Summary

Any assignments in the claimants' favour of alleged claims available to their former partnership and company were subject to compromise agreements that were in full and final settlement of the disputes between the parties.

Facts

The first, second and seventh defendants applied to strike out the claim, alternatively for summary judgment. The claimants (K) had operated a number of Burger King franchised restaurants, some operated through a partnership (P) and others through a limited company (C). The first defendant operated Burger King restaurants under licence from the second defendant. The seventh defendant was the authorised distributor of products to all franchised Burger King outlets. The second defendant had issued forfeiture proceedings against P and C who counterclaimed for damages. P was wound up and C went into liquidation. The parties entered into compromise agreements in full and final settlement of any disputes. K, purporting to sue as assignees of certain causes of action alleged to have existed in favour of P and also as shareholders of C, then issued proceedings against the defendants. K alleged breaches of terms of the franchise agreements, breaches of oral agreements, abuse of a dominant position, conspiracy between the defendants and that the compromise agreements were invalid. The defendants contended that any assignments in K's favour of alleged claims available to P and C were subject to the compromise agreements that were valid agreements and the causes of action pleaded had no real prospect of success and were an abuse of process.

Held

Where K purported to bring proceedings as shareholders of C, such proceedings did not comply with the requirements for derivative actions; that a liquidator did not have funds to bring a claim was not a basis for a derivative action. Moreover the claims fell within the express clause of the compromise agreement and accordingly would be struck out. K's allegation that the partnership compromise agreement was invalid had no basis, no real prospect of success and would be dismissed.

Application granted.