ok, I may be talking out of my bottom here, but is it right for a director not to hold shares in a shareholder company?

 

Also, it looks like she was pretty lackadaisical in getting this all set up - did you have to fill in/sign forms stating you were a director (I only ask that as when my OH set his company up I was a joint director and had to sign bits and pieces). If you didn't, is it possible to actually become a director of a company - in the laws eyes anyway?

 

What I'm getting at is that if she named you as director on the stationery, yet you held no shares and had not signed up for it, then was she not being more than a little fraudulent?

 

Also, if this is the case it gives more weight to you argument of 'exactly in what capacity did you think I was doing this work for you?' when you weren't being paid for it.

 

Just a thought?

[Desperate Daniella]

Hi Lexis,

 

She did it all online. I can't remember signing a document later. I thought that was unusual at the time, but she said it could be done that way. I was hoping that that is what she had done, but I'm definitely on the stuff I downloaded as a director.

 

I'm just going to put up my proposed letter to her solicitor - first draft.

[Desperate Daniella]

I have received your letter of 2nd November with enclosures.

With regard to the Listing Questionnaire you are well aware that you have not in fact complied with Directions because you have not supplied the documents I requested from your Standard Disclosure List. I will point this out to the Court.

Your client may well wish to deny that I worked many hours on the initial setting up of the company but clearly I have evidence to the contrary. It is highly unlikely that I would have been made a Director of the Company if I had not been fully involved with it from the very start. At the time the Company was set up I had been working for your client for at least six months. Your client has again failed to answer the question, “On what basis did she think I was working for the company?”

I relied on your client’s assurances that I would be paid for the work I did during the setting up period of the Company, as well as for the work undertaken on behalf of clients. The Companies Act 2006, Section 51, states:

(1) A contract that purports to be made by or on behalf of a company at a time when the company has not been formed has effect, subject to any agreement to the contrary, as one made with the person purporting to act for the company or as agent for it, and he is personally liable on the contract accordingly.

Your client in her Witness Statement states that “if the loans had been advances against the Defendant’s income from the Company, they would have been entered in the books of the Company as such but they were not.” There were no official books for the company. Your client kept notes of her expenses in a lever arch file. The monies came from her personal account because there was no company bank account until August 2008 when it was set up in order to receive the first registration payments from clients.

Clearly I am entitled to payment for the work done on behalf of the company under a quantum meruit, and my invoice is enclosed. The £50 an hour I have charged for time spent with clients is based on your client’s suggestion that this would be the fee we would charge on an hourly rate, if we were not charging on a flat percentage rate, as we were new to the business and other such companies were charging £80-£90 for similar work.

You already have documentary evidence that I started work for the company in early 2007 and as my email about the brochure I designed is dated 25th April I have started to charge from that date for all the preparatory work I undertook. Therefore the charging period is for one year -52 weeks - plus 14 weeks which takes us into August 2008 when we received our first client instruction. This is a total of 66 weeks in all and it is realistic and very fair for me to charge for eight hours a week, although in many weeks I spent considerably more time than this. £10 an hour is again a very reasonable rate for me to charge your client.

Turning to the IOUs: An IOU is a paper having on it these letters, with a sum named and duly signed, as an acknowledgment of a debt but it does not amount to a promissory note. The intention of the IOUs was to acknowledge the debt but it was not intended as a promise to pay. The promise to pay was the subject of a verbal agreement between your client and myself. The payment would be made from future funds paid into the new company from the income generated from our clients.

Your client and I were both aware there would not be income from that source for a while. Your client assured me that she wanted me to work with her in the company and needed my expertise. Your client knew that I was keen to start work for the company as soon as possible but her constant procrastination over every tiny detail meant that the procedure of setting up the company was considerably more protracted than I could have imagined. She assured me that she would provide funds to enable me to work for the company until client income was generated and I started work in good faith.

Despite the Claimant telling me that the shares had been split 50/50, she issued 100% to herself which would effectively give her 100% of the profits of the company, and clearly I would be paid from this.

An informal IOU in these circumstances would determine the debt. However, if it was intended to be a promise to repay the money at some time in the future and not just an acknowledgment of a debt then an informal IOU would not be sufficient to establish the facts of the situation. To simply write on a piece of paper “IOU £xxx” and sign it makes it very clear that there was a verbal agreement as to how and when the money would be repaid.

If your client now intends to claim a legal right to demand the money and ignore the verbal agreement then she is treating the IOUs as promissory notes. When signing a promissory note, both the lender and the person receiving the loan should be fully aware of the note’s language. Most of the notes which are the subject of this action are no more than an acknowledgment of a debt but do not meet the criteria of a promissory note because the language of the notes is not easily understood.

Therefore these notes do not legally state a promise to pay. Had they been promissory notes, they would have stated “Payable by (date)” or “Payable on Demand.” Only one of the IOUs gives a date for repayment – 31st October 2007. I was unable to repay those funds on the date in question. I had agreed that date as it was reasonable to assume in April 2007 that the company would be up and running by then and client income would have been generated. Your client fully appreciated that the delays in setting up the company had caused this problem, and stated that I could pay later when the funds came in. In fact she advanced me a further £2,000 on that same day.

 

Our agreement was that she would provide funds on the basis of need. I did not want the amount to keep going up and up, and your client received payment of £10,000 against the only dated IOU in March 2008.

 

Your client is in breach of contract. By excluding me from the business she prevented me from earning the money with which to repay her. I was from the start deliberately misled by your client, a wealthy woman, to undertake work on “her” company’s behalf and entered into this agreement on trust. Had I been aware of her misrepresentation with regard to the shareholding, I would not have wanted to be in this financial arrangement. I could have sold my assets and left the country, and I bitterly regret relying on your client’s assurances.

 

Turning now to Estoppel: Estoppels prohibit an individual from being harmed as the result of another’s deeds, statements or promised, when later actions or statement contradict or undermine what was originally stated, promised or inferred. Your client made false promises to me which caused me detriment and harm.

 

So, “Where A has by his words OR conduct…[led] … B into believing that a certain state of facts exists, and B has acted upon such belief to his prejudice, A is not permitted to …[say to] … B that a different state of facts existed at the time” (per Lord Birkenhead in Maclaine v Gathy (1921).

 

To establish a reliance-based estoppel, the victimised party must be able to show both inducement and detrimental reliance, i.e.:

 

1. There must be evidence to show that the representor actually intended the victim to act on the representation or promise. Clearly your client did.

 

2. The victim must satisfy the court that it was reasonable for him or her to act on the relevant representation or promised, and

 

3. What the victim did must either have been reasonable, or

 

4. The victim did what the representor intended, and

 

5. The victim would suffer a loss or detriment if the representor was allowed to deny what was said or done – detriment is measured at the time when the representor proposes to deny the representation or withdraw the promise, not at the time when either was made, and

 

6. In all the circumstances, the behaviour of the representor is such that it would be “unconscionable” to allow him or her to resile.

 

Furthermore in ‘The Law relating to Estoppel by Representation, 4th Edition, 2004 at para 1.2.2, Spencer Bower defines estoppel by representation of fact as follows:

 

Where one person (‘the representor’) has made a representation of fact to another person (‘the representee’) in words or by acts or conduct, or (being under a duty to the representee to speak or act) by silence or inaction, with the intention (actual or presumptive) and with the result of inducing the representee on the faith of such representation to alter his position to his detriment, the representor, in any litigation which may afterwards take place between him and the representee, is estopped, as against the representee, from making, or attempting to establish by evidence, any averment substantially at varience with his former representation, if the representee at the proper time, and in the proper manner, objects thereto.

 

An estoppel by representation [of fact] will arise between A and B if the following elements are made out. First, A makes a false representation of fact to B, which your client did. Second, in making the representation A intended or knew that it was likely to be acted upon. Third, B, believing the representation, acts to its detriment in reliance on the representation. (It must have been reasonable to rely on the representation, which it clearly was in this case.) Fourth, A subsequently seeks to deny the truth of the representation. Fifth, no defence to the estoppel can be raised by A.

 

 

Then I don't know what to do. How do I change my defence to include estoppel?

Do I tell him that I will be using/relying on estoppel?

 

DD

 

[angel_1]

hiya DD

 

just popping in for your updates and wow since i last looked in

 

and will be back later am in and out today but wanted to throw over a big hug to you keep up the good work and fab help as always from the cag crowd - waves to you all

 

laters angel x

[Desperate Daniella]

Hi Angel,

 

Thank you. Fab help as you say.

 

DDxx

[angel_1]

keep at it DD - the journey also teaches us all something but more importantly also about ourselves too;)

 

off for a spot of lunch keep happy laters angel x

[lexis200]

Hi DD - That looks good to me, but one tiny thing that stood out for me was this bit

 

Turning now to Estoppel: Estoppels prohibit an individual from being harmed as the result of another’s deeds, statements or promised, when later actions or statement contradict or undermine what was originally stated, promised or inferred. Your client made false promises to me which caused me detriment and harm.

 

I think it should read 'statements or promises' not promised, and 'stated, promised or implied', not inferred (if I'm right that she's the one making the statements, promises and implications) as you infer, she implies.

[mkb]

You already have documentary evidence that I started work for the company in early 2007 and as my email about the brochure I designed is dated 25th April I have started to charge from that date for all the preparatory work I undertook. Therefore the charging period is for one year -52 weeks - plus 14 weeks which takes us into August 2008 when we received our first client instruction. This is a total of 66 weeks in all and it is realistic and very fair for me to charge for eight hours a week, although in many weeks I spent considerably more time than this. £10 an hour is again a very reasonable rate for me to charge your client.

 

 

8hrs @£10ph is only £80 per week & seems to me to be way too low. Are you sure this is right? Over 66wks, this only makes it £5200

 

In your calculations have you added up all the advances & deducted the payment you made? You have said in this post that you have already paid back £10,000.

 

I haven't followed your saga as such but why are you only claiming £5200? Your work is clearly worth a LOT more than that...

[bazaar]

DD, I'm not too sure you should be giving them all this evidence in your letter. Theyve obviously got a game plan here and part of it is to wind you up and get you to start firing off all sorts.

Pick apart their letter to you, is it without predjudice?

This stuff should go in your WS , or counterclaim as proof of work. You file it at court early, then only send them a copy recorded delivery just in time. This way they are on the back foot and wont have the time to come up with any more antics.

Remember its a game for the solicitor, if they can score points from you early on, then they will.

Just log the letter, its pretty much a threat to make you back down.

Your hourly rate of £50 is about average. But have a look around and get quotes for this work. If your going for a counterclaim, then your hourly rate should remain the same, dont confuse things by setting lower rates. You worked for the company and this would be your rate as a self employed person.

You were either a joint owner of the company or you werent, thats the first bit.

If you were not ( and it looks this way to me). Then you have all those hours work with your folder of clients and calls etc etc. ready for the court to look at,

If theyve failed to give you documents you need to rely on under the CPR, then apply to court to get them, I didnt think there were fees involved in this because youre the defendant. Please someone correct me if Im wrong

[pedross]

I agree with Bazaar

 

If you try and prove to the solicitor that you are going into this all guns blazing you are wasting ammunition. I also like the information on Estoppel provided by Caro. I would do as Bazaar suggests and file it with the court in your WS and supply the solicitor with a copy just before the hearing.

 

It appears to me you have 3 clear issues now which are as follows:

 

1. The IOU's were to be repaid from the income of the company (if this is accepted by the court then it is game over, the only benefit of a counterclaim is if you have overpaid)

 

2. Estoppel would prevent the claim from proceeding because the promises of the claimant have not matterialised in the way they should have done and you have made the point sufficiently in your post.

 

3. One way or another you are owed money. The money owed has settled the debt by contra. You expected the money to be salary and dividends (point 2 again) but it must be just salary as you were a director and not a shareholder (which is allowed Lexis). If the claimant proves to the court that it was not salary then the money is still due as you will show.

 

You need to convince the court that the claimant has not been forthcoming with the true facts of the case and made your defence difficult. Several issues have only been brought to your attention late in the day which has added to your difficulty. I believe that you should bring to the courts attention that the dispute is not about if you owe the money but how it should be repaid. Your verbal agreement is that it was to be repaid from your share of the income from the company and it is therefore irrelevent in what form that income is paid or even if it covers the debt. The claimant owns 100% of the company so it is reasonable to expect her to fund the company and not you.

 

I have read your post again and I think it is a good argument. You just need to be clear in your own head about the individual points and do not mix them up so that if one goes badly you do not start waffling but are clear about the next.

 

Pedross

[The GodMother]

It costs £75 FOR THE COURTS TO ORDER SHE PRODUCES THE DOCS UNDER A N244. tHIS IS FOR BOTH CLAIMANT AND DEFENDANT.

[Desperate Daniella]

Thank you everyone. Have been out for the afternoon, briefly online now and will be back later.

 

Lexis, promised was a typo. It should of course have been promises. Inferred was the quote I took from the wikipedia link Caro gave me. I suppose implied is the same, and I prefer that word.

 

mkb, in the early days a lot of it was discussion. I just don't have any records on a week by week basis, and don't want to appear greedy to the court. Some weeks nothing happened, other weeks I was really busy with it, but I have no proof of the time spent. Maybe I should make it £15 an hour?

 

Bazaar, the letter was not without prejudice.

 

I have already done the Witness Statement and sent it to them as Directed by the Court. I haven't filed it at the Court as the Directions didn't tell me to, just said to send it to her. Will I be allowed to add to it? I did see on CAG somewhere that you can amend your pleadings until the case comes to Court. ???

 

Every time I've asked the court to do anything they have asked for a fee and I am flat broke. Things were not great before all this blew up, but I was keeping up with most things. I was absolutely dependent on this company succeeding and she is well aware that I was doing extremely well for the clients - that was her problem.

 

Pedross, if I'm using estoppel to stop the claim proceeding, how and when do I do that? That's why I thought I should send a tough letter. I'd rather not go to court for the following reasons:

 

Her Witness statement is adamant that the money had nothing to do with the company which is why she didn't mention it in her PoC. Her barrister will obviously argue this and try to have everything else dismissed as irrelevant and that is what is absolutely terrifying me. He says that this was a loan with nothing to do with the company, the judge believes him and says I must pay it back. That would not be fair, but what if the judge won't admit the evidence of all the stuff I have done. What if he believes she designed the brochure, logo, etc? She hasn't claimed that because it's not true and she's obviously got the solicitor now who has stopped her making untrue statements like the one she sent in with the AQ. Is that even admissable? If the judge actually reads her AQ statement it should be pretty clear that she certainly can't compose anything. She couldn't even write her own biography, or a two para letter to potential clients without my drafting it for her.

 

My statements about her behaviour in my defence mean that I have "deliberately obfuscated the issues and attempted to malign [her] in order to deny [my] liability. Well she is quite clearly denying that she owes me for any work at all.

 

I would hope a judge would think that I should be paid for the work I did, but I was so disappointed that they didn't strike out the claim when they could have done so that I have little faith in them.

 

I have followed the Directions to the letter; they have ignored them and got away with it.

 

Do you think the fact that she has never offered me any payment at all for anything I did will be taken into consideration?

 

I'm perfectly happy to state my case, just worried that the work I did won't be allowed.

 

I certainly think I need to send the invoice now because otherwise they can say I never asked for the money.

 

DD

[pedross]

There you go again.

 

Why will the judge believe that the loan is nothing to do with the company. If it is nothing to do with the company why did she lend you the money. Just give this your best shot and convince me why she would lend you that amount of money if it was nothing to do with the company.

 

Why did she create an IOU with no conditions or repayment date. Just give me one good reason that they could give were the conditions for repayment.

 

Why did she make you a director of the company if you did nothing at all to create it or develop it.

 

I'm fed up now - let me know when you have answered these and I will type some more.

 

Pedross

[Desperate Daniella]

I'm fed up too, and very frightened. Please remember that apart from one friend who has marital problems and so I don't want to bother her too much, I'm dealing with this entirely on my own apart from all of you here - and I'm so very grateful you are here.

 

Several years ago a friend of mine went to court over a constructive dismissal. She told the truth. Her solicitor and barrister were useless. I couldn't go on the first day of the trial. If I had gone I would have told her to be ill the next day and get a doctor's certificate because the judge had already decided against her. It was clear from the first minute of the second day, and she lost with costs against her of £33,000. On appeal, when she got a brilliant barrister it was reduced to £3,000 over three years, but it was absolutely clear to me in that courtroom that the judge favoured the claimant. The claimant had three 'independent' witnesses - she paid for them to travel the world with her. The judge couldn't see that and I was sitting behind her wanting to scream at my friend's stupid barrister about the questions she should have been asking.

 

So that's why I'm so worried.

 

In answer to your questions, of course I have the right answers, and proof. I'm worried in case her barrister says that this is irrelevant and the judge goes with it. I would never have believed that my friend telling the truth could have lost her case.

 

Thanks again, Pedross.

 

DDxx

Edited December 5, 2009 by Desperate Daniella

[caro]

It's up to you to prove that it isn't irrelevant!!!

 

I don't know if you have any other experiences of court - I'm guessing not. But you need to forget what happened to your friend in the past and concentrate entirely on your own case, making it as strong as you can so you make sure it doesn't happen to you. Go in with a positive attitude!

 

If you haven't already done it, google the phrase "promissory estoppel", because I think it may cover your situation very well. You should be able to find some examples. Search on CAG for the phrase too.

 

Have you asked the court how much it would cost to apply for the case to be struck out? If you're thinking of losing thousands, then surely it's worth a relatively small amount to get this behind you so you can move on with the rest of your life. Think really hard about how you could raise the money. Can you cut back anywhere, have you got anything you can put on ebay to raise some money? Is there anyone who might lend it to you?

 

Make a list of your options, decide which way you want to go, and then focus your energies on it so you can learn as much as you can to make your case rock solid.

 

Chin up DD.

[caro]

Oh yes - and a good night's sleep makes things look better.

[starinhersky]

DD, you say you havent filed your WS yet?

What time did the court give for this? We may be able to construct your defence to submit to the court, use the fact that you are a LIP for submitting it late, this seems all a little disjointed, because youve sent the other side your statement and not the court, so theyve picked it apart and started all this BS. DO NOT give them that luxury again.

Lets get to work on this, go through their claim as it was originally with all the fibs on it. make a copy and start marking it where there is an issue, then go through their latest WS if there is one.

She is being coached by her solicitor now so we may be able to highlight some dodgy statements from her, which will show her in bad light.

As Caro has said, concentrate on your own case, its irrelevant what happened to other people.

Now get yourself nice and calm, then make a start on getting everything organised, tag everything in a folder if you can. IE, if they say one thing, what would you counter it with? The answers are all there, youve just got to cut out the fat to get to the meaty bits.

[cymruambyth]

That seems like good advice.

I've lost track (sorry), maybe you could copy and paste a couple of posts giving the poc, your defence and the solicitor's reply, then add your own comments in red. Caggers can then help on each document. Also make a note of the posts that start this phase so that you can refer to them or repost every couple of days; in long cases it would help as a quick reference instead of hunting.