The case in Pirrwitz v AI Airports International Limited and PI Power International Limited was an excellent result for Voisin law firm. After a lengthy hearing before the Royal Court, in which witnesses from the US, Germany, Switzerland and Jersey were heard alongside legal experts from Italy, the Deputy Bailiff’s judgment, which ran to some fifty-seven pages, had no hesitation in concluding that AI and PI, as Jersey companies, did have the authority under their articles to remunerate Mr Pirrwitz as they had, that they had acted in their best interests in so doing, and that he was entitled to the remuneration he sought, i.e. remuneration payable upon removal as a director by shareholder vote. The judgment also emphatically dismissed the funds’ counterclaim against Mr Pirrwitz for breach of fiduciary duty concerning his role on the board of the company that owned and managed Parma airport.

The trial at first instance produced a hard-fought victory for Mr Pirrwitz in the long and convoluted process of extracting his entitlement to director’s remuneration from two funds. The funds, both of whom had received great press in the financial gazettes of Europe and beyond during the events forming the backdrop for Mr Pirrwitz’s directorship, had announced publicly on their websites on 24th January 2013 their disappointment with the decision at first instance: however misguided this disappointment, the funds proceeded to appeal the decision of the Deputy Bailiff and two Jurats.

Having been unsuccessful in their application for a stay of execution of the first instance judgment before a single judge of the Court of Appeal, the funds’ appeal was heard before Michael Beloff QC, Christopher Nugee QC and Robert Logan Martin QC. In essence, the funds appealed the Royal Court’s decision on the following grounds:

1. That it had erred as a matter of law in finding that the funds’ articles permitted them to execute director service contracts including remuneration of the kind pursued by Mr Pirrwitz;
2. That it had erred as a matter of fact in finding that the boards of the funds had indeed authorised the execution of director service contracts containing such remuneration;
3. That it had erred in finding that the boards of the funds were acting in the funds’ best interests in executing the director service contracts;
4. That it had erred in finding that the funds’ Chairman had acted in their best interests in signing the director service agreements on the funds’ behalf.

The second of the grounds above is of particular note, as it called into question the learned Jurats’ findings of fact and their assessment of the evidence. Such appeals are rarely brought and still less rarely are they successful, as they require the higher court to depart from a decision of the lower without having had the opportunity to witness the live examination of those at the crux of the matters in hand, the witnesses and the experts.

Following a day and a half’s hearing before the Court of Appeal Christopher Nugee QC delivered a lengthy judgment, which unanimously rejected all grounds of the appeal as emphatically as the Royal Court had upheld all Mr Pirrwitz’s claims at first instance. 

The funds, the Court of Appeal decided, had authority to remunerate Mr Pirrwitz as they had, that they did so as a matter of fact and, through legitimate and proper delegation through their chairman, that they did so for a proper purpose. It was most direct in its dismissal of the ground on which it had heard by far the lengthiest submissions in deciding that the Royal Court had made the correct decision on the facts of the case, having weighed the funds’ witnesses of fact and found them distinctly wanting. The judgment reiterated the orthodoxy that, unless the higher court is convinced that the lower court’s factual findings are wrong, it must let them stand, as it had no hesitation in doing here.

The judgment of Christopher Nugee QC affirmed the entitlement of a hard-working director to the fruits of his labour under contract with the funds that had enjoyed that labour: a case commenced as a simple summons for a debt had the Court of Appeal as its final arbiters. This appeal success was managed by the same Voisin team who represented Mr Pirrwitz at first instance, Advocate Mike Preston and Dexter Flynn, who can be contacted concerning the case or about instructing Voisin on litigation matters.