JLT Specialty Ltd v Craven, Court of Appeal - Civil Division, November 08, 2018, [2018] EWCA Civ 2487

Resolution Date:November 08, 2018
Issuing Organization:Civil Division
Actores:JLT Specialty Ltd v Craven
 
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Case No: A2/2017/2250

Neutral Citation Number: [2018] EWCA Civ 2487

IN THE COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

Mr Philip Mott QC (sitting as a Deputy High Court Judge)

[2017] EWHC 2117 (QB)

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 08/11/2018

Before:

LORD JUSTICE HENDERSON

and

LORD JUSTICE NEWEY

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Between:

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Mr Daniel Stilitz QC (instructed by Eversheds Sutherland (International) LLP) for the Appellant

Mr Christopher Stone (instructed by Fox Williams LLP) for the Respondent

Hearing date: 31 October 2018

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JudgmentLord Justice Newey:

  1. The issue in this case is whether the respondent, Mr James Craven, is liable to repay a bonus that he received from the appellant, JLT Specialty Limited (``JLT'').

  2. Mr Craven became an employee of JLT, which carries on business as an insurance broker, under an ``Executive Employment Agreement'' dated 5 May 2005. This provided that, unless terminated earlier pursuant to clause 10 (which dealt with matters such as incapacity, insolvency and misconduct), Mr Craven's employment was to:

    ``continue until terminated by either party giving to the other not less than 364 days written notice of its/his wish to terminate this Agreement, always provided that any such written notice given by the Executive [i.e. Mr Craven] shall not expire before the 5th anniversary of the Effective Date [i.e. 5 May 2005] (the Initial Period)''.

    The agreement further provided for JLT to pay Mr Craven a ``Signing Bonus'' of £225,000, but by clause 4.4 part of the bonus was to be repaid:

    ``In the event that before expiry of the Initial Period [i.e. the period up to 5 May 2010] the Executive [i.e. Mr Craven] serves written notice of termination of his employment or otherwise terminates his employment (other than by reason of his death) or if before the expiry of the Initial Period his employment is terminated by [JLT] in circumstances falling within clause 10.1.(c) hereof''.

    The amount that would be repayable would depend on ``the number of working days remaining until the expiry of the Initial Period from the last day of the Executive's employment''.

  3. The Executive Employment Agreement was subsequently varied pursuant to a written addendum dated 8 March 2012 (``the Addendum''). Mr Craven's employment was now to continue, unless terminated earlier pursuant to clause 10, ``until terminated by either party giving to the other 52 weeks written notice of its/his wish to terminate the Agreement, always provided that any such notice given by the Executive shall not expire before 31 December 2016 (`Contractual Period')''. There was also provision for Mr Craven to receive a ``Bonus Advance'' of £500,000. By point 2.2, the Bonus Advance was to be ``expunged on an amortised basis over the contract period'' as the first call on a specified bonus pool, subject to ``the Bad Leaver provisions in point 2.3 below''. Point 2.3 was in these terms:

    ``In the event that the Executive [i.e. Mr Craven] is a Bad Leaver (The Executive's employment ends for any reason other than redundancy, ill health, early retirement, or arranging consultancy agreement with JLT. An example of a Bad Leaver would be going to work for a competitor) or resigns on or before 31 December 2016, then the Bonus Advance will be repayable in full as follows:

    2.3.1 If the Bonus Advance was awarded as a Cash Payment or as Staged Cash Advances then the gross value of the Bonus Advance paid to the Executive as at the date of resignation will be repayable by the Executive within 7 days of the Executive's employment ending...''.

  4. The Bonus Advance was paid to Mr Craven as a ``Cash Payment'' in August 2012.

  5. On 23 September 2015, Mr Craven wrote to JLT asking that his letter be accepted as his ``notice to resign with effect from today's date''. JLT replied on 29 September, stating:

    ``I am writing...

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