An international distributor of racing cars instructed our Dispute Resolution Team to pursue a claim in the High Court in London, concerning its distribution agreement with the UK manufacturer.
Our client was appointed to act as the exclusive distributor of the defendant’s racing cars in China and other territories, for a fixed term of two years. Early in the second year of the agreement, the manufacturer appointed another company as its distributor in China and purported to terminate its agreement with our client. Our client initially instructed a London firm, who advised them to make an application for an interim injunction to prevent the purported termination of the distribution agreement pending trial.
As a result of the response put forward by the manufacturer’s solicitors (a US firm), the injunction application was withdrawn. An adverse costs order was made against our client, but its claim proceeded. In its defence, the manufacturer argued that it was entitled to terminate the agreement and to appoint an alternative distributor, because our client had failed to comply with its obligations under the agreement. The client’s claim for damages was for just over £1.69m. We were instructed to take over conduct of the case at this stage, in place of the client’s former London lawyers.
In view of the issues surrounding the withdrawal of the injunction application, an expedited trial timetable was agreed, meaning that all of the usual stages in the litigation process needed to be completed in less than four months.
Working closely with an expert on Chinese trade law and with Counsel, we were able to build a strong and credible response to the manufacturer’s allegations. This ultimately put the client into a strong negotiating position in respect of its claim for damages, the costs of the injunction application hearing and the costs of the action generally.
We presented clear legal arguments, backed up with consistent witness and expert evidence. Following an exchange of which, and with just days before significant costs were incurred in attendance at trial, the parties entered into settlement discussions. We were able to negotiate a substantial but confidential settlement for the client.