Claim No. CFI 081/2023

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF FIRST INSTANCE

BETWEEN

MICHAEL GEORGE FORBES

Claimant

and

ROBERT KIDD

Defendant

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JUDGMENT OF H.E. JUSTICE SIR JEREMY COOKE

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UPON the Case Management Order of H.E. Justice Sir Jeremy Cooke dated 14 August 2024 (the “CMC Order”)

AND UPON hearing Counsel for the Claimant and Counsel for the Defendant at the Pre-Trial Review before H.E. Justice Sir Jeremy Cooke on 26 May 2025

AND UPON hearing Counsel for the Claimant and Counsel for the Defendant at the Trial before H.E. Justice Sir Jeremy Cooke on 18 to 24 July 2025

IT IS HEREBY ORDERED THAT:

1. Judgment is entered in favour of the Claimant in the sum of GBP 4,599,352.22.

2. Interest will run on the said judgment sum at the judgment rate until payment.

3. The Defendant is to pay the Claimant’s costs of this action on the standard basis to be the subject of assessment if not agreed.

Issued by:
Hayley Norton
Assistant Registrar
Date of issue: 7 August 2025
At: 11am

SCHEDULE OF REASONS

Introduction

1. The Claimant (“Mr Forbes”) seeks to recover a success fee from the Defendant (“Mr Kidd”) pursuant to a Letter of Engagement dated 21 November 2016 (“The Letter of Engagement”) sent to the Defendant by email of 4 January 2017 by Mr Christopher M Smylie (“Mr Smylie”) on behalf of SarCogent Solutions DMCC (“Sarcogent”), a company of which he was the Chief Executive and for which he was the sole signatory. It had been formed by him and Mr Forbes in order to provide services, the nature of which is in dispute. Mr Forbes claims as an assignee of the rights of Sarcogent under the Letter of Engagement by an Assignment dated 10 April 2019 of which notice was sent to Mr Kidd 22 December 2022. Whilst there was a pleaded issue as to the validity of this assignment, it is now accepted by Mr Kidd as being valid.

2. The Letter of Engagement was expressly subject to UAE law and the exclusive jurisdiction of the DIFC Courts. It included the following wording:

3. The Letter of Engagement, which was addressed to Mr Kidd at his home address in Cyprus, was attached to an email of 4 January 2017 which also attached an invoice addressed to him from Sarcogent in the sum of USD 102,970 for professional fees, under the heading “General Consultancy”. The details on the invoice described the services as being “General advisory and consultancy services in relation to (a) the management and conduct of ongoing litigation in the Scottish Courts during the period from 20 August 2016, including correspondence, telephone calls, general liaison with appointed legal team, attendance at meetings with you/legal team in Cyprus (September), attendance at meetings with you/legal team in Glasgow (October) and attendance at the diet of Debate in the Court of Session in Edinburgh (December) and (b) all other project work carried out for you in the period from 1 April 2016 to 31 December 2016 (excluding all RSS- related work, separately invoiced)”.

4. The email, sent by Mr Smylie from his Gmail account address included the following, under the heading “Action v BP etc”:

5. There is an issue about whether this email was read at the time by Mr Kidd and whether Mr Kidd agreed thereto. The email was available to him at the time of his Defence but in his witness statements he said that Mr Clarkson had obtained a copy from Sarcogent in July 2017 which he discussed with him. He never returned a signed copy of the Letter of Engagement as requested. The invoice, which was addressed to him personally, was partly paid some 11 months later in December 2017, by payment of GBP 20,000, following an interim award of costs in the litigation in Scotland referred to (“the BP Litigation”) in the sum of GBP 1 million in February 2017 on the basis of Mr Kidd’s success in establishing, on a summary basis, that Burness Paull (“BP”) had acted in admitted breach of fiduciary duty to him. That payment of GBP 20,000 was, as revealed by emails between them, made by the solicitors who had conduct of that litigation on Mr Kidd’s behalf, Levy & McRae (“L&M”). The partner with conduct of the litigation there was Mr Graham Craik who received instructions to make the payment from Mr Fraser Clarkson, who in turn was authorised to do so by Mr Kidd, who had engaged Mr Clarkson as his financial adviser/ CFO of his companies and who had taken over from Mr Smylie and Mr Forbes in July in instructing and communicating with L&M.

6. The primary short issue between the parties is therefore whether or not there was agreement to the terms of this Letter of Engagement by Mr Kidd to whom it was addressed and which, on its face referred to a superseded prior Letter of Engagement to A & E Investments (“A&E”) dated 15 August 2015. Mr Forbes’ case is that this Letter of Engagement essentially reflected what had already been agreed orally and was accepted by Mr Kidd by his conduct in the continuing requirement for Sarcogent to render the litigation support services which it continued to do in the BP litigation, even after being excluded from giving instructions to L&M as such. Mr Kidd denied that there was any such agreement but in his evidence, at times accepted that there was an agreement between Sarcogent and A&E on different terms, namely an entitlement to a success fee of 25% of any recovery to be split between all professionals, meaning lawyers and experts engaged on his behalf in the BP litigation, which he had originally agreed with Mr Forbes in a “handshake deal” in September 2013. No such agreement was pleaded in his Defence but this version of the agreement emerged from his Second Witness Statement and from time to time in his oral evidence under cross examination, whilst at other times he maintained there was no binding agreement at all. At the end of the day, the existence or non-existence of prior oral agreements or of an earlier letter of engagement is merely background to the issue of agreement to the terms of the Letter of Agreement, but may impact on the probability of a contract on those terms.

7. The second short issue between the parties is whether, if any such agreement was concluded, it is unenforceable as being contrary to public order in the UAE because Sarcogent were not licensed lawyers and lawyers are not permitted to charge success fees. These points turn on the question whether or not Sarcogent were providing “legal services” to Mr Kidd or A&E or whether they were providing other services which would not be subject to the same prohibition. Equally, a UAE statutory time bar would apply to the claim if the services provided under the Letter of Engagement were to be so characterised. The evidence before the Court of the UAE lawyers appointed by both parties as experts showed broad agreement between them on these issues.

8. There is a further issue as to the quantum of any entitlement on the part of Mr Forbes, should the Court find in his favour on the terms of any agreement between him and Mr Kidd by reference to expenses incurred in the pursuit of the BP litigation which would fall to be deducted before application of any success fee.

The Pleadings

9. The Particulars of Claim, when stripped of the allegations against other defendants which were struck out at an early stage, relied on a discussion of the success fee of 25% at a meeting in London on 29 September 2013, an email of 1 October 2013 referring to Mr Forbes’ undertaking to pursue the next phase of work on a success fee basis of 75/25 and a meeting on 14 July 2014 in Aberdeen where there was an oral agreement to a 25% success fee in relation to any sum awarded to Mr Kidd by the courts or received via settlement of litigation against BP. Reference was made both to Mr Smylie’s email of 1 July 2014 and Mr Forbes’ email of 28 July 2014 which set out more detailed terms of the arrangement, the latter of which set out a reduction in the success fee from 25% to 20%. The crucial paragraph in the Particulars of Claim was paragraph 13 which referred to and relied upon the terms of the Letter of Engagement dated 21 November 2016 as constituting the terms of a contract between Sarcogent and Mr Kidd under which Sarcogent provided litigation support to Mr Kidd until around October 2017 when Mr Forbes and Mr Smylie were effectively cut out of the correspondence when a negotiated settlement appeared to be imminent.

10. The Defence was replete with denials that any success fee had been agreed at any time. Whilst the number of such denials or averments was stated by Counsel for Mr Forbes to total 20 in all, any reference to paragraphs 7, 14.1, 15.3, 16, 19, 26.1, 29.3, 30, 37.1, 43, 45, 47 and 58, reveals that this was the essential case being made by Mr Kidd, with the additional argument that he would never enter into a contract which involved his personal liability as opposed to that of one of his companies. Other defences were put forward, all of which have since been abandoned or falsified by the evidence from Mr Kidd’s own appointed expert, save for those referred to above. It was Mr Forbes’ case that, since Mr Kidd’s evidence did not tally with his pleaded Defence and there was no plea of the agreement or its terms to which Mr Kidd’s evidence sometimes adverted, the claim must succeed. In my judgment, however, the burden lies on Mr Forbes to prove that there was a contract on the terms which he alleged. The fact remains that Mr Kidd’s case was hard to pin down and was developed in Counsel’s argument to include variation of an oral agreement and ultimately novation.

The General Background.

11. It is not necessary for the purposes of this decision to recite the lengthy history which led up to the BP litigation and the alleged agreement to the success fee. It is sufficient to say that Mr Kidd was a successful businessman who sold part of his company ITS Tubular Services Holdings Ltd (“ITS”) to Lime Rock Partners V LP (“LRP”) in 2009. ITS then failed, leading to its administration in April 2013 with Mr Kidd’s remaining shareholding rendered valueless in a sale by the Administrator. It was in 2012, as his relationship with LRP deteriorated, that he first engaged Mr Forbes at USD 10,000 per month, along with Maclay Murray and Spens (“MMS”) to assist him to regain control of the business and rescue it. Such efforts failed. BP had acted for Mr Kidd in the sale but had assisted the purchaser, in an undeclared conflict of interest, a matter which was uncovered by Mr Forbes and discussed by him with Mr Smylie, who at that time was working at MMS. Mr Kidd engaged the two of them to provide background and documentation for advice by leading counsel on the prospects of a claim against BP and/or others and to enquire into litigation funding opportunities for its pursuit in the Scottish courts. This led to litigation, commenced in 2015, against BP but not conducted by MMS, but by L&M instead, under the leadership of Graham Craik who instructed Mr Andrew Smith QC (as he then was) and Mr Jonathan Brown, Advocate.

12. Mr Forbes and Mr Smylie were to move to Dubai where Sarcogent was incorporated on 13 March 2015 and was granted a trading licence on 13 April 2015. That licence expired on 12 April 2019 and Sarcogent was administratively dissolved by Mr Smylie on or around 9 June 2019, after the assignment of rights to the Sarcogent claim against Mr Kidd to Mr Forbes on 10 April 2019. Sarcogent’s Service Licence, issued by the DMCC Authority, stated that its sole licensed activity was that of “management consultancies”. A remark on the licence expressly stated: “activities do not include providing legal consultancy or legal activities.” Mr Smylie was Chief Executive Officer and sole signatory for Sarcogent. Mr Smylie worked for Davidson & Co, a licensed firm of solicitors in Dubai on a part time basis. He generally appears to have sent emails from his personal Gmail address however, not from a Davidson & Co email address.

13. Over a period of time, fees were paid to Mr Forbes, Mr Smylie and then Sarcogent by Mr Kidd, through one of his companies, A&E, at agreed rates on a time basis. That is consistent with both parties’ respective cases. Services were rendered, the exact nature of which is disputed until on 3 July 2017 Mr Fraser Clarkson became the immediate and exclusive point of contact for instructing L&M. Mr Forbes, Mr Smylie and Sarcogent whilst apparently unaware of this restriction on their authority were increasingly excluded from involvement. As already intimated, Mr Kidd’s claim against BP was settled on 9 January 2018 for an all-in figure of GBP 20 million, although GBP 1 million had already been awarded in 2017 in respect of an interim award of costs. Being unable to obtain from Mr Kidd, Mr Craik or Mr Clarkson, details of appropriate deductions to be made in the calculation of the success fee, Mr Smylie, on 16 February 2018, submitted an invoice on behalf of Sarcogent for a success-based fee of 20% of GBP 20 million, amounting to GBP 3,960,643.67 without deduction for any costs incurred or sums already paid to Sarcogent, (which on Mr Forbes’ case were to be taken into account as part of the 20% entitlement). The invoice was returned marked “invalid”. The balance of the BP settlement sum of GBP 19 million was paid to L&M on 28 February 2018 and, subject to payment of costs to L&M and Counsel, the balance was then paid to A&E.

14. Whilst there is a dispute about the identity of those who knew and approved of the terms of their engagement, both L&M and Mr Jonathan Brown were engaged under letters of engagement which provided for success fees, which were later found by the Courts in Scotland to be unlawful. This resulted in a settlement agreement dated 11 January 2021 between Mr Kidd and these lawyers of all sums due for the BP litigation and other matters, in the sum of GBP 1.75 million. Mr Kidd is said to have signed the L&M letter(s) of engagement to which Jonathan Brown’s terms of engagement were attached as an appendix. Mr Kidd denied knowledge of the latter.

The Evidence of UAE Law.

15. The parties’ appointed experts, Mr Faisal Attia for Mr Forbes and Mr Al Dahbashi for Mr Kidd, produced a joint expert report on UAE law dated 18 July 2025. I was grateful to them, particularly because the latter had to take over at short notice from a partner who, having previously written an expert report, was unavailable for the trial. Mr Al Dahbashi was able to endorse his partner’s report and agreed the Joint Report with Mr Attia. Mr Attia gave additional explanatory evidence at the trial and was cross-examined, whilst Mr Al Dahbashi was not cross-examined at all.

16. It was common ground between the two lawyers that for a valid contract to be effected under UAE law, the requirements of Articles 129 and 142 of the Civil Transactions Law had to be met. Compliance with the terms of Articles 132 and/or 135 was sufficient. Mr Al Dahbashi identified three requirements under Articles 129 and 141, namely agreement on the essential elements of their obligations by mutual acceptance by offer and acceptance, a defined subject matter and a lawful cause.

17. In paragraph 3.3.2 of the Joint Expert Report, the experts agreed that “silence cannot be considered as an acceptance, but silence at the time that requires expression might imply acceptance” and that “silence shall be deemed acceptance if there was a previous course of dealing between the contracting parties and the underlying offer was relating to this previous course of dealing.”

18. As explained by Mr Attia, whose evidence I accept, the effect of Article 132 is that the mutual consent required for the formation of a contract can take any form, including conduct, provided that the circumstances leave no doubt of such mutual intention. Where there was no formal offer and acceptance nor a formal contract document, acceptance could be implied from words and/or conduct. Where Article 132 speaks of “adopting any other course in respect of which the circumstances leave no doubt that they demonstrate mutual consent”, it was for the Court to decide, on the balance of probabilities, whether such doubt existed. The experts considered that there was no effective difference between the provision as so translated and what appeared in the Joint Report at paragraph 3.3.1: “Respondents acceptance of the Letter of Engagement does not have to be in writing. Rather, such acceptance can be expressed by the Defendant’s acts which clearly demonstrate its consent to the Letter of Engagement”.

19. Furthermore, under Article 135 (1), although silence in itself cannot constitute an acceptance, it can do so if the circumstances give rise to a need to speak to refute acceptance. Article 135 (2) then goes on to provide two specific instances in which silence is to be deemed an acceptance, without deviating from the general provision in Article 135 (1). Those two circumstances are, first, where there has already been a course of prior dealing between the contracting parties to which a new offer relates: secondly, where there has been a course of prior dealing and the offer benefits the person to whom it is made.

20. I was referred to various decisions which amounted to examples of the application of these principles but which did not assist much because the experts agreed that whether or not there has been an implied acceptance under Article 132 or an acceptance by silence under Article 135 is a matter of fact for the Court to determine. In particular, in the circumstances of this case, acceptance of the Letter of Engagement did not have to be in writing but could be expressed by Mr Kidd’s acts which clearly demonstrated his consent to its terms. Furthermore, it was a matter for the Court to determine whether continuing the instructions to Sarcogent after receiving the Letter of Engagement demonstrated consent to its terms. The terms of the Letter of Engagement itself would be relevant in deciding whether or not there was a need for the putative acceptor to speak/inform the other party if its terms were not accepted.

21. Under Article 3 of the Executive Council Resolution No. 22 of 2011: “No person may undertake the profession of providing Legal Services to third parties in the Emirate unless he is registered or licensed to do so by the LAD”. It will be noted that the restriction applies “in the Emirate” and, as a matter of grammar, that expression refers to the location of third parties as opposed to the location of the provision of legal services. If there is any doubt about that, regard may be had to the aim of the provision which is referred to below as being to protect the public in the UAE against the practice of law by unregulated persons.

22. The two experts in UAE law agreed that the Letter of Engagement in itself would be void if the DIFC Court found that Sarcogent was providing such prohibited legal services under it, because such services could only be provided by licensed lawyers in the jurisdiction and the provision of legal services without a licence would be contrary to UAE public policy. It is common ground that Sarcogent had no such licence. The purpose of the provision, according to Mr Attia, but which is, in any event, self-evident, was to protect the public in the UAE from unqualified people providing legal services and to uphold appropriate standards in the provision of such services. It was the unchallenged evidence of Mr Attia that the provision of advice in the UAE on foreign law would not be caught by this prohibition because it was the provision of domestic services which was regulated.

23. In cross examination, Mr Attia accepted that individuals with foreign law qualifications operating in the UAE could not advise on UAE law without a licence to do so. They might be employed in a firm of local lawyers which had such a licence but any advice given on UAE law by a person resident in the jurisdiction to persons within the jurisdiction had to be given by someone who was licensed. Whilst not expressly covered in the evidence, it appeared to me self-evident that those engaged by a licensed firm of lawyers in the UAE, whether legally qualified or not in the UAE, could send emails and give advice in the name of the licensed firm under the aegis of those qualified in that firm, since the licensed firm would be responsible for the work of its employees. The employees would be covered by the licence where a licensed person was responsible for the advice.

24. In construing provisions of a Code or Law, Mr Attia explained that the court should give effect to any provision which was clear on its terms and if it was considered unclear to look for the aim or intent of the lawmakers in promulgating the provision. Furthermore, the law should be considered as a whole with a view to consistency.

25. Under Article 31 of the Legal Profession Law of 1991, lawyers in the UAE were, at the relevant time, prohibited -from agreeing to fees in the form of success fees. Any such success fee, if agreed by a licensed lawyer or by an entity providing legal services requiring such a licence, would be unenforceable and the Letter of Engagement would be void on that ground also. A success fee arrangement agreed by others who were not licensed lawyers or providing legal services would, if validly agreed, be enforceable.

26. The experts also agreed that Article 53(1) of the UAE Federal Decree Law No. 34 of 2022 would render the claim under the Letter of Engagement time-barred if Sarcogent was providing such legal services under it, because a three-year limitation period would then apply, whereas, if no such legal services were being supplied, the limitation period would not have expired by 13 November 2023 when the current action was begun.

27. The UAE 1991 Legal Profession Law and Article 1 of the Dubai Executive Council Decision No. 22/2011 and the 2022 Legal Profession Law set out their scope of their application in materially identical ways. In translation, Article 1 of the Executive Council Decision referred to legal services which included, “without limitation, pleading, representing third parties before legal authorities, arbitration and conciliation entities and centres and administrative authorities, legal counselling, contract drafting and any other legal services”. Article 6 of the 2022 Law, though inapplicable to the events which preceded it, effectively reiterated that. In translation, it referred to the legal profession’s activities as including, without limitation, appearing on behalf of and representing persons in court and similar bodies, giving legal opinions and advice, drafting contracts and relevant legal documents as well as representing parties in non-traditional legal work under a limited power of attorney.

28. Both experts agreed that the UAE Federal Law No. 23/1991 did not provide a specific definition of “legal services”. However, Article 1 of the Dubai Executive Council Decision No. 22 of 2011 did provide useful guidance as to what would be considered legal services provided in the Emirate of Dubai. Whilst what was referred to therein could not be said to be exhaustive, it would be a matter for the DIFC Court to decide what other activities could fall within the prescribed words.

The Witnesses of fact

29. Both Mr Forbes and Mr Kidd gave evidence and were cross-examined.

30. Mr Forbes puffed up his CV and even referred to himself as being in the business of legal consultancy in his LinkedIn profile. He had an exaggerated idea of his own expertise and abilities. He overstated the significance of his contribution to ascertaining that there was a case to pursue against BP, although it seems it was his initiative which led to the investigation and pursuit of it. He was fit to see the conflict of interest issue. He was wrong to say in evidence that he and Sarcogent had no role in monitoring costs as the documents showed assurances that they would do so. He was also wrong to maintain that Sarcogent had no role in arranging litigation funding, as the Alastair Munro loan which was arranged by Mr Smylie showed. He did not appear to know much about how Mr Smylie carried on the business of Sarcogent, where it seems that Mr Smylie was the dominant actor in dealing with L&M, as might be expected since he was a Scots solicitor. Whilst I consider that he was essentially honest, and did his best to remember events of many years ago, I do not consider that he had any real recollection of the details of meetings beyond what could be derived from the documents. He could not have had any real recollection beyond the general outline of any agreement reached by him, save as triggered by contemporary documents. Insofar as he may have suggested that the only real change to the success fee arrangement was the reduction which he proposed from 25% to 20%, that was not the case because the documents show changes in details of the way in which the figures were to be assessed as different proposals were made at different times.

31. Mr Kidd professed to have no recollection of seeing any document or of any event which militated against his own case although, as appears below, that case lacked clarity in any event. Whilst he was obviously not a man for detail and, on his own evidence, did not concern himself with contracts or accounts and passed emails addressed to him for others to deal with, without reading them, he was a most unsatisfactory witness. I consider that he was motivated largely by a sense of grievance at the loss of his ITS business which had led to the BP litigation where the recovery made was much less than he had hoped for. In his evidence, he did not accept that there had been any “success” for which any success fee should be paid, stating that he had got little out of the litigation and that much had been swallowed up in legal costs which had not been appropriately controlled by Mr Forbes, Mr Smylie and Sarcogent. He referred to himself, in a text message as “the only loser” in it all. At bottom, it appeared to me that he did not think that they were deserving of any fee and that, whatever he might have agreed, he was not bound by it without a signed document. Despite saying that he was “not too materialistic”, it was plain that he did not want to pay Sarcogent any success fee at all.

32. When the deductions that he put forward under a signed statement of truth as those which fell to be taken into account in calculating any success fee that might be due were explored with him, it became plain that the inaccuracies in it and the misleading nature of its contents could only have been included out of a desire to prevent any recovery on the part of Mr Forbes. On his own evidence, he only looked at the top and bottom line of the document known as RTP 1, which, he said, had been drafted for him by Mr Clarkson and/or Lachy. The fact that Mr Kidd was prepared to sign a statement of truth in relation to his Defence and to the contents of this document without checking any part of it himself for accuracy, suggests that he does not have sufficient regard for the Court or for the truth. I did not find his evidence of ignorance of the contents of the Letter of Engagement to be credible, as was also the case with his professed ignorance of other success fees of which he complained. The variety of defences put forward by him which were later abandoned, whether based on UAE law propositions or otherwise, illustrated his desire to avail himself of any possible route to avoid payment of the success fee.

33. His oral evidence was inconsistent as to whether or not there had been an agreement to a success fee of some kind. At some points in his evidence, he said that there had never been an agreement to any success fee, in line with the Defence submitted by him for which he had signed a statement of truth. In opening his case, his Counsel said that he accepted that he was bound by an agreement reached in September 2013, from which he never thereafter deviated, to the effect that Mr Forbes was entitled to a success fee of 25% which was to cover him and all other professionals, whether they agreed to a success fee or charged on a more orthodox basis. In his own evidence, he did deviate from this supposedly consistent stance. Whilst saying on occasion that there never had been an agreement to a success fee at all, in other parts of his oral evidence he accepted that a success fee of 25% had been agreed with Mr Forbes but that there had been no success because the case against BP was not truly won nor a success, as it was settled at a low figure as a result of a shortage of cash to fund the trial, caused by the lack of control of the fees run up by his lawyers. Elsewhere, he said that there was no agreement because no Letter of Engagement had ever been signed by him: he had made a proposal, counterproposals had been made and no agreement eventuated. Despite all this, he maintained that he had never changed his position on the subject.

34. In his Defence at paragraph 22.3, Mr Kidd appeared to accept that the letter of engagement 15 August 2015 had been received but in his oral evidence he was not prepared to accept that. He said that he never saw that letter and never committed either to it or the critical Letter of Engagement on which Mr Forbes relied, which he appeared to accept had been received and forwarded to his team. His inconsistencies and disregard for the truth meant that his evidence was unreliable and, unless uncontroverted, supported by documents or inherent probabilities, I was unable to accept it.

35. I could not, for reasons which appear in this judgement, accept his evidence that he had never seen the Sarcogent letter of engagement dated 15 August 2015 addressed to A&E nor read the critical Sarcogent Letter of Engagement dated 21 November 2016. Moreover, if, as he said, he referred all such matters to his team consisting of Lachy, Fergus McLellan, Constandia Aminou and Fraser Clarkson, the failure to respond to these letters of engagement, which provided that “your continuing instructions in this matter will amount to your acceptance of the contents of this engagement letter” is telling. His team took instructions from him after reviewing materials sent to them. Continuing instructions and payment of invoices could only be the result of instructions given by Mr Kidd to his team to do so, once they had made him aware of the essence of the contents which he had not supposedly absorbed. Following the letter of engagement of 15 August 2015, Sarcogent continued to manage the litigation on his behalf with payments for services made to Sarcogent on 17 September 2015 and 19 August 2016. Following the Letter of Engagement of 21 November 2016, received on 4 January 2017, Sarcogent continued to act on his instructions and payment was made, on his instructions of an invoice addressed to Mr Kidd himself in December 2017, long after, on his own evidence Mr Clarkson had told him of the terms of the Letter of Engagement. That invoice covered work carried out before and after the date of that Letter of Engagement.

36. Mr Forbes also called his brother Andrew Forbes to give evidence about a meeting with Mr Kidd in July 2014 and about statements made by Mr Lachlan Forbes (“Lachy”) (their younger brother who was married to a daughter of Mr Kidd’s and worked closely with Mr Kidd) and by Mr Kenny Pratt, who was Mr Kidd’s brother-in-law. I found Mr Andrew Forbes to be an honest, accurate and reliable witness.

37. Two other key individuals who were involved in the events in question were not called by either party. The first of these was Mr Smylie who declined to cooperate with either party and was said to be suffering from ongoing health issues. The effect of this was that no direct evidence was available of matters he handled for Sarcogent and various Sarcogent documents were unavailable, including the alleged letter of engagement dated 15 August 2015 which, it was said by Mr Forbes, probably remained in the Cyprus offices belonging to one of Mr Kidd’s companies which had been used by Sarcogent. Counsel acting for Mr Kidd levelled accusations against Mr Smylie in his submissions for which I could see no basis. The second of these absent individuals was Lachy, who assisted Mr Kidd with the electronic documents whilst he was giving evidence and could obviously have given evidence himself. The evidence before the Court showed that Lachy had access to all Mr Kidd’s emails and tended to respond to such emails on his behalf. On Mr Kidd’s evidence, Lachy, Mr McLellan, Constandiou Aminou and in the later stages, Mr Clarkson were those that dealt with the contractual and accounting side of his business interests and Lachy was clearly his No. 2 who put his decisions into effect.

38. Mr Kidd called Mr Fraser Clarkson his current CFO, Mr Fergus McLellan, who also worked for him and Mr Morgan Munter to give evidence on his behalf. I regret to say that Mr Fraser Clarkson was an even more unsatisfactory witness than Mr Kidd. His evidence in relation to his discussions of the Letter of Engagement with Mr Kidd in about July 2017 did not make sense and appeared to be designed to support a version of events which tallied with Mr Kidd’s second witness statement but on which the latter gave inconsistent evidence, as detailed above. For a chartered accountant to seek to support the calculations which were advanced under a statement of truth by Mr Kidd as those properly to be taken into account in deductions from any success fee (RPT1), was disgraceful. He did not even accept under cross examination that RPT1 was misleading, when it self- evidently was. It was put to him that he had manufactured a document with the object of minimising any sum payable without regard to the need to show that the costs were properly incurred in the pursuit of the BP litigation. He did not accept this but the accusation was apposite. A cursory examination of the document reveals the failure to take into account the recovery of at least GBP 1.75 million of costs, when putting forward costs incurred in that litigation, the unjustifiable inclusion of some GBP 786,000 of costs paid to MMS and of payments made to Sarcogent on other matters than the BP litigation and significant elements of unevidenced, unvouched or undocumented loans and expenditure, the details of which appear elsewhere in this judgment.

39. Two further witnesses gave evidence as part of Mr Kidd’s case each of those spoke well of Mr Kidd’s character and denigrated that of Mr Forbes. Mr Fergus McLellan’s evidence was that Mr Forbes did not play a key role in advising and working with Mr Kidd on the sale of IIS project in Ghana, as Mr Forbes had said in his witness statement. He was equally not involved in the sale of property at Miller Road Houston. Mr Munter’s evidence was that Mr Kidd was professional, thoughtful and highly principled and not someone who entered into agreements lightly or without due process. He regarded Mr Forbes as someone who sought to insert himself into situations where he could see potential benefit, presenting himself as a central figure in arrangements where his actual role was unclear or unsupported by any formal agreement. Whilst I have already found that Mr Forbes did exaggerate his expertise and the importance of his role with Mr Kidd, I did not find this evidence from either witness to be of any assistance. The Court had to form its own view about Mr Kidd in the context of this particular dispute.

40. A witness statement was adduced by Mr Kidd from Mr Andrew Smith KC (then QC) who was the lead counsel in the BP litigation and who had direct dealings with all the protagonists. He had sought to mediate, so far as possible between Mr Kidd, Mr Forbes and Mr Smylie. Mr Forbes did not require him to attend for cross examination and his contemporary emails spoke for themselves. The family context of the dispute is inescapable and the bitterness that was engendered was obvious. It appeared that Mr Kidd and the Kidd family, who had benefited from the GBP 20 million recovery in the BP litigation blamed Mr Forbes not just for lesser recovery than had been hoped or expected, but also in some way for the loss of the ITS business, which, as the evidence in a series of pieces of litigation in Scotland showed, was in dire straits long before Mr Forbes was asked in any way to help.

41. As with many disputes, and particularly those involving events taking place many years ago, the recollection of individuals is often unreliable and the contemporary documents provide a better guide to what the parties agreed and to the events which occurred. In this case, although the critical events occurred in the years 2013-2017, there were missing documents and the essential nature of any deal on success fees, it might be thought, would be memorable, particularly for those who hoped to obtain substantial sums as a result. In reaching the conclusions to which I have come, I have taken full account of both documents and witness evidence, as well as the inherent probabilities which could explain the actions of the parties.

The sequence of events as revealed by the documents and evidence

42. Whilst Mr Murray KC for Mr Kidd relied on eight documents primarily as the most reliable guide to what was and was not agreed, in my judgement it is necessary to cast the net wider. Even so, the material is limited and the documents do provide a relatively clear guide to the course of events. In this section of the judgment, I refer to the documents as the primary source of information along with the common ground between the parties as to events which indisputably occurred. Interlaced with this, I have included the evidence of the protagonists where it is helpful to do so.

43. It is common ground that there was a meeting in London in September 2013 between Mr Forbes and Mr Kidd. Whilst, throughout his Defence, Mr Kidd maintained that no success fee agreement had ever been reached between him and Mr Forbes at any time, in his second witness statement he said that in conversation with Mr Forbes, whom he had engaged to manage the claim against BP, he had stated that if the claim was successful against BP and he recovered funds, he would be happy for up to 25% of his recovery to be set aside for all the professionals involved in the pursuit of the claim. He would retain 75% of the recovery and Mr Forbes and the team he engaged would be entitled to the balance. “In my eyes, this was a simple deal and I never deviated from this”. His Counsel, in a valiant attempt to reconcile his evidence, suggested that Mr Kidd never regarded the original deal, as he set it out, as a success fee but it clearly was. Mr Forbes’ evidence was that he met Mr Kidd in his Montague Square residence on 29 September 2013 and told him that the claim against BP should be pursued and that a sum of GBP 1 million ought to be sufficient to finance it. At that meeting, he said that a success fee was discussed, being 25% of any recovery from the action against BP. 44. In an email of 1 October 2013 sent by Mr Forbes to Lachy, but not to Mr Kidd himself, the following appears:

44. In an email of 1 October 2013 sent by Mr Forbes to Lachy, but not to Mr Kidd himself, the following appears:

45. If this email faithfully records the meeting and it remains uncontroverted by any immediately ensuing response, the agreement was for a fee of 25% on any successful recovery, which Mr Forbes would split with other professionals utilised for the claim but that any fixed costs would be notified and approved upfront, presumably by Mr Kidd, before any commitment was made. Mr Forbes’ oral evidence was to this effect. Whether some professionals were to be engaged on a success fee and others on fixed fees does not appear from the email and I did not consider that either Mr Forbes or Mr Kidd had any reliable recollection of the thinking at the time.

46. Following Mr Smylie’s disengagement from MMS and his decision to set up Sarcogent with Mr Forbes for the purpose of managing the BP claim, an email of 1 July 2014 from Mr Smylie to Mr Kidd, copied to Lachy refers to a meeting over dinner the previous night. That email contained the following:

47. There then followed a discussion of various business interests of Mr Kidd, where Sarcogent might be able to assist the first of these came under the heading of “ITS/Downhole Litigations”.

48. Mr Forbes’ evidence was that he did not expect Mr Kidd to agree to the monthly retainer of USD 25,000 per month. On 11 July 2014 Mr Smylie sent a chaser to Mr Kidd and Lachy saying:

49. That raised a reply from Lachy saying: “Let me speak to Bob as he was still considering things.” It would seem that the proposal to proceed on the basis outlined if there was no response was sufficient to draw forth this reply. This led to Mr Smylie emailing Lachy and Mr Kidd saying: “Thanks Lachy. I will hold off the document review meantime.” That was obviously not what was desired since the response came back speedily from Lachy, copied to Mr Kidd: “we need to continue with document review and this can be charge [sic] until a wider scope is agreed”. The same day, Lachy sent Mr Forbes an email saying that he needed to know how much the costs would be to have the documents ready, by which he meant the documents necessary to commence proceedings. At that stage therefore Mr Smylie had made a proposal which had not been accepted, whether because of the monthly retainer, as Mr Forbes said he thought, or because of the proposed success fee, with its greater detail, it is not possible to say.

50. It is Mr Forbes’ case that there was a meeting on 14 July 2014 at the Bieldside Inn in Aberdeen between Mr Forbes and Mr Kidd, which was also attended by Mr Forbes’ brother Andrew Forbes. Mr Forbes said they met in order to clarify the position on the operational costs three days after Lachy’s email. During that meeting Mr Kidd and he confirmed their mutual understanding that the 25% success fee, as agreed in September 2013, would remain in place and they shook hands on the deal. He said he raised the matter in order to ensure alignment with the 1 July proposal made by Mr Smylie and, in clear terms, Mr Kidd agreed and confirmed that he should continue managing the claim on that basis. The success fee was thus nailed down in the presence of Mr Andrew Forbes as a witness. Whether the proposal differed from that in the email of 1 October 2013 in relation to professionals who would or would not charge on a success fee basis, depends on the view taken as to the meaning of the earlier email and the parties’ understanding thereof, on which I could form no clear view.

51. Mr Andrew Forbes’ evidence, in his witness statement was to the effect that Mr Forbes put proposals to Mr Kidd on the basis of “whatever you recover, our cut would be 25%”. Those words had stuck in his memory. He had previously been told by Mr Forbes that their prior agreement was that any professional work would be done on an hourly rates basis and that Mike and Chris would get a cut of 25% of any monies recovered. In cross examination, when asked, he could not recall any express words of agreement by Mr Kidd and could not recall any handshake. He said that no details were discussed and he understood there to be confirmation of what had previously been agreed between the two of them. In his witness statement, he referred then to the email exchange he had with Mr Forbes concerning the email of 28 July 2014 that Mr Forbes sent to Mr Kidd and Lachy, which is referred to below.

52. Whilst Mr Kidd, in his second witness statement referred to meeting with Mr Smylie and Mr Forbes in London in June 2014 when Mr Smylie referenced his imminent move to Dubai to be a consultant with Davidson & Co - a Dubai-based law firm and the engagement of L&M instead of MMS to pursue the BP litigation, he only had a vague recollection of a meeting on 14 July. He said that at that meeting there was a discussion of potential oilfield deals with Mr Andrew Forbes and the company with which he was involved. At paragraph 33 of that witness statement, he said that his position was that he was happy for up to 25% of his total recovery to be available for the whole professional team (including all costs incurred) in order that he retained a minimum of 75%. He categorically did not agree to the claimant receiving 25% of his total recovery alone, which would have meant an unacceptably small percentage for himself. In the ensuing paragraphs of that witness statement, he referred to Sarcogent being set up to manage the litigation in Scotland, to liaise with and manage L&M, to keep him updated with advice on the progress of the case, ensuring that legal fees and other costs were transparent and under control. He and Mr Forbes as Sarcogent were to act in his best interests and protect them overall. Billing would be done through Sarcogent instead of on a personal basis. He made it clear at these two meetings that all costs were to be managed, transparent, kept under control and it was their responsibility to secure funding for the litigation. It was also his evidence that Mr Smylie, as a qualified lawyer, would work as part of the legal team and that he did so. Sarcogent were managing the legal and professional team and advising him so they were essentially acting as part of that legal team and were therefore providing legal services to him in relation to the BP litigation.

53. It was on 28 July 2014 that Mr Forbes emailed Mr Kidd and Lachy:

54. On 29 July 2014 Mr Andrew Forbes, in an email to Mr Forbes commented that he thought this “a very good deal”. “They should not question the 20% divi as Bob did agree to 25%. This is very fair but again they would be better with a retainer”. Whilst the earlier emails provided for a success fee of at least some professionals involved in the pursuit of the claim, other fees would fall outside it. Even if those emails could be read differently, the 28 July email makes the point that Sarcogent would work at a cut-price hourly rate, compared with the average charge rate of professionals and that any professionals involved would be tied down to fixed and capped discounted fees which would only make sense if they were to fall outside the ambit of the success fee. In his witness statement, Mr Andrew Forbes stated that the 25% was definitely agreed by both parties at the meeting, as confirmed in this email. Mr Kidd’s evidence was that he had no recollection of this suggested reduction at all.

55. On 10 April 2015 L&M issued its letter of engagement addressed to “Robert Kidd, A&E Investments Inc, c/o Campbell Corporate Services Ltd in Grand Cayman”. The client was identified as A&E on the basis that some agreement existed between that entity and Mr Kidd concerning the recovery of sums sued for and that A&E was obliged to pursue the various rights of action for its own benefit and would meet all the fees and costs incurred, although the actions would be pursued in the name of Robert Kidd as pursuer. A duty of care was acknowledged as owed to Mr Kidd as well as the formal named client. The L&M letter of engagement specified that, unless advised in writing to the contrary, L&M were entitled to accept instructions from Robert Kidd, Mike Forbes or Chris Smylie. In a section of the letter under the title “Basis of calculation of fees” provision was made for basic fees at specified hourly rates which were said to represent a discount to the fee which the instruction would ordinarily command. In those circumstances a success fee was agreed, giving rise to an additional 1% of the basic fee for every GBP 100,000 recovered in excess of a threshold of GBP 10 million. The letter expressly referred to appendices to it which sets out the terms of agreements to be proposed and agreed with the clerks to Counsel to be instructed. By signing the letter of engagement, the signatories acknowledged agreement to those terms. Appendix 1 set out a success fee for junior counsel calculated on a similar basis to that of L&M. The letter of engagement was to be signed for and on behalf of A & E and also signed by Mr Kidd as guaranteeing the obligations of A&E.

56. On 1 May 2015 another company of Mr Kidd’s, namely All Services Group Holdings Ltd (“ASG”) signed a general consultancy services agreement with Sarcogent, with Mr Smylie signing for Sarcogent and Mr Kidd for ASG. On 3 May 2015 a similar agreement was concluded between Sarcogent and ASG relating to refinancing, which was signed by Mr Smylie for Sarcogent and Mr Forbes for ASG. Mr Kidd took the view that this loan was commercial madness and blamed Mr Forbes and Mr Smylie. Despite criticism of this signature by Mr Forbes, the evidence was that the board of ASG approved the agreement and it was Mr Forbes’ evidence that the refinancing was critical to the immediate survival of ASG which was in breach of its borrowing covenants and was otherwise likely to be put into liquidation by the lenders.

57. On 21 May 2015 Mr Smylie emailed Mr Craik of L&M in relation to a number of matters, referring to Mr Kidd’s desire to see positive progress in the BP litigation. Reference is made to the possible appointment of an expert with a success fee and to the amended letter of engagement and associated terms and conditions of L&M. Mr Smylie had not received copies of the appendices which set out the terms of engagement of counsel and required them, saying that he could not get Mr Kidd to sign the letter of engagement without them.

58. As appears from the Letter of Engagement dated 21 November 2016 and Mr Smylie’s email of 4 January 2017 referred to above, there appears to have been an earlier Sarcogent letter of engagement dated 15 August 2015 in the name of A&E. Any suggestion that there was no such letter of engagement would mean that Mr Smylie was acting dishonestly in saying, in his email, that there had been such a letter. I reject that suggestion, particularly as there has never been any response from anyone which cast doubt upon its existence, save for Mr Kidd’s comments in his evidence. The terms of Mr Smylie’s email of 4 January 2017 show that the difference between that letter of engagement and the Letter of Engagement dated 21 November 2016 under which the claim is made against Mr Kidd, lies in the identity of the party to the earlier letter, namely A&E, as compared with Mr Kidd personally in the later version. In that connection, the first two paragraphs under the heading “introduction” are obviously important since throughout the period thereafter Sarcogent acted on the instructions of A&E/Mr Kidd and managed the litigation as contemplated by the terms of the letter.

59. Mr Kidd’s evidence on the earlier letter of engagement and the later Letter of Engagement dated 21 November 2016 was wholly unsatisfactory for the reasons given earlier in this judgment, regardless of the inconsistencies in his evidence about the earlier oral discussions and agreements reached with Mr Forbes. He said that he did not read the Letter of Engagement but sent it to his team. He then said that he had no recollection of receiving it but would not read it if he had received it; he would send it to Fergus McLellan to review it. As far as he recalled, he told his team to review it and maintained in his evidence that he had not signed it, that silence was not an acceptance and that he had done nothing to show acceptance of its terms. He had no answer to the point that an invoice addressed directly to him, sent with the email of 4 January 2017 had been paid in December 2017 on his instructions.

60. On 1 September 2015, Mr Forbes sent Mr Kidd/Lachy his “last and closing MGF invoice” (MGF being the company he used to invoice for his personal services), saying that as of that date he and Mr Smylie would bill time and line via Sarcogent, monthly in arrears and break down time against all entities for Mr Kidd’s apportionment. This email supports the evidence of Mr Forbes that the services he had been providing were, in the future to be provided by Sarcogent, a matter which is not disputed by Mr Kidd. Invoicing appears to have been effected on the basis of GBP 150 per hour.

61. It was on 4 January 2017 that Mr Smylie sent Mr Kidd the email referred to in paragraph 4 above with the Letter of Engagement referred to in paragraph 2 above. Reference is made to the discussion with Mr Craik about the identity of L&M‘s client in the context of the award of expenses and the Court Auditor’s assessment/approval as the reason for a change in the identity of the party to the letter of engagement with Sarcogent and the letter of engagement with L&M. In those discussions it was said in the email that Mr Kidd had agreed that this change of identity of the client was the better option. Mr Kidd said he had no recollection of such a discussion which obviously must have happened. The evidence did not establish whether or not Mr Kidd signed a fresh letter of engagement with L&M but it seems likely that he did so for the reasons set out in Mr Smylie’s email. In an email of 1 November 2017 from Mr Craik to Mr Clarkson, the former enclosed two engagement letters as requested. In that email he commented:

62. The reference to two engagement letters is significant as is the reference to Mr Kidd’s signature to both and, contrary to the evidence of Mr Kidd under cross examination, the reference to the existence of the appendices to the engagement letters with Jonathan Brown’s success fee arrangement contained therein prior to signature. Mr Kidd therefore appears to have signed those engagement letters which, in their terms, recorded the success fee arrangements of both L&M and Mr Brown as junior counsel.

63. Whether Mr Kidd did so or not, the suggestion that is made by Mr Kidd in his witness statement that the request for him to sign the Sarcogent Letter of Engagement was a contrivance on the part of Mr Forbes and Mr Smylie as a deliberate and cynical attempt by them to engineer a situation where they could claim personally against him (as stated in paragraph 88 of his second witness statement) does not bear examination.

64. I have no difficulty in finding that the email of 4 January 2017 enclosing the Letter of Engagement was received by Mr Kidd, as was accepted at one point by him in cross examination when he said he forwarded it to his team for review. I also cannot accept his evidence that he did not read this email, his evidence being that he did not read long winded emails, did not concern himself with lawyers, accountants, contracts or accounts, but would send them to Lachy or another member of his team. This was not a long email and in order to decide whether to send it on to one of his team, he would need at least to read it through to see what its general import was. In the forefront of the letter was the paragraph stating that his continuing instructions in the matter would amount to his acceptance of the contents of the Engagement Letter. He must have read that and been alive to its potential significance and, on his own evidence, would have been likely to refer the matter to Lachy or Mr McLellan, both of whom would recognise its potential importance and discuss with him the terms set out in the Letter to ascertain if they were acceptable. If sent to Lachy, Mr McLellan or anyone else in the team, they would see the terms of the email and appreciate the need to respond if its terms were not agreed or acceptable. It is inevitable that there would have been a response from Lachy or someone else, if not from Mr Kidd himself, if objection was taken by Mr Kidd to the terms set out.

65. Following Mr Kidd’s receipt of this email, whether or not he forwarded it to Lachy or Mr McLellan, Sarcogent continued to act on the instructions of Mr Kidd in relation to the BP litigation until 3 July 2017 when Mr Kidd emailed Mr Craik to say that Mr Fraser Clarkson had recently taken on the role of acting Chief Financial Officer of the ASG group and that, with immediate effect L&M should “liaise directly and solely with Fraser in all aspects relating to the current legal cases”. This does not appear to have been communicated to Mr Forbes or Mr Smylie, since if it had, issues would likely have arisen sooner than they did.

66. It was in July 2017 that Mr Clarkson met with Mr Smylie and Mr Forbes in Dubai and following that meeting received copies of the invoices Sarcogent had raised and the Sarcogent Letter of Engagement. On his evidence, Mr Clarkson reviewed it and then asked Mr Kidd about it, pointing out the clause giving rise to the success fee of 20% of the recovery net of expenses incurred in obtaining it. At paragraphs 19 and 20 of Mr Clarkson’s witness statement, he said that Mr Kidd had said that he could not recall the Letter of Engagement but after briefly reviewing it, noted that it was unsigned. Mr Kidd said that, had he seen the Letter of Engagement when it was issued, he would not have signed it anyway because he did not agree to the terms set out therein. He informed Mr Clarkson that, right at the outset, he had agreed that in the event of a successful recovery, he would be happy for 25% of any funds recovered to be available for all of the professionals that worked on the case against BP, by which he meant L&M, counsel, Mr Smylie and Mr Forbes as well as the experts. The 25% would therefore include all fees incurred during the case but if there was any surplus after payment of them that would go to the professionals, meaning that he, Mr Kidd would get 75% of any recovery.

67. Under cross examination, Mr Clarkson was asked whether he had noted the provision in the Letter of Engagement that stated that continuing instructions would amount to acceptance of the contents of the Letter. He said that he flagged up the 20% figure but nothing else. Mr Clarkson told the court that he had a degree in law as well as being a chartered accountant. He would necessarily have been familiar with Letters of Engagement and standard form contracts which sometimes contain terms of this kind. The notion that he did not notice the paragraph, as he told the Court, is not credible. He agreed that he understood the words now that he read them and it is inconceivable that, having reviewed the document, as he said he did, he did not grasp the potential significance and point this out to Mr Kidd. When asked why, having a Letter of Engagement in his hand to which he knew Mr Kidd did not agree, he did not revert to Mr Smylie, he answered that he was told by Mr Kidd not to do so and not to “rock the boat” with the trial coming up. Whether or not this makes sense in the context of the decision taken on 3 July 2017 that Mr Clarkson would be the sole authorised person to give instructions to the lawyers, as set out above is debatable. Any supposed shortage of funds at the time might have induced a desire not to rock the boat with the lawyers instructed but could have no impact on the position with Sarcogent when a decision had been taken to divest it of authority, even if apparently not told of this. In the Defence, Mr Kidd maintained that Sarcogent continued to participate in the mediation and in discussions as to the future conduct of the litigation right through to December. Regardless of this, contrary to the evidence of Mr Clarkson and Mr Kidd, the position must have been fully discussed between them at the time and the decision taken not to challenge the Letter of Engagement. The obvious reason for not doing so is that it was accepted and recognised as an agreement by which Mr Kidd was bound. No chartered accountant, faced with a Letter of Engagement including this provision, whether signed or not, would fail to respond to register an objection, if there was truly an objection by Mr Kidd to its terms.

68. In February 2017, Lord Tyre’s decision in the Court of Session found BP liable for breach of fiduciary duty on a summary basis with a trial set for January 2018. In September 2017 he awarded Mr Kidd costs of GBP 1 million. In October 2017 Mr Forbes and Mr Smylie began to suspect that Mr Kidd did not intend to pay a success fee as they seemed to be increasingly excluded. In November 2017 the payment of GBP 1 million was made to L&M in relation to the costs award.

69. It will be recalled that the email of 4 January 2017 had attached not only the Letter of Engagement in Mr Kidd’s name but also Sarcogent’s invoice 002/2017 for fees and outlays covering work done on the BP action for the period from 20 August 2016 to 31 December 2016. This invoice for USD 102,970 was addressed to Mr Kidd personally and the narrative of the bill referred to “general advisory and consultancy services in relation to the management and conduct of ongoing litigation in the Scottish courts during the period from 20 August 2015 to 31 December 2016 … Including correspondence, telephone calls, general liaison with appointed legal team, attendance at meetings with you/legal team in Cyprus (September), attendance at meetings with you/legal team in Glasgow (October) and attendance at the diet of Debate in the Court of Session in Edinburgh (December)”. The invoice also included other project work.

70. On 1 November 2017, Mr Craik emailed Mr Clarkson, as referred to in paragraph 61 above. In the final paragraph of that email he said this:

71. On 5 December 2017, Mr Clarkson emailed Mr Forbes and Mr Smylie, stating that they had each been in touch with both Mr Kidd and himself regarding payment to Sarcogent from the expenses award made by the Court. The email continued:

72. On 12 December 2017, Mr Clarkson sent them both a further email saying: “Graham Craik has been instructed to make a payment of £20,000 to Sarcogent as a part payment against invoice 002/17”. Payment of that sum was then made.

73. On 9 January 2018 the BP litigation settled for GBP 20 million all-in, but including the GBP 1 million paid on the costs award.

74. In an email of 16 January 2018, Mr Smylie sought assurances from Mr Clarkson as to Mr Kidd’s bona fides in relation to the success fee, expressing the hope that there would not be a repeat of the delay in payment, as had happened with the invoice (002/2017) when he had been promised payment from the interim award of expenses by the Court. He was seeking details of any deductions to be made from the GBP 20 million settlement in relation to the success fee and outlined the deal which was struck “between Mike and Bob, with Andy Forbes in attendance” and which formed the basis for the Sarcogent Letter of Engagement, with the scaling back from the initial proposal of 25% to 20% “on the premise that he would be responsible for all and any success fees or commissions he may choose to agree to”. On that footing, success fees payable to Graeme Craik, Jonathan Brown and Alistair Munro from whom a loan had been taken would not fall to be deducted.

75. Mr Smylie complained in emails that neither Mr Kidd nor Mr Clarkson would speak to him and Andrew Forbes’ evidence, both in his witness statement and under cross examination was that Mr Kidd would not speak to him either when he sought to contact him about payment of the success fee. In consequence he spoke to Mr Kidd’s brotherin-law, Kenny Pratt who told him that a nominal amount of money would be paid, nowhere near 20% and more like a couple of hundred thousand. He also said that he had spoken to Lachy on the telephone about 4 to 6 weeks prior to the conclusion of the court case – some time approximately in November/December 2017 when he asked him whether Mike and Chris were going to be paid their money to which the answer was yes.

76. In similar vein, there was an exchange of texts between Mr Forbes and Mr Kidd on 5 February 2018 in which the former said he had received feedback from Chris and Kenny asking if this was how his friendship and loyalty was to be repaid. He said “this could have ended today with us walking away – neither particularly happy, but settled! You promised me, you never lie and I was not going to be burned. Just have been!. Mike”. The response from Mr Kidd was as follows: “Mike I can assure you there is no intention to burn anyone here and no lies have been told. Fraser is going through all papers and as soon as completed he will be in touch. After all the promises I feel I am the only loser, Bob”.

77. When Mr Clarkson was asked in cross examination about the difficulty in contacting him, he accepted that this might have been the case. He said he could not remember whether, in January 2018 Mr Kidd had instructed him not to talk to Mr Smylie about the success fee, although he referred to the instruction which he said had been given in July 2017 not to “rock the boat”. In an email about that time, Mr Craik told Mr Smylie that, unless Mr Kidd authorised him to do so he could not discuss his affairs with him but that Fraser Clarkson would contact him shortly about the success fee. It is clearly to be inferred that Mr Kidd did give general instructions not to speak to Mr Smylie and was not prepared to talk to Mr Forbes or Mr Smylie himself. When he told Mr Forbes that Fraser was going through all the papers it was doubtless intended to assure him that Mr Clarkson was ascertaining what were the proper deductions to be made from any success fee that was to be paid. Mr Clarkson told the court that he did not contact Mr Smylie after 28 January 2018, so far as he could recall.

78. It was on 16 February 2018 that Sarcogent issued an invoice for the full amount of 20% of GBP 20 million, having no basis for ascertaining what proper deductions for costs were appropriate. On 23 February Mr Kidd returned the invoice marked “invalid and not accepted”.

79. On 15 March 2018, Andrew Smith KC (then QC) emailed Mr Forbes asking how he was and saying that he was sorry that things had not worked out properly for him. “I continue to try to persuade Fraser and Bob to do the right thing on this, and won’t stop doing so. I know that this was all your idea and your hard work and I don’t like it that you are not given the rightful result. Anyway, I shall do all I can for you”. On 3 June 2018, in another email, he said: “I am working hard and trying to get your just deserts on this…... My primary motivation is to ensure you get paid and I rather think it might work out without giving you too much hope. I’m sorry for the really bad family stuff going on, but promise I’m trying to make this right for you and Chris. It is taking a lot of time, but I know you should be properly compensated. Stick with it. It is not over.” Yet again, on 4 December 2018, he emailed to regret at what had happened, saying he did not want to pry into family matters but that he did “want to try to persuade Bob….. that he should make peace with you and Chris in financial terms”. He said he was rather hoping that when cash was returned by Mr Craik and Mr Brown in respect of unlawful success fees, Bob could be persuaded to pass some on but all he could do was keep nudging in the hope that Mr Kidd would chill out a bit.

80. It is apparent from these emails that Mr Smith was aware of the success fee arrangement although not the details of it as he makes plain in his witness statement. In that witness statement he expresses his regret that he was being provided with information by L&M that he now realised was incorrect because he was being told repeatedly that costs were not being paid as the case went along. It was only after the case was settled that he discovered that Mr Craik and Mr Jonathan Brown were on success fees and said that he regarded those as unlawful. Had he been told of those fees then he could have negotiated a differently structured settlement which avoided any additional fees being paid to either. With regard to the success fees of Sarcogent, he said he took the view that they had contributed a lot to the progress of the case and it was down to them that a possible negligence claim against BP had been identified. He said that his emails to Mr Forbes were sent in an attempt to be helpful to everyone, assuming there was an agreement in place, although at no time did he speak or ask about it. He said that his conversations were hard to remember at the time of his making his statement on 3 April 2025, but they were short although his correspondence might be read as saying that Mr Kidd conceded to him that money was owed. He remembered Mr Kidd making it plain it was not a matter that he wished to discuss with him.

81. It was on 11 January 2021, following decisions of the Court of Session as to the unlawfulness of success fees charged by L&M and Jonathan Brown that a settlement agreement was reached between them, A&E and Mr Kidd in which all claims in respect of various pieces of litigation were settled for GBP 1.75 million.

82. This action was commenced on 13 November 2023 with pleadings exchanged thereafter, with statements of truth signed by both Mr Forbes and Mr Kidd respectively, including RTP 1, produced by Mr Kidd on 13 December 2024 in answer request for further information, with a statement of truth by him.

Was there a contract on the terms of the Letter of Engagement?

83. I have no hesitation in coming to the conclusion that there was an agreed success fee, as Mr Kidd was prepared to accept from time to time, both in his second witness statement and in passages in cross examination. He concluded a number of different success fee arrangements with L&M, Jonathan Brown, Alistair Munro (in the loan agreement referred to below) and an expert Kenneth Chrystie in addition to those alleged with Mr Forbes and Sarcogent. Whilst Mr Kidd denied knowledge of some of these and suggested that they were arranged by others without its approval, there can be no doubt that he signed the L&M letter(s) of engagement which provided for such a fee with an appendix which provided for Jonathan Brown’s success fee. In circumstances where there would never have been a claim of any kind if Mr Forbes had not investigated the matter and pursued it with Mr Smylie, and Mr Forbes and Mr Smylie were prepared to do the preparatory work to put together information to put before lawyers for advice as to the validity of any such claim, there is every reason to think that Mr Kidd would willingly have agreed to a success fee in respect of a potential recovery which otherwise could never have materialized.

84. Whilst the exact terms of the arrangements made in September 2013 and on 14 July 2014 are disputed, the best evidence of what was discussed appears in the emails around that time, namely those of 1 October 2013, 1 July 2014 and 28 July 2014 to which reference has already been made in this judgment. The question arises as to whether the initial arrangement was for a 25% success fee to include all professional fees or only those professionals who agreed to charge on a success fee basis. It was always the case that Mr Kidd was going to have to approve any fixed fees that were to be charged by professionals and he specifically agreed to the terms of the L&M letter(s) of engagement by appending his signature, with its appendix. I find it inconceivable that any businessman of his experience, whether or not relying upon Lachy and/or Mr McLellan for review of the detailed terms of contracts would not familiarise himself with the principal terms and the projected financial impact in terms of cost/benefit.

85. I am satisfied that there was undoubtedly oral agreement to a 25% success fee in September 2013 and July 2014 and that Mr Forbes’ and Andrew Forbes’ evidence on this is to be accepted. It may well be that matters evolved as it became plain that certain people were not prepared to work on a success fee basis whilst others were agreeable to doing so. It is clear that there was some evolution in the terms put forward, including in particular the reduction from 25% to 20% and the changes in Mr Forbes’ proposal of 28 July 2014 with the hourly fees of GBP 150 per man hour for Sarcogent.

86. I do not consider that any of this really matters because the key issue is whether or not there was agreement to the terms of the Letter of Engagement, where the manner in which the success fee was to be calculated is spelt out.

87. It is inconceivable to me that there was no engagement letter of 15 August 2015 and that its terms were not identical to those of the Letter of Engagement dated 21 November 2016 sent on 4 January 2017 following earlier discussions, which likely took place in November, since any other conclusion would mean that Mr Smylie was being dishonest in saying what he did in that email. A perfectly sensible reason was put forward for the change in the identity of the client from A&E to Mr Kidd.

88. For the reasons already given, I conclude that Mr Kidd must have read the terms of the Letter of Engagement and its predecessor at least in outline before forwarding them to his team. He could not have failed to note the request to send back a signed copy and the provision that continuing to instruct Sarcogent to act would amount to acceptance of the contents of the Letter. In all probability, as he said in evidence he would refer such matters to his team, which in this context could only really mean Lachy. The absence of any evidence from Lachy is significant, as the right-hand man to Mr Kidd to whom communications were largely entrusted on matters of detail. He had access to Mr Kidd’s emails and would therefore have been fully aware of the terms of these letters of engagement without the need for Mr Kidd to refer them to him, but it is inevitable, on Mr Kidd’s own evidence that they would have discussed the terms following review by Lachy and decided what to do. In those circumstances, a failure to respond to the Letter of Engagement and its predecessor and in particular the opening paragraphs stating that continuing instructions would be taken as acceptance of the terms contained in the letters could only mean that Mr Kidd was agreeable to the contents of the earlier letter being binding on A&E and to the later Letter as binding him personally. He knew he had agreed to a 25% success fee initially and knew of the reduction offered by Mr Forbes to 20%. Neither Lachy nor Mr Kidd could have considered that they could ignore these letters of engagement expressed in those terms, if they disagreed with them

89. Seen as a matter of UAE law, I conclude that, by conduct following the receipt of the Letter of Engagement on 4 January 2017, Mr Kidd accepted its terms. He continued to instruct Sarcogent to manage the litigation as it had been previously doing and expressly decided, after the terms had, on Mr Clarkson’s and his own evidence, been brought to his attention in July 2017, to pay a Sarcogent invoice (002/2017) addressed to him personally in respect of work which straddled the date of the Letter of Engagement, including in particular attendance at the Diet of Debate in December. There was a previous course of dealing between A&E and Sarcogent and a previous course of dealing between A&E and Mr Forbes. There was an underlying agreement for a success fee for Mr Forbes made in September 2013 and for Sarcogent in July 2014 and now details were being put forward for the work that Sarcogent had done and continued to do. If those terms were not acceptable, Mr Kidd had, in my judgement, a duty to speak up to reject the terms of the Letter of Engagement if he was not accepting it.

90. A contract sprung into being on the basis of this offer and his acceptance by conduct in accordance with the requirements of Article 129 and 132 of the Civil Transactions Law. The actions of Mr Kidd following receipt of the Letter of Engagement, in continuing to engage Sarcogent until 3 July 2017 (and after that, though denying them authority to instruct L&M) and in paying an invoice addressed to him personally in the full knowledge of its terms are capable of giving rise to only one sensible conclusion. The evidence shows, as recorded in the Defence, that Mr Smylie attended the mediation in November 2017, met with L&M at that time and liaised with them thereafter. There was an interchange of acts demonstrating mutual consent. The course adopted by Mr Kidd was one, which, in the circumstances leave me in no doubt that it demonstrates mutual consent.

91. Additionally, the requirements of Article 135 of that Law are satisfied.

92. I conclude therefore that there was a contract on the terms of the Letter of Engagement.

Did Sarcogent provide legal services?

93. Whilst this is an un-meritorious point taken by Mr Kidd, if it were to be correct, it would be an answer to the whole claim. I do not consider that there is anything in the point however for a number of reasons. It was for Mr Kidd to make good the assertion that legal services were being provided under the Letter of Engagement in violation of the prohibition and that the contract was thereby rendered void.

94. I have summarised the effect of the expert evidence of UAE and Dubai law earlier in this judgment. The prohibition, which exists for the purpose of protecting persons resident in the UAE from the activities of unlicensed legal practitioners of UAE law is not designed to protect foreigners in respect of advice on foreign law or foreigners in relation to advice on UAE law. It is certainly restricted to the jurisdiction of Dubai and to the practice of law within it.

95. The Letter of Engagement did not require the provision of legal services in Dubai. Its terms have been set out earlier in this judgment. Most of the activities on which Mr Kidd relied did not even arguably, in my view, involve the provision of legal services within the meaning of the prohibition. The management of litigation, in terms of support of a team of lawyers consisting of solicitors and counsel in Scotland in relation to litigation in that country does not involve the provision of legal services in Dubai. Nor does any negotiation of fees of such lawyers, monitoring costs or attempts to obtain third party funding. Advice on Scots law, which Mr Smylie was qualified to give would fall outside the prohibition, although there is no evidence of him providing such advice in any event.

96. There is no doubt that the provision of advice on UAE law or the drafting of contracts subject to UAE law within the UAE falls within the ambit of the “without limitation” definition of “legal services” in Executive Council Resolution No. 22 of 2011 but it will be recalled that Article 3 of that Resolution specifically provided that it was the provision of Legal Services “to third parties in the Emirate” which was prohibited. There is no prohibition in relation to the provision of such services to third parties outside Dubai or the UAE because the aim and object was to protect those within the jurisdiction. Nor can there be any restriction on practitioners giving such advice or providing legal services when outside Dubai themselves. There is no evidence of the location of Mr Smylie when he carried out those activities of which complaint is made, which could even arguably amount to the provision of services.

97. There were, in my judgment, only two activities relied on by Mr Kidd which could even arguably amount to the provision of legal services in Dubai/the UAE. The first of these was the drafting of the loan agreement with Alistair Munro and the provision of what was said to be advice on UAE law in a five line email of 24 August 2016. Whilst the Loan Agreement could be described as an agreement to agree, Mr Smylie drafted that legal document which was expressly governed by the laws of Dubai and the UAE and subject to the exclusive jurisdiction of this court. The drafting of a document which is intended to be a contract of some kind, whether enforceable or not in accordance with its terms, does not make the drafting of it any less the provision of legal services because part or the whole of it is unenforceable. However, this was drafted by Mr Smylie for Mr Kidd and sent to him in Cyprus, by email. The “advice” stated that the Loan Agreement was “about as basic as I can make it” and that it was “of course In some respects an agreement to agree which naturally limits its enforceability but I understand that you just want something in place, confidentially, to cover unforeseen eventualities. It’s a draft at the moment so please let me know if you want any changes made.”

98. The advice, such as it was and the Loan Agreement were provided to Mr Kidd outside Dubai. Moreover, these activities took place several months before the contract was concluded on the Letter of Engagement and therefore could not render that contract void. If any contract was to be rendered void by the provision of legal services it would be an earlier contract, but none of those contracts required the provision of legal services as such. I cannot see how a contractual engagement to carry out services which are not legal services falling within the ambit of the Resolution can be rendered void by one piece of advice and/or one piece of legal drafting which fell within the definition. The drafter might not be entitled to charge for such work because the provision of that service was prohibited, but the contract for the provision of other services could not be affected thereby. Furthermore, it seems that Mr Smylie used his Gmail address indiscriminately. He did not have a Sarcogent email address but equally used his Gmail account when carrying out work for Davidson & Co who were licensed in Dubai. Whether therefore the work was carried out under the aegis of Davidsons and was the subject of charging by Davidsons does not appear from the documents. Mr Kidd is not able to establish a breach of the Resolution by these activities, let alone a breach which could render the contract on the terms of the Letter of Engagement null and void.

99. The only other activity upon which Mr Kidd relied and which could arguably be said to fall within the prohibition was the sending of the email of 4 January 2017 which enclosed the Letter of Engagement itself. The Letter of Engagement was subject to UAE law but once again the email was sent to someone outside the jurisdiction and it did not constitute advice in any event nor the provision of legal services in itself. It was an invitation to a client abroad to enter into an agreement for the provision of litigation support services (not legal services). Whilst it could be said that drafting the Letter itself involved the provision of legal services, the question arises as to the identity of those to whom those services were provided. There is again no evidence that it was drafted in Dubai and, of course, the persons for whom the contract was drafted were essentially himself and Mr Forbes, who was outside the jurisdiction, together trading as Sarcogent. Sarcogent was a DIFC entity. The purpose of the prohibition was certainly not to protect a layman, in UAE terms, from drafting an agreement for himself, nor by extension, his company, under which that company undertook to provide legal support services. Selfevidently, as with the Munro Loan Agreement, the drafting of the contract necessarily preceded the conclusion of the contract on the terms of the Letter of Engagement and could not therefore render it void. Moreover, as already stated, the contract itself did not require the provision of legal services and it could not be rendered void by any individual act which was banned by the 1991 Law and the Resolution.

100. The other examples of forwarding a legal opinion from specialist corporate lawyers in the UK confirming advice he had previously given and a reference in an email of 25 September 2016 to his understanding that sponsorship type agreements were frowned on by the authorities as circumventing UAE legal requirements do not constitute the giving of legal advice on UAE law nor the provision of legal services in themselves.

101. I therefore conclude that whether regard is had to the substance of the services provided or their form (and it is substance that matters) Mr Smylie and Sarcogent cannot be said to have been providing prohibited legal services, let alone services which were capable of rendering the Letter of Engagement void. The result is that the prohibition on provision of legal services by an unlicensed practitioner is of no effect in the circumstances of this case and that the Letter of Engagement is not void, whether as a result of required activity by an unlicensed person thereunder nor as the result of the conduct of legal services which were not required by the contact but were carried out under its banner. Nor, as is accepted, if legal services are not the subject of the Letter of Engagement, is the contract unenforceable by reason of the agreement to a success fee. Nor, as is again accepted, if legal services are not the subject of the Letter of Engagement is the claim made by Mr Forbes as assignee of the rights thereunder time barred.

What costs fall to be deducted in calculating the Success Fee?

102. In an exhibit referred to as RTP 1, Mr Kidd put forward a calculation of the amount which would be due to Sarcogent, amounting to GBP 83,000 on the basis of a 20% success fee. This contained a series of undocumented and unvouched deductions for professional fees and associated costs from the GBP 20 million recovered in the BP litigation. It failed to take account of some matters which plainly ought to have been included in the exhibit and put forward a number of other items which could not properly be regarded as falling within the terms of the provisions of paragraph 4 of the Letter of Engagement. The evidential burden of establishing that deductions were appropriate fell on Mr Kidd. It is necessary to descend into some detail in relation to the figures in this document which was inaccurate and misleading, despite Mr Kidd’s refusal to accept those adjectives as apposite.

103. If reference is made to paragraph 4 of the Letter of Engagement, it will be seen that the success fee is to be calculated as a sum equivalent to “20% of the net sums recovered under any such claims”.

104. The success fee was to be payable under paragraph 4 “in the event that the Claims are successful, in whole or in part,” so that it is plain that only costs incurred in the pursuit of a successful claim, whether successful in whole or in part, and not recovered under a Court order, can fall within the ambit of the provision which provides for deduction from the success fee.

105. Counsel for Mr Forbes, as part of the closing submissions, produced a Schedule of 17 pages by reference to RTP 1 setting out Mr Forbes’ contentions as to the sums which were properly to be deducted. Counsel for Mr Kidd did likewise in respect of the latter’s contentions. Included as an appendix to this judgement is a table which sets out my conclusions in relation to the various heads of expenses which were said to be deductible. There were three main heads, namely Professional Fees, Associated Expenses and Loans incurred to finance the litigation. Professional Fees consisted of three elements, namely: first, the fees of L&M, Counsel, Experts and related disbursements; secondly the fees of MMS; and thirdly “Other Professional Fees”.

Fees of L&M, Counsel, Experts and related disbursements

106. It might have been thought that this would be a straightforward item but this was not so. The issue largely centered on distinguishing between fees incurred on the claims which were successful and other matters. There was also a significant issue about the fees recovered from L&M and Mr Brown following the Court’s determination that their success fees were unlawful.

107. The first issue was one of principle, namely whether fees incurred in a Section 1 Petition which sought disclosure of third party document by means of a dawn raid for the purpose of bringing proceedings, qualified as a deduction under the Letter of Engagement. As appears from the documents, a number of potential claims were envisaged at around the time that the application was made to the Court but the terms of the application itself were not available for me to see the extent to which the proposed proceedings for which disclosure was sought ranged beyond the Claims defined in the Letter of Engagement. It seemed to me inevitable that some of these costs were directly applicable to the pursuit of the claims against BP and some were not. The total figure, taking account of some element of duplication in those put forward in RTP 1 and the supporting schedules provided by Mr Kidd’s lawyers amounted to GBP 268,447.69. Doing the best that I can on the available evidence it seems to me that I should apportion that amount and allow GBP 150,000 as deductible costs, which may be generous to Mr Kidd as the burden of proof rests upon him. On the figures put forward on behalf of Mr Forbes, the total due in respect of this first head of fees is therefore GBP 5,831,431.84.

108. As part of that figure, however, a deduction of GBP 1.75 million had been made in respect of the recovery of the unlawful success fees charged by L&M and Mr Brown. A significant issue emerged during closing speeches in relation to the proper amount to be deducted in respect of the fees of L&M and Counsel in the light of the unlawfulness of that part of their fees which were found to be success fees. Lord Doherty, in his judgment identified the success fee of L&M as GBP 1.89 million, being 90% of the basic fee of GBP 2 .1 million and the success fee of Jonathan Brown as GBP 990,000, being 90% of his basic fee of GBP 1.1 million. The documents show that, as against the total of GBP 6,080,000 of fees charged by L&M, payment had been made of GBP 5.6 million, a shortfall of GBP 380,000. The total of the unlawful fees was GBP 2.88 million, which Mr Kidd was entitled to recover, subject to payment of the shortfall of GBP 380,000. He should therefore have recovered from his lawyers the sum of GBP 2.58 million. By a settlement agreement made between him, L&M and Jonathan Brown in respect of different pieces of work which included the BP litigation, all claims in each direction were discharged upon the payment by L&M of the sum of GBP 1.75 million. RTP 1 had failed to take into account any recovery at all, a completely unjustifiable stance taken by Mr Clarkson. The correct figure that should have been taken into account was GBP 2.58 million for the reasons given above.

109. In consequence, the total for the first element of the Professional Fees is the figure of GBP 5,831,431.84, less the sum of GBP 2.58 million (but adding back the figure of GBP 1.75 million which had already been taken into account). This gives rise to a total of GBP 5,001,431.84.

110. As a very late entrant into the proceedings, Mr Kidd put forward a round figure of GBP 250,000 as the cost of recovering fees from L&M and Mr Jonathan Brown, without any supporting evidence and I consequently reject it as a claimed deduction.

111. The second element of the Professional Fees consisted of those paid to MMS. No detailed bills were produced by Mr Kidd, relying instead on a list of files and invoices supplied by MMS. A figure was identified of GBP 794,000. The list of files and invoices made available to the Court showed however that only two figures, namely GBP 1,320 and GBP 6,600 related to the “Professional Negligence Claim against Paul & Williamsons/Burness Paull” whereas RTP 1 included a total relying on other filenames and invoices, including ITS on the basis, on Mr Clarkson’s evidence, that some of the work therein might be attributable to the BP litigation. I am not prepared to make any apportionment on such a basis because it would be expected that MMS would properly bill in relation to its own files. The deductible costs for MMS are therefore GBP 7,920.

112. The “Other Professional Fees”, said by Mr Clarkson to total GBP 144,000 were undocumented but Mr Forbes was prepared rightly to accept that payments to Meston Reid and Ian Birnie fell for deduction, amounting to GBP 60,412.82

113. In consequence, the correct figure for professional fees which can qualify for deduction from the sums recovered in calculating the success fee is GBP 5,069,764.66

Associated Expenses

114. The claimed Associated Expenses consisted of ASG Management costs, Travel and accommodation costs and the interest on the loan made by Alistair Munro of GBP 500,000. In relation to the management costs, Mr Clarkson produced a schedule relating to 2014 – 2017 which, without any rational basis, allocated a portion of the salaries of Mr Kidd, Lachy, Mr McLellan and Ms Adimou as lost opportunity costs with a further element of office costs. They were described as “internal costs of managers reporting to Bob Kidd, calculated over the period of the claim”. Also included is a “charge” of USD 10,000 per month for Bob Kidd representing the opportunity cost of working on this claim. These could not properly be considered as costs which fell within the requirements of the Letter of Engagement and without any sensible evidence of time spent, could not be established. I reject the claim for this figure in its entirety.

115. A claim was made for travel and accommodation costs of GBP 483,276 which was said to be calculated from information provided by a travel agent which could not be disclosed because of the confidential information contained in it. There was thus no supporting documentation or vouching of the expenses, detailing the flights or purpose lying behind them. Similarly, no invoices were produced in respect of accommodation costs because it was said that they could not be located. These claims must fail as unsupported by any real evidence.

116. A claim was made for interest of GBP 500,000 in respect of a loan advanced by Alistair Munro to Mr Kidd. The Loan Agreement dated 24 August 2016 had been drafted by Mr Smylie. It was a loan of GBP 500,000 which was unsecured and interest free for a period of six months, “beyond which time interest shall accrue at a rate to be agreed between the Parties, acting reasonably and taking account of prevailing Bank lending rates at the time.” The loan was to be repayable on the earlier of the completion date of a share purchase agreement relating to Mr Kidd’s Ghana power project and a date falling not later than seven days after the issue of the judgment in the Commercial Court action against BP, or such other date as might be agreed between the parties. Under clause 4 there was provision for a further payment: “In the event that the Commercial Court action leads to a successful outcome in favour of the Borrower, [the Parties agree that a further sum will fall due to the lender at that time in an amount to be agreed between the Parties, acting reasonably and taking account of the nature of the Court’s award.”

117. Mr Smylie described this as akin to an agreement to agree, for reasons which are obvious from the terms relating to repayment, interest and a further payment if the BP litigation should be successful. Whilst the terms of the loan did not require it to be used in any particular manner, it was in fact used to fund L&M fees. It was therefore, in my judgement an appropriate deduction and whilst a doubling of Mr Munro’s outlay in a period of a couple of years reveals a generosity on Mr Kidd’s part that is not illustrated elsewhere, I consider that the GBP 500,000 claimed as interest on the loan is a genuine deductible under the Letter of Engagement.

118. Under this second head of Associated Expenses therefore I allow GBP 500,000 only.

Loans incurred to finance the litigation

119. Three loans were relied on by Mr Kidd. The first is the Alistair Munro loan to which I have already referred. Interest on it has already been taken into account in the Associated Expenses but the loan itself was for GBP 500,000 which had to be repaid and this sum is deductible.

120. A loan of GBP 721,676.35 is advanced on the basis of a letter of 31 March 2025 signed by Lachy, addressed to his father-in-law, in which he confirms that A&E loaned, on a series of dates between 11 August 2015 and 31 January 2018 a total of GBP 721,676.35 “in connection with funding the legal case brought by you against Burness Paull and the loan was paid directly to Levy & McRae”. The letter states that there were no agreed terms for repayment and nothing had yet been repaid. No collateral was provided and no interest was payable on it. The letter said that there was no formal written agreement in connection with the loan.

121. This is a very surprising document in circumstances where it is common ground that at least until November 2016 A&E was L&M’s client. I cannot be satisfied of the existence of this loan without proper evidence of it and its usage. I therefore reject this as a deductible expense for the purposes of the Letter of Engagement.

122. The third loan is said to have been made by O&GM and gives rise to a figure of GBP 757,323.65 in RTP 1. This figure is derived from the total of GBP 1,979,000 in RTP 1, taking account of the two loans referred to above, of GBP 500,000 and GBP 721,676.35 The evidence in support of this appears at paragraph 28.3 of Mr Kidd’s third witness statement where he said that he could produce no other information than the figure of USD 1 million/GBP 757,576 and the date upon which the loan was advanced which was 12 October 2016. Whilst it was said in a response to a Request for Further Information that other information in relation to the loan would be addressed in the witness statement, it never was. There is again no satisfactory evidence of any such loan or expenditure incurred and it cannot therefore be taken into account.

123. In the light of these findings, the total available after deduction of the costs which qualify under the Letter of Agreement of GBP 6,069,764.66 is GBP 13,931,235.34. There remain to be taken into account fees already paid to Sarcogent. Mr Kidd sought to deduct payments made to Mr Forbes by A&E of GBP 267,000, payments made to Sarcogent from companies other than A&E (GBP 985,000) as well as an agreed figure of GBP 178,659 actually paid to Sarcogent. I can see no basis for deduction of sums paid to Mr Forbes under the Letter of Agreement which was clearly intended to supersede not only the earlier 15 August 2015 letter of agreement but also the oral agreements concluded earlier, whatever their exact terms. Mr Forbes was paid sums in relation to other work in any event. The sums which Mr Kidd wanted to take into account in this respect were sums paid by way of retainer and it would not be possible to apportion any part of that to the BP litigation as opposed to other matters in which Mr Forbes was involved on Mr Kidd’s behalf. The correct figure to include here therefore as a further deduction from the sum of GBP 13,931,235.34 is GBP 178,659, which results in a figure of GBP 13,752,576.34 to which the 20% success fee should apply. 124. The success fee is therefore GBP 2,750,315.27, to which it is agreed that interest should be added at 9% for a total of 2,728 days from 16 February 2018, the date of the invoice, to the date of this judgment. This equates to 7.47 years and amounts to GBP 1,849,036.95. The total claim as at the date of judgment is therefore GBP 2,750,315.27 + GBP 1,849,036.95 = GBP 4,599,352.22. The figures are set out in Appendix 1 to this Judgment.

124. The success fee is therefore GBP 2,750,315.27, to which it is agreed that interest should be added at 9% for a total of 2,728 days from 16 February 2018, the date of the invoice, to the date of this judgment. This equates to 7.47 years and amounts to GBP 1,849,036.95. The total claim as at the date of judgment is therefore GBP 2,750,315.27 + GBP 1,849,036.95 = GBP 4,599,352.22. The figures are set out in Appendix 1 to this Judgment.

Conclusion

125. Judgment is therefore to be given for the Claimant, Mr Forbes against the Defendant, Mr Kidd, in the sum of GBP 4,599,352.22

126. Interest will run on the judgment sum at the judgment rate of 9% per annum until payment.

127. It was agreed that costs should follow the event and Mr Kidd must therefore also pay Mr Forbes’ costs of this action on the standard basis to be the subject of assessment if not agreed.

Appendix 1

Conclusions on the elements of RTP1