Judgment of Learning Curve (NE) Group Ltd v Lewis and Probert [2025] EWHC 1889 (Comm)

Michael Booth KC and Simon Adamyk, instructed by DWF Law LLP, acted on behalf of the successful claimant in securing a multi-million pound judgment in a hotly-contested commercial dispute.

Learning Curve (NE) Group Ltd v Lewis and Probert [2025] EWHC 1889 (Comm) was a claim for breach of warranties contained in a share purchase agreement. In 2021, the Defendants (as vendors) and the Claimant (as purchaser) entered into a share purchase agreement (“SPA”) for the sale and purchase of the entire issued share capital in a company which trades as “MPCT” and provides education to young people, in particular through the delivery of military training courses.

The Company receives funding for some of its activities from the Education and Skills Funding Agency (“ESFA”), an executive agency acting on behalf of the Department for Education. After the purchase, the Claimant discovered that the Company had, in breach of ESFA’s funding rules, overclaimed well in excess of £1 million funding from ESFA. The Claimant sued the vendors for breaches of several of the warranties contained in the SPA, including a warranty that, during the last four years before the purchase, the Company had complied with the funding rules.

The Claimant claimed for (among other things) damages for breach of warranty. The measure of loss was agreed to be the difference between (a) the value of the shares in the Company as at the completion date as warranted (ie. as if the warranties had been true) (the “Warranty True Value”); and (b) the actual value of those shares as at that date (the “Warranty False Value”). The parties agreed that the most appropriate way to value the Company was using a multiple-based approach, ie. on the basis of the Company’s maintainable earnings before interest, taxes, depreciation and amortisation (“EBITDA”) multiplied by an appropriate multiplier.

The Defendants vigorously defended the proceedings and denied liability on a plethora of bases. Among other things, they denied that sufficient notice had been given of the claims or their amount in accordance with the SPA. They contended that, because the SPA contained an indemnity in respect of any over-claimed funding, no claim for damages for breach of warranty could be brought. They contended that the Defendants did not have the requisite knowledge of any breaches, but that the Claimant did and that the relevant matters had been disclosed. They denied any breach of any of the warranties. They contended that the breaches did not give rise to any loss because they would not have caused a hypothetical reasonable vendor and purchaser to have reduced their assessment of the EBITDA (which gave rise to detailed and complex issues on quantum). And they contended that the Claimant had failed to mitigate its loss. The Defendants also counterclaimed for repayment of a sum which they had paid earlier.

The claim and counterclaim resulted in substantial factual and expert evidence and a hotly-contested two-week trial. The Claimant, represented by Michael Booth KC and Simon Adamyk, succeeded in defeating all of the Defendants’ arguments. The Claimant secured a substantial award of damages well in excess £5 million, and exactly equalled the Part 36 offer which it had made nearly a year and a half previously.

Learning Curve (NE) Group Ltd v Lewis and Probert [2025] EWHC 1889 (Comm) is reported here.

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