AA strike-out ex-CEO’s claim for damages


The AA have obtained strike-out and summary judgment orders in relation to most of a claim presented against it by its former Chief Executive Officer and Chairman, Robert Mackenzie.  Mr Mackenzie, who was dismissed for gross misconduct after physically attacking a colleague on a company away day, brought claims for wrongful dismissal and personal injury, with his claims for damages including claims arising out of lost share value.  The AA secured strike-out or summary judgment in relation to:

  1. Mr Mackenzie’s claim for wrongful dismissal insofar as it related to benefits other than basic salary and holiday pay.  By reference to the Lavarack principle, the AA successfully argued that the remedy for wrongful dismissal should be approached on the basis of the least onerous way for the contract-breaker to perform the contract.  In this case, this entailed an assumption that the AA would have exercised the PILON clause in Mr Mackenzie’s contract, limiting his recovery to basic salary and holiday pay, and preventing him from recovering bonus payments and ancillary benefits.
  2. Mr Mackenzie’s claim for the value of shares lost upon his dismissal.  These shares required the AA share price to hit particular thresholds in order to have any value and the share price ultimately missed the threshold by a significant margin.  The AA successfully contended that there was no realistic prospect of Mr Mackenzie proving at trial that, had he remained Chief Executive Officer/Chairman, he would have positively affected the share price to such an extent that the shares  would have hit the threshold.
  3. Mr Mackenzie’s claim for personal injury.  The High Court accepted the AA’s argument that, even on the assumption that Mr Mackenzie had been caused a personal injury, he had no realistic prospect of proving at trial that his injury was foreseeable.

The AA was represented by James Laddie QC and Andrew Smith, who were instructed by Simon Goldring of RPC.

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