'A Sign Of Our Enduring Friendship' Or A Multi-Million Pound Mistake?

Scott Pagel and Ivor Farman, two former Goldman Sachs types, set up their own hedge fund in the headier days of the early 2000s. Things didn't go so well at first, and the pair renegotiated their 50/50 split of the profits of the LLP they used as a vehicle for the venture. After a better stretch, things really started to go awry -- to the point where Pagel said he was 'flirting with insolvency every five minutes' as a result of large personal tax liabilities in the USA. Push came to shove in 2008, when the fund experienced heavy losses from a position in illiquid stocks chosen by Farman. Farman, in an e-mail, said that if the 'the sh*t' ever hit the fan he would do 'whatever I can to look after you'. The sh*t did exactly that, and while relations between the partners (like the fund's performance) continued to deteriorate, Farman nevertheless made a 'goodwill gesture' of shares which realised ₤3.8 million (in response to Pagel's demand for ₤5 million). Pagel wanted