Bluefin has lost a £240,000 High Court appeal against a husband and wife adviser firm whose contracts were terminated in 2009.
Helen and Ashley Armstrong joined Thinc, now Bluefin, in April 2008 and were given a supplementary payment of £240,000 to compensate them for bringing their 10,000 clients to Thinc.
Thinc was bought by Axa in 2006 and rebranded as Bluefin in January 2009.
The Armstrong’s argued that in negotiations with Thinc before signing the contract, Thinc assured them the only condition in the contract concerning the supplementary payment was that they stay with the firm for a minimum of three years.
In June 2009, Thinc wrote to the Armstrong’s to terminate their contracts on the basis their production had fallen “considerably below” the standards required. The contract set out that Thinc could terminate the contract “without cause”. Thinc took legal action against the couple to recoup the £240,000 payment.
The judge in both the High Court ruling and the appeal found the assurance from Thinc about the supplementary payment was a “collateral warranty” preventing Thinc from recovering the payment if it terminated the contracts within three years.
Thinc lost the original case in January, with a High Court Judge ruling there was no mention of any minimum production levels in the contracts.
Bluefin’s appeal claimed there was no mention of “collateral warranty” in the original case, which was rejected by High Court Judge Lord Justice Rix this week.
He said: “There was evidence, and it stood to reason, that the Armstrong’s relied on the “no other conditions” assurance when they applied to join up and signed up with Thinc. It is true that there could still be a questions as to what the assurance amounted to – for instance could it be interpreted as permitting reclaim of the payment upon termination by Thinc without cause? However, it would be ridiculous to supposed that that is how they viewed the assurance, and it was plain from Mrs Armstrong’s evidence that they did not.”