It is an established principle of contract law that a claimant who is deprived of the loss of a chance as a result of a defendant’s breach of contract, will be entitled to damages. The burden of proof is on the claimant to prove on the balance of probabilities (being more likely than not) by showing what he would have done, that he was deprived of a chance as a result of the breach.
However, what is the position when the loss of the chance is dependent not on what the claimant would have done, but on the hypothetical acts of a third party?
The Court of Appeal has recently held, in McGill – v – The Sports & Entertainment Media Group & 8 Ors  ECWA Civ 1063, that a football agent could recover damages for the loss of a chance from a rival agent and football club, for inducing a player to breach an oral agency contract.
The brief facts of the case are that in 2007 Anthony McGill, a football agent, entered into an oral agreement with Gavin McCann, a former professional footballer at that time with Aston Villa F.C, to act exclusively as his agent for the negotiation of an improved contract with Aston Villa or to secure a contract with Bolton Wanderers F.C before the end of August 2007. However, before a deal was signed and with McCann nearing completion of a transfer to Bolton, a rival agent, S.E.M, took over McCann’s representation and finalised his move to Bolton, earning £300,000 commission.
McGill issued proceedings against SEM and Bolton. He alleged that both parties induced McCann to breach his contract with McGill and completed the transfer themselves on substantially the same terms as those negotiated by McGill, thereby depriving McGill of the commission due to him under his oral contract with McCann. It is of note that McGill had previously brought a claim against McCann in breach of contract, which had settled in 2009, some three years before the present claim was issued.
It is also relevant to note that FA Rules at the time required agent contracts to be in writing, so McGill would have been unable to obtain payment of any fee due to him, unless he had entered into a written agreement with McCann before the transfer had been finalised.
The High Court found that Bolton and SEM had induced McCann to breach his contract with McGill, but as McGill had not proved on the balance of probabilities that McCann would have entered into a written agreement with him, he could not recover the commission claimed.
McGill successfully appealed to the Court of Appeal, who disagreed with the High Court’s approach. They held that McGill’s loss should be assessed on the less restrictive loss of chance basis, as his entitlement to payment was dependent upon the hypothetical actions of McCann, namely that he would have entered into an FA compliant written agency agreement with McGill when the transfer was concluded. The Court accepted that McGill had shown a real or substantial chance (although not necessarily more likely than not) that McCann would enter into a written contract with him and so he was not barred by the High Court’s ‘balance of probabilities’ finding. He was entitled to recover a percentage of his claim, based on the chance in percentage terms that McCann would have signed a written contract with him.
The case serves as a useful example of the Court’s willingness to allow claims for the loss of a chance, where that chance is based, not on the actions of a claimant, but on the hypothetical actions of a third party, in this case, Gavin McCann. Where the Court is satisfied that there is a real and substantial chance (as opposed to a speculative one), the Court will award damages based on the percentage chance.
The case also underlines the importance of ensuring that commercial agreements are made in writing, with no room for ambiguity.
Further, the fact the previous settlement with McCann did not prevent McGill from pursuing other defendants is important. Any settlement agreements should be carefully worded to ensure they do not prevent a party from pursuing other potential defendants and provide that claims against such other defendants are preserved.
This article is not intended and should not be relied upon for legal advice. Should you wish to discuss your matter, please contact Joe Reeves of our Litigation Department on 0207 563 5480 or Contact: firstname.lastname@example.org