Pinewood Asia Pacific welcomes UK Court decision to uphold case against Pendragon subsidiary

LONDON, Oct. 13, 2023 /PRNewswire/ -- Pinewood Asia Pacific (Pinewood AP), an Asian-based technology supplier, welcomed on Friday a decision by a UK High Court judge to dismiss efforts by a Pendragon subsidiary to have the claim dismissed and the case will now go to court.

Pinewood AP alleges contract breaches by Pendragon subsidiary Pinewood Technologies PLC  in their reseller agreement, resulting in Pinewood AP being unable to fulfil contracts it had devoted time and resources into building.

"We are delighted that the judge has rightfully decided to dismiss the strikeout and that Pinewood Technologies PLC have a case to answer," said Pinewood AP Chief Executive David Neilsen. "Alongside Josephine Lee, we set up a business, won contracts and thought we had a good partnership with Pendragon.."

"We are pleased that we will take the matter forward in court and that justice has a chance to be done. We are doing this not only for ourselves, but for all the staff we had to make redundant," Neisen said.

Whilst the case continues, Pinewood AP intends to seek permission to appeal with respect to certain aspects of the judgment.

Notes to editor:

Brief outline of the case

The case revolves around an alleged breach of contract between Pinewood Technologies PLC and their reseller in Asia, Pinewood Technologies Asia Pacific Limited (Pinewood AP). "The Reseller Agreements envisaged that the Claimant Pinewood AP would devote significant costs and resources to promote and sell the Pinewood DMS in the Asia Pacific region in accordance with certain targets, whilst restricting its ability to generate alternative sources of income." There were contractual obligations within the agreements including development obligations that would be made by Pinewood Technologies PLC who would make the necessary developments to enable the reseller to sell the system in the territories they operated in.

Two key obligations are that Pinewood UK would:

• "make any necessary changes to ensure that the Pinewood Dealer Management System meets the legal requirements of the Territory, provided that [Pinewood AP] provides Pinewood Technologies PLC reasonable notice and detail of the changes required" (the "Legal Requirements Obligation"); and
• use "its best endeavours to make any necessary changes to ensure that the Pinewood Dealer Management System meets the vehicle manufacturer franchise standards of the franchises held by Contracting Customers" (the "Franchise Standards Obligation").

Despite repeated requests and notice periods, Pinewood Technologies PLC did not meet these obligations, resulting in Pinewood AP struggling to fulfil their contracts with their customers. With some of these developments necessary to operate in certain territories, it was imperative that the conditions were met.

As a result of Pinewood AP not being able to fulfil their contracts, their business model, which they had diligently built and resourced, was no longer viable in its current state.

Upon the failure of Pinewood AP to fulfil all their contracts in Asia, Pinewood UK then approached the customers of Pinewood AP and subsequently won numerous contracts from Pinewood AP. The developments requested by Pinewood AP would obviously still be required by the customers and, with Pinewood UK knowing these were required (having been told about them through Pinewood AP's work) quickly then, with Pinewood AP removed from the picture, completed the developments they had been unable to previously do so.

The alleged actions of Pinewood UK have meant that they have been able to profit from their breach of contract.