Banker’s reference no guarantee
An Arab businessman lost pounds 18m at the claimant casino, and wrote scrip cheques against his account with the defendant. The claimant obtained judgment, but being unable to enforce that judgment pursued his bank. The club had used a system where its bankers obtained confirmation of the value of a customer’s cheque from his bankers, and the club would then provide the appropriate credit. They now said that the defendant bankers had given such assurances and were liable as a consequence when their customer’s cheques were not met. They sought to rely on the international system under which banks relied on each others answers to such questions.
Held: The claim failed. The system did not create a private right as between the customer of one bank and the second bank who answered the question. The procedure was almost informal and was not widely recognised in banking law. There was insufficient evidence to establish that the answer given by the defendant’s employee was dishonest, and the claim in deceit failed.
Flaux J
[2008] EWHC 511 (Comm), Times 09-Apr-2008, [2008] 2 All ER (Comm) 112, [2008] 1 CLC 399, [2008] Bus LR D95, [2008] 2 Lloyd’s Rep 1
Bailii
Gaming Act 1968 16(1)
England and Wales
Citing:
See Also – Grosvenor Casinos Ltd v National Bank of Abu Dhabi ComC 14-Nov-2007
. .
Cited – Crockfords Club Ltd v Mehta CA 8-Jan-1992
The Defendant had gambled at the plaintiff’s casino, using cheques drawn on a company to obtain chips, all of which he lost. The cheques not having been honoured, Crockfords sued the Defendant for repayment of the loan made to him on the issue of . .
Cited – Derry v Peek HL 1-Jul-1889
The House heard an action for damages for deceit or fraudulent misrepresentation.
Held: The court set out the requirements for fraud, saying that fraud is proved when it is shown that a false representation has been made knowingly or without . .
Cited – Uzinterimpex JSC v Standard Bank Plc ComC 15-May-2007
The court considered the liability of a bank under its guarantee of a transaction. The court set out the elements of the tort of deceit: (a) The defendant must have made a representation which can be clearly identified.
(b) It must be a . .
Cited – AIC Ltd v ITS Testing Services (UK) Ltd (‘the Kriti Palm’) CA 28-Nov-2006
The defendant appealed a finding of deceit. Having issued its certificate as to the quality of a cargo of gasoline, it then failed to disclose to the party who had paid it to produce the certificate, information it had which cast doubt on the . .
Cited – Angus v Clifford 1891
The court considered what would be required to be shown for proof of fraud where recklessness was relied on: ‘Not caring, in that context, did not mean not taking care, it meant indifference to the truth, the moral obliquity of which consists in a . .
Cited – Angus v Clifford 1891
The court considered what would be required to be shown for proof of fraud where recklessness was relied on: ‘Not caring, in that context, did not mean not taking care, it meant indifference to the truth, the moral obliquity of which consists in a . .
Cited – Calico Printers Association v Barclays Bank Limited 1931
There is no privity of contract between the payee/customer of a remitting bank and the collecting bank arising from the processing of a cheque. Wright J said: ‘To create privity it must be established not only that the principal contemplated that a . .
Cited – Henderson v Merrett Syndicates Ltd HL 25-Jul-1994
Lloyds Agents Owe Care Duty to Member; no Contract
Managing agents conducted the financial affairs of the Lloyds Names belonging to the syndicates under their charge. It was alleged that they managed these affairs with a lack of due careleading to enormous losses.
Held: The assumption of . .
Cited – Lipkin Gorman (a Firm) v Karpnale Ltd HL 6-Jun-1991
The plaintiff firm of solicitors sought to recover money which had been stolen from them by a partner, and then gambled away with the defendant. He had purchased their gaming chips, and the plaintiff argued that these, being gambling debts, were . .
Cited – Smith New Court Securities Ltd v Scrimgeour Vickers HL 21-Nov-1996
The defendant had made misrepresentations, inducing the claimant to enter into share transactions which he would not otherwise have entered into, and which lost money.
Held: A deceitful wrongdoer is properly liable for all actual damage . .
Cited – Komercni Banka, A S v Stone and Rolls Ltd and Another ComC 15-Nov-2002
Toulson J discussed a set off against a claim for damages: ‘The question whether an alleged benefit should or should not be taken into account cannot be determined by mere application of the ‘but for’ test. Where the wrongful conduct consists of . .
Lists of cited by and citing cases may be incomplete.
Banking
Updated: 10 November 2021; Ref: scu.266202