10 February 2015 #Dispute Resolution
You cannot have escaped the recent judgment regarding Gordon Ramsay. For those who haven’t heard of him he is a celebrity restaurateur and the star of several TV food programmes including Hell’s Kitchen. Splashed all over the news was his recent battle in the High Court regarding the question of his personal liability for the £640,000 annual rent for the York & Albany pub near Regent’s Park, which it was claimed he had guaranteed. The pub deal took place when his father-in-law, Christopher Hutcheson, was in charge of his business affairs, a relationship which very publicly came to an end in 2010 when Mr Hutcheson was sacked, along with Mr Ramsay’s brother in law, for gross misconduct. Indeed, during the trial Mr Ramsay’s wife, and daughter of Mr Hutcheson, said that the discovery that her father and brother were “systematically defrauding” her husband was “extremely distressing”, and Mr Ramsay referred to himself as a “performing monkey” under the control of Mr Hutcheson.
So what was Mr Ramsay’s defence to the personal guarantee?
Mr Ramsay claimed that his father-in-law had used, without his authority, a ghost-writer machine to create his signature on the guarantee and, as such, the guarantee was not binding on him. Ghost-writer machines are often used by celebrities to sign or autograph books and memorabilia mechanically. The judge, however, in a scathing judgment, refused to accept Mr Ramsay’s evidence in court commenting that Mr Ramsay’s version of events was “entirely implausible”. He ruled that Mr Ramsay would have known very well the full extent of the use of the ghost-writer machine on his behalf: “...long before the entry into the agreement for lease and the lease of the [York & Albany] premises, that the machine was routinely used to place his signature on legal documents.” It was therefore decided that Mr Ramsay’s father-in-law was acting within his authority and that the personal guarantee was binding, leaving Mr Ramsey liable for the unpaid rent. Not only is Mr Ramsey facing liability for the rent, but the judgment leaves him facing his opponent’s heavy legal costs, which are understood to be in the region of £600,000. Added to Mr Ramsay’s own legal costs bill, it is likely that Mr Ramsay will have to make a total payout of over £1m for costs alone. The judge refused Ramsay permission to appeal against his decision, although Mr Ramsay can still ask the court of appeal for permission.