Sir Elton fails in court action against PwC

In April last year, one of the country’s top judges in London’s High Courtthrew out his £14m damages and interest claim against the firm. In addition to losing the High Court claim Sir Elton was also left facing a potential legal costs bill estimated at around £8m.

Earlier this month, though, Sir Elton’s lawyers returned to the Appeal Courtwhere, in a complex legal fight centred on the construction of contracts,they sought to re-open the claim.

However, by a two to one majority the Court of Appeal today ruled against Sir Elton, and backed the High Court ruling. Lord Justice Robert Walker said he had ‘come to the same conclusion as the High Court judge’.

Mark Howard QC for Sir Elton had argued in the Appeal Court the singer’s claim that the accountants were negligent in failing to report to him that he and his companies, rather than his ex-manager John Reid and his companies, were bearing the costs of various outside companies whose services were used during Sir Elton’s overseas tours.

‘The total costs born by Sir Elton in this way amount to just under £7m. He claims these sums together with interest,’ said Howard. When the case was heard last year interest was already being put at a further £7m.

Howard said the claim was on the basis that failure by PwC to report on the situation had resulted in Sir Elton losing his ability to recover the money from John Reid and his companies.

In the High Court decision under challenge Justice Andrew Ferris ruled that PwC was not guilty of negligence in the way it managed the pop superstar’s affairs.

The judge said he then considered that PricewaterhouseCoopers did owe a dutyof care to Sir Elton. But he continued : ‘The loss which he seeks to recovercould not on any view be recovered by him.’

‘I am not satisfied that PricewaterhouseCoopers were negligent,’ he said.

Lord Justice Pill said he considered it ‘highly unlikely’, in the absence ofdetailed provisions on how payments were to be made, that the interpretationSir Elton put on the deal between him and John Reid and his companies wascorrect.

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