McLaren and title sponsorship
The reference to McLaren and title sponsorship was a reference to a very recent and very confidential proposal made by McLaren. Mr Harris (as his diary shows, and he and Mr Sami said in evidence) met Mr Sami on 14 and 20 March to discuss a McLaren title sponsorship proposal. It was very confidential because of McLaren's existing contractual commitments. The proposal led to an e-mail from Mr Harris to Mr Haines sent on 20 March which referred to a priced proposal for a 4 year deal. Mr Sami is said to have being willing to go to McLaren's board provided Mr Haines and Mr Harris agreed to propose McLaren as their recommended option to the Vodafone Board. Mr Sami is also recorded as insisting that the proposal should not be shared with Mr Perring or other external parties. Mr Harris, however, had told Mr Sami he would be given an answer "by noon" but he had stressed that Vodafone needed "to know for certain that" McLaren could "make this happen before we go to our Board".. Mr Harris said that the noon deadline was moved and it was arranged to meet again later. Mr Harris and Mr Sami both said, and I accept, that despite the recorded risk of an impasse as to who might first commit themselves, this was potentially an exciting proposal ("big on big") and they were looking at ways of trying to find solutions for some days. Indeed on 26 March at the Metropolitan Hotel in London Mr Sami made a presentation to Mr Haines and Mr Harris of possible Vodafone branding on the McLaren car. Mr Haines and Mr Harris said that it was only on 28 March that the proposal came to a halt, when Mr Sami came to Dusseldorf with another (in effect secondary) sponsorship proposal because it had been realised that title sponsorship could not be achieved.
It was part of Jordan's case that the McLaren title sponsorship proposal had been rejected by the time Mr Haines spoke to Mr Jordan and Mr Phillips on 22 March. Plainly it was rightly recognised that, if it had not, the likelihood of Mr Haines then making a binding agreement with Jordan was greatly reduced. The evidence, including the documents and the evidence of Mr Sami, overwhelmingly establishes that the proposal was still alive on 22 March and for some days thereafter and known to Mr Haines to be so. The consequence is as Jordan recognised. The basis for much of Jordan's cross-examination on this issue was a document which was dated to 22 March entitled "Vodafone/McLaren - Partnership Summary" which referred to Vodafone becoming "title partner (effective 2007)".. In fact that was a ruse to ensure the secrecy required for the proposal by McLaren. What it in fact does is further to demonstrate that the proposal was the subject of considerable continuing work on 22 March itself.
Gallaher 20 March
It was on 20 March that Mr Phillips wrote to Mr Jenner of Gallaher about their sponsorship agreement as I mentioned in paragraph 13 of this judgment. The letter refers to a conversation between Mr Northridge and Mr Jordan the previous day and was intended to clarify "our mutual criteria for extending our agreement".. In fact it is a classic stalling letter in effect saying that Jordan did want to extend the relationship along the lines discussed (plainly as a secondary sponsor) but needed first to explore the opportunities available to find a title sponsor.
Benetton's proposal
On 21 and 22 March Mr Perring was engaged in preparation of a summary of the Benetton proposal. The "Team Name" was shown as "Vodafone Renault".. It is therefore apparent that the Benetton title sponsorship proposal was also being worked on on 22 March itself. Indeed as late as 17.13 on that day Mr Briatore's assistant was sending Mr Perring amendments he had made to the proposal.
It was, however, also a significant plank in Jordan's case, for the same reason as McLaren, that by the time of the 22 March telephone call between Mr Haines and Mr Jordan and Mr Phillips the Benetton proposal had also been rejected and Jordan was the only acceptable option available to Vodafone as Vodafone was committed to a title sponsorship and so Ferrari was also not acceptable.
The foundation of Jordan's contention about Benetton was a witness statement of Mr Paul Jordan (paragraph 19 above). In that statement he said that "on about 22 March 2001 Ted Brezina called me to say that he had heard that Benetton would not be sponsored by Vodafone and that Jordan were to be sponsored. I immediately passed this information on to Ian Phillips at Jordan".. This statement was further expanded in a second witness statement dated 14 June 2003 in which Paul Jordan said he had spoken again with Mr Brezina "who remembers being told that Benetton would not be sponsored by Vodafone.. He does not recall who told him but that it was from a Benetton employee". Mr Paul Jordan also says he made a note of Mr Brezina's call to him which is written on the back of a note dated Thursday 22 March and before a draft prepared on the following Monday. There is indeed a note which reads "Vodafone Ted-B'TON No Deal - Gone to Jordan".. There is also a note in Mr Phillips notebook said to be of his conversation with Mr Paul Jordan which reads "Ted Brezina Charlie Perring leaked to Ted". That is curious if Mr Paul Jordan had been told Mr Brezina got his information from a Benetton employee. It is also curious that Mr Brezina should be told on 22 March by anyone that the sponsorship had gone to Jordan before Mr Haines had even spoken to Mr Jordan. Even Mr Perring did not believe any decision was made on 22 March.
It is not easy to comment on such second-hand evidence when it is flatly contradicted by the documents. There can sensibly be no dispute that Benetton remained a live possibility for sponsorship by Vodafone both at and after 22 March. Mr Perring himself was still working on it, although he did say that he was told by Mr Haines on 22 March that Benetton had been dropped. What I do think is likely and indeed is readily accepted by both Mr Haines and Mr Harris is that at this time they saw Jordan as a better prospect than Benetton and, though with less certainty, as a better prospect than Ferrari. But it is perfectly plain that no decision had been taken to reject Benetton and I reject Mr Perring's evidence that he was told otherwise by Mr Haines. It is however, I think, highly probable that encouraged by Mr Perring and their own efforts Mr Jordan and Mr Phillips may well have believed that Jordan was very much in pole position if not alone on the grid and that with a little bit more effort they could "get the deal".. Mr Perring acknowledged in his evidence that he was not aware of the level of discussions that Benetton were having separately with Vodafone but thought from his perspective that Benetton had been discounted.
Ferrari at 22 March
It is also clear from a further e-mail sent by Mr Perring to Mr Haines at 6.24pm on 22 March that Mr Perring had spoken to one of Ferrari's legal advisers about Ferrari sending a proposal and financial information to Mr Haines and that Mr Perring believed that Mr Haines and Mr Todt were in touch with each other on the subject.
Jordan at 22 March
Earlier on 22 March (at 11.06) Mr Phillips had sent Mr Perring an e-mail which converted the US$ figures in his 15 February "note" to sterling (including all the bonuses). Despite Mr Phillips' evidence that the bonuses had been rejected and his stated belief that they were in any event to come out of "another budget" it is apparent that insofar as there was any proposal from Jordan on 22 March the bonuses in the 15 February e-mail were and remained part of it.
Orange
There is a note in Mr Phillips notebook of a conversation he had with Mr Perring on 22 March which reads "used it to our advantage Red v. Orange us convert 15/2 figures to £".
It can therefore be taken that this note was written before the e-mail referred to in paragraph 110. A number of the e-mails recovered from Mr Harris' computer show that on 21 and 22 March Mr Perring was telling Mr Harris that Orange (one of Vodafone's major competitors) was unhappy with its sponsorship of the Arrows F1 team, was looking at other teams and had met with Jordan on 21 March. These e-mails also make it absolutely clear that Vodafone was still pursuing proposals from Benetton and that Mr Perring knew as much. Their target indeed was to drive Vodafone from Benetton to Jordan.
Anyone reading these e-mails, let alone someone of Mr Harris' experience, would at once realise that they were a naïve and crude attempt by Mr Perring to demonstrate to Vodafone that if it did not at once commit to sponsor Jordan then a major competitor might very well do so. The e-mail of 22 March was entitled "Red vs Orange" and so echoed Mr Phillips' note to which I have referred in paragraph 111 of the same date. The thrust of Mr Perring's thesis was that Orange would be happy for Vodafone to sponsor Benetton (in effect because Arrows would always beat Benetton) but would withdraw from F1 completely if Vodafone sponsored Jordan because Jordan would then always beat Arrows. Mr Perring also stressed that Orange were aware of the "limited window of opportunity" for it to agree to sponsor Jordan ("next Friday") because of Jordan's need "to re-commit to Benson & Hedges".
Mr Boyle submitted that it must have been apparent to Mr Harris and, through him, Mr Haines from this information that "Vodafone needed to make a decision at once on whether to commit to a deal with Jordan or risk losing Jordan to Orange in circumstances where the work done by Brown ... the previous day showed that Jordan was the first choice".. Hence, it was submitted, it was entirely understandable that Mr Haines would have made a binding agreement with Jordan on the telephone later that day and both he and Mr Harris must have deliberately chosen not to refer to Orange in their evidence because it would be bound to have been a significant factor in their thinking at the time.
I reject this thesis entirely. It simply cannot stand with the documents and commonsense. Further it is, I think, much more remarkable that neither Mr Perring nor Mr Phillips recalled the "Orange threat" when they made their witness statements and gave evidence unless, perhaps, as is undoubtedly the case (for reasons which will become apparent) Orange was not a subject which it was in the interests of Jordan to raise. The evidence of both Mr Jordan and Mr Phillips was that at this stage Jordan's discussions with Orange were limited to a musical arrangement with Mr Jordan personally, albeit Mr Jordan accepted he and Mr Denny of Orange had "touched on Formula 1" in their discussions. Mr Jordan thought Mr Perring must have got his information about Orange from Mr Marshall who had introduced Mr Jordan to Mr Denny. In his fifth witness statement Mr Phillips also expressed the belief that Mr Marshall was the source of Mr Perring's information about Orange. He said he was not. But Mr Phillips accepted that Mr Perring had telephoned him on 22 March and he had then made the note about "Red v Orange", but he said he did not ask Mr Perring to inform Vodafone whilst recognising it was obviously advantageous to Jordan Mr Perring should do so.
It is entirely credible that Mr Haines and Mr Harris would treat an e-mail such as this as further proof of Mr Perring's lack of objectivity and indeed naivety and ignore it. It is not credible that any company such as Orange would commit to a major sponsorship with Jordan in a matter of days let alone when they were already title sponsors of another team. Nor is it credible that Mr Haines and Mr Harris would believe that they would. Both were adamant and I am sure truthful in saying that they always made it clear that if Jordan needed to act it should do so without regard to Vodafone. They were not so naïve as to think that Vodafone needed Jordan more than Jordan needed Vodafone. Mr Perring and Jordan were, of course, also unaware that both Ferrari and McLaren were still well in the race as well as Benetton. The fact that neither Mr Haines nor Mr Harris mentioned Orange is, I think, strongly supportive of their views of Mr Perring and the likelihood that they simply ignored what he said.
AT 22 MARCH SUMMARY
At 22 March and before the telephone conversation between Mr Haines and Mr Jordan: i) Everyone concerned at Vodafone (including Mr Kieser and Mr Perring) knew that Vodafone's decision on F1 sponsorship was due to be taken in mid-April. They also knew (as would in any event, in my judgment, be obvious) that the decision was to be taken by the board of directors and not by Mr Haines. I also think it probable that Jordan was aware of both matters not just as commonsense but also because Mr Perring would have been certain to tell them. Certainly it is documented that Jordan was not only told of the important role Sir Christopher Gent had in the decision but acted on it before 22 March. ii) There were four teams under active consideration: Ferrari, Benetton, McLaren and Jordan. Jordan may have believed, encouraged by Mr Perring and Mr Paul Jordan, that Benetton was not a realistic contender. Jordan and Brown knew nothing about the McLaren title sponsorship possibility. Jordan, again encouraged by Mr Perring, may also have thought that Ferrari could not provide what Vodafone was seeking. Mr Haines' thinking on 22 March was, as he put it, "Jordan probably had their nose ahead" and was "the most likely partner" but no more than that. The Brand Council had not met since 15 March when Ferrari had been favoured. iii) The only "proposal" from Jordan which existed was for a 3 year agreement at a total cost (including "appearance" bonuses) of $150m with further "performance bonuses" to be paid, all expressed in sterling, with a yellow and black car in the first year, with no options to renew, and with none of the detailed joint venture and intellectual property matters in a form which could even begin to be the subject of a binding agreement. iv) In that context it is little short of inconceivable that Mr Haines, whatever pressure Mr Jordan might put on him, could have decided that day to commit to any contract with Jordan shutting out the other teams. To do so would have been to ignore Vodafone's corporate procedures and his own brief and to bind Vodafone to terms of material uncertainty and indeed which in the case of bonuses and colouration were known not to be acceptable. Of course the matter has to be looked at objectively and not by way of Mr Haines' motives or intentions. But that does not mean that it has to be looked at without regard to the factual context and some sense of reality.
THE 22 MARCH CONVERSATION
Mr Phillips
Mr Phillips' account is to be found (first) in paragraphs 105 to 113 of his first witness statement. He says Mr Perring spoke to him (after he had been told by Mr Paul Jordan that Vodafone had agreed to sponsor Jordan and not Benetton) and told him that Benetton had been dropped and to tell Mr (Eddie) Jordan to expect a call later in the day from Mr Haines "with some good news". He and Mr Jordan therefore expected to be told by Mr Haines that Jordan had the contract. The statement continues:
"At about 6.20pm David Haines called Eddie Jordan. We were sitting in my office waiting for the call. The call lasted approximately 10/15 minutes, it was on the loudspeaker and I heard what was said. Eddie Jordan started by extolling Jordan but he was cut short by David Haines who said,
"Eddie, stop, stop, you've got the deal".
I have read the defence regarding this conversation. David Haines certainly did not make the comments attributed to him. David Haines clearly told Eddie Jordan that he had the deal. By saying this it left no room for misunderstanding that the sponsorship contract had been awarded to Jordan.
We were thrilled to hear this and said it was great news and Eddie Jordan thanked David Haines for his confidence in Jordan. We expected the agreement would ultimately be replaced by a detailed written sponsorship contract along the lines of the draft already prepared and given to Charles Perring.
David Haines asked us to send a draft contract to Peter Harris saying "you can sort out the formalities with Peter". For reasons I have explained we had no doubt that David Haines had Vodafone's authority to conclude the agreement. We agreed with David Haines to keep the deal confidential for the time being for two reasons. First we wished to break the news to Gallaher in our own time and second we both wished to publicise the deal at the Monaco Grand Prix. As far as Gallaher were concerned, Eddie Jordan spent some time explaining to David Haines that Gallaher had been very good to Jordan over the past years and he wished to take time to prepare a dignified exit for them. David Haines acknowledged this was the correct approach and he would expect to be dealt with in the same way.
After concluding the agreement and discussing Gallaher, Eddie Jordan spent about five minutes discussing Vodafone's forthcoming meeting with Bernie Ecclestone. Eddie Jordan explained how he thought David Haines should deal with Bernie Ecclestone and that it would be helpful to be able to tell him that Vodafone were now Jordan's title sponsor. However it was accepted by Eddie Jordan and David Haines that the agreement would have to be kept confidential for the time being."
Mr Jordan
Mr Jordan's account in paragraph 31 of his first witness statement was to the same effect:
"31. I have read Ian Phillips' account of the telephone conversation with David Haines. This accords with my recollection. There is absolutely no doubt that David Haines told me we had the deal. There were no conditions attached to this statement. We were of course extremely pleased at this news. I telephoned Charles Perring to tell him and thank him for his help and spoke to Dominic Shorthouse. I told Ian Phillips that we needed to write to Vodafone to confirm David Haines' decision. We drafted the letter the following day."
Mr Phillips Note
Nothing more of substance was said about the conversation in Mr Jordan's second witness statement (dated 14 February 2003) nor in Mr Phillips' second statement of the same date or third dated 7 April 2003. In Mr Phillips' fourth witness statement dated 9 June he referred to going through his notebooks to identify "relevant notes" (albeit some of those notes had been referred to in his earlier statements). In paragraphs 4 to 7 of this statement Mr Phillips added the following:
"4. C8/1788-1790 are notes made by me and Eddie Jordan during the telephone conversation with David Haines on 22.03.2001 referred to at IP 107. I should like to amplify that conversation in relation to the manuscript notes. Eddie Jordan and I were sitting in my office opposite each other across my desk awaiting the call which Charles Perring told us to expect. While we were awaiting the call, I received a call from one of our drivers, Jarno Trulli. I opened my notebook at page 70 (C8/1790). The left hand page and the right hand page were both blank. I made a note of his name and telephone number on the left hand page (C8/1788). The remainder of the writing on that page is Eddie Jordan's who used one of my pens. Shortly after my call with Jarno Trulli, Eddie Jordan had a telephone conversation with Dominic Denny at Orange talking about a meeting he had had with his boss Denise Lewis. They spoke about the meeting in their London office at George Street in relation to a music and Formula 1 programme, a key issue being noted as Jordan. Eddie Jordan made the note as he talked.
5. Shortly after this we received the call from David Haines when he spoke the words "you've got the deal". Eddie Jordan had the notebook in front of him and had my pen. When David Haines said "you've got the deal", Eddie Jordan wrote the words "David Haines-do have".. I picked up another pen with a finer nib and pulled the notebook closer to me and wrote the words in quotation marks "you've got the deal". As a former journalist I am used to writing key notes of importance particularly quotes.
6. As Eddie Jordan had been writing on the opposite page and we were writing on fresh pages the carbon paper remained underneath the previous page. After writing the quotation Eddie and David started talking about the exit strategies with Gallaher and I took hold of the book and placed the carbon under page 70. As soon as Eddie and David started talking about the formalities of the deal they had made I made the further notes.
After the telephone conversation I drafted the memo to Dot using my broad nibbed fountain pen which Eddie Jordan had been using. After we left the office in our separate cars. I drove home to Piddington."
The importance of this evidence was (understandably) perceived to be such that in opening the case Mr Boyle put it right at the forefront of his submissions, producing the original notebook for inspection and emphasising Mr Phillips' stated experience as a trained journalist in "writing key notes of importance particularly quotes". Mr Jordan's third witness statement did not address the note. The note itself (at C8/1790) contains (above the draft memo to Dot) "Lawyers- David Haines -auditors, Bank, Warburg Pincus Credit Suisse/J Fuily - Peter Harris". Those words are also on the carbon. The words which are not on the carbon are "You've got the deal" and "contract, etc to Peter Harris".
Mr Perring
Mr Perring's evidence in his witness statement was that by 22 March he knew Benetton had been rejected and "therefore made the assumption that Jordan would be selected because as far as I was aware now it was the only team in the running".. He said he had telephoned Mr Haines to say the teams should be told what the position was. He says Mr Haines told him that Benetton had been dropped and that he would be speaking to Eddie Jordan. Mr Perring said (as could hardly be gainsaid on the documents) that he "did not expect a deal to be done there and then" and (in the course of his oral evidence) that when told by Mr Jordan on 22 March that Jordan had the deal, whilst he was not surprised by the decision, he was by its timing. Importantly Mr Perring said he did not contact either Mr Haines or Mr Harris about Mr Jordan's call informing him about the deal.
Mr Haines
In his first witness statement (18 December 2002) Mr Haines said:
"On the 22 March I attended the CEBIT trade fair in Hanover, Germany with my two colleagues Andy Moore (Consumer Insights Director at Vodafone) and Jost Schulte (Global Brand Manager at Vodafone). We drove the 3.5 hours from Dusseldorf to Hanover, it's about 300 kilometers.
Charlie Perring had called me at some point during that day on my mobile asking me to call Eddie. He wanted me to reassure Eddie that Jordan was still a contender for the Vodafone sponsorship.
I spent the return journey from Hanover on the telephone. We left Hanover around 4pm German time. A couple of hours after we set out on our way back, I got round to calling Eddie. I had made at least 17 calls before actually calling Eddie (including a fifteen minute conversation with Ekrem Sami). I attach a copy of my car phone itemised bill for 22nd March at DH 31. I was using both my car phone and my mobile.
It was dark, raining and there was heavy traffic. It must have been after 7 pm German time. I was in the back of the car with Andy Moore, whilst Jost Schulte sat in front of me. I was using my mobile phone, which kept breaking up and cutting the conversation off as we were going through hilly countryside.
In order to understand the context of the telephone conversation with Eddie, it is important to appreciate that firmly planted in my mind at the time of the conversation was the following:
a) Neither I, nor anyone from Vodafone had ever had a contractual discussion with any representative of Jordan and there were already very significant outstanding issues from the early meetings we had had ....
b) The telephone conversation with Eddie was just one of many. I had become used to Eddie badgering me - he called or asked to be called frequently ....
c) We were in the midst of the informal approval procedure with the Brand Steering Committee/Brand Council of the recommendations we were going to make to the EOIC. We had proposals from Ferrari, McLaren, Jordan and Renault Benetton. Certain members of the Brand Steering Committee had expressed a strong preference for Ferrari, but there were perceived problems with Ferrari, and the other teams (especially Jordan) were offering what appeared to be better branding packages. The matter was still up in the air and needed more discussion.
d) Decisions on which team to go with would not be taken until 4th and 5th April at the EOIC, GORC and Executive Committee meetings - as we had agreed with Sir Christopher Gent in February.
e) Peter and I were off to see Bernie Ecclestone in a couple of days to talk to him about Vodafone's involvement in F1.
When I actually spoke to Eddie, he seemed agitated, more pushy than normal and he repeatedly asked me where we were with the Jordan proposal.
As I did not know which way the decision would go with the EOIC, GORC and Executive Committee on the 4th and 5th April, I was keen to keep a number of options alive, including Jordan. I do recall using the phrase "We are getting very close" a number of times to Eddie. This to indicate that Vodafone were getting very close as the decision as to which team to pursue negotiations with was to be made on 4th and 5th April, but no decision had been made yet.
Eddie's reaction to this was to try and verbally push harder, he was really trying to pressure me. Whilst I understood why he would have been keen, I did not understand his heightened level of impatience at this particular time. I remember thinking that Eddie was not going to push me into a corner as he had tried to do (unsuccessfully) on 6th February with Gallaher.
In response to this verbal pressure I reiterated the same point using different language each time. I said, "the Jordan proposal is very interesting", and "Jordan are a very serious contender for the deal". I also recall at one point in response to his pressure saying things are looking good for a deal with Jordan.
I do not believe I said, "you have got the deal". I would not have given the impression in the telephone call that the deal was Jordan's, because it was not.
I did ask Eddie to forward me a draft contract so we could compare the standard conditions with the Renault Benetton contract that we had already requested (but never received).
Eddie offered to supply a list of his references. I was surprised at this as I knew who he was and I had not asked for or been offered references for any other team. The purpose of these references was unclear to me. I did not ask for clarification as I wanted to end the conversation and Eddie seemed to be winding up the telephone conversation. I think he felt he had got as much out of me as he was going to get.
I do not recall Eddie thanking me for our confidence. If he did, this would not be out of context as Jordan was in the running, one of four possible teams the Brand Steering Committee would consider as a recommendation to the EOIC, GORC, and Executive Committee.
From the entirety of the conversation it was crystal clear to me as it would have been to any observer that we had not just concluded an agreement to sponsor Jordan. It was simply the end of another telephone conversation. There was no excitement or any comments from Eddie that would have indicated he had concluded a huge deal. If anything, the conversation was somewhat brusque.
In fact, when the conversation ended Jost Schulte turned around and asked me when we expected to have a decision on Formula 1. I was still annoyed by Eddie's tone and manner and remember giving Jost quite a short and direct answer. I recall telling him in German "we are not that far, don't expect an immediate decision".
I did not discuss the conversation with Andy at all who was scribbling notes across from me."
Mr Moore and Mr Schulte
Both Mr Moore and Mr Schulte also gave evidence. Despite the fact that neither had been asked for their recollection until many months later both were patently truthful and careful in giving their evidence and also patently did recall the conversation. Both readily accepted that they were working on other things in the car and trying not to give the impression of eavesdropping on Mr Haines' conversations. Both found F1 interesting and heard references to "Eddie" and deduced that Mr Haines was talking to Eddie Jordan. Mr Schulte remembered Mr Haines using expressions like "it looks good" and "it is very promising". Neither remembered him using words to the effect of "you've got the deal" or anything similar. Mr Moore remembered Mr Haines using the words "we are getting very close". Mr Schulte said that whilst he could not exclude the possibility that Mr Haines did use the words "you've got the deal" they would not have fitted into what he did hear of the conversation or the brief reference to it between himself and Mr Haines after it had finished.
THE OTHER EVIDENCE
Before commenting on this evidence about the conversation on 22 March I will summarise such other significant evidence as there is about it.
Mr Jordan and Mr Harris
At 15.44 hours UK time on the following day (23 March) a letter was faxed from Mr Jordan to Mr Harris. Mr Harris was in Atlanta. Atlanta time is 5 hours behind UK time. The letter referred to an earlier discussion. That was a reference to a telephone call earlier that day in which Mr Jordan had told Mr Harris (to his surprise) that Mr Haines had agreed that Vodafone would sponsor Jordan or as Mr Harris put it in his witness statement "had got the go ahead for a deal". Mr Harris was non-committal and at once telephoned Mr Haines who was "shocked and horrified" and asked Mr Harris to write to Mr Jordan to clear up any misunderstanding.
Jordan's letter of 23 March
The letter signed by Mr Jordan, and with my emphases, read as follows:
"As you know I spoke to David yesterday evening and he confided in me of his decision.
The list of references David asked me to forward to you is attached.
You have already met my people who will work with you on the contractual and implementation issues, Ian Phillips and Mark Gallagher.
Ian is ready to take the draft contract through to conclusion; if you prefer we could have a Heads of Agreement ready next week.
Mark will co-ordinate the added-value technology programme and will contact you separately on this matter.
In anticipation of your meeting with Bernie Ecclestone next week, I did point out to David that a forthright approach usually pays best dividends in the end. I also suggested that there may be some advantage in delaying negotiations on future business until your identity as a title sponsor is known as the team will be able to personally assist you in achieving a better result."
Mr Harris agreed that it was likely that he e-mailed this letter on to Mr Haines when he received it. The reference to "the draft contract" was to the one referred to in paragraph 84 which Mr Perring had sent on to Mr Harris. Despite attempts to explain it away, the letter acknowledges in effect that whatever Mr Haines' "decision" matters had not even reached and would be required to reach at least Heads of Agreement. The reference to "Mark" was to Mark Gallagher and the "added value programme" was to be the subject of one of the schedules to the draft contract which was blank. The reference to Mr Ecclestone must I think be read as in effect saying better to see him only once you have signed up with Jordan. Indeed, and again despite his attempts to explain it, Mr Phillips' note of his conversation with Mr Jordan on the morning of 23 March makes that clear as do the earlier drafts of the letter he prepared and which are also to be found in his notebook. The earlier drafts are also revealing in other respects. The opening paragraph of an earlier draft read "As you know I spoke to David yesterday evening and I was extremely pleased to hear that we will have a relationship going forward".. I agree with Mr Aldous that even the letter as sent suggests an attempt to achieve a binding agreement as soon as possible rather than an assertion that such an agreement is already in place. The explanation offered for this was that the agreement was so confidential that it could not be revealed even to the typist. I think, in agreement with Mr Aldous' submission, that is absurd. The letter does assert a decision by Mr Haines and seeks to have a binding agreement concluded. To write that an agreement had already been made would add nothing and not adding it does nothing to keep the essential matter confidential.
Mr Phillips Note
Perhaps the most notable, indeed dramatic, exchanges in the trial came, however, when Mr Phillips was cross-examined by Mr Aldous about the contemporary note of the conversation on which Jordan placed so much emphasis. The transcript, understandably, does not fully catch the event. In short it became apparent that the all important words "You've got the deal" might not have been written contemporaneously rather than added at some unstated later time. The facts are stark. Mr Phillips made no reference to the note in any witness statement until 9 June, a week before the trial started, and nine days before he gave evidence. The account given there and repeated in the witness box was provided in minute detail bolstered by his journalistic experience in noting contemporaneously things of importance. But it was clear and accepted by Mr Phillips that other (and other important) passages in his notebook had in fact been added later to what were otherwise contemporaneous notes. That was demonstrated because they had not come through on the carbon. The elaborate explanation of why that was not so in the case of these four words was demonstrated conclusively to be false when Mr Phillips was asked to repeat what he said had happened at the time with the carbon in the witness box. It was demonstrated that the note could not have been made as he had stated. His final comment on what was a patently embarrassing experience for him was "You can reflect at any time and go back and add things; why not?" That has to be compared with his 9 June witness statement. The experienced journalist, as I find, failed to make a contemporaneous note about what was presented as the most important four words spoken in the conversation and indeed words which were said to be of enormous excitement and importance to Jordan itself at the time they were supposedly spoken.
Mr Harris' letter of 26 March
As agreed in their telephone conversation on 23 March, Mr Harris drafted a letter to be sent to Jordan. The letter is dated 26 March (a Monday) but was sent by fax on the morning of Tuesday 27 March. Mr Harris was having a heavy weekend. He flew from Atlanta to the UK arriving on Monday morning. The letter read as follows:
"Dear Eddie,
Thank you for your recent letter dated March 22, 2001.
I have shared your letter with David and we feel it is important to stress that we are still completing our final assessment against which Formula 1 team to potentially sponsor.
As you are well aware we are committed to making this decision in the very near future which is why we wish to work with your team on finalising the terms of a potential title sponsorship deal. However until final terms have been received from each team and until our Board approves such a decision we cannot fully commit to a partnership with the Jordan team or any other team at this time.
I will follow up with Ian and Mark on next steps but just thought it important to explain our current position with regard to a final decision.
We look forward to seeing you soon and wish you the best of luck in Brazil."
This letter has been subjected to minute analysis by Mr Boyle. He asks rhetorically why does it not deny what Mr Jordan was saying, why did neither Mr Haines nor Mr Harris immediately telephone Mr Jordan to put him right, why does it refer to a "final decision" as if acknowledging that Mr Haines had taken a decision. None of these points impress me at all. The position was not confrontational however it may now be seen. The letter was I think a polite way of disabusing Jordan of any misunderstanding and expressed belief in a context where it might well be that the decision would yet go in Jordan's favour. It also flagged, as Mr Jordan was said to be and I am sure he was "well aware", that the decision was due to be taken and taken by the board in the very near future. Mr Haines said he did not want to be badgered by Mr Jordan again and writing was, he thought, "the right thing to do".
Mr Phillips' e-mail of 28 March
On the morning of 28 March Mr Phillips sent a short e-mail to Mr Harris in response to his letter. It read (so far as material):
"Your letter to Eddie was received yesterday and understood. This is just to say that Eddie and I will be going to Brazil ... and that if you need to discuss any details of the proposal we are able to come to Dusseldorf at your convenience."
This response was only disclosed by Jordan following the court's order in April 2003 and was no longer available on Mr Harris' computer. The explanation for it offered by both Mr Jordan and Mr Phillips in evidence was that they had been assured that, in effect, Mr Harris's letter did not mean what it said and for so long as Jordan was to be awarded the sponsorship it was better not to take an aggressive stance by asserting that it had already been awarded the contract. Yet the response does not even refer to any telephone conversations let alone any understanding derived from them.
The "covering ass" note
There is another note by Mr Phillips which was made shortly after Jordan had received Mr Harris' fax and so probably on 27 March itself. The note is of a telephone call from Mr Perring. The top copy of the note (so far as material) reads "covering ass letter. No problem. David took decision last week - phone call. Peter Harris .... Complete deal + bonuses got to tie everything down...."
The words I have underlined were, as Mr Phillips accepted, added later. They are not on the carbon unlike the rest of the note. They look different. They are, again, one might have thought, the most important words spoken (if they were spoken) yet other matters were recorded at the time. Moreover, on Mr Perring's evidence (which I accept) that he did not think any decision had been made by 22 March and had not spoken to anyone at Vodafone about the 22 March conversation the added words cannot be attributable to him. I regret to say that once again I think Mr Phillips was untruthful in the evidence he gave about this. Read without the added words and on the basis that Mr Perring was expressing a personal opinion the note is hardly consistent with Jordan's case.
Mr Phillips' notebook also contains notes of a conversation with Mr Harris said to have taken place on 27 March following the conversation between Mr Phillips and Mr Perring. This note also contains material which it is accepted was added later. Mr Harris had no recollection of any conversation with Mr Phillips on that day. He was having an even busier day. He met Mr Briatore in the morning in London, flew to Paris to meet Mr Todt and then back to Dusseldorf in the evening. So far as material, and again with the words added later underlined, the note reads:
"Chris Gent meeting Wednesday. Not delaying. Lot of money, lot of people internally who have to be convinced. J has a lot of support. Looks good for you. Letter was if you've got to move you must"
This note both in its original and additional form is substantially consistent with Vodafone's evidence and case. It is not consistent with the 26 March letter meaning anything other than what it said. It also fits with the response to that letter which Mr Phillips sent. It is notable that neither in this note nor his e-mail of 28 March does Mr Phillips record surprise nor assert that Jordan already had a deal. The reference to "if you've got to move you must" is a reference to Gallaher. As I have already mentioned (paragraph 116) Mr Haines and Mr Harris both said that whenever Jordan raised in conversation the need for an early decision by Vodafone because of Jordan's need to meet a deadline with Gallaher (or otherwise) their reaction was that Mr Jordan should not let the Vodafone prospect stand in the way of doing whatever they had to do. Mr Phillips' evidence was to the precisely opposite effect: he said he was told on this occasion that if he had to tell Gallaher that it could no longer sponsor Jordan because Vodafone had agreed to do so then he should do just that.. I have no doubt at all that Mr Haines and Mr Harris evidence is to be preferred. The note itself supports them. So does the letter. What happened (and did not happen) with Gallaher thereafter puts the matter beyond doubt.
Mr Jordan also said he spoke to Mr Haines on 27 March about Mr Harris' letter. Mr Jordan said he was "perplexed and very annoyed" about the letter but decided "confrontation was not the answer." He says Mr Haines told him that Mr Harris had been concerned about the 22 March conversation and that he thought Mr Haines had "jumped the gun." Mr Jordan's first witness statement (paragraphs 32 and 33) continues:
"David Haines said that he had told Peter Harris that his decision was that Vodafone would sponsor Jordan and that I should not worry and that everything would be sorted out. He confirmed that he was the boss and it was his programme and his responsibility. He said he would discuss the matter at a board meeting the following Tuesday and that he did not want any paperwork showing that a decision had been made. I was reassured by this conversation."
Mr Haines recalled having a conversation with Mr Jordan after 22 March but said that he would have said nothing to undermine the substance of Mr Harris' letter which he had asked Mr Harris to write nor to claim that any decision was his to make. Again, I unhesitatingly accept what Mr Haines says. He and Mr Harris were in the process of preparing their recommendations at the time, starting with a Brand Steering Committee meeting to be held on 29 March.
There is a handwritten note made on 28 March by Jane Graves (a secretary to Mr Jordan) which reads "Vodafone - decision tomorrow by the Board. David Haines - Global Director, confidentially told EJ and IP -JGP are the one - not rubber stamp by board. Letter advising jumped the gun".. The same note refers to Mr Jordan having had a meeting with Denise Lewis, a senior executive of Orange. These notes were taken at a Jordan Executive Meeting attended by Mr Jordan and others and (part time) Mr Phillips. The typed-up notes made no reference to Orange but for "action" by Mr Jordan recorded "Vodafone team choice decision to be made 29/03 by Vodafone -JGP have been confidentially told this just needs to be rubber stamped by the Vodafone Board meeting on Weds 4th April". The contrast with the handwritten note and Mr Phillips' note of his conversation with Mr Harris remains without satisfactory explanation. Nor does the meeting appear to have been characterised by such confidentiality that Mr Haines' "decision" could not be mentioned.
Mr Ecclestone
It was also a significant part of Jordan's submissions that there was an explanation for Mr Haines' change of mind shortly after 22 March away from Jordan. First, there was a telephone conversation on 23 March in which Mr Todt called Mr Haines and was told that Mr Harris would be formally joining the Vodafone team in April and it was agreed that Mr Harris and Mr Todt should meet on 27 March in Paris. Second, the meeting with Mr Ecclestone (arranged by Mr Briatore) duly took place on 26 March in London when he gave a strong recommendation that Vodafone should sponsor Benetton and mentioned that Ferrari would not be a bad option either. These activities, it was suggested, affected Mr Haines' eagerness for Jordan and so when Mr Haines and Mr Harris met in Dusseldorf on 28 March to prepare for the 29 March meeting of the Brand Steering Committee they decided to recommend the "small on big" option with Ferrari rather than a "big on small" option with Jordan. Whilst such a thesis may merit the description "inventive" it does not stand up to even modest examination. Both Benetton and Ferrari were in any event serious contenders. But even if it were true and even if it helped to explain the 26 March letter, the fact is that letter was sent and received and acknowledged and Jordan's case that Mr Haines and Mr Harris in subsequent telephone conversations then said in effect that the letter did not mean what it said becomes even more improbable.
CONCLUSION ON THE 22 MARCH TELEPHONE CONVERSATION
I have no doubt that Mr Haines' account is to be preferred to that of Mr Jordan and Mr Phillips. No sensible objective observer could reasonably have thought that any binding commitment was made by anything which was said or that Mr Haines had made any decision let alone that Vodafone had. I am sure Mr Jordan was pushing hard. I do not doubt he thought he was on a winner. He may even have indulged in wishful thinking. But not even the rudiments of a "deal" in the sense Jordan seeks to use the word had been established at the time. Nothing had even reached the stage of what could be described as Heads of Agreement and even Mr Jordan's letter recognised both that fact and the need at least to have agreed such a document. But I also think and find that Mr Haines did not even use the words "You've got the deal" at least in the context or sense on which Jordan relies. Had he done so Mr Phillips would indeed I think have noted them at the time rather than or in addition to the somewhat bland information he did record and the subsequent correspondence and references to the conversation would not have taken the form they did.
What happened after 22 March is itself also wholly inconsistent with any binding commitment and indeed with any belief on the part of Jordan that such a commitment had been made.