Legal Analysis

[Maxmil]

Now that L'affaire Newey has cooled somewhat, I would like to see some informed speculation as to the outcome. I took a course in U.S. Contract Law so long ago that I will not reveal the date. Therefore I am just going to pose the questions and let some other(s) with a better background in UK or EEC law provide the answers.

Assumptions: (1) Newey's preexisting contract with McL expired in August, 2002. (2) He first negotiated and executed a new contract with Jag beginning in August 2002. (3) McL then talked him into signing a second contract, covering his services after August 2000.

Questions:

(1,A) Does Jag have a case against Newey? (For breach of contract?)

(1,B) If so, what are Jag's remedies? (Specific Performance? i.e. Newey is forced to honor the first of the two contracts and work for Jag after 8/02. Monetary Damages for Breach of Contract? If so, how determined?

(2,A) Does Jag have a case against McL? (For "alienation of affection"? i.e. McL illegally induced Newey not to perform under his contract.)

(2,B) If so, how would Monetary Damages be determined?

(3) Isn't it more likely that everyone will go back into their caves hissing and spitting?

Let's hear from all you barristers, solicitors, whatevers, out there.

[Liz]

[Questions:

(1,A) Does Jag have a case against Newey? (For breach of contract?)

Depends on what was in the McLaren contract as to when his contract allowed him to talk with other teams. If he was forbidden to discuss terms with anyone until his contract actually expired and his option was not picked up, then yes. Otherwise ... I'd have to see the contract. Also to know under the laws of what country it was executed.

(1,B) If so, what are Jag's remedies? (Specific Performance? i.e. Newey is forced to honor the first of the two contracts and work for Jag after 8/02. Monetary Damages for Breach of Contract? If so, how determined?

Depends on what's in the McLaren contract. Specific performance clauses would be impossible under a personal services contract. How are they going to make him work for them if he doesn't want to? They could, however, enjoin him from working for McLaren until the mess is sorted out.

(2,A) Does Jag have a case against McL? (For "alienation of affection"? i.e. McL illegally induced Newey not to perform under his contract.) Depends on what's in the McLaren contract still in force. The Jag contract is not yet in force if he is still under contract to McLaren, so they couldn't have induced him not to perform under it.

(2,B) If so, how would Monetary Damages be determined? Start high and negotiate.

(3) Isn't it more likely that everyone will go back into their caves hissing and spitting? No, it's more likely that Jag will receive a large sum of money and players to be named later as an inducement to go away and headhunt someone else's Newey. But it is also likely that Paul Stoddart and Toyota are taking notes as to how this one comes out, as they have a similar dispute pending.

The end result will be that (a) Ron Dennis again looks like a prat who is not in control of his operation; (b) Newey, and a lot of high-powered lawyers, will be wealthier and McLaren and Jag will get big tax write-offs for litigation costs; (c) Bobby Rahal and Newey will no longer be best friends; and (d) nobody else will sign Newey to a contract without having a really, really good team of lawyers vet it first.

Oh, and Enrique Bernoldi will sigh with relief that now they are picking on somebody else.

[Emfa]

Sorry, no answers (speculative or otherwise), just another question. I was particularly interested in some of the insight given by neutral in the "Jaguar Responds... " thread, viz.

Newey, according to insiders at McLaren, has a clause in his contract that forbids him from negotiating with other teams while his McLaren contract is more than 12 months long, and therefore Newey could not legally be reaching any agreement with any team before the coming month of August. McLaren are therefore keen to sign Newey on an extension now, before the 12-month term begins.

So, the question is "Has Newey breached his contract with McLaren for negotiating with Jaguar?" and will anything become of that? (related to Q1,A and Liz's postulation)

[Maxmil]

Originally posted by Emfa
So, the question is "Has Newey breached his contract with McLaren for negotiating with Jaguar?" and will anything become of that? (related to Q1,A and Liz's postulation)

If " . . . more than twelve months long, . . . " means "until one year before the contract terminates" then the answer might be "yes". I kind of doubt that such a clause would be upheld in the U.S. however, and as a practical matter it should be unenforceable as contrary to our First Amendment. What it might do is to help get McLaren off the hook with Jaguar. It shows that they tried to prevent him from doing what he did, i.e. sign up another deal.