Before:

	Kenneth MacLean instructed by (Maxwell Batley) for the Claimant Michael Swainston and Margaret Gray (instructed by Barlow Lyde & Gilbert) for the First and Second Defendants David Garland (instructed by Kennedys) for the Third Defendant Tom Beazley (instructed by Fishburn Morgan Cole) for the Fourth Defendant
	Jacob J
1.	In late 1991, a company called Airbreak Leisure Group was in the travel business, arranging and selling holiday packages. Its shares had been admitted to the Unlisted Securities Market of the Stock Exchange in about August 1991. But even so, at the time of the material events, its 5 directors between them owned most of the shares - 72.41%.
2.	The directors of Airbreak, led by its Chairman Mr David Lewis assisted by its Finance Director, Mr Martin Linton, set about the acquisition by Airbreak of a company called Sunsail International Ltd. Sunsail was in the business of providing sailing connected holidays of various sorts - sailing in groups of yachts ("flotillas"), single yacht charter, sailing clubs abroad, a sailing school in the UK and some corporate short term sailing facilities in the UK. An important part of the trade was the flotilla holiday business, particularly in the waters of Greece and Turkey. For these Sunsail had to provide a substantial number of yachts. A point turns on its title to the Greek registered yachts. It also had to work with local operators and another point turns on its ability to obtain payment from its Turkish partner, called Renko J.
3.	In due course Airbreak acquired Sunsail. The acquisition was not by the payment of money for the Sunsail shares. The consideration given to the vendors took the form of newly issued shares in Airbreak and loan stock (1.55m in amount) in Airbreak. At the same time, Airbreak raised about £3m by way of a rights issue to existing shareholders. The directors themselves undertook not to exercise their rights; the shares concerned being placed by the advising merchant bankers, Williams de Broe Plc ("WdB"), with clients of theirs. The transaction required the issuing of new shares in Airbreak - some to go to the vendors and some to go to those who took up the rights offer or placing.
4.	By the rules of the USM, a Circular to shareholders was needed. Moreover, ss.80 and 95 of the Companies Act 1986 required the consent of the company to what was proposed. So, the directors, through Mr Lewis, took advice in relation to the preparation of the Circular and the necessary general meeting. The 1st defendants, Eversheds, were appointed solicitors. The relevant individual partner was Dr Scheps, the 2nd defendant. WdB were the merchant bankers and are the 3rd defendants. The reporting accountants were Hacker Young ("HY") and are the 4th defendants. The remaining defendants are the 5 directors. A compromise has been reached with one of these, though whether he realises that he could still be involved by way of a claim for contribution I know not. The position of another, Mr Perry, is puzzling to say the least. I was told that there has been no compromise with him, yet he has been willing to provide a detailed witness statement in aid of the claimant. Actually his statement helps them very little, for what it says in essence is that he personally left all the details of the acquisition and Circular to Mr Lewis and Mr Linton. He says that if he had known the matters said to be material he would not have voted for the acquisition.
5.	Turning back to the events, the Circular was issued on 23rd December 1991 accompanied by a notice requisitioning an extraordinary general meeting of the company on 15th January 1992. Airbreak simultaneously agreed to purchase Sunsail, the agreement being held in escrow pending the result of the EGM. At the meeting the acquisition of Sunsail, the increase of the share capital and the rights issue and placing were approved. This is hardly surprising. By the time of the issue of the Circular, the directors had already undertaken to Sunsail to vote for the resolutions. These committed votes alone were enough to meet the USM requirements and virtually enough for a special resolution under Section 95 of the Companies Act 1985Acts. With the votes of Dr Scheps (who himself held 3.86% of the Airbreak shares) more than enough votes were indeed as a practical matter pre-empted for a special resolution.
6.	So Sunsail was acquired in early 1992. As a result, Airbreak now had another subsidiary, Sunsail, some £3m and a liability to the former shareholders of Sunsail of £1.55m because of the loan stock which had been issued. And of course, there were more shareholders in Airbreak itself. Some of these may have relied upon the information in the Circular either to take up their entitlement or to buy the shares pursuant to the placing.
7.	All did not go well thereafter. Airbreak went into administration on Saturday 26 h September 1992 pursuant to an order of Mummery J. However, the affidavit of Mr Lewis made the next day describes Sunsail as profitable and said that its Association of British Travel Agents ("ABTA") bonding and Air Travel Organisers Licence ("ATOL") bonding were still in place. The trouble was not with Sunsail but with four other interdependent subsidiaries of Airbreak who had become insolvent. They had lost their ATOL bonds and their licences to operate had been withdrawn by the Civil Aviation Authority. Mr Lewis explained that the Group (excluding Sunsail) had made a loss of about £7m in the year to the end of August 1992. Sunsail itself was said to have generated a significant profit. There is undisputed evidence that this profit was of the order of £2m.
8.	The purpose of putting Airbreak into administration was to enable it to sell Sunsail. So it happened. The sale was to its former owners at something of a "fire-sale" price, namely £1.5m. This was made up of the sum of £100K plus a taking over of the balance of the unpaid loan stock. The claimant's expert accountant assesses the value of the Airbreak shares used to "pay for" Sunsail at nearly £5m. Taking these and other figures into account the expert assesses the loss incurred because of the Sunsail acquisition as £4.5m. As it happens, Sunsail itself subsequently went well, continuing to make profits. Last year it was sold for about £40m.
9.	It was not until 17th December 1997 that the administrator of Airbreak commenced these proceedings against the professional defendants (1-4) and the director defendants (5-9). Plainly, outsiders were funding the administrators. That position is now a little, but not much, more in the open: in 1998 the administrators assigned Airbreak's cause of action to the present claimant, The Guild (Claims) Ltd. It is a company formed for sole purpose of pursuing this claim. Its only asset is this cause of action. For reasons best known to themselves the investors in the claimant have taken steps such that their identity cannot be ascertained. Personally, I find speculative investment in litigation against parties with deep pockets unattractive. However, no one (subject to the question of security for costs) challenges the right of the claimant to pursue this claim. The law of champerty is not what it was. The claimant stands completely in the shoes of Airbreak and I must and do decide it on that basis.
10.	It is only on that basis that the claim is advanced. The claimant does not stand in the shoes of the shareholders to whom the Circular was addressed. There is no claim by any such shareholder, either directly against any of these defendants or against Airbreak. If there had been the latter sort of claim then Airbreak in turn might have had a claim against its advisors or directors for contribution by way of reimbursement of any damages it had to pay shareholders as a result of issuing a misleading Circular (if such it was). But there is no such claim.
11.	The above is the broad factual background against which each of the professional defendants seeks to have the claim struck out as against them. Their first application for a strike out was made before me on 17th-18th May 1999. It was clear that the case being advanced was not wholly within the pleading as it then stood. I had considerable reservations about the case at the time. But I could not be sure that at bottom it was not viable. I adjourned the matter so that the claimant could re-plead. In particular, it was necessary to plead in precise detail the duties of each professional, what the alleged breaches were and how those breaches were causative of loss. I also required (by my orders then and subsequently) that the claimant should file the witness statements and expert reports upon which they intended to rely at trial without the defendants having to file any evidence. I also ensured that the claimant had disclosure. My purpose was to be sure that the claimant had a viable case before putting the defendants to significant expenditure.
12.	It has taken nearly a year for the claimant to put its statement of claim into the final form which it wishes to advance and to get witness statements from its proposed factual and expert witnesses. The professional defendants say that notwithstanding all this, no viable case is shown and the case should be struck out. Formally the new pleading has not been allowed; but all were agreed that I should treat the case as one in which the defendants were applying to strike it out.
13.	The rules governing a strike out are CPR Part 3 Rule 3.4(2) ("no reasonable grounds for bringing a claim"), Part 3 Rule 3.4(5) (preserving the inherent jurisdiction and Part 24 Rule 24.2 ("claimant has no real prospect of succeeding on the claim"). It was common ground that 1 should apply the "no real prospect" test. Each side cited authorities on what this means, but in the end, they simply point to the words of the rules. It is fair to say that the authorities warn against a "mini-trial" where the court seeks to resolve important disputed facts. That, however, is not the exercise upon which the defendants invited me to embark. There are no disputed facts, and there is no prospect of something turning up on disclosure. If what has been provided by now shows no real prospect of success, the case should be struck out. I turn to the attacks on the case advanced.
14.	It is said that each of the professionals were in breach of their respective duties to Airbreak and that those breaches of duty were causative of damage to Airbreak. In the case of each professional, a host of breaches of duty are alleged by way of failure to advise as to what should be in the Circular ("omitted matters"). But in no case is it said that there was a failure to provide vital information about the target company or the acquisition generally to the directors of Airbreak itself. On the contrary, it is positively alleged that the directors themselves knew all the material facts, which, it is said, should have been recited in the Circular. That is the basis of the claim against them. Thus is this far from the ordinary sort of case of alleged professional negligence, namely one where it is alleged that negligent advice was given and relied upon by the client who acted on that advice. Here the directors knew the material facts about Sunsail.
15.	I say the directors knew. Actually, they did not all know all of the facts. It was Mr Lewis and Mr Linton who were directly dealing with the professionals. They knew everything, which it is claimed the professionals should have advised, should be in the Circular. Other directors were, more or less, prepared to leave it to them. After all, they were the Chairman and Finance directors. What is clear is that the professionals in the course of their investigations of Sunsail were reporting to all the directors of Airbreak. If some of the directors chose to stand by and let those directors with most financial and other relevant knowledge deal with the matter I do not see how that can be visited on the professionals. Nor, to be fair, is it pleaded that there was any specific duty upon each professional to ensure that each director was made fully aware of every matter alleged to be so material that it should have been in the Circular. Incidentally, it should not be assumed that only some of the directors were aware of some of the points concerned. For instance in relation to the title to Greek yachts point, it is clear that all the directors knew about it.
16.	The strike-out attacks are comprehensive. Attacks are made on each of the three matters which must be proved, namely duty, breach of duty and causation of damage. It is convenient however to commence with just one item, Sunsail's title to Greek yachts, a point of major importance to the claimant's case. During the course of the due diligence, HY raised this question by a letter of 6th December 1991 to Dr Scheps. Plainly, title to Greek flagged yachts was not a matter on which ordinary English solicitors could themselves advise. So, a specialist firm called Constant and Constant were asked to produce a report on the position. This they did, both in writing and via an oral report of a Mr Tassos Michael to the entire Board of Airbreak. The report indicated that there were potential problems with title. Nominally, the yachts were in the name of a Greek national (owing to requirements of Greek law). It was not clear that title could be firmly established: the report is couched in dramatic terms, using the words "grave risk" and referring to a possibility of confiscation by the Greek Government. All this the directors knew. But they decided, via Mr Lewis, that the problem was in fact illusory. Following Mr Michael's presentation to the Board Mr Lewis wrote to WdB on 21st December setting out his detailed views on the "problem". I do not recite the longish letter. It is sufficient to say that it is clear that detailed consideration was given to the point.
17.	In the result, the Circular did not mention the title "problem". The Circular was accompanied by a short form report from HY. This did not mention it either. A later, long-form report did - what it said was:
	"The Greek maritime and fiscal regulations require that yachts operated in Greek waters have majority ownership by Greek nationals. It has been, therefore necessary for the Group to have Greek nominees owning the majority of the shares in the Greek companies operating the yachts. Sunsail, however has full beneficial ownership of those companies.    It is possible that the Greek authorities if they become aware of the beneficial ownership of the yachts could confiscate the yachts without compensation. There is little the Group can do about this, but as Sunsail have been operating in this way in Greece for many years and it would appear that this method of operating is customary in Greece the drastic consequences outlined above may well be somewhat remote."
	It seems clear that all of that was true. There is no suggestion that the "problem" at any time, before the acquisition, during Airbreak's ownership or thereafter, ever became real. Nonetheless, it is alleged that it was the duty of each of the professionals to advise that the question was referred to in the Circular and that their breach of that duty led to damage.
18.	First, then, was it a breach of duty not to advise that the "problem" should be referred to in the Circular? The pleading of Evershed's duties runs as follows:
	"13   At all material times Eversheds, through Mr Scheps, were aware:    (1)   that Airbreak had a quotation on the USM and that the proposed acquisition and related rights issue and placing would involve Airbreak in issuing a circular to shareholders. (2)   that the circular had to comply with the then requirements of the USM and in particular paragraph Cl7 of the Green Book (which applies to companies whose shares are already traded on the USM) which required:       "a statement as to the financial and trading prospects of the company or group, together with any material information which may be relevant thereto, including all special trade factors or risks (if any) which are not mentioned elsewhere in the document and which are unlikely to be known or anticipated by the general public, and which could materially affect the profits". 14.   In the premises, it was an express, alternatively implied, term of Eversheds' retainer from Airbreak that Eversheds would:    (1)   exercise reasonable skill and care in and about the performance of their services pursuant to their retainer; (2)   exercise reasonable skill and care in identifying and drawing to the attention of the directors and/or Airbreak those facts and matters which were material to the financial and trading prospects of Sunsail and the enlarged group, including all special factors and risks which could materially affect the profits and viability of Sunsail and the enlarged group ("the Material Facts"); (3)   take reasonable steps to ensure that the directors and each of them appreciated the materiality and/or implications of the Material Facts insofar as their materiality and/or implications might not be obvious to individuals with the respective experience of the directors and each of them and/or insofar as the directors did not appear to appreciate the same; (4)   exercise reasonable skill and care in advising the directors that the Material Facts had to be brought to the attention of Airbreak's shareholders by disclosure to the circular; (5)   if on notice that the directors were proposing to omit from the circular the Material Facts or any of them, to explain to the directors that they were not entitled so to do; (6)   if on notice of facts and matters which rendered it impossible for the stated objectives of the acquisition to be achieved and/or which rendered it unlikely that those objectives would be achieved, to tell the directors so in terms; (7)   if on notice that the acquisition carried with it substantial risks, to take reasonable steps to satisfy themselves that those risks were appreciated by the directors and each of them; (8)   in particular, exercise reasonable skill and care in advising Airbreak, and its directors, on whether:    (a)   the proposed circular was true and accurate in all material respects; (b)   there were any material facts the omission of which would make any statement in the circular (or fact or opinion) misleading; (c)   the circular complied with the then requirement of the USM and in particular paragraph C17 of the Green Cook (which applies to companies whose shares are already traded on the USM) which required:       "a statement as to the financial and trading prospects of the company or group, together with any material information which may be relevant thereto, including all special trade factors or risks (if any) which are not mentioned elsewhere in the document and which are unlikely to be known or anticipated by the general public, and which could materially affect the profits". (d)   at the time the board of directors came to consider and approve the acquisition and related rights issue and placing, the due diligence undertaken by the company had been completed, and if not, whether the board had the necessary information required to make an informed decision to approve the acquisition and related rights issue. (e)   in particular exercise reasonable skill and care in liaising with and keeping Airbreak's other professional advisors informed of relevant matters coming to Eversheds' attention which were, or might be, of importance to the services to be provided to Airbreak by those other professional advisers. 15.   Further, insofar as Eversheds might give advice which extended beyond the scope of its retainer, in particular insofar as Eversheds might give commercial advice to Airbreak and/or its directors on the viability and/or desirability of the acquisition, placing and/or rights issue and/or the price to be paid by Airbreak to acquire Sunsail, Eversheds were obliged to exercise reasonable care and skill in so doing having regard to the best interests of Airbreak."
19.	The pleading adds corresponding duties in tort but nothing turns on that. The duties as now pleaded are wider than as originally pleaded. They now clearly extend to commercial matters. Thus in the case of the "title problem", even though Eversheds had caused the directors to consider the matter carefully, it is said that Eversheds should have advised that the question of title was material and ought to have been in the circular.
20.	Eversheds say that their duties did not extend to advising in relation to commercial assessments. Eversheds accept that they were obliged to advise Airbreak as to the need for the circular to cover "any material information" and especially to deal with "all special trade factors or risks", but they say it was not their duty to identify those commercial matters. That was a matter for the directors. Specifically, for instance, in relation to the Greek yachts, it was not for Eversheds to make a commercial assessment as to whether Mr Lewis' view was wrong.
21.	Eversheds rely upon what was said by Lord Jauncey in the Privy Council case of Clark Boyce v Mouat [1994] 1 AC 428 at 437: "When a client in full command of his faculties and apparently aware of what he is doing seeks the assistance of a solicitor in the carrying out of a particular transaction, that solicitor is under no duty whether before or after accepting instructions to go beyond those instructions by proffering unsought advice on the wisdom of the transaction. To hold otherwise could impose intolerable burdens on solicitors." The claimant says the position in this case is not as stark as that. The borderline between the solicitor's duty to advise and the director's ultimate decision is more blurred. They refer to what Mr Justice Jonathan Parker said in the Court of Appeal in Andrew v Kounnis Freeman (CA) 27.05.99: "Only rarely will the court be in a position to determine the question of the existence or otherwise of a duty of care owed by professional advisers on a strike out application."
22.	I think that it is not possible to deal with the question of duty in relation to quasi-commercial matters in the abstract. Solicitors concerned with assisting parties in relation to commercial transactions are often faced with commercial considerations. Ultimately, commercial matters are for the client but things are not so simple that one can say the solicitor's duty simply stops at questions of law. Suppose, in particular, an advising solicitor appreciated that the directors were intending to make a false statement of fact, surely they would be under a duty to advise that cannot be done? That would be so whether the directors were dishonest or merely mistaken: the solicitors could not stand by and let the directors press ahead with their dishonesty or mistake.
23.	Therefore, I propose to look at the question of the solicitor's duty in relation to each item individually rather than follow the course suggested by the defendants and dealing with the matter globally - though in fact some of the items can be dealt with collectively.
24.	Turning back to the question of title, should Eversheds have advised that it be mentioned in the circular? I think the answer is clearly not. They had raised the question, the directors had considered it, and it was in the end a matter for them. Eversheds were not in a position to say the directors were wrong. And as I have said, they were not.
25.	Moreover, suppose that conclusion were wrong. What difference would it have made if the question of title had been mentioned in the circular? The answer is clear: none. Over 75% of the shareholders knew about the "problem" and were content to proceed. So, even if there was a duty, which was broken, it was not causative of any damage.
26.	My conclusion here applies also to the other professional defendants.
27.	There is, however, another aspect of the yacht title question which causes me to think that there may have been a breach of duty by Eversheds. This point is not concerned with whether Airbreak's title was shaky: it arises simply because the vessels had a foreign flag. Under the Civil Aviation Authority ("CAA") licensing rules an applicant for an ATOL had to show that it had adequate financial resources. The CAA were particularly concerned with "free assets". The permitted turnover depended upon the level of free assets. The circular said: "As a result of the asset base of Sunsail, and the Placing and the Rights Issue, the Enlarged Airbreak Group's balance sheet will, on a pro forma basis, show net assets of £6,918,000 (see Part III, "Pro forma consolidated net assets of the Enlarged Airbreak Group"). On this basis, the Enlarged Airbreak Group can continue to increase turnover without the need in the foreseeable future to increase assets further in order to comply with the Civil Aviation Authority's "free assets" requirements."
28.	Now what was missed was that the CAA were very unlikely to treat yachts abroad, not just the Greek ones, as suitable "free assets. "So, the circular was wrong in suggesting that the acquisition of Sunsail would enable the group as a whole to increase its turnover. There is some evidence that Dr Scheps knew of the CAA's policy. So also of course did the directors. No one seems to have considered the CAA's policy as regards free assets when that statement was made. It is arguable that Dr Scheps slipped up here. True it is that ultimately the question was one for the directors. Indeed they specifically confirmed that "the Sunsail Group brings with it an asset base substantially larger than that of Airbreak's, which will enable Airbreak or should enable the enlarged Airbreak Group to expand without being impeded to provide additional "free assets" to satisfy the CAA requirements" in the verification notes which were gone through before the circular was issued. Nonetheless, I think that if any of the professionals had been aware that that was wrong it would have been within the scope of their duty to say so. It is arguable that it was Eversheds' duty to point out an erroneous statement of fact and that, having regard to Dr Scheps' previous experience with CAA requirements which dated back a year or so, that he was negligent in not doing so. I am not saying that if he had not had that experience it would have been his duty to investigate the CAA requirements specifically.
29.	However, again this slip was not causative of any loss. Airbreak was never impeded from expanding by an insufficient "free asset" base. On the contrary, in the next year its failure was due in large part to inadequate bookings leaving it with 65,000 unsold flights and unsold hotel bookings. Also the competition (particularly Thomsons) unexpectedly advertised aggressively, forcing Airbreak to spend much more on counter-advertising.
30.	Moreover, it is not shown that this minor reason for the acquisition, if omitted from the circular, would have made any difference. The claimants run a "but for the negligence" argument. They do not even prove the Circular would not have gone out if the directors had noticed this problem, which was at least as much a matter for them as for Eversheds.
31.	As for the other professionals, they were not concerned with CAA requirements and I cannot see they had any duty to investigate them.
32.	I next turn to the question of Sunsail's banking arrangements including the fact that one of Sunsail's two principal bankers, Lloyds, had imposed a moratorium on capital expenditure. It is said that these matters ought to have been specifically dealt with in the Circular - or that if the professionals had properly advised the transaction would not have gone ahead. Again it is not suggested that the professionals did not do an adequate investigation or that any of the allegedly "material facts" were not known to the directors of Airbreak. The claim is essentially that the professionals should have saved the directors from their own folly (assuming, for the moment, that the acquisition was a bad deal).
33.	What happened is that Eversheds arranged for the production of a report on Sunsail's banking arrangements. It was duly produced and considered by the Board and also by a Committee appointed by the Board. There is no real complaint about the report itself - a complaint that it failed to mention the Lloyds moratorium is just wrong - it clearly does. The complaint is that the professionals did not advise the directors that certain matters contained in the report were "material" for the purposes of the Circular and that they ought to have done so. In passing I note that there is no expert evidence from a solicitor experienced in this field of practice that it is the duty of a solicitor to go over a banking report and tell the recipient what is commercially significant about it. I was told that no solicitor expert evidence was provided because it was thought that the court would have the necessary expertise. Quite why, I do not know. Judges are unlikely to have much had experience of this sort of thing. Whilst they are equipped to decide points of law, practice in a field of expertise is something quite different.
34.	Such expert evidence as there is on the point seeks to lay the blame on HY. What the claimant's expert says is: In the circumstances, in my view it was insufficient for Hacker Young merely to refer to the continuation of the existing facilities as an "assumption" as expressed in their Paragraph 2.8 of the WCR. In my view they should have advised the Directors of Airbreak in terms: That without the Lloyds and Credit Lyonnais facilities being committed for the twelve months after the Circular, or at least until the summer cash flows became certain, there was a significant risk that the combined Group would not have sufficient working capital. That the Lloyds Bank facility was subject to significant conditions, some of which had not been satisfied, and was in particular conditional on the continued support of Credit Lyonnais. That Credit Lyonnais had not confirmed the continuation of their facility and had given some indication that any facility in future would be at a much reduced level. That the Directors should not give a confirmation as to the adequacy of working capital in the Circular until the Lloyds Bank and Credit Lyonnais position had been confirmed in the form that was assumed in the Working Capital Review."
35.	I do not really understand this. The banking report clearly points out all these matters, it points out that there is an assumption. The working capital report sets out all these matters. What more should have been done? Stand over the directors and make them read the report? Moreover, all this wholly ignores the fact that the Directors were not expecting to acquire Sunsail and run it in isolation. It was to be part of the enlarged group which would have £3m more. The banking arrangements were almost certain to be revisited as part of the intention was to repay some of Sunsail's indebtedness. It was not for Hacker Young to advise the Directors on how to conduct their business.
36.	In passing I also note (though this was not the subject of argument before me) that the whole of the expert evidence filed does not directly address the critical question. The experts do no more than say they would have done something different or what they think should have been done. They do not address the test laid down by the House of Lords in the well known case of Bolam v Friern Hospital Management Committee [1957] 1 WLR 582. The real question is whether the professionals acted in accordance with a practice accepted at the time as proper by a responsible body of opinion skilled in the relevant field.
37.	Putting the matter shortly the Directors knew exactly what was being bought and what its banking arrangements were. They were the company for these purposes and the company cannot complain.
38.	Next it is said the professionals failed to advise in relation to certain debt recoverability and particularly that from Sunsail's Turkish partner Renko. I can take this shortly. The expert evidence is aimed only at HY, yet the point is pleaded against all three professionals. As to HY, it is clear that the directors knew about the Renko position. It was set out in a draft long form report of January 1992. The structure of that report (including the Renko position) was discussed between HY and Mr Lewis on 19th December. It is not suggested that HY had any duty to advise on the contents of the Circular.
39.	As to causation on this point, it is again clear that the directors knew about the point, they decided to go ahead and they, in their capacity as shareholders, were committed to vote for it. The omission from the Circular of the Renko point was not causative of anything.
40.	I do not propose to go further into the other matters said to have been material and to have been omitted from the Circular, namely the profit forecast, the deferred tax liability, the separate non-binding agreement with the owners of Sunsail, the Thai yachts point and the working capital forecast. Exactly the same sort of point is valid in the case of all of them. In the case of the Thai yachts point, it is additionally factually flawed. In all cases the directors knew of the facts and decided to go ahead. The "omissions" were essentially matters for commercial judgment once the professionals had found out the facts. And their omission from the Circular is not shown to be causative of anything.
41.	That is sufficient to dispose of this case. But it has several other major flaws to which I now turn. First, there is the fundamental basis on which the claim is predicated. It is essentially a "but for" case. It is said that if the professionals had advised properly they would have pointed out the material omissions. That would have caused the directors to stop in their tracks. The Circular would not have been issued. There would have been no increase in the share capital and no acquisition of Sunsail. Assume that were so in relation to one or more of the "material omissions". That would not be enough to make out a case. That would be a condition precedent for the claim to succeed but no more. Galloo v Bright Grahame Murray [1994] 1 WLR 1260 is authority, if one were needed, for the proposition that "but for" is not conclusive. Let me illustrate it here by reference to the specific example of the title to Greek yachts point. Suppose it could be proved that if one or more of the professionals had advised that it be in the Circular and on the basis of that advice the directors would have decided not to proceed. Why should that have been causative of any damage when the title "problem" never proved to be a problem in fact? Common sense, logic, call it what you will, tells you it is not.
42.	To my mind the next flaw in the case is not only fatal but also elementary. Assume that there were material omissions from the Circular so it presented a misleading picture of the proposed acquisition. Assume further that it is only because the circular was misleading that the acquisition went through. And assume that Sunsail was worth less than it was estimated to be at the time of the acquisition. What damage has the company suffered? It paid no money for Sunsail. Nor was the value of Sunsail warranted. It is true that the shareholders (old and new) will have shares in an Enlarged Group whose assets are worth less than they were led to believe by the Circular. Their shares would be worth less than they expected. They would have a claim against the company. But the company itself has not suffered any damage - after the acquisition it owned Sunsail and had £3m more capital. That is all.
43.	One can test this last point another way. Suppose misled shareholders had sued the company and succeeded. The company would have to pay out and, if the professionals had been at fault, the company could recover from them what it had to pay out. But it could not also claim that it too had suffered the same damage as the shareholders. The professionals could not be liable to pay in effect twice. Yet that is in substance what is claimed here. The fact that those to whom the Circular was addressed have not sued does not mean the company can.
44.	There is a related but separate point: the loss claimed is not within the scope of the professionals' duty. Lord Hoffmann in South Australia v York Montague [1997] AC 191 said:
	"Rules which make the wrongdoer liable for all the consequences of his wrongful conduct are exceptional and need to be justified by some special policy. Normally the law limits liability to those consequences which are attributable to that which made the act wrongful. In the case of liability in negligence for providing inaccurate information, this would mean liability for the consequences of the information being inaccurate."
	There is no attempt in the pleading to tie the loss to the alleged breaches of duty - except in a "but for" manner, which is not good enough. South Australia requires one to ask what the purpose of the duty undertaken by the professionals was. It was to advise Airbreak in relation to the circular. The purpose of the advice was to ensure that the circular was accurate to those who were going to rely upon it. Those persons did not include the company. So liability to the company is limited to claims against the company by third parties based upon the allegedly misleading circular.
45.	There is a suggestion that the circular was needed to make the commercial decision. But that decision was plainly made before the circular went out, and the directors, forming nearly 3/4 of the shareholders, had committed themselves to it. Moreover, they had done on the basis of the due diligence performed by the professionals which had brought to light every matter, which it is said should have been in the circular. Once one takes the question of the circular out of consideration, the case is laid bare - the professionals gave the directors all the information. It was they who made the decision. If and to the extent they were not informed, that was their choice.
46.	Thus far the argument assumes damage to Airbreak. As I have said the claimant's expert puts it at £4.5m. But I think the position is not like that at all, because the expert assumes that Airbreak paid for Sunsail when it did not. There are other major flaws with the calculation. It overlooks the fact that Sunsail made a profit after acquisition, yet seeks to take into account the rather less sums Airbreak put into it. It overlooks the £3m raised by the circular. Mr Davis for HY has put in uncontradicted evidence showing that the net effect of the acquisition was clearly positive.
47.	The above matters are sufficient, in my view, for me to be sure that there is no realistic prospect of the claim succeeding. In so holding I am conscious that I have not dealt with a host of other points which were argued on behalf of the defendants It is not necessary to do so, though by not dealing with them I am not rejecting them.
48.	Accordingly I give summary judgment against the claimant in respect of its claims against the first four defendants.