In this complex case, Graham Garbett was able to assist the Court, utilising his accounting skills and his experience in business valuations.
Claimant X and Defendant Y were joint partners in a profitable, but underperforming restaurant. X, who oversaw the day-to-day operations of the business, travelled abroad for three months to visit family. During X’s absence, Y, who controlled the finances of the business, sold the business and its assets to a third party.
X was not informed of the sale until his return.
X claimed that:
- He had suffered lost earnings on the basis that the business profits had declined in the months leading up to the disposal, and that the reason for this was that Y had opened up a rival restaurant, and had recruited the manager of the partnership's restaurant.
- He had suffered lost profit because the business was sold at an undervalue.
- He had suffered a loss of capital because the last 3 years of accounts did not properly reflect the partners’ capital input.
Graham Garbett was appointed as Joint Independent Expert Witness to report on whether:
- The loss of earnings in the months prior to disposal could be quantified
- The basis on which the business was sold was reasonable
- The business and assets were sold at a true value, and if not, the value at which it could have been sold
- All elements of capital introduced and partner withdrawals, particularly where they were of a non-cash nature, had been accurately included in the capital accounts
Graham was able to quantify the amount Defendant Y owed Claimant X, facilitating a settlement