Summary

A claim for breach of an alleged sponsorship contract was dismissed as no binding agreement existed, contrary to the claimant's allegation that one of the defendant's employees had orally notified the claimant of a sponsorship deal.

Facts

Action by the claimant ('Jordan') for damages for breach by the defendant ('Vodafone') of an alleged contract to sponsor the Jordan Formula One ('F1') team or for alleged misrepresentation. Jordan's primary claim was that in March 2001 Vodafone's global brand director ('H') spoke to the managing director and majority shareholder in Jordan ('J') by telephone and informed him that Vodafone would sponsor Jordan for the years 2002-2004. Jordan's case was that at that stage all the necessary terms of the sponsorship had been agreed in principle. Alternatively Jordan relied on an alleged representation by H to the effect that a contract would soon be agreed between Jordan and Vodafone. Vodafone denied that any such agreement was made and contended that a vast range of points of substance would have to have been agreed in a formal contract and that H was known by Jordan not to have authority to commit Vodafone to such a contract. Jordan argued that H did have authority to communicate to Jordan that Vodafone had taken a decision to sponsor Jordan even if H did not have the authority to make that decision himself.

Held

(1) H did not have the authority to enter such a sponsorship agreement. (2) The position immediately before the conversation relied on by Jordan was that four F1 teams were under active consideration by Vodafone. Jordan's sponsorship proposal was not in a form which could even begin to be the subject of a binding agreement. In the circumstances it was inconceivable that H could have decided to commit to a contract with Jordan. To do so would have ignored Vodafone's internal procedures. Objectively the alleged terms contained material uncertainty. (3) H's account of the disputed phone call was to be preferred. No sensible objective observer could reasonably have thought that any binding commitment was made by anything that was said or that H had made any decision, let alone that Vodafone had. Nothing had even reached the stage of what could be described as heads of agreement. H did not use the words "You've got the deal" in the context or sense on which Jordan relied. (4) What happened after the phone conversation was also wholly inconsistent with any binding commitment or any belief on the part of Jordan that such a commitment had been made. (5) On the evidence Jordan failed to establish that it had suffered any loss. (6) The submission that H was communicating a decision of Vodafone failed on the facts. (7) The alternative case failed because no representation was made as alleged and Jordan did not rely on any representation as alleged.

Claim dismissed.