A £3.6m yacht 'bought as seen' scuppers tycoon
American multimillionaire sues lawyers after bargain buy splutters to halt on its maiden voyage
For most people, the concept of "buyer beware" usually applies to a second-hand family saloon, but for one multimillionaire American entrepreneur, caveat emptor has taken on a whole new meaning with a blighted luxury yacht purchase and subsequent High Court battle.
When telecoms tycoon Michael Hirtenstein bought the 46ft yacht Candyscape from London property tycoon Christian Candy for the knock-down price of €4.5m (£3.6m), he thought he was "stealing" the vessel from the One Hyde Park owner. This was in July 2010, during the financial crisis and a slump in luxury yacht values. The American had planned to travel to Europe to collect his prize and propose to his girlfriend on board.
Instead, within an hour of doing the deal, when the yacht was 12 miles out to sea in international waters, the starboard engine of his new toy, now called Il Sole (in defiance of superstitions about the risk of renaming boats), suffered catastrophic failure.
This month, in a rare insight into the secretive world of luxury yachts and their even more secretive wealthy owners, the case ended up in the High Court in London, with Mr Hirtenstein suing his own lawyers Hill Dickinson for their failure to obtain a guarantee over the condition of the yacht.
Hill Dickinson partner James Lawson, who arranged the purchase from Mr Candy's company Candyscape Ltd, had assured Mr Hirtenstein that it came with a personal guarantee. However, after a two-week hearing, Mr Justice Leggatt has ruled that no such guarantee existed.
Mr Hirtenstein, who in court described the yacht as a "vanity purchase", made his fortune with the sale of his telecoms start-up for $270m in 2005 before establishing a New York property empire.
Christian Candy used to own the yacht The yacht, which Mr Candy purchased for $12.45m in 2005, was originally advertised for €17m, but sold for only €4.5m as an "as is, where is" purchase to Mr Hirtenstein in what was described in one court document as an "emergency fire sale".The court heard how, before the sale, Mr Hirtenstein had said that the yacht "should only retain or increase in value since I am stealing it". But after the engine failure, estimates for repair or replacement came in at more than $450,000 after Il Sole was towed back to shore, reportedly in Italy, before Mr Hirtenstein subsequently transported the yacht to New York and invested more than $2.5m in a complete refit and replacement of both engines in June 2011.
The Independent on Sunday understands it is now available for charter from $135,000 per week, and according to maritime tracking services it is currently cruising the coves and bays off the Hamptons on Long Island in New York.
However, while Mr Justice Leggatt ruled that while Hill Dickinson was liable for legal negligence, which the firm accepted, he said that this had not caused Mr Hirtenstein to suffer any loss. He was entitled only to nominal damages, partly because the claimant would have bought the yacht in any event. The judge's ruling also found that Mr Hirtenstein didn't specifically ask for a guarantee.
A costs hearing is expected in October, when the "nominal damages" amount will be determined, with a source close to the defence case saying this is expected to be "a peppercorn amount". The source added that Hill Dickinson considered the case a victory over Mr Hirtenstein and would be "pursuing him for substantial costs",
In a statement Hill Dickinson said: "Hill Dickinson regrets that a mistake was made in this matter. The firm highlighted the error to the client as soon as it came to their attention and was satisfied that it had caused the client no loss. This position has been vindicated in the judgment."
- 1 Student jailed for hacking University of Birmingham computers to improve his grades
- 2 Smartphones are making children borderline autistic, says psychiatrist
- 3 Company breaks open Apple Watch to discover what it says is 'planned obsolescence'
- 5 The most powerful passports in the world
Student jailed for hacking University of Birmingham computers to improve his grades
Smartphones are making children borderline autistic, says psychiatrist
Nepal earthquake: More than 1,100 killed across four countries and in Mount Everest avalanche
Royal baby: Live updates as the wait continues for Duchess of Cambridge's second child
Hermann Goering's daughter fails to reclaim items looted by Nazi deputy during WWII
The sickening truth about food banks that the Tories don't want you to know
Migrant boat disaster: Ukip candidate mocks victims in sickening Twitter post
Nigel Farage wants the BBC to stop making programmes like Doctor Who, Strictly Come Dancing, and Top Gear
Global warming: Scientists say temperatures could rise by 6C by 2100 and call for action ahead of UN meeting in Paris
General Election 2015: Britain would become a 'communist dictatorship' under Ed Miliband and Nicola Sturgeon, claims wife of Michael Gove
Rupert Murdoch berated Sun journalists for not doing enough to attack Ed Miliband and stop him winning the general election
£24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...
£22000 - £40000 per annum: Recruitment Genius: This company is part of a Group...
£16000 - £18000 per annum: Recruitment Genius: Are you a a young, dynamic pers...
Voluntary: Cancer Research UK: We’re looking for someone to support our award ...