As set out in paragraph 30 of AC’s evidence, AC personally guaranteed each of the three debts which totalled £1,004,165.69. It was important to AC that the three debts be settled once I had sold AC’s interest in QPRH through Barnaby. AC told Steele, after he had sent me the first draft of Mishcons’ contracts, that the purchasers would have to settle the three debts on behalf of QPRH to ensure that there were no balance obligations on ACa. This was, therefore, one of the conditions for accepting the Bruno Michel Offer.

Steele led AC to believe that this had subsequently been agreed with the buyers and Steele never said otherwise. In fact, as AC explained to Steele in its email sent at 15:38 on 6 November 2007 (see page 84 of AC 1), B M had agreed that the purchasers would pay the team’s debts of up to £5,000,000, which was to include the three debts. As he specified in his email, the debts paid by the purchasers following completion did not exceed £4,000,000 and therefore there was no reasonable explanation as to why the three debts had not been paid to AC, except that Mishcons had failed to get this agreement included in the contracts.

On 20 August 2007, in connection with debt 1, DR sent a demand letter to QPRH requesting the immediate repayment of £264,870 owed to it (see pages 85 of AC 1). I asked Z whether it would lend the money to AC to repay part of DR’s debt. On the basis that AC subsequently repaid Z when it received the funds from QPRH/the purchasers, Z paid £100,078.68 directly to DR on 18 October 2007 (see page 86 of AC 1). AC, therefore, still remained indebted to Zi in respect of these paid funds and was very patient in waiting for the conclusion of these proceedings to claim payment of this debt. AC made another payment to D R through its Barclays bank account on 4 March 2008 (see pages 87-89 of AC 1).

On 20 August 2007, Credit Suisse sent a fax to QPRH regarding debt 2 (see page 90 of AC 1).
AC recalls that it had mentioned the three debts to Steele on several occasions and he assured him that they were being taken care of. As can be seen from my email to Steele at 3:41 p.m. on 20 November 2007 (see pages 91 & 92 of AC 1), following De Riu’s demand letter of 20 August 2007 (referred to above), AC sent a list of the payments to be made by the purchaser by 31 August 2007 (i.e. the three debts), which was a condition of the Transaction. A copy of the list which was attached to this e-mail is on page 93 of AC 1. When the debts had still not been paid in November 2007 AC reminded Steele and asked for clarification.
AC saw a handwritten document in the defendants’ statement (see page 94 of AC 1) which it can assume was written by Steele during the meeting of 28 August 2007. This document refers to each of the three debts (see paragraph 30 above) and to the offer and agreement with Sarita:

‘AGM 5/11 SARITA OFFER 1p ? 264 870 ? 198 161 Mark ? 541 134 28/8/07 ’
Accordingly, Steele clearly knew (as the handwritten testimony shows) about the three debts and the clear instructions that AC/Barnaby had given and that AC was only willing to accept the offer for the shares if the debts were settled. If Steele decided not to inform the purchasers of this condition, then this was contrary to AC’s instructions. Alternatively, if Steele did indeed tell the purchasers that the three debts were a condition of me/ Barnaby’s agreeing to the sale of the shares, and the purchasers refused to pay the debts or change their offer, AC was certainly not informed.
A complaint has been lodged with Scotland Yard about the matter.