The party’s over for cheating organiser
Court battle exposes overcharging at £800,000 event at Elton John’s home
Rajeev Syal

guardian.co.uk,
Sunday November 23 2008

The extravagant spending of Britain’s rich and famous has been revealed
in the High Court, where the organiser of some of Britain’s most lavish
parties was shown to be a cheat who regularly overcharged his stellar
list of clients.

Matthew James had become one of Britain’s most famous fixers with a
series of outlandish events. He sent giraffes and zebras to wander
among guests at a garden party thrown by Elton John, recreated an
airport to celebrate Kevin Spacey’s term at the Old Vic, and held an
open-air dinner for Stella McCartney in a forest lit with 2,000
candles.

But his award-winning company, DNA Productions (Europe), has been wound
up after a High Court battle over the cost of an £800,000 party in the
grounds of John’s mansion. The judge ruled that the company had grossly
overcharged one client and routinely concealed the true costs of events
to others.

James came to prominence in 2001 after organising the White Tie and
Tiara Ball in the grounds of John’s 37-acre pile in Windsor, Berkshire.
Over four years, he organised the annual charity event attended by
guests including Puff Daddy, Michael Caine and Ronnie Wood with a
variety of glittering themes. At one, based on an 18th-century
Fragonard painting of a girl on a swing, staff wore powdered wigs and
Swarovski created a secret crystal garden in the woods. In 2005 James
entertained hundreds of guests with a menagerie of safari animals.

His company went bust after he was ordered to pay £100,000 to
Armenian-born property tycoon Rafi Manoukian by the High Court. Mr
Justice Evans-Lombe found that James had launched a ‘campaign of
concealment’ over the cost of a joint birthday and christening party
that was held by Manoukian at John’s home. Guests, including David and
Victoria Beckham, dined in an £80,000 marquee.

Manoukian, who with his brother Bob is believed to be worth more than
£250m, had expected DNA to charge a 12.5 per cent management fee and
take commissions from suppliers of up to £16,000 for the lavish party.
But when he received the full £827,761 bill, he believed that the
company had been unfair in raising costs and had failed to pass on
discounts offered by suppliers.

His suspicions were confirmed when an assistant at DNA accidentally
sent a list detailing the real costs of supplies and services to his
office. Manoukian, 52, refused to pay the full bill. James took his
case to the High Court demanding an outstanding payment of over
£200,000.

Documents emerged in court showing the full scale of the ‘impropriety’.
James and a former employee of DNA admitted that the company had a
policy of concealing suppliers’ discounts from all20their clients.
Evidence showed that James had taken at least £50,000 in discounts from
Manoukian’s party which he had not passed on to his client.

One email, from James’s assistant and event producer Victoria Smith to
a supplier, said: ‘When you do quote, could you also just include 10
per cent commission to us hidden in the quote? We have to show the
client all our invoices which is why we need the written quote and also
the commission included.’

In another email to a supplier, Smith wrote: ‘As discussed, attached is
a breakdown of how I need your quote laid out in order to show
Manoukian – so we can then get deposit [sic] from him! Where the costs
are higher, it’s because we have marked them up – your quote should
still show these as I have quoted to Manoukian but allowing for a bit
more commission for DNA. Does that make sense?!’

The judge said: ‘Matthew James accepted it was DNA’s practice to
conceal from its clients that it was receiving commissions or discounts
from some of its suppliers in addition to an event management fee… It
was Matthew James’s evidence that DNA’s practice was not to record
offers of commission or discounts from suppliers in writing, as far as
possible, and correspondence referring to such offers or their payment
was routinely deleted from DNA’s books and records.’

The judgment revealed that DNA went into voluntary liquidation last
June with debts of £389,892. The company’s staff have also been
laid off. James could not be contacted last week.