Blue v Ashley [2017]
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Blue v Ashley [2017] EWHC 1928 dealt with a dispute regarding the existence of a contract between two individuals, Blue and Mike Ashley, in the context of a conversation that took place at the Horse and Groom pub in London.
During the discussion, Mike Ashley purportedly told Blue that if he managed to elevate the shares of Sports Direct International Plc to £8, he would receive a bonus of £15 million. Blue claimed that this constituted a binding contract and initiated legal proceedings.
However, the High Court ruled that no binding contract existed. The judgment took into account various factors such as the setting, purpose, nature, and tone of the conversation. The court highlighted that the meeting in the pub was an unlikely setting for negotiating a contractual bonus arrangement, especially with the presence of alcohol and a lack of formality.
The court also considered the purpose of the occasion, emphasising that it was outward-facing and aimed at building a commercial relationship with representatives of a prospective service provider rather than discussing personal bonus plans. The nature and tone of the conversation were described as jocular and inconsistent with the seriousness required for a contract.
Additionally, the court noted that Mr Ashley had no commercial reason to offer a £15 million incentive to Blue at that time. The lack of commercial sense, coupled with the vagueness of the offer, further supported the conclusion that no serious contractual intention existed.
The court considered the perceptions of the witnesses present during the conversation, including those from the prospective service provider, and highlighted that none of them believed Mr Ashley was making a serious contractual offer. The vagueness of the offer and Mr Blue's own perception, as indicated by evidence, were also significant factors in the court's decision.
In conclusion, the court found that, objectively, there was no intention to create a contract during the jocular conversation at the pub. The subsequent belief of Mr Blue that a serious offer was made was characterised as wishful thinking, and the court ruled against the existence of a legally binding agreement.
During the discussion, Mike Ashley purportedly told Blue that if he managed to elevate the shares of Sports Direct International Plc to £8, he would receive a bonus of £15 million. Blue claimed that this constituted a binding contract and initiated legal proceedings.
However, the High Court ruled that no binding contract existed. The judgment took into account various factors such as the setting, purpose, nature, and tone of the conversation. The court highlighted that the meeting in the pub was an unlikely setting for negotiating a contractual bonus arrangement, especially with the presence of alcohol and a lack of formality.
The court also considered the purpose of the occasion, emphasising that it was outward-facing and aimed at building a commercial relationship with representatives of a prospective service provider rather than discussing personal bonus plans. The nature and tone of the conversation were described as jocular and inconsistent with the seriousness required for a contract.
Additionally, the court noted that Mr Ashley had no commercial reason to offer a £15 million incentive to Blue at that time. The lack of commercial sense, coupled with the vagueness of the offer, further supported the conclusion that no serious contractual intention existed.
The court considered the perceptions of the witnesses present during the conversation, including those from the prospective service provider, and highlighted that none of them believed Mr Ashley was making a serious contractual offer. The vagueness of the offer and Mr Blue's own perception, as indicated by evidence, were also significant factors in the court's decision.
In conclusion, the court found that, objectively, there was no intention to create a contract during the jocular conversation at the pub. The subsequent belief of Mr Blue that a serious offer was made was characterised as wishful thinking, and the court ruled against the existence of a legally binding agreement.
