Opinion Evidence in Respect of Estimating and Planning, Resources and Quantum, Except for Function Point Analysis Which Was the Responsibility of Neil Douglas
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Neutral Citation Number: [2010] EWHC 86 (TCC) Case No: HT-06-311 IN THE HIGH COURT OF JUSTICE QUEEN'S BENCH DIVISION TECHNOLOGY AND CONSTRUCTION COURT Royal Courts of Justice Strand, London, WC2A 2LL Date: 26/01/2010 Before : THE HON. MR. JUSTICE RAMSEY - - - - - - - - - - - - - - - - - - - - - Between : (1)BSkyB Limited Claimants (2)Sky Subscribers Services Limited - and - (1)HP Enterprise Services UK Limited Defendants (formerly Electronic Data Systems Limited) (2)Electronic Data systems LLC (Formerly Electronic Data Systems Corporation - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Mr Mark Howard QC, Mr Alex Charlton QC, Mr Alec Hayden, Mr Fionn Pilbrow and Mr Mathew Lavy (instructed by Herbert Smith LLP ) for the Mr Mark Barnes QC, Mr Alan Gourgey QC, Ms Zoe O’Sullivan and Mr Stephen Tudway (instructed by DLA Piper ) for the Hearing dates: - - - - - - - - - - - - - - - - - - - - - Approved Judgment I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic. ............................. THE HON. MR. JUSTICE RAMSEY Index A: GENERAL BACKGROUND AND INTRODUCTION........................................... 9 INTRODUCTION............................................................................................................... 9 SKY CUSTOMER RELATIONSHIP MANAGEMENT......................................................... 10 BRIEF CHRONOLOGY ................................................................................................... 11 THE PARTIES ................................................................................................................ 14 EDS’ CONSORTIUM PARTNERS.................................................................................... 15 ARTHUR ANDERSEN ..................................................................................................... 15 B: THE MAIN DOCUMENTS...................................................................................... 17 THE ITT........................................................................................................................ 17 THE EDS RESPONSE..................................................................................................... 19 THE LETTER OF INTENT............................................................................................... 24 THE PRIME CONTRACT ................................................................................................ 24 THE DEED OF GUARANTEE .......................................................................................... 30 THE LETTER OF AGREEMENT...................................................................................... 31 THE MEMORANDUM OF UNDERSTANDING .................................................................. 32 C: THE EVIDENCE....................................................................................................... 35 SKY’S WITNESSES OF FACT .......................................................................................... 35 Witnesses called....................................................................................................... 35 Sky witnesses not called.......................................................................................... 39 EDS’ WITNESSES OF FACT ........................................................................................... 40 Witnesses called....................................................................................................... 40 EDS witnesses not called ........................................................................................ 44 CREDIBILITY OF WITNESSES........................................................................................ 45 Joe Galloway............................................................................................................ 45 Gerard Whelan........................................................................................................ 62 John Chan................................................................................................................ 62 Tony Dean................................................................................................................ 62 Steve Leonard.......................................................................................................... 63 Scott Mackay ........................................................................................................... 63 Andy Waddell.......................................................................................................... 63 EXPERT EVIDENCE ....................................................................................................... 63 IT Expert Evidence................................................................................................. 63 Customer churn expert evidence........................................................................... 66 Call avoidance expert evidence.............................................................................. 68 Quantum expert evidence....................................................................................... 69 D: THE LAW OF DECEIT AND NEGLIGENT MISREPRESENTATION........... 71 THE LAW ON DECEIT ................................................................................................... 71 THE LAW OF NEGLIGENT MISSTATEMENT OR MISREPRESENTATION ......................... 76 E: ISSUES OF CONSTRUCTION OF DOCUMENTS.............................................. 87 INTRODUCTION............................................................................................................. 87 THE ENTIRE AGREEMENT CLAUSE .............................................................................. 87 2 EDS’ submission...................................................................................................... 87 Sky’s submission ..................................................................................................... 88 Analysis .................................................................................................................... 89 CLAUSE 7.2 OF THE PRIME CONTRACT ....................................................................... 95 LIMITATION AND EXCLUSION OF LIABILITY: CLAUSE 20 OF THE PRIME CONTRACT 96 Clause 20.2............................................................................................................... 97 Clause 20.5............................................................................................................... 98 SCOPE OF SETTLEMENT IN THE LETTER OF AGREEMENT .......................................... 99 Introduction............................................................................................................. 99 EDS’ submissions.................................................................................................... 99 Sky’s submissions.................................................................................................. 100 Analysis .................................................................................................................. 100 THE MEMORANDUM OF UNDERSTANDING ................................................................ 103 Introduction........................................................................................................... 103 Did the Memorandum of Understanding constitute a binding agreement?.... 104 Background to the Memorandum of Understanding ........................................ 106 The 6 March 2002 phone call............................................................................... 109 The signing of the Memorandum of Understanding on 26 March 2002.......... 110 Subsequent conduct .............................................................................................. 112 F:CLAIMS FOR NEGLIGENT MISSTATEMENT OR MISREPRESENTATION ......................................................................................................................................... 116 INTRODUCTION........................................................................................................... 116 EDS’ SUBMISSIONS ..................................................................................................... 116 SKY’S SUBMISSIONS .................................................................................................... 117 ANALYSIS .................................................................................................................... 119 The Contractual framework ................................................................................ 120 CLAIMS UNDER THE MISREPRESENTATION ACT 1967.............................................. 123 G:THE CASE ON MISREPRESENTATIONS ......................................................... 125 Introduction........................................................................................................... 125 INITIAL REPRESENTATIONS ....................................................................................... 125 Resources, time and cost....................................................................................... 125 RESOURCES................................................................................................................. 127 The Greater Resources Representation.............................................................. 130 The Lesser Resources