Payments Pro v FCSA: High Court refuses summary judgement in umbrella employers' membership termination dispute

The High Court has refused an application by four umbrella employers for summary judgement, or alternatively strike out of the defence, in their dispute with the Freelancer and Contractor Services Association over the termination of their memberships. In Payments Pro Ltd & Ors v Freelancer and Contractor Services Association Ltd [2026] EWHC 2415 (Ch), Deputy Master Valentine also declined the association's invitation to strike out the claimants' case of the court's own motion.

FCSA is a trade association and voluntary accreditation body for the professional resourcing sector. Its membership operates as an industry kitemark, and the claimants say 70 to 75 per cent of their clients will only contract with members. In November 2025 FCSA terminated all four memberships. Two were terminated under a provision of separate terms governing members using a special purpose vehicle model, after alleged breaches went unremedied for 21 business days. The others were terminated under a group provision allowing withdrawal of membership from related companies. The claimants deny breach, but the judge assumed it in FCSA's favour for the application.

The claimants argued that FCSA could not terminate on that basis because the articles gave no such power, because the contractual framework required its disciplinary process to be followed, because the decision engaged a Braganza duty that was not met, or because rectification or estoppel by convention applied. The judge applied CPR 3.4 and 24.3 and the Easyair principles, noting that strike out is a high hurdle.

On the articles, the claimants said termination rights must sit wholly within registered articles and cannot cross-refer to private terms, relying on the Companies Act 2006, Bratton Seymour v Oxborough and Cherry Tree Investments v Landmain. The articles here provide that membership ceases on termination in accordance with the terms and conditions. The judge found that the Act does not say in terms that termination powers must be in the articles, and that the class-rights provisions relied on concern shares. Bratton and Cherry Tree involved documents that omitted the disputed term altogether, and did not establish the proposition advanced. The claimants' case fell well short of the threshold.

On construction, the judge accepted that the question was capable of resolution but held that it was not a short point suited to summary determination. It was interlinked with the Braganza and rectification arguments and with whether a breach occurred, the drafting lacked clarity, and several points were not fully argued, including how the disciplinary process interacts with a separate complaints procedure and whether non-compliance would render termination void. He cited Chief Master Marsh's remarks in Commerz Real v TFS Stores.

On Braganza, the judge said he had little information about how FCSA reached its decisions. The claimants sought adverse inferences from the absence of board documents, relying on Al-Masarir v Saudi Arabia, but that case involved a defendant refusing to participate. Here FCSA, fully engaged, denied any duty to explain its reasoning, which accounted for the gap. He added that the law on implying such duties is developing, contrasting Mid Essex Hospital Services v Compass Group with Lord Leggatt's obiter remarks in Tesco Stores v USDAW and the approach in TAQA Bratani v Rockrose. The parties also disputed whether FCSA acted in a quasi-regulatory capacity. He expressed no view on whether a duty applies.

The rectification and estoppel arguments rested on January 2025 emails preceding the addition of clause 4(q) to the terms and conditions. The claimants said they showed a common intention that the disciplinary process would apply to breaches of the special purpose vehicle terms. The judge found the emails capable of more than one interpretation, with materially different accounts of their meaning, and considered the issues better resolved at trial.

The application was dismissed. The judge also refused to strike out the claimants' case, noting that failure to meet the threshold did not make their claim hopeless. He stressed that nothing in the judgement expresses a view on the ultimate merits.

Mark Hubbard and Amit Karia, instructed by William Sturges LLP, appeared for the claimants. Mark Harper KC, instructed by JMW Solicitors LLP, appeared for FCSA.