The owners of city lap dancing venue The Rocket Club have been ordered to pay costs to a former boss after a High Court Row between two former friends.
Balevents, which is owned by the family of Laurence Reddy, has been told to pay Allan Sartori £35,000 by October 13 – but that is likely to be only a fraction of the final costs bill.
The ruling came at the end of a legal battle over a narrow strip of land outside the Broad Street venue which sparked a venomous falling out between the two businessman who were previouisly best of friends.
Judge Mr Justice Kitchin has ruled that the strip of land, which commands a prime rent, partly due to its importance as a refuge for club patrons forced outside by the smoking ban, is registered to Mr Sartori.
The ruling means Mr Sartori, formerly The Rocket Club’s general manager, is entitled to recover possession of the plot from the venue’s owner, Balevents, which was until recently nominally owned by Mr Reddy’s brother, William, although Mr Reddy was effectively the boss.
Balevents must also pay Mr Sartori “damages for trespass”, from June 4 last year until he gets back possession of the plot, along with the crushing legal costs of the case.
The seeds of the legal struggle were sown when Mr Sartori put in a claim for “squatters rights” over the then Birmingham City Council-owned strip of land and, in October 2009, the Land Registry agreed to transfer it into his name.
Balevents went to court, claiming the company – not Mr Sartori – should have been registered as freehold owner of the disputed land and accusing the former general manager of breaching the “duty of fidelity and loyalty” he owed the club’s owners.
However, Mr Justice Kitchin said that, while the businessmen were still good friends, Mr Reddy “consented” to Mr Sartori making the application to the Land Registry in his own name.
Detailing Mr Sartori’s “long association” with the land, the judge added that his father, Bernard Sartori, had in the mid-1970s opened a takeaway business from a catering trailer parked there, which became a “focal point in the area” and was later taken over by his son.
Describing Mr Sartori as “an emotional man”, the judge said he was “a truthful and generally reliable witness” and “his account of events is entirely credible in light of his association with the land for some 25 years”.
However, the judge said of Mr Reddy: “By contrast, I did not find Mr Reddy a candid witness ... where his evidence and that of Mr Sartori conflict, I therefore prefer the evidence of Mr Sartori.”
The court heard the venue went through various guises over the years – including as a Ronnie Scott’s jazz club – but was suffering serious financial problems by 2003.
Mr Sartori contacted Mr Reddy who stepped in to re-finance the club to the tune of £360,000.
It re-opened as The Rocket Club in May 2003 – with Mr Reddy financing the venture and Mr Sartori appointed as general manager – and was “very profitable” for several years, allowing Mr Reddy to get back all the money he had invested.
However, the fortunes of the club were hit by the economic downturn and relations between the businessmen suffered after Mr Reddy’s son, Mathew, became actively involved in running the venue, but developed “a poor relationship” with Mr Sartori.
Still friends, the pair met at the Green Man pub in Middleton in 2009, where Mr Sartori claimed Mr Reddy agreed to sell him the club for £400,000. He insisted Mr Reddy “shook hands on the deal”, but the latter denied they had reached any firm agreement.
The disputed strip of land was registered in Mr Sartori’s name in October 2009 and negotiations for the sale of the club continued into 2010. However, the judge said relations between the two “finally broke down” in February last year and Balevents launched legal action shortly thereafter.
Mr Reddy described himself as a “consultant” to Balevents, in which he held no shares and was not a director, but the judge said he was “responsible for making all the key financial and corporate decisions for the company” and “was at all times a de facto director”.
Turning to the falling out between the pair during negotiation’s for the club’s sale, the judge said Mr Reddy “became aggressive and abusive and stormed out of the house” during a dinner party at Mr Sartori’s home in July 2009.
The two went out to dinner again in August 2009, but the judge said: “Once again the evening ended with Mr Reddy losing his temper, on this occasion after Mr Sartori raised the issue of the sale of the business”.
The two men went on a Mediterranean sailing holiday together in October 2009, but the judge said their relationship was, by then, “plainly deteriorating” and their final falling out followed a few months later.
Ruling on the central issue in the case, Mr Justice Kitchin said: “I have no doubt that Mr Reddy was concerned to protect the land in front of the club but, at that stage, he and Mr Sartori were still good friends and he had no reason to anticipate their subsequent falling out.
“He was also aware of the long association of Mr Sartori’s family with the land.
“Mr Reddy must have been well aware that the application (to the Land Registry) was being made by Mr Sartori on the basis of his family’s occupation of the land.
“I also believe that Mr Reddy consented to Mr Sartori making and pursuing the application for his own benefit, as revealed by his comment that the land would provide Mr Sartori with a pension.
“In summary, I believe that Mr Reddy well knew of and consented to Mr Sartori making the application to register the land in his own name and for his own benefit. I reject Mr Reddy’s evidence to the contrary.”
The judge said that, before the pair fell out, “I am satisfied that Mr Reddy and Mr Sartori both considered that the land belonged to Mr Sartori. Mr Sartori explained that he was told by Mr Reddy on many occasions that the frontage of the club was his and I accept that evidence.”
Balevents claimed Mr Sartori’s ownership of the disputed land came from “opportunities presented” to him by his role as director, or very senior employee, and the judge accepted Mr Sartori “did have a fiduciary obligation and duty of good faith directly, or indirectly, to Balevents”.
However, handing victory to Mr Sartori, he concluded: “In summary, I am satisfied that Mr Sartori had been in adverse possession of the land for more than 10 years when he made his application to be registered as proprietor ... Mr Sartori is entitled to be registered as the proprietor of the land.”
After the ruling, Mr Sartori told the Post: “I am just glad that it is all over and I want to just move on now with my life and I hope that I can continue to do good work for people in and around Broad Street as I have done in the past.”