Bastone and Firminger Ltd v Nasima Enterprises (Nigeria) Ltd and Others: ComC 20 May 1996

Banking – collecting banker – remitting banker – privity of contract Banking – remitting bank – right to damages – other than indemnity by customer Conflict of laws – RSC Order 11 r.1(1)(f) – ‘damage sustained within the jurisdiction’ – meaning Amendment of writ – causes of action arising after date of writ – exception – discretion
Rix J took a general view of the court’s discretion to allow the addition (within the limitation period) of causes of action based on assignments subsequent to the writ, but was also able to distinguish Roban Jig on the facts.

Rix J
[1996] CLC 1902
England and Wales
Cited by:
CitedNML Capital Ltd v Argentina SC 6-Jul-2011
The respondent had issued bonds but in 2001 had declared a moratorium on paying them. The appellant hedge fund later bought the bonds, heavily discounted. Judgment was obtained in New York, which the appellants now sought to enforce against assets . .

Lists of cited by and citing cases may be incomplete.

Banking

Updated: 26 November 2021; Ref: scu.186603

Fielding and Platt Ltd v Selim Najjar: CA 17 Jan 1969

The plaintiff company had contracted to make and export to the defendant an aluminium extrusion press. The defendant re-assured the plaintiff that it would be lawful for him to import the plant, but asked that the plant be described falsely on the invoice as ‘parts for rolling mill’. Payment was made by promissory notes. After the first two promissory notes had not been met, the plaintiff ceased production, and sued on the notes and succeeded summarily. The defendant appealed.
Held: The plaintiff was entitled to payment under the first note, because it had performed its obligations under the contract, and there was no failure of consideration. However there was no such completed consideration for the second promissory note, and the defendant should be allowed to defend.
The request to mis-invoice the goods, if illegal, was severable, and did not undermine the contract as a whole. To succeed in their defence of illegality, the defendant had to show that the plaintiff was aware that performance by importing the plant would be illegal, and had agreed to go ahead notwithstanding that illegality. That had not been demonstrated in this case.
An innocent party who is ignorant of the facts or circumstances that would make performance of a contract illegal may be allowed to recover money paid by him under the illegal contract.
Only in exceptional circumstances should a court deprive a claimant of judgment on a claim based on a promissory note.
Lord Denning MR said: ‘The plaintiffs, Fielding and Platt Ltd are manufacturers of machinery. Their business is in Gloucester. In the middle of 1965 they entered into a contract with a Lebanese company called SCIALE Aluminium of Lebanon. They agreed to make and sell to the Lebanese company an aluminium extrusion press for a total sum of andpound;235,000. The plant and equipment was to be delivered free on board at a British port. The time for delivery was 10 1/2 months from 19 June 1965. Payment was to be made by six promissory notes given by the defendant, the managing director of the Lebanese company, Mr Selim Najjar, personally; and he deposited shares, of his own, as security for the due payment of the promissory notes. The promissory notes were payable at intervals during the progress of the work. The first four were payable whilst the plaintiffs were making the machinery in England. Thus the first note was payable on 4 October 1965, for andpound;23,500; the second on 4 December 1965, for andpound;47,000, the third on 4 February 1966, for andpound;47,000; and the fourth on 4 April 1966, for another andpound;47,000. The fifth note was payable on 4 June 1966, for andpound;47,000, which was just about the time when the machinery was to be delivered to the port. The sixth note, the final one, for andpound;23,500, was payable on 4 August 1966.
On 4 October 1965, the first promissory note, for andpound;23,500, fell due. It was not paid. The defendant apologised for not paying it. He asked for a few days’ grace. He said that had been agreed. So be it. He was given a few days-indeed more than a few days. Still he did not pay. When the note was a fortnight overdue he wrote on 18 October 1965: ‘It is my estimate that by the middle of next month all will be arranged and I will be able to proceed with the payments.’ He realised that his non-payment might result in delays on the English side, for he added: ‘Please remember that any delays on your part due to delayed payments will be acceptable.’ When the note was more than three weeks overdue, the plaintiffs decided to suspend work on the contract. On 27 October 1965, they cabled to the Lebanese company:
‘We have today suspended all work on your contract with us and this includes notification to all our material suppliers that they must do no further work on this contract. We have been forced to take this action to comply with the requirements of our authorities. Our current financial commitment to material and equipment suppliers plus design and stock material and labour charges, is extremely heavy. We trust you appreciate that this is your liability. As a result of suspending all work you will appreciate that our delivery date will be considerably extended and the amount of the delay will depend on the time taken for you to resolve your difficulties.’
The defendant never paid the first promissory note or any of the others. He never paid anything. In consequence, the plaintiffs suspended work on the contract, and it remained suspended. No further work was done on it. There were negotiations for a revival of the contract, but they came to nothing.
Stopping there, it is quite plain to me that the defendant was liable to pay the first of the promissory notes. We have repeatedly said in this court that a bill of exchange or a promissory note is to be treated as cash. It is to be honoured unless there is some good reason to the contrary. It is suggested that, on the first note, there was a failure of consideration. That suggestion is quite unfounded. The plaintiffs were getting on with their part of the contract. They were, they say, ordering goods from their suppliers and getting on with the work. At any rate, there is no evidence to the contrary; and, unless they were themselves in default, they were clearly entitled to payment of the first note. The position as to the second note is different. Before it fell due, the defendant said: ‘I cannot pay’; and the plaintiffs replied: ‘We, therefore, suspend work.’ Seeing that the plaintiffs had suspended work, they could not claim payment in full, but at most damages. They could not sue on each note as it fell due-each of the six-when they had suspended all work on the contract. So there is an available defence on the second note. But not on the first note.
This brings me to the second point. In answer to the claim in both notes, the defendant raises a defence of illegality. He says that it was his intention to break the laws of the Lebanon and that the plaintiffs were parties to it. In order to import the extrusion press into the Lebanon, he had to get an import licence from the Lebanon authorities. He had already got a licence to import a two million pound rolling mill, but he had not got a licence to bring in an extrusion press. His intention was to import it without a licence, and he says that the plaintiffs agreed to help him to do so. The plaintiffs agreed, he says, to put in a false invoice. He says: ‘I asked you to invoice the press as part of a rolling mill, and you agreed to it, and, therefore, you cannot recover anything.’ That defence does not commend itself to me. Here is a man who prays in aid his own illegality-he admits he was trying to evade the laws of his own country-and he seeks to implicate the plaintiffs in it.
In order for this to be any kind of defence, he must show first of all that the contract contained a term that the plaintiffs were to give a false invoice; so that it could not lawfully be performed. For if it would be lawfully performed (by giving a correct invoice) the plaintiffs can certainly sue on it. I do not think there was any such term. During the negotiations the Lebanese company did ask the plaintiffs to invoice the press as ‘parts for rolling mill’. But this request did not, as I read the correspondence, become a term of the contract. The contract was concluded on 13 July 1965. And the only subsequent reference was contained later in the confirmation which the plaintiffs sent to the Lebanese company. There was a long detailed description of the goods covering many pages and then, in brackets, were the words (‘to be invoiced as ‘parts for rolling mill”). That was a mere notification by the Lebanese company of the way they wanted an invoice made out. It was not a term of the contract itself. The plaintiffs would therefore quite justifiably refuse to give such invoice, and insist on the contract being lawfully performed.
In the second place, even if it were a term, the defendant would have to show that the plaintiffs were implicated in this illegality, that is that they had knowledge of it and were actively participating in it, see Foster v Driscoll, Lindsay v Attfield, Lindsay v Driscoll ([1929] 1 KB 470 at p 518; [1928] All ER Rep 130 at pp 146, 147) per Sankey LJ. I can see no evidence worthy of the name to suggest that the plaintiffs knew of this illegality. The only evidence is contained in a cable about the import licence. On 16 June 19658 the plaintiffs stated that they were agreeable to the proposed contract ‘subject to evidence of satisfactory importing licence arrangements’. The Lebanese company replied:
‘Concerning our import licence, we have a regular import licence for a total amount of two million sterling, for a complete aluminium plant. This licence is more than what we require for an extrusion press, and since we don’t want to lose our right for the remaining amount, we want the material to be invoiced as ‘parts for rolling mill’. This of course is for local consumption. We discussed these details with your representative here, and will make sure that you do the correct thing when the time comes. Please bear in mind that few items (just any thing) of the total order should be in Beirut the first week of October the latest, because our licence is valid until October 24, 1965, and before that date something should have arrived.’
I do not think that cable was enough to give the plaintiffs knowledge of the illegality. It only shows that the Lebanese company thought it convenient, for local consumption, to have the machines invoiced as parts for a rolling mill, instead of the more accurate description of an aluminium extrusion press.
I cannot help remarking that the defendant seems to have a special fondness for false invoices. At a later stage he suggested that the plaintiffs should give an invoice for only half the cost, instead of the whole; so as to save customs duties. He also suggested that the plaintiffs should write a false letter (which he drafted) to show the Lebanese customs authorities. The plaintiffs very properly did not agree to those suggestions. And when the matter finally came to a head, the plaintiffs firmly said: ‘We must invoice the goods correctly.’ I know there is a suggestion in the affidavit of the defendant that the plaintiffs were implicated, but, in the face of the documents, I see no substance in this suggestion.
There is another point: even if there was a term that these goods should be invoiced falsely in order to deceive the Lebanese authorities, I do not think it would render the whole contract void. That term would be void for illegality. But it can clearly be severed from the rest of the contract. It can be rejected, leaving the rest of the contract good and enforceable. The plaintiffs would be entitled, despite the illegal term, to deliver the goods FOB English port, and send a true and accurate invoice to the Lebanese buyer. The Lebanese buyer could not refuse the goods by saying ‘I stipulated for a false invoice’. He could not rely on his own iniquity so as to refuse payment.
In my opinion, therefore, the defence of illegality is clearly bad. I would allow judgment to be entered on the first note and for the interest thereon; and give leave to defend as to the second.’
Davies LJ said: ‘I agree with the result reached by Lord Denning MR and I do not propose to add anything.’
Widgery LJ said: ‘I also agree. I find each of the main issues in this case one of some difficulty and I am much indebted to counsel for the defendant for his argument; but in the end I have concluded that they are sufficiently determined to justify judgment under RSC, Ord 14 in respect of the amount of the earlier promissory note. So far as the allegation of illegality is concerned, there are I think two independent and sufficient answers to it. First, in order to succeed on this question, the defendant must show that the plaintiffs were aware of the illegal purpose in the falsification of the invoice and that they agreed actively to participate in that purpose so that goods could be illegally imported into the Lebanon which would not otherwise be allowed to enter. The only basis on which it is said that the plaintiffs at any material time had knowledge of that illegal purpose is the telex message of 18 June from the Lebanese company, to which Lord Denning MR has referred. If I may just repeat again the essential words, they were replying to an enquiry from the plaintiffs as to their import licence, and they stated:
‘We have a regular import licence for a total amount of two million sterling, and for a complete aluminium plant. This licence is more than what we require for an extrusion press and since we don’t want to lose our right for the remaining amount, we want the material to be invoiced as’ parts for rolling mill’. This, of course, is for local consumption . . ‘
When that was first read to us, for my part I found it quite incomprehensible, and it is not until one gets further in the correspondence that the real point of it becomes clear. The plaintiffs, of course, had to judge the legality or illegality of what was proposed, without the benefit of the correspondence which developed months later as to the terms of that telex message. I can see no reason whatever to suppose that the plaintiffs should see more in that message than that the invoice was to indicate that the goods were part of a larger matter, which in itself would not involve any illegality that I can see. It is only later that one appreciates that the character of the goods may be of some relevance, and if the plaintiffs did agree to invoice the goods as part of a larger whole, I cannot for my part see that that would involve them in any illegality sufficient to excuse the defendant from liability in this case. Alternatively, as Lord Denning MR has said, I am of the opinion that there was no term in this contract requiring the plaintiffs to invoice the goods as part of a rolling mill. The chief contractual document is a formal and lengthy quotation which the plaintiffs submitted to the defendant setting out details of the machine to be supplied; and on 13 July the Lebanese company accepted that quotation in these words:
‘please consider this letter as an official order based on your quotation of July 5, 1965 and our different telexes to which you have given your agreement.’
At that point there was nothing in the contractual documents to imply an obligation on the plaintiffs to invoice the goods as part of a rolling mill. Counsel for the defendant has referred to the telexes mentioned in that letter, but there was no agreement by the plaintiffs to any telex involving a special form of invoicing. When the plaintiffs received that acceptance of their offer, they sent a formal and detailed confirmation; and it is to be observed that under the terms of their agreement no contract was to be binding on them until that confirmation had been given. In my judgment, that was no more than a confirmation of that which was already agreed, and it would be quite unreal to regard it as a counter-offer containing a new term whereby the goods were to be invoiced as part of a rolling mill.
On the second issue, namely, the failure of consideration, for which the notes were given, my opinion is that these notes were given by the defendant in consideration of the plaintiffs entering into the agreement with the Lebanese company and carrying out that agreement. It is arguable that if counsel for the defendant can sustain his contention that the plaintiffs repudiated the contract in November and that that repudiation was accepted by the Lebanese company, then perhaps it can be shown that liability on bills maturing after the date of the repudiation had itself been determined; but, like Lord Denning MR I can see no possible ground on which it can be said that the consideration for the first bill, which would mature in October 1965, at a time when the plaintiffs were in no way in default, can have been rendered wholly ineffective by virtue of that which followed.
I also would accordingly allow the appeal to the extent that judgment should be entered only in respect of the amount of the first bill and interest thereon.’

Lord Denning MR, Davies, Widgery LJJ
(1969) 113 Sol Jo 160, [1969] 1 WLR 357, [1969] 2 All ER 150
England and Wales
Citing:
CitedScott v Gillmore 6-Jul-1810
A bill of exchange, part of the consideration for which is spirituous liquor sold in less quantities than of 20s. value, is totally void, though part of the consideration was money lent -The statute 24 G. 2, c. 40, s. 12, making illegal the sale of . .
CitedRegazzoni v KC Sethia (1994) Ltd CA 1956
The rule against enforcing foreign political laws did not require it to enforce a contract that violated Indian laws against export to South Africa. The court permitted recognition but not enforcement of foreign revenue laws.
Denning LJ said: . .

Lists of cited by and citing cases may be incomplete.

Contract, Banking

Updated: 23 November 2021; Ref: scu.459793

Director of Public Prosecutions v Scarlett: CACD 7 Feb 2000

A defendant subject to a confiscation order in criminal proceedings for drugs related offences could be ordered to repatriate assets from banks accounts held abroad. The absence of an explicit power in this behalf did not prevent the order because of the wide power to make such ancillary orders to ensure compliance with an order as appeared necessary. An additional punishment for contempt for failing to obey was not punishing him twice, and he could purge the contempt if he chose.

Times 07-Feb-2000
England and Wales

Criminal Sentencing, Banking, Contempt of Court

Updated: 23 November 2021; Ref: scu.80043

In re Banque des Marchands de Moscou (Koupetschesky) (No 2): CA 1954

A Russian bank operated in Russia. It had no branch in England, but did have an account, in credit, with a bank in London. On December 15, 1917 the bank was nationalized by a decree of the soviet government. On December 16th 1917, two documents were signed, purporting to be orders from the Russian bank to the one in London directing it to pay to the order of O, a russian, andpound;10,000 in the one case and andpound;2000 in the other. The Russian bank was dissolved under a Russian degree in or about January 1918, and any liability of the banker to O was extinguished in Russian law. On May 30 1932 after the dissolution of the russian bank a winding up order in respect of it was made in England under the Companies act 1929 section 338. On September 21, 1932, O, being then domiciled in France, lodged a proof in the winding up in respect of an alleged that the andpound;12,000 being the aggregate of the two sums of andpound;10,000 and andpound;2000. No application for leave to serve a writ out of the jurisdiction for the purpose of recovering either of the two sums was made. O died and assets having come into the hands of the liquidator and the liquidator having rejected the proof on November 12 1952, O’s widow and administratrix applied to the court by summons dated December 3 1952, to reverse the liquidator’s decision.
Held: The debts of andpound;10,000 and andpound;2,000 were locally situate in Russia where the russian bank had resided, and even if the debts could have been recovered in England or by action instituted in england, that fact would not have made them locally situate in England ; and accordingly, the debts remained subject to the nationalisation and other degrees of the Soviet government, and the proof was rightly rejected.
A chose in action must be regarded as situated in a country where it is enforceable. A possibility of serving process out of the jurisdiction under Order 11 does not have the effect of altering the local situation of a chose in action so as to bring it within the jurisdiction.

Romer LJ
[1954] 2 All ER 746, [1954] 1 WLR 1108, 98 Sol Jo 557
England and Wales
Cited by:
CitedWight, Pilling, Mackey v Eckhardt Marine GmbH PC 14-May-2003
(Cayman Islands) An international bank went into liquidation in the Cayman Islands, with liabilities in Bangladesh. A new bank was created in Bangladesh, and the applicants sought to make the new bank liable, and through them the liquidators.
Banking, Insolvency, International

Updated: 25 November 2021; Ref: scu.183831

Shearer and Others v Spring Capital Ltd and Others: ChD 17 Oct 2013

‘the first two claimants were enjoying large country houses and expensive London flats while bogus solicitors were attempting to collect money due on high interest loans on behalf of their money-lending business, Logbook Loans. They could hardly have imagined that, in 2013, they would be asking real solicitors to invoke equity on their behalf to escape the burden of interest rates on their own debts which are at a level which Logbook Loans’ erstwhile customers might have thought modest.’

Alexander QC HHJ
[2013] EWHC 3148 (Ch)
Bailii

Banking

Updated: 21 November 2021; Ref: scu.516553

Perenicova And Perenic: ECJ 15 Mar 2012

ECJ Consumer protection – Consumer credit agreement – Incorrect statement of annual percentage rate of charge – Effect of unfair commercial practices and unfair terms on the validity of the contract as a whole
Held: ‘a finding that a commercial practice is unfair has no direct effect on whether the contract is valid from the point of view of Article 6(1) of Directive 93/13.’

A. Tizzano, P
[2012] EUECJ C-453/10, C-453/10
Bailii
Citing:
OpinionPerenicova And Perenic French Text ECJ 29-Nov-2011
ECJ Opinion – Consumer protection – Directive 93/13/EEC – Article 4, paragraph 1 and Article 6, paragraph 1 – Unfair terms in consumer contracts – Directive 2005/29/EC – Unfair commercial practices of companies . .

Lists of cited by and citing cases may be incomplete.

European, Consumer, Banking

Updated: 21 November 2021; Ref: scu.516211

Credit Suisse v Allerdale Borough Council: CA 20 May 1996

Builder’s Guarantee Ultra Vires LA

The council set out to provide a swimming pool using powers under s.19 of the 1976 Act. Purporting to use powers under s.111 of the 1972 Act, it set up a company to develop a site by building a leisure pool and time-share units, with a view to selling the time-share units to pay for the cost of building the pool. The council gave a guarantee to help the company to finance the project, and on the strength of this the company obtained a facility from the bank. The sale of the time-share units proved unsatisfactory and the company went into liquidation. The bank sued the council under the guarantee to recover the sums owed to it by the company.
Held: The guarantee was ultra vires where it had been given to a company when the authority was acting outside it’s proper powers. Where a statutory corporation purports to enter into a contract which it is not empowered by the relevant statute to enter into, the corporation lacks the capacity to make the supposed contract. This lack of capacity means that the document and the agreement it contains do not have effect as a legal contract. It exists in fact but not in law. It is a legal nullity. The purported contract which is in truth not a contract does not confer any legal rights on either party. Neither party can sue on it. Any third party dealing with a local authority should be aware of that fact [of limited capacity and competence] and of the potential legal risk.
Hobhouse LJ said: ‘The discretion of the court in deciding whether to grant any remedy is wide one. It can take into account many considerations, including the needs of good administration, delay, the effect on third parties, and the utility of granting the relevant remedy.’

Hobhouse LJ
Times 20-May-1996, [1997] QB 306
Local Government Act 1972 111, Local Government (Miscellaneous Provisions) Act 1976 819
England and Wales
Citing:
Appeal fromCredit Suisse v Allerdale Borough Council QBD 17-Jun-1994
A Local Authority’s guarantee for its own company was void, having been given for impermissible reasons. . .
AppliedLondon and Clydeside Estates v Aberdeen District Council HL 8-Nov-1979
Identifying ‘maandatory’ and ‘regulatory’
The appellants had sought a Certificate of Alternative Development. The certificate provided was defective in that it did not notify the appellants, as required, of their right to appeal. Their appeal out of time was refused.
Held: The House . .

Cited by:
CitedStretch v The United Kingdom ECHR 24-Jun-2003
The claimant had taken a lease of property from a local authority. Relying upon an option for renewal, he invested substantially in the property, but it was then decided that the option was ultra vires.
Held: Property rights protected under . .
CitedRegina v Soneji and Bullen HL 21-Jul-2005
The defendants had had confiscation orders made against them. They had appealed on the basis that the orders were made more than six months after sentence. The prosecutor now appealed saying that the fact that the order were not timely did not . .
CitedKilby v Basildon District Council Admn 26-Jul-2006
Tenants complained that the authority landlord had purported to vary a clause in his secure tenancy agreement which gave certain management rights to tenants.
Held: The powers to let on secure tenancies were governed by statute. The clause . .
CitedBirmingham City Council v Qasim and Others CA 20-Oct-2009
The council argued that the defendant was not a tenant granted to him as a secure tenancy since he had not been granted the tenancy in accordance with its policies. An employee had manipulated the Council’s system to grant tenancies to bypass the . .

Lists of cited by and citing cases may be incomplete.

Local Government, Contract, Company, Banking

Updated: 20 November 2021; Ref: scu.79620

Promontoria (Chestnut) Ltd v Simpson and Another: ComC 23 Jul 2020

Claim against the defendants under two guarantees which they gave to the Clydesdale Bank in the cumulative amount of pounds 300,000, together with interest.

[2020] EWHC 2137 (Comm)
Bailii
England and Wales
Cited by:
See AlsoPromontoria (Chestnut) Ltd v Simpson and Another ComC 22-Jul-2020
. .

Lists of cited by and citing cases may be incomplete.

Banking

Updated: 20 November 2021; Ref: scu.653899

Iranian Offshore Engineering and Construction Co v Council af The European Union: ECFI 6 Sep 2013

ECJ Common foreign and security policy – Restrictive measures against Iran with the aim of preventing nuclear proliferation – Freezing of funds – Action for annulment – Time-limit for amendment of the form of order sought – Admissibility – Obligation to state reasons – Manifest error of assessment

Pelikanova P
T-110/12, [2013] EUECJ T-110/12
Bailii
European

International, Banking

Updated: 20 November 2021; Ref: scu.515166

In re Yorkshire Woolcombers Association Ltd: CA 2 Jan 1903

Nature of Company’s Debenture Charge

The court considered the nature of a debenture charge. Romer LJ said: ‘I certainly do not intend to attempt to give an exact definition of the term ‘floating charge’, nor am I prepared to say that there will not be a floating charge within the meaning of the Act, which does not contain all the three characteristics . . ‘. ‘I certainly think that if a charge has the three characteristics that I am about to mention it is a floating charge. (1) If it is a charge on a class of assets of a company present and future; (2) if that class is one which, in the ordinary course of business of the company, would be changing from time to time; and (3) if you find that by the charge it is contemplated that, until some future step is taken by or on behalf of those interested in the charge, the company may carry on its business in the ordinary way as far as concerns the particular class of assets I am dealing with.’ and (Vaughan Williams LJ) ‘ . . what you do require to make a specific security is that the security whenever it has once come into existence, and been identified or appropriated as a security, shall never thereafter at the will of the mortgagor cease to be a security.’

Romer LJ, Vaughan Williams LJ
[1903] 2 Ch 295
England and Wales
Citing:
Appeal fromIn re Yorkshire Woolcombers Association Ltd ChD 1903
Farwell J said: ‘A charge on all book debts which may now be, or at any time hereafter become charged or assigned, leaving the mortgagor or assignor free to deal with them as he pleases until the mortgagee or assignee intervenes, is not a specific . .

Cited by:
Appeal fromIllingworth v Houldsworth HL 1904
A clause in a floating charge allowing a company to continue to trade in the assets charged: ‘contemplates not only that it should carry with it the book debts which were then existing, but it contemplates also the possibility of those book debts . .
CitedNational Westminster Bank Plc v Spectrum Plus Ltd and others ChD 15-Jan-2004
The company granted a debenture to the claimant purporting to secure its book debts. The company went into liquidation. The liquidator challenged the bank’s charge.
Held: Siebe was wrongly decided. The charge was ineffective over the book . .
CitedSupercool Refrigeration and Air Conditioning v Hoverd Industries Ltd ChD 1994
(New Zealand) The court noted a greater reluctance in Australia and Ireland than in England to accept the creation of a fixed charge over present and future book debts.
Tompkins J said:’ a requirement to pay the proceeds of the book debts . .
CitedNational Westminster Bank Plc v Spectrum Plus Ltd; In re Spectrum Plus CA 26-May-2004
The court was asked whether a charge given over book debts in a debenture was floating or fixed.
Held: Since the charge asserted some control over receipt of the payments, it was a fixed charge. Upon payment into the account, title to the . .
CitedNational Westminster Bank plc v Spectrum Plus Limited and others HL 30-Jun-2005
Former HL decision in Siebe Gorman overruled
The company had become insolvent. The bank had a debenture and claimed that its charge over the book debts had become a fixed charge. The preferential creditors said that the charge was a floating charge and that they took priority.
Held: The . .

Lists of cited by and citing cases may be incomplete.

Company, Banking

Updated: 19 November 2021; Ref: scu.191954

Evans v Rival Granite Quarries Ltd: CA 1910

The court discussed the nature of a floating charge, Buckley LJ describing it as: ‘A floating security is not a future security; it is a present security, which presently affects all the assets of the company expressed to be included in it. On the other hand, it is not a specific security; the holder cannot affirm that the assets are specifically mortgaged to him. The assets are mortgaged in such a way that the mortgagor can deal with them without the concurrence of the mortgagee. A floating security is not a specific mortgage of the assets, plus a licence to the mortgagor to dispose of them in the course of his business, but is a floating mortgage applying to every item comprised in the security, but not specifically affecting any item until some event occurs or some act on the part of the mortgagee is done which causes it to crystallise into a fixed security.’

Buckley LJ
[1910] 2 KB 979
England and Wales
Cited by:
CitedNational Westminster Bank Plc v Spectrum Plus Ltd; In re Spectrum Plus CA 26-May-2004
The court was asked whether a charge given over book debts in a debenture was floating or fixed.
Held: Since the charge asserted some control over receipt of the payments, it was a fixed charge. Upon payment into the account, title to the . .
CitedNational Westminster Bank plc v Spectrum Plus Limited and others HL 30-Jun-2005
Former HL decision in Siebe Gorman overruled
The company had become insolvent. The bank had a debenture and claimed that its charge over the book debts had become a fixed charge. The preferential creditors said that the charge was a floating charge and that they took priority.
Held: The . .

Lists of cited by and citing cases may be incomplete.

Banking

Updated: 19 November 2021; Ref: scu.198018

In re Yorkshire Woolcombers Association Ltd: ChD 1903

Farwell J said: ‘A charge on all book debts which may now be, or at any time hereafter become charged or assigned, leaving the mortgagor or assignor free to deal with them as he pleases until the mortgagee or assignee intervenes, is not a specific charge, and cannot be. The very essence of a specific charge is that the assignee takes possession, and is the person entitled to receive the book debts at once. So long as he licenses the mortgagor to go on receiving the book debts and carry on the business, it is within the exact definition of a floating security.’

Farwell J
[1903] 2 Ch 284
England and Wales
Cited by:
Appeal fromIn re Yorkshire Woolcombers Association Ltd CA 2-Jan-1903
Nature of Company’s Debenture Charge
The court considered the nature of a debenture charge. Romer LJ said: ‘I certainly do not intend to attempt to give an exact definition of the term ‘floating charge’, nor am I prepared to say that there will not be a floating charge within the . .
CitedNational Westminster Bank Plc v Spectrum Plus Ltd and others ChD 15-Jan-2004
The company granted a debenture to the claimant purporting to secure its book debts. The company went into liquidation. The liquidator challenged the bank’s charge.
Held: Siebe was wrongly decided. The charge was ineffective over the book . .
CitedIn Re Westmaze Ltd (In Administrative Receivership) ChD 15-May-1998
Westmaze were mechanical engineers. They gave a charge to secure borrowings, which described itself as a fixed charge.
Held: A Charge over a company’s book and trading assets was in fact floating even though described as a fixed charge unless . .
At First InstanceIllingworth v Houldsworth HL 1904
A clause in a floating charge allowing a company to continue to trade in the assets charged: ‘contemplates not only that it should carry with it the book debts which were then existing, but it contemplates also the possibility of those book debts . .

Lists of cited by and citing cases may be incomplete.

Banking, Company

Updated: 19 November 2021; Ref: scu.191953

Iccrea Banca (Admissibility – Lack of Jurisdiction of National Court To Review The Legality of Acts of The Single Resolution Board): ECJ 3 Dec 2019

Reference for a preliminary ruling – Directive 2014/59/EU – Banking Union – Recovery and resolution of credit institutions and investment firms – Annual contributions – Calculation – Regulation (EU) No 806/2014014 – Implementing Regulation (EU) 2015/81 – Uniform procedure for the resolution of credit institutions and investment firms – Administrative procedure involving national authorities and an EU body – Exclusive decision-making power of the Single Resolution Board – Procedure before the national courts – Failure to bring an action for annulment before the EU Courts in good time – Delegated Regulation (EU) 2015/63- Exclusion of certain liabilities from the calculation of contributions – Interconnectedness of a number of banks

[2019] EUECJ C-414/18, C-414/18, ECLI:EU:C:2019:1036
Bailii
European
Citing:
OpinionIccrea Banca (Admissibility – Lack of Jurisdiction of National Court To Review The Legality of Acts of The Single Resolution Board – Opinion) ECJ 9-Jul-2019
Preliminary ruling – Admissibility – Lack of jurisdiction of national court to review the legality of acts of the Single Resolution Board – Requirement that acts of the Single Resolution Board must be challenged before the General Court – . .

Lists of cited by and citing cases may be incomplete.

Banking

Updated: 19 November 2021; Ref: scu.669838

Madho Row Chinto Punt Golay (And After His Death, His Brother, Eswunt Row Chinto Punt) v Bhookun-Das Boolaki-Das: 8 Feb 1837

A party resident at Baroda indorsed two Hoondies, or Bills of Exchange, in the name of a firm carrying on the business of banking at Surat, alleging himself to be the Gomashtah or Agent of the firm, and afterwards, on the Bills being dishonoured, absconded.
Held: that in order to fix the firm at Surat with the amount of the Bills, clear evidence ought to have been produced of the authority to act as Gomashtah, and their Lordships not Being satisfied with the evidence admitted in the Courts below, reversed the decrees of both the Zillah and the Sudder Courts with costs.

[1837] EngR 491, (1837) 1 Moo Ind App 351, (1837) 18 ER 143
Commonlii
England and Wales

Banking

Updated: 17 November 2021; Ref: scu.313608

Evans and Another v Finance-U-Ltd: CA 18 Jul 2013

The court was asked whether FUL remained able to enforce the bill of sale to recover unpaid arrears in respect of the loan which Mr and Mrs Evans took out in order to purchase the car. The purchase price of the car was andpound;7,290 which the claimants financed by paying a cash deposit of andpound;1,400 and by borrowing the remaining andpound;5,890 from FUL under the terms of a loan agreement dated 20th April 2007.

Mummery, Patten, Black LJJ
[2013] EWCA Civ 869
Bailii
England and Wales

Consumer, Banking

Updated: 17 November 2021; Ref: scu.513515

Gonzalez Calvet v SRB (Order): ECJ 30 Sep 2021

Appeal – Article 181 of the Rules of Procedure of the Court – Economic and monetary policy – Single resolution mechanisms for credit institutions and certain investment firms – Resolution procedure applicable in the event of proven or foreseeable failure of an entity – Decision refusing to grant financial compensation to the shareholders and creditors concerned – Content of the application – Lack of means and arguments – Appeal in part clearly inadmissible and in part clearly unfounded

C-27/21, [2021] EUECJ C-27/21P_CO
Bailii
European

Banking

Updated: 17 November 2021; Ref: scu.668514

European Commission v Kingdom of Belgium: ECJ 6 Jun 2013

ECJ Failure of a Member State to fulfil obligations – Articles 56 TFEU and 63 TFEU – Articles 36 and 40 of the EEA Agreement – Tax legislation – Tax exemption reserved to interest payments by resident banks and excluding interest payments by banks established abroad

C-383/10, [2013] EUECJ C-383/10
Bailii

European, Banking

Updated: 12 November 2021; Ref: scu.510327

Tournier v National Provincial and Union Bank of England: CA 1924

The court considered the duty of confidentiality owed by a banker to his client. Bankes LJ said: ‘At the present day I think it may be asserted with confidence that the duty is a legal one arising out of contract, and that the duty is not absolute but qualified. It is not possible to frame any exhaustive definition of the duty. The most that can be done is to classify the qualification, and to indicate its limits.’ and ‘In my opinion it is necessary in a case like the present to direct the jury what are the limits, and what are the qualifications of the contractual duty of secrecy implied in the relation of banker and customer. There appears to be no authority on the point. On principle I think that the qualifications can be classified under four heads: (a) Where disclosure is under compulsion by law; (b) where there is a duty to the public to disclose; (c) where the interests of the bank require disclosure; (d) where the disclosure is made by the express or implied consent of the customer.’
Scrutton LJ said: ‘The Court will only imply terms which must necessarily have been in the contemplation of the parties in making the contract. Applying this principle to such knowledge of life as a judge is allowed to have, I have no doubt that it is an implied term of a banker’s contract with his customer that the banker shall not disclose the account, or transactions relating thereto, of his customers except in certain circumstances’ and ‘I doubt whether it is sufficient excuse for disclosure, in the absence of the customer’s consent, that it was in the interests of the customer, where the customer can be consulted in reasonable time and his consent or dissent obtained.’
Scrutton LJ did not think that the ‘ancient formula’ set out in Parmiter for defamation was sufficient in all cases, because words might damage the reputation of a man as a business man which no one would connect with hatred, ridicule or contempt.
Atkin LJ said: ‘The facts in this case as to the course of business of this bank do not appear to be in any degree unusual in general banking business. I come to the conclusion that one of the implied terms of the contract is that the bank enter into a qualified obligation with their customer to abstain from disclosing information as to his affairs without his consent.’
and ‘I have already stated the obligation as an obligation not to disclose without the customer’s consent. It is an implied term, and may, therefore, be varied by express agreement. In any case the consent may be express or implied, and to the extent to which it is given the bank will be justified in acting. A common example of such consent would be where a customer gives a banker’s reference. The extent to which he authorises information to be given on such a reference must be a question to be determined on the facts of each case. I do not desire to express any final opinion on the practice of bankers to give one another information as to the affairs of their respective customers, except to say it appears to me that if it is justified it must be upon the basis of an implied consent of the customer.’
As to defamatory meaning, Atkin LJ said: ‘I do not think that it is sufficient direction to a jury on what is meant by ‘defamatory’ to say, without more, that it means: were the words calculated to expose the plaintiff to hatred, ridicule or contempt, in the mind of a reasonable man? The formula is well known to lawyers but it is obvious that suggestions might be made very injurious to a man’s character in business which would not, in the ordinary sense, excite either hate, ridicule, or contempt – for example, an imputation of a clever fraud which, however much to be condemned morally and legally, might yet not excite what a member of the jury might understand as hatred or contempt.’

Bankes LJ, Atkin LJ, Scrutton LJ
[1924] 1 KB 461, [1923] All ER Rep 550, 130 LT 682
England and Wales
Citing:
CitedParmiter v Coupland And Another 1840
In an action for libel, the Judge is not bound to state to the jury, as matter of law, whether the publication complained of be a libel or not ; but the proper course is for him to define what is a libel in point of law, and to leave it to the jury . .

Cited by:
CitedHedley Byrne and Co Ltd v Heller and Partners Ltd HL 28-May-1963
Banker’s Liability for Negligent Reference
The appellants were advertising agents. They were liable themselves for advertising space taken for a client, and had sought a financial reference from the defendant bankers to the client. The reference was negligent, but the bankers denied any . .
CitedTurner v Royal Bank of Scotland Plc CA 24-Mar-1998
The plaintiff complained as to the provision of references by his bank. The bank said he had given an implied permission through the bank which had made the request. Later changes in the bankers code of practice would have required explicit written . .
CitedElli Christofi v Barclays Bank Plc PatC 19-Jan-1998
A bank’s duty of confidentiality did not arise as regards information received but already known pursuant to statutory duty. The claimant’s writ and statement of claim were struck out as disclosing no cause of action. As regards the allegation of an . .
CitedChristofi v Barclays Bank Plc CA 28-Jun-1999
A bank is under no obligation of confidence to its customer so as to prevent it disclosing to another party a fact which was ascertainable from inspection of public registers, namely in this case that a caution against registration having been . .
CitedBerkoff v Burchill and and Times Newspapers Limited CA 31-Jul-1996
The plaintiff actor said that an article by the defendant labelling him ugly was defamatory. The defendant denied that the words were defamatory.
Held: It is for the jury to decide in what context the words complained of were used and whether . .
CitedThornton v Telegraph Media Group Ltd QBD 16-Jun-2010
The claimant said that a review of her book was defamatory and a malicious falsehood. The defendant now sought summary judgment or a ruling as to the meaning of the words complained of.
Held: The application for summary judgment succeeded. The . .
CitedJeremy D Stone Consultants Ltd and Another v National Westminster Bank Plc and Another ChD 11-Feb-2013
The claimants asserted an equitable claim against funds held by the defendant bank in the name of a company owned by another defendant who they said defrauded them through a Ponzi investment scheme.
Held: The claim failed. On the evidence, the . .
CitedRe C (A Child) FC 29-Sep-2015
There had been care proceedings as to C. The mother was treated by a psychiatrist, X, and an associate Y. They also prepared expert reports. M formally complained about X, and the charges having been dismissed, the doctors now sought disclosure of . .
CitedLipkin Gorman v Karpnale Ltd CA 1989
A partner in a firm of solicitors stole money from them, and spent it gambling with the defendants. The firm sued also their banker, who had been held to be aware of the defaulting partner’s weaknesses and activities.
Held: The solicitors . .

Lists of cited by and citing cases may be incomplete.

Banking, Contract, Intellectual Property

Leading Case

Updated: 12 November 2021; Ref: scu.216369

Westminster Bank Ltd v Hilton: HL 1926

As against the money of the customer’s in the banker’s hands the relationship between banker and customer is that of principal and agent.
Lord Atkinson said: ‘It is well established that the normal relation between a banker and his customer is that of debtor and creditor, but it is equally well established that quoad the drawing and payment of the customer’s cheques as against money of the customer’s in the banker’s hands the relation is that of principal and agent. The cheque is an order of the principal’s addressed to the agent to pay out of the principal’s money in the agent’s hands the amount of the cheque to the payee thereof.’

Lord Atkinson
(1926) 43 TLR 124
England and Wales
Cited by:
CitedBarclays Bank plc v Quincecare Ltd QBD 1992
The relationship of banker and customer is that of agent and principal: ‘Primarily, the relationship between a banker and customer is that of debtor and creditor. But quoad the drawing and payment of the customer’s cheques as against the money of . .
CitedNational Westminster Bank plc v Spectrum Plus Limited and others HL 30-Jun-2005
Former HL decision in Siebe Gorman overruled
The company had become insolvent. The bank had a debenture and claimed that its charge over the book debts had become a fixed charge. The preferential creditors said that the charge was a floating charge and that they took priority.
Held: The . .
CitedOffice of Fair Trading v Abbey National Plc and seven Others ComC 24-Apr-2008
The Office sought a declaration that the respondent and other banks were subject to the provisions of the Regulations in their imposition of bank charges to customer accounts, and in particular as to the imposition of penalties or charges for the . .

Lists of cited by and citing cases may be incomplete.

Banking

Leading Case

Updated: 11 November 2021; Ref: scu.194778

Office of Fair Trading v Abbey National Plc and seven Others: ComC 24 Apr 2008

The Office sought a declaration that the respondent and other banks were subject to the provisions of the Regulations in their imposition of bank charges to customer accounts, and in particular as to the imposition of penalties or charges for the breach of the overdraft limits.
Held: The relevant terms were not exempt from assessment under the 1999 Regulations. None of the terms failed as penalties at common law, and nor would the application of the Regulations disapply any protection given by common law. The Regulations should be read in a purposive way, and the exemptions did not save the Banks’ terms from being caught by the Regulations. In declining to provide an overdraft the banks were not providing a service. However: ‘the Banks supply to current account customers services within the meaning of the 1999 Regulations when they pay in accordance with a payment instruction regardless of whether it is a Relevant Instruction and involves the Bank in carrying out additional procedures and when they operate the running account with a debit balance, that is to say, when they allow borrowing on the account, regardless of whether the borrowing is by way of an unarranged overdraft. However, this does not mean that it is irrelevant to the application of Regulation 6(2)(b) that charges are levied for carrying out payment instructions and allowing borrowing only when the instructions are Relevant Instructions and the borrowing is by way of unarranged overdraft.’

Andrew Smith J
[2008] EWHC 875 (Comm), Times 29-Apr-2008, Gazette 08-May-2005, [2008] 2 All ER (Comm) 625
Bailii
Unfair Terms in Consumer Contracts Regulations 1999, Enterprise Act 2002 213(1)
England and Wales
Citing:
CitedLondon Borough of Newham v Khatun, Zeb and Iqbal CA 24-Feb-2004
The council made offers of accommodation which were rejected as inappropriate by the proposed tenants.
Held: The council was given a responsibility to act reasonably. It was for them, not the court to make that assessment subject only to . .
CitedDirector General of Fair Trading v First National Bank HL 25-Oct-2001
The House was asked whether a contractual provision for interest to run after judgment as well as before in a consumer credit contract led to an unfair relationship.
Held: The term was not covered by the Act, and was not unfair under the . .
CitedJoachimson v Swiss Bank Corporation CA 1921
The service of the order nisi binds the debt in the hands of the garnishee – that is, it creates a charge in favour of the judgment creditor. No cause of action for non payment arises in respect of money standing on a current account until the . .
CitedSocimer International Bank Ltd v Standard Bank London Ltd CA 22-Feb-2008
Rix LJ considered the restraints operating a party to a contract in exercising any discretion gien under it, preferring the use of the term ‘irrationality’ to ‘unreasonableness’: ‘It is plain from these authorities that a decision-maker’s discretion . .
MentionedLymington Marina Ltd v MacNamara and others CA 2-Mar-2007
A share in a marina had been inherited by one brother whose application to grant successive sub-lcences of it to the other two was rejected by the marina, who said that this was not permitted. The marina appealed a finding that it had to make its . .
CitedWestminster Bank Ltd v Hilton HL 1926
As against the money of the customer’s in the banker’s hands the relationship between banker and customer is that of principal and agent.
Lord Atkinson said: ‘It is well established that the normal relation between a banker and his customer . .
CitedBank of New South Wales v Laing 1954
A bank is not under an obligation to lend to a current account customer or to allow him overdraft facilities unless it has agreed to do so. . .
CitedEasycar (UK) Ltd v Office of Fair Trading ECJ 10-Mar-2005
The claimant was a self drive car hire company taking bookings over the internet. Its terms refused a refund on cancellation save in special circumstances. The OFT said these terms infringed the regulations. The claimant said their contracts were . .
CitedRolls Razor Ltd v Cox CA 1967
Winn LJ said: ‘the relationship of banker and customer upon a current account implies from its very nature an intention on the part of both parties that debits and credits arising between them shall be brought into a running account on which by . .
CitedBairstow Eves London Central Ltd v Smith and Another QBD 20-Feb-2004
. .
CitedEmerald Meats (London) Ltd v AIB Group (UK) Plc CA 12-Apr-2002
The claimant appealed a finding that it had not been overcharged interest by the respondent. The account was overdrawn. They claimed that on each occasion when a cheque was paid into the account, the bank had charged a day’s extra interest before . .
CitedBarclays Bank v WJ Simms and Cooke (Southern) Ltd QBD 1979
The customer made out a cheque to pay his builder, but countermanded it. The bank paid the cheque when it was presented by mistake, and now sought repayment from the builder.
Held: The bank succeeded. The court discussed the extent of a . .
CitedLloyds Bank Plc v Independent Insurance Co Ltd CA 26-Nov-1998
The bank had made an electronic transfer of funds for a customer in satisfaction of that customer’s proper debt, but it was done under a mistake of fact as to the cleared status of funds received.
Held: The appeal was turned down. The bank was . .
CitedAbu Dhabi National Tanker Co v Product Star Shipping Ltd (No 2) CA 1993
Where parties enter into a contract which confers a discretion on one of them, the discretion must be exercised honestly and in good faith, and not ‘arbitrarily, capriciously or unreasonably’. The owner had acted unreasonably in that there was no . .
CitedIn re Charge Card Services Ltd ChD 1987
The court discussed the historic availability of set-off in an insolvency: ‘By the turn of the [20th] century, therefore, the authorities showed that debts whose existence and amount were alike contingent at the date of the receiving order, and . .
CitedHeininger v Bayerische Hypo-und Vereinsbank AG ECJ 13-Dec-2001
ECJ Consumer protection – Doorstep selling – Right of cancellation – Agreement to grant credit secured by charge on immovable property. . .
CitedParagon Finance plc v Nash etc CA 15-Oct-2001
The court was asked to consider whether there was any implied term limiting the power of a mortgagee to set interest rates under a variable rate mortgage.
Held: A loan arrangement which allowed a lender to vary the implied rate of interest, . .
CitedCommission v Netherlands C-144/99 ECJ 10-May-2001
ECJ Failure by a Member State to fulfil its obligations – Directive 93/13/EEC – Unfair terms in consumer contracts – Incomplete transposition of the directive into national law. As to the applicable principles in . .
CitedLidl Belgium GmbH and Co KG v Etablissementen Franz Colruyt NV ECJ 19-Sep-2006
ECJ (Approximation of Laws) – Directives 84/450/EEC and 97/55/EC – Misleading advertising – Comparative advertising – Conditions under which comparative advertising is permitted – Comparison of the general level . .
CitedBaybut v Eccle Riggs Country Park Ltd ChD 2-Nov-2006
The purchaser of a caravan park purported to terminate the 10 year licences under which the owners of the various caravans occupied their respective pitches. The sale agreement of the caravan site had contained a covenant by the purchaser with the . .
CitedThe County Homesearch Company (Thames and Chilterns) Ltd v Cowham CA 31-Jan-2008
The defendants contracted to pay estate agents to find them a house. They completed the purchase of a property mentioned to them three times by the agent, but now appealed from a finding that they were obliged to pay his commission. The judge found . .
CitedDublin Port and Docks Board v Bank of Ireland 22-Jul-1976
(Supreme Court of Ireland) The court discussed a bank’s obligation to process cheques issued by its customers: ‘a banker should pay his customers’ cheques in the order in which they are presented, subject to the interest of the customer being taken . .
CitedExport Credits Guarantee Department v Universal Oil Products HL 1983
A contract provided for the payment of a stated sum by one party to the contract (A) to the other party (B) in the event of the non-performance by A of one of more contractual obligations owed by A not to B himself but to C, who was not a party to . .
CitedJoseph Constantine SS Line Ltd v Imperial Smelting Corp Ltd 1942
Before a court, he who asserts something must must prove it: ‘Ei qui affirmat non ei qui negat incumbit probatio’
Lord Wight discussed the question of whether there had been ‘a vital change of the law . . Operating on the circumstances.’ . .
CitedRegina (Factortame Ltd and Others) v Secretary of State for Transport, Local Government and the Regions (No 8) CA 3-Jul-2002
A firm of accountants had agreed to provide their services as experts in a case on the basis that they would be paid by taking part of any damages awarded. The respondent claimed that such an agreement was champertous and unlawful.
Held: The . .
CitedJeancharm Ltd (T/A Beaver International) v Barnet Football Club Ltd CA 16-Jan-2002
The claimant contracted to supply football shirts to the defendant, but claimed that clauses in the contract with regards to late delivery and payment operated as penalties and so were void at common law.
Held: The sums set out were immodest . .
CitedSkillion pIc v Keltec Industrial Research Ltd 1992
In the context of a covenant in a lease restricting the tenant’s use of the demised premises, it is the landlord who requires and puts forward the clause, and, the landlord will be treated as the proposer and the clause must therefore be construed . .
CitedPhilip Bernstein (Successors) Ltd v Lydiate Textiles Ltd; orse Sterling Industrial Facilities v Lydiate Textiles Ltd CA 26-Jun-1962
Lord Justice Diplock: ‘. . the ordinary rule which the courts apply is that contracts should be enforced, pacta sunt servanda, unless they can be brought within that limited category of cases in which, for reasons of public policy, the court refuses . .
CitedShamsher Jute Mills Ltd v Sethia (London) Ltd 1987
The plaintiff sold goods to the defendant under the protection of a letter of credit. The plaintiff did not himself provide approriate documentation to claim under the letter of credit, and the banker did not pay.
Held: The plaintiffs were the . .
CitedFaaborg-Gelting Linien v Finanzamt Flensburg ECJ 2-May-1996
A non-takeaway restaurant is a supply of services, and a ferry supply was made from its place of business. The supply of prepared food and drink at a restaurant resulted from a whole series of services (including the preparation and service of the . .
CitedCofidis SA v Jean-Louis Fredout ECJ 21-Nov-2002
ECJ Directive 93/13/EEC – Unfair terms in consumer contracts – Action brought by a seller or supplier – National provision prohibiting the national court from finding a term unfair, of its own motion or following . .
CitedHer Majesty’s Customs and Excise v Gerhart Schindler and Jorg Schindler ECJ 24-Mar-1994
Europa The importation of lottery advertisements and tickets into a Member State with a view to the participation by residents of that State in a lottery conducted in another Member State relates to a ‘service’ . .
CitedWire TV Limited v Cabletel (UK) Limited CA 30-Jul-1997
When construing an agreement which is not a sham, the court should recognise that the parties might have a choice as to how a contract is structured and pay appropriate respect to the structure adopted by the parties. . .
CitedDomsalla (T/A Domsalla Building Services) v Dyason TCC 4-May-2007
A consumer has no grounds for complaining about the construction adjudication process per se under the Regulations . .
CitedBryen and Langley Ltd v Boston CA 29-Jul-2005
The special facts surrounding the agreement of the standard term at issue were such that the court held that it could not possibly say that there had been a breach of the principle of fair dealing and that rendered it unnecessary for the court to . .
CitedLloyds Bank plc v Voller 2002
. .

Cited by:
CitedOffice of Fair Trading v Foxtons Ltd ChD 17-Jul-2008
Complaint was made that the Foxtons standard terms of acting in residential lettings were unfair. Foxtons objected to the jurisdiction of the Claimant to intervene.
Held: On a challenge to an individual contract, the court would be able to see . .
See AlsoOffice of Fair Trading v Abbey National Plc and others ComC 8-Oct-2008
The director sought a further judgment as to whether charges imposed by banks on a customer taking an unauthorised overdraft, and otherwise were unlawful penalties. . .
Appeal fromAbbey National Plc and others v The Office of Fair Trading CA 26-Feb-2009
The OFT had sought to enquire as to the fairness of the terms on which banks conducted their accounts with consumers, and in particular as to how they charged for unauthorised overdrafts. The banks denied that the OFT had jurisdiction, and now . .
See alsoOffice of Fair Trading v Abbey National Plc and others ComC 21-Jan-2009
. .
At First InstanceOffice of Fair Trading (OFT) v Abbey National Plc and Others SC 25-Nov-2009
The banks appealed against a ruling that the OFT could investigate the fairness or otherwise of their systems for charging bank customers for non-agreed items as excessive relative to the services supplied. The banks said that regulation 6(2) could . .
CitedCavendish Square Holding Bv v Talal El Makdessi; ParkingEye Ltd v Beavis SC 4-Nov-2015
The court reconsidered the law relating to penalty clauses in contracts. The first appeal, Cavendish Square Holding BV v Talal El Makdessi, raised the issue in relation to two clauses in a substantial commercial contract. The second appeal, . .

Lists of cited by and citing cases may be incomplete.

Banking, Consumer

Updated: 11 November 2021; Ref: scu.267090

Fetch.AI Ltd and Another v Persons Unknown Category A and Others: ComC 15 Jul 2021

Cryptocurrency Action

The claimants sought damages and other remedies saying that the unknown defendants had obtained access to the private key guarding their crypto currency assets, and then sold them at an undervalue, acquiring substantial profits for themselves in subsequent unknown transactions. The Court considered the nature in law of such systems, and preliminary injunctive without notice relief.
Held: The orders were made. There were potential causes in action based upon breach of confidence, unjust enrichment and is entitled also to maintain an equitable proprietary claim based upon constructive trust in respect of assets which have been removed from it dishonestly and without its licence or consent. The assets, both the private encryption keys and the cryptocurrency were property. The private keys in their nature attracted protection in the law of confidence.
The issues raised were arguably triable within this jurisdiction

Pelling QC HHJ
[2021] EWHC 2254 (Comm)
Bailii
The Trade Secrets (Enforcement, etc) Regulations 2018, Rome II Convention
England and Wales
Citing:
CitedShenzhen Senior Technology Material Co Ltd v Celgard Llc CA 9-Oct-2020
. .
CitedAdams v Cape Industries plc CA 2-Jan-1990
Proper Use of Corporate Entity to Protect Owner
The defendant was an English company and head of a group engaged in mining asbestos in South Africa. A wholly owned English subsidiary was the worldwide marketing body, which protested the jurisdiction of the United States Federal District Court in . .
AdoptedIon Science v Persons Unknown 21-Dec-2020
Butcher J said that the ‘. . lex situs of a cryptoasset is the place where the person or company who owns it is domiciled. . . There is apparently no decided case in relation to the lex situs for a cryptoasset. Nevertheless, I am satisfied that . .
CitedWestdeutsche Landesbank Girozentrale v Islington London Borough Council HL 22-May-1996
Simple interest only on rate swap damages
The bank had paid money to the local authority under a contract which turned out to be ultra vires and void. The question was whether, in addition to ordering the repayment of the money to the bank on unjust enrichment principles, the court could . .
CitedBanker’s Trust v Shapira CA 1980
Enforcement through innocent third party bank
Two forged cheques, each for USD500,000, had been presented by two men and as a result USD1,000,000 had been transferred to accounts in their names. The plaintiff sought to trace assets through the banks involved.
Held: The court approved the . .
CitedAB Bank Ltd, Off-Shore Banking Unit (Obu) v Abu Dhabi Commercial Bank Pjsc ComC 12-Aug-2016
Application to set aside Norwich Pharmacal Order: ‘The application raises the question whether the court has jurisdiction to permit service out of the jurisdiction of an application for the grant of a Norwich Pharmacal Order.’
Held: An order . .
CitedKryiakou v Christie’s QBD 2017
Warby J summarised the five criteria for the grant of a bankers Trust order: there must be good grounds for concluding that the money or assets about which information is sought belonged to the claimant.
whether there is a real prospect that . .
CitedIon Science v Persons Unknown 21-Dec-2020
Butcher J said that the ‘. . lex situs of a cryptoasset is the place where the person or company who owns it is domiciled. . . There is apparently no decided case in relation to the lex situs for a cryptoasset. Nevertheless, I am satisfied that . .
CitedMitsui and Co Ltd v Nexen Petroleum UK Ltd ChD 29-Apr-2005
Mitsui sought disclosure of documents from a third party under the rules in Norwich Pharmacal.
Held: Such relief was available ‘where the claimant requires the disclosure of crucial information in order to be able to bring its claim or where . .
CitedRussian Commercial Bank (Cyprus) Ltd v Khoroshilov ComC 12-May-2020
Before an alternative service order can be made, the court must be satisfied that there are special or exceptional circumstances for departing from the machinery which the Convention adopts for its signatory countries. . .

Lists of cited by and citing cases may be incomplete.

Torts – Other, Banking

Updated: 11 November 2021; Ref: scu.667410

Green and Another v The Royal Bank of Scotland Plc: CA 9 Oct 2013

The claimants appealed against a claim that they had been mis-sold interest rate swap arrangements by their bankers, thereby suffering losses.

Richards, Hellett, Tomlinson LJJ
[2013] EWCA Civ 1197
Bailii
Financial Services and Markets Act 2000 150
England and Wales
Citing:
CitedHedley Byrne and Co Ltd v Heller and Partners Ltd HL 28-May-1963
Banker’s Liability for Negligent Reference
The appellants were advertising agents. They were liable themselves for advertising space taken for a client, and had sought a financial reference from the defendant bankers to the client. The reference was negligent, but the bankers denied any . .
CitedLoosemore v Financial Concepts 2001
The skill and care to be expected of a financial advisor would ordinarily include compliance with the rules of the relevant regulator. . .

Lists of cited by and citing cases may be incomplete.

Banking

Updated: 11 November 2021; Ref: scu.516319

HSBC Bank Plc v Brophy: CA 2 Feb 2011

The customer appealed against an order finding that his credit card agreement was binding upon him.
Held: The appeal failed. His argument that the application form amounted only to an invitation to treat, and that the contract was one made by conduct only and therefore not compliant with the 1974 Act, failed. The form was an application for credit: ‘By signing the application form and returning it to the Bank Mr. Brophy applied for credit and offered to be bound by the terms and conditions set out in the form. The form itself made it clear that it contained a request for credit and that the applicant should not sign it unless he was willing to be bound. It cannot therefore be regarded as a mere invitation to treat on his part which might lead the Bank to make him a formal offer of credit. Nor, on the other hand, did it contain an agreement of any kind unless and until it was countersigned by the Bank. The Bank accepted Mr. Brophy’s offer by counter-signing the form, at which point there came into being an executed agreement within the meaning of section 61 of the Act.’ Similarly, applying Hurstanger, the document contained the information required.

Sedley, Moore-Bick, Sullivan LJJ
[2011] EWCA Civ 67, [2011] Bus LR 1004, [2011] ECC 14
Bailii
Consumer Credit Act 1974 61
England and Wales
Citing:
CitedHurstanger Ltd v Wilson 2006
(Coventry County Court) Michael Douglas discussed the 1983 Regulations, saying: ‘The 1983 Regulations prescribe, among other things, the minimum contents of a regulated agreement, the information which must be brought to the attention of the . .
CitedWilson and Another v Hurstanger Ltd CA 4-Apr-2007
The company sought to enforce its loan agreement and charge over the defendants’ property. The defendants appealed saying that the agreement was unenforceable under the Act, since a commission had been paid to the introducing broker, and his fee had . .
Appeal fromBrophy v HFC Bank QBD 22-Mar-2010
The customer sought to appeal against a finding of liability for the debt on his credit card, and that the credit card agreement which operated between Mr Brophy and the bank for a period of some 14 years, from 1994 to 2008, was a valid and . .

Lists of cited by and citing cases may be incomplete.

Consumer, Banking

Leading Case

Updated: 11 November 2021; Ref: scu.428529

Barclays Bank v WJ Simms and Cooke (Southern) Ltd: QBD 1979

The customer made out a cheque to pay his builder, but countermanded it. The bank paid the cheque when it was presented by mistake, and now sought repayment from the builder.
Held: The bank succeeded. The court discussed the extent of a banker’s obligations to its customers.
Robert Goff J set out the defences to a claim in restitution: ‘(1) If a person pays money to another under a mistake of fact which causes him to make the payment, he is prima facie entitled to recover it as money paid under a mistake of fact. (2) His claim may however fail if (a) the payer intends that the payee shall have the money at all events, whether the fact be true or false, or is deemed in law so to intend; or (b) the payment is made for good consideration, in particular if the money is paid to discharge and does discharge a debt owed to the payee (or a principal on whose behalf he is authorised to receive the payment) by the payer or by a third party by whom he is authorised to discharge the debt; or (c) the payee has changed his position in good faith or is deemed in law to have done so.’
‘It is a basic obligation owed by a bank to its customers that it will honour on presentation cheques drawn by the customer on the bank, provided that there are sufficient funds in the customer’s account to meet the cheque, or the bank has agreed to provide the customer with overdraft facilities sufficient to meet the cheque. Where the bank honours such a cheque, it acts within its mandate, with the result that the bank is entitled to debit the customer’s account with the amount of the cheque, and further that the bank’s payment is effective to discharge the obligation of the customer to the payee on the cheque, because the bank has paid the cheque with the authority of the customer.
In other circumstances, the bank is under no obligation to honour its customer’s cheques. If however a customer draws a cheque on the bank without funds in his account or agreed overdraft facilities sufficient to meet it, the cheque on presentation constitutes a request to the bank to provide overdraft facilities sufficient to meet the cheque. The bank has an option whether or not to comply with that request. If it declines to do so, it acts entirely within its rights and no legal consequences follow as between the bank and its customer. If however the bank pays the cheque, it accepts the request and the payment has the same legal consequences as if the payment had been made pursuant to previously agreed overdraft facilities; the payment is made within the bank’s mandate, and in particular the bank is entitled to debit the customer’s account, and the bank’s payment discharges the customer’s obligation to the payee on the cheque.
In other cases, however, a bank which pays a cheque drawn or purported to be drawn by its customer pays without mandate. A bank does so if, for example, it overlooks or ignores notice of its customer’s death, or if it pays a cheque bearing the forged signature of its customer as drawer, but, more important for present purposes, a bank will pay without mandate if it overlooks or ignores notice of countermand of the customer who has drawn the cheque. In such cases the bank, if it pays the cheque, pays without mandate from its customer; and unless the customer is able to and does ratify the payment, the bank cannot debit the customer’s account, nor will its payment be effective to discharge the obligation (if any) of the customer on the cheque, because the bank had no authority to discharge such obligation.
It is against the background of these principles, which were not in dispute before me, that I have to consider the position of a bank which pays a cheque under a mistake of fact. In such a case, the crucial question is, in my judgment, whether the payment was with or without mandate. The two typical situations, which exemplify payment with or without mandate, arise first where the bank pays in the mistaken belief that there are sufficient funds or overdraft facilities to meet the cheque, and second where the bank overlooks notice of countermand given by the customer. In each case there is a mistake by the bank which causes the bank to make the payment. But in the first case, the effect of the bank’s payment is to accept the customer’s request for overdraft facilities; the payment is therefore within the bank’s mandate, with the result that not only is the bank entitled to have recourse to its customer, but the customer’s obligation to the payee is discharged. It follows that the payee has given consideration for the payment; with the consequence that, although the payment has been caused by the bank’s mistake, the money is irrecoverable from the payee unless the transaction of payment is itself set aside. Although the bank is unable to recover the money, it has a right of recourse to its customer. In the second case, however, the bank’s payment is without mandate. The bank has no recourse to its customer; and the debt of the customer to the payee on the cheque is not discharged. Prima facie, the bank is entitled to recover the money from the payee, unless the payee has changed his position in good faith, or is deemed in law to have done so.’

Robert Goff J
[1979] 3 All ER 522, [1980] QB 677
England and Wales
Cited by:
CitedSandra Estelle Fielding v The Royal Bank of Scotland Plc CA 11-Feb-2004
The husband and wife had signed a bank mandate allowing the bank to act upon the authorisation of either of them. The wife complained that the bank should not be able to recover from her any sums expended by the husband.
Held: The mandate . .
CitedLloyds Bank Plc v Independent Insurance Co Ltd CA 26-Nov-1998
The bank had made an electronic transfer of funds for a customer in satisfaction of that customer’s proper debt, but it was done under a mistake of fact as to the cleared status of funds received.
Held: The appeal was turned down. The bank was . .
CitedOffice of Fair Trading v Abbey National Plc and seven Others ComC 24-Apr-2008
The Office sought a declaration that the respondent and other banks were subject to the provisions of the Regulations in their imposition of bank charges to customer accounts, and in particular as to the imposition of penalties or charges for the . .
CitedPortman Building Society v Hamlyn Taylor Neck (a Firm) CA 22-Apr-1998
The mortgage advance had been against an express requirement that the client use the property as his private residence. After the client defaulted, the appellant lender discovered that the solicitors acting for themselves and the lay client had . .
CitedMarine Trade Sa v Pioneer Freight Futures Co Ltd Bvi and Another ComC 29-Oct-2009
The parties stood to make substantial losses against each other under contracts for differences after the dramatic fall in the freight market in the financial turmoil of late 2008. . .

Lists of cited by and citing cases may be incomplete.

Banking, Contract

Leading Case

Updated: 11 November 2021; Ref: scu.194776

A and Others v Minister van Buitenlandse Zaken: ECJ 14 Mar 2017

Account freezing was act of State, not EU

ECJ (Area of Freedom, Security and Justice Area of Freedom, Security and Justice External Relations : Common Foreign and Security Policy Fundamental Rights : Charter of Fundamental Rights – Judgment)Reference for a preliminary ruling – Common Foreign and Security Policy (CFSP) – Specific restrictive measures directed against certain persons and entities with a view to combating terrorism – Common Position 2001/931/CFSP – Framework Decision 2002/475/JHA – Regulation (EC) No 2580/2001 – Article 2(3) – Inclusion of the ‘Liberation Tigers of Tamil Eelam (LTTE)’ on the list of persons, groups and entities involved in terrorist acts – Question referred for a preliminary ruling concerning the validity of that inclusion – Compliance with international humanitarian law – Concept of ‘terrorist act’ – Actions by armed forces during periods of armed conflict

K. Lenaerts, P
ECLI:EU:C:2017:202, [2017] EUECJ C-158/14, [2017] WLR(D) 180
Bailii, WLRD
European

Human Rights, Crime, Banking

Updated: 11 November 2021; Ref: scu.580690

Three Rivers District Council and Others v Governor and Company of The Bank of England (No 3): HL 22 Mar 2001

Misfeasance in Public Office – Recklessness

The bank sought to strike out the claim alleging misfeasance in public office in having failed to regulate the failed bank, BCCI.
Held: Misfeasance in public office might occur not only when a company officer acted to injure a party, but also where he acted with knowledge of, or with reckless indifference to the illegality of the act, or with reckless indifference to the probability of causing harm. The directive placed general duties of supervision on the Bank of England, but imposed sufficiently detailed duties to give rise to private rights.
As to the Rules, the difference between the words of rule 24.2 and rule 3.4(2)(a) (between a test which asks the question ‘is the claim bound to fail?’ and one which asks ‘does the claim have a real prospect of success’) is elusive, but the practical effect of the two rules will often be the same and, in more complex cases, attention to the overriding objective of dealing with the case justly is likely to be more important than a search for their precise meaning: ‘For the reasons which I have just given, I think that the question is whether the [defence] has no real prospect of succeeding at trial and that it has to be answered having regard to the overriding objective of dealing with the case justly. But the point which is of crucial importance lies in the answer to the further question that then needs to be asked, which is – what is to be the scope of that inquiry?’
‘The second principle, which is quite distinct, is that an allegation of fraud or dishonesty must be sufficiently particularised, and that particulars of facts which are consistent with honesty are not sufficient. This is only partly a matter of pleading. It is also a matter of substance. As I have said, the defendant is entitled to know the case he has to meet. But since dishonesty is usually a matter of inference from primary facts, this involves knowing not only that he is alleged to have acted dishonestly, but also the primary facts which will be relied upon at trial to justify the inference. At trial the court will not normally allow proof of primary facts which have not been pleaded, and will not do so in a case of fraud. It is not open to the court to infer dishonesty from facts which have not been pleaded, or from facts which have been pleaded but are consistent with honesty. These must be some fact which tilts the balance and justifies an inference of dishonesty, and this fact must be both pleaded and proved.’
Lord Hope said: ‘Conversely, I consider that if one part of the claim is to go to trial it would be unreasonable to divide the history up and strike out other parts of it. A great deal of time and money has now been expended in the examination of the preliminary issues, and I think that this exercise must now be brought to an end. I would reject the Bank’s application for summary judgment.’
Lord Hobhouse considered the need for a judge always to assess the claimant’s prospect of success: ‘The important words are ‘no real prospect of succeeding’. It requires the judge to undertake an exercise of judgment. He must decide whether to exercise the power to decide the case without a trial and give a summary judgment. It is a ‘discretionary’ power, i.e. one where the choice whether to exercise the power lies within the jurisdiction of the judge. Secondly, he must carry out the necessary exercise of assessing the prospects of success of the relevant party. If he concludes that there is ‘no real prospect’, he may decide the case accordingly. . . Whilst it must be remembered that the wood is composed of trees some of which may need to be looked at individually, it is the assessment of the whole that is called for. A measure of analysis may be necessary but the ‘bottom line’ is what ultimately matters.’

Lord Steyn, Lord Hope of Craighead, Lord Hutton, Lord Hobhouse of Woodborough, Lord Millett
Times 23-Mar-2001, [2001] 2 All ER 513, [2001] UKHL 16, [2000] 2 WLR 1220, [2003] 2 AC 1, [2001] Lloyds Rep Bank 125, (2001) 3 LGLR 36
House of Lords, Bailii, House of Lords
Civil Procedure Rules
England and Wales
Citing:
CitedAshby v White KBD 1703
Mr Ashby a burgess of the borough of Aylesbury was deprived of his right to vote by the misfeasance of a returning officer.
Held: The majority rejected the claim.
Lord Holt CJ (dissenting) An action would lie: ‘If the plaintiff has a . .
See AlsoThree Rivers District Council and Others v Governor and Company of The Bank of England HL 18-May-2000
The applicants alleged misfeasance against the Bank of England in respect of the regulation of a bank.
Held: The Bank could not be sued in negligence, but the tort of misfeasance required clear evidence of misdeeds. The action was now properly . .

Cited by:
CitedBrown and Another v Bennett and Others (No 2) ChD 16-Nov-2001
The power to make a wasted costs order did not apply only against advocates in court, and not only against the applicant’s own representatives. The test was as to the causing of additional costs. In this case several barristers had been involved at . .
CitedWWF – World Wide Fund for Nature (Formerly World Wildlife Fund); World Wildlife Fund Inc v World Wrestling Federation Entertainment Inc CA 27-Feb-2002
The claimant sought enforcement of a contract restricting the use by the appellant defendant of the initials ‘WWF’ in their trading. The agreement had been reached in settlement of an action for breach of the claimant’s trade mark rights. The . .
CitedCampbell v Frisbee ChD 14-Mar-2002
The defendant appealed a summary judgement on the claimant’s claim with respect to her alleged disclosure of details Miss Campbell’s private life. The claimant sought an action for account of profits for breach of the terms of a contract of service. . .
CitedCornelius v Hackney London Borough Council CA 25-Jul-2002
The applicant sought damages from the council for misfeasance in public office. Protracted litigation had followed his dismissal after he had attempted to bring allegations of misconduct within the authority to the attention of a council committee. . .
CitedLord Ashcroft v Attorney General and Department for International Development QBD 31-May-2002
The claimant was the subject of confidential reports prepared by the defendants which were leaked to newspapers causing him damage. He sought leave to amend his claim to add claims for breach of the Data Protection Act and for public misfeasance. . .
CitedAkenzua, Coy (Administrators of the Estate of Marcia Zena Laws (Deceased)) v Secretary of State for the Home Department, the Comissioner of Police for the Metropolis CA 23-Oct-2002
The claimant sought damages for misfeasance in public office. The defendant had been involved in the release of a person known to be violent from custody, and where he had subsequently killed a member of the claimant’s family. The family appealed a . .
CitedR Cruickshank Limited v The Chief Constable of Kent County Constabulary CA 13-Dec-2002
The claimant had sought damages from the defendant for unlawful interference with contractual relations, and for misfeasance in public office. It now appealed against an order striking out its claim. It claimed that the police had unlawfully abused . .
CitedE D and F Man Liquid Products Ltd v Patel and Another CA 4-Apr-2003
The rules contained two occasions on which a court would consider dismissal of a claim as having ‘no real prospect’ of success.
Held: The only significant difference between CPR 24.2 and 13.3(1), is that under the first the overall burden of . .
CitedKeegan and Others v Chief Constable of Merseyside CA 3-Jul-2003
The police had information suggesting (wrongly) that a fugitive resided at an address. An armed raid followed, and the claimant occupant sought damages.
Held: The tort of malicious procurement of a search warrant required it to be established . .
CitedEquitable Life Assurance Society v Ernst and Young CA 25-Jul-2003
The claimant sought damages from its accountants, saying that had they been advised of the difficulties in their financial situation, they would have been able to avoid the loss of some 2.5 billion pounds, or to sell their assets at a time when . .
CitedChagos Islanders v The Attorney General, Her Majesty’s British Indian Ocean Territory Commissioner QBD 9-Oct-2003
The Chagos Islands had been a British dependent territory since 1814. The British government repatriated the islanders in the 1960s, and the Ilois now sought damages for their wrongful displacement, misfeasance, deceit, negligence and to establish a . .
CitedEquitable Life Assurance Society v Bowley and others ComC 17-Oct-2003
The claimant sought damages against its former directors for negligence and breach of fiduciary duty. The defendants asked that the claims be struck out.
Held: It was no longer good law that directors might leave the conduct of the company’s . .
CitedCriterion Properties Plc v Stratford UK Properties and others CA 18-Dec-2002
The parties came together in a limited partnership to develop property. The appeal was against a refusal to grant summary judgment on a claim that one party had been induced to enter the contract by a fraudulent misrepresentation.
Held: In . .
CitedQuark Fishing Ltd, Regina (on the Application Of) v Secretary of State for Foreign and Commonwealth Affairs Admn 22-Jul-2003
The respondent had failed to renew the claimant’s license to fish in the South Atlantic for Patagonian Toothfish. The refusal had been found to be unlawful. The claimant now sought damages.
Held: English law does not generally provide a remedy . .
CitedChagos Islanders v Attorney-General and Another CA 22-Jul-2004
The claimants sought leave to appeal against a finding that they had no cause of action for their expulsion from their islands.
Held: ‘Exile without colour of law is forbidden by Magna Carta. That it can amount to a public law wrong is already . .
CitedWatkins v Secretary of State for The Home Departmentand others CA 20-Jul-2004
The claimant complained that prison officers had abused the system of reading his solicitor’s correspondence whilst he was in prison. The defendant argued that there was no proof of damage.
Held: Proof of damage was not necessary in the tort . .
CitedCelador Productions Ltd v Melville ChD 21-Oct-2004
The applicants each alleged breach of copyright and misuse of confidential information in the format of the television program ‘Who wants to be a Millionaire’. The defendant appealed a refusal to strike out the claim. It was not contended that no . .
CitedGeorge Wimpey UK Ltd v VI Construction Ltd CA 3-Feb-2005
A land purchase contract had been rectified by the judge for unilateral mistake. A factor had been dropped from a formula for calculating the price.
Held: The judge’s conclusion that the circumstances existed to allow a rectification was . .
CitedDouglas and others v Hello! Ltd and others (No 3) CA 18-May-2005
The principal claimants sold the rights to take photographs of their wedding to a co-claimant magazine (OK). Persons acting on behalf of the defendants took unauthorised photographs which the defendants published. The claimants had retained joint . .
CitedIqbal v Legal Services Commission CA 10-May-2005
The claimant had been a partner in a firm of solicitors. They came to be suspected by the respondent of overclaiming legal aid payments and sums were withheld. For this and other reasons the practice folded, and the claimant became insolvent. He . .
CitedMarks and Spencer Plc v Customs and Excise HL 28-Jul-2005
The claimant had sought repayment of overpaid VAT, and the respondent resisted arguing that this would be an unjust enrichment. A reference to the European Court was sought.
Held: It was not possible to say that the House’s opinion was acte . .
CitedArmstrong v Times Newspapers Ltd and David Walsh, Alan English CA 29-Jul-2005
The claimant sought damages after publication by the first defendant of articles which it was claimed implied that he had taken drugs. The paper claimed qualified privilege, and claimed Reynolds immunity.
Held: The defence of qualified . .
CitedWeston v Gribben ChD 20-Dec-2005
. .
CitedWeir and others v Secretary of State for Transport and Another ChD 14-Oct-2005
The claimants were shareholders in Railtrack. They complained that the respondent had abused his position to place the company into receivership so as to avoid paying them compensation on a repurchase of the shares. Mr Byers was accused of ‘targeted . .
CitedWatkins v Home Office and others HL 29-Mar-2006
The claimant complained of misfeasance in public office by the prisons for having opened and read protected correspondence whilst he was in prison. The respondent argued that he had suffered no loss. The judge had found that bad faith was . .
CitedHenderson v 3052775 Nova Scotia Ltd HL 10-May-2006
The liquidator had sought to set aside a transfer of company property as having been made at an undervalue. The defence was that the buyer had assumed some of the company’s debt in addition, and in effect that it was a preference on other creditors. . .
CitedVibixa Ltd, Polestar Jowetts Ltd v Komori UK Ltd and Another, Spectral Technology Ltd CA 9-May-2006
The claimants sought damages for damage to property alleging breach of statutory duty. The defendant said that the regulations were made under European not English law, and that the Secretary of State did not have power to make regulations under the . .
CitedAdidas-Salomon Ag v Drape and others ChD 7-Jun-2006
The claimants had sponsored tennis players to wear their logo. The respondents organised tennis tournaments whose intended rules would prevent the display of the claimant’s logos. The claimants said that the restriction interfered with their rights . .
CitedAshley and Another v Sussex Police CA 27-Jul-2006
The deceased was shot by police officers raiding his flat in 1998. The claimants sought damages for his estate. They had succeeded in claiming damages for false imprisonment, but now appealed dismissal of their claim for damages for assault and . .
CitedAnsar v Lloyds TSB Bank Plc and others CA 9-Oct-2006
The claimant challenged a decision of the chairman of the Employment tribunal not to recuse himself on a later hearing after the claimant had previously made allegations of bias and improper conduct against him. . .
CitedHilda Amoo-Gottfried v Legal Aid Board (No 1 Regional Committee) CA 1-Dec-2000
The claimant appealed an order dismissing her claim for misfeasance in public office by the defendant, for the way in which they had mishandled her membership of duty solicitor rota schemes.
Held: The court discussed the requirements for . .
CitedWalsh v Staines and others ChD 26-Jul-2007
The defendants applied to strike out a claim based on an allegation of a fraudulent deceit and conspiracy in earlier proceedings between the parties. It was said that the defendant solicitors had represented that their client had funds to support an . .
CitedBray v Deutsche Bank Ag QBD 12-Jun-2008
A former employee of the defendant bank sued in defamation after the bank published a press release about its results which he said was critical of him.
Held: Where there is a real issue as to whether the words are defamatory of the claimant, . .
CitedD Pride and Partners (A Firm) and Others v Institute for Animal Health and Others QBD 31-Mar-2009
The claimants sought damages after the loss of business when the defendants’ premises were the source of an outbreak of foot and mouth disease. The organism had escaped from their premises via a broken drain.
Held: Much of the damage claimed . .
CitedAlexander-David v London Borough of Hammersmith and Fulham CA 1-Apr-2009
The authority was required to provide housing to the minor applicant, but she was too young to hold a legal estate. An equitable lease had been created, and she now appealed against an order for possession having broken the terms of the agreement, . .
CitedImerman v Tchenguiz and Others QBD 27-Jul-2009
It was said that the defendant had taken private and confidential material from the claimant’s computer. The claimant sought summary judgement for the return of materials and destruction of copies. The defendant denied that summary judgement was . .
CitedMexfield Housing Co-Operative Ltd v Berrisford ChD 5-Oct-2009
The claimant appealed against refusal of a summary order for possession of the defendant tenant’s house for arrears of rent. The arrears arose through delay in payment of Housing Benefit, and all arrears had been cleared by the hearing of the . .
CitedL v L and Hughes Fowler Carruthers QBD 1-Feb-2007
The parties were engaged in ancillary relief proceedings. The Husband complained that the wife had sought to use unlawfully obtained information, and in these proceedings sought delivery up of the material from the wife and her solicitors. He said . .
CitedLand Securities Plc and Others v Fladgate Fielder (A Firm) CA 18-Dec-2009
The claimants wanted planning permission to redevelop land. The defendant firm of solicitors, their tenants, had challenged the planning permission. The claimants alleged that that opposition was a tortious abuse because its true purpose was to . .
CitedGold Group Properties Ltd v BDW Trading Ltd TCC 3-Mar-2010
The parties had contracted for the construction of an estate of houses and flats to be followed by the interim purchase by the defendants. The defendants argued that the slump in land prices frustrated the contract and that they should not be called . .
CitedJO1 v Garret and Another QBD 31-Mar-2010
The claimant sought damages against a social worker, alleging misfeasance in public office, and now appealed against a strike out of his claim.
Held: The elements necessary to succeed in such a claim were not made out in the pleadings, and . .
CitedKaschke v Gray and Another QBD 29-Mar-2010
kaschke_grayQBD10
The defendant appealed against the refusal of the Master to strike out the claim in defamation in respect of a post by a third party on his unmoderated blog. The claimant said that the article accused her of an historic association with a terrorist . .
CitedAbbar and Another v Saudi Economic and Development Company (Sedco) Real Estate Ltd and Others ChD 5-Aug-2010
The defendant sought a strike out of the claim in fraud, saying it was an abuse of process, saying that the facts as pleaded were consistent with honest dealing. The claimants said they had been induced to purchase shares.
Held: The request . .
CitedCook v Telegraph Media Group Ltd QBD 29-Mar-2011
The claimant, an MP, complained in defamation of the defendant’s description of his rejected expenses claim regarding an assistant’s charitable donation. The paper pleaded a Reynolds defence. The claimant said that when published the defendant knew . .
CitedSmith and Others v Ministry of Defence QBD 30-Jun-2011
Claims were made after the deaths of British troops on active service in Iraq. In one case the deaths were from detonations of improvised explosive devices, and on others as a result of friendly fire. It was said that there had been a foreseeable . .
CitedSeray-Wurie v The Charity Commission of England and Wales CA 3-Feb-2009
The claimant appealed against the striking out of his claim for defamation in a reort prepared by the defendants criticising his actions as chairman of a CAB. The action had been struck out on the basis of qualified privilege, and the claimant’s . .
CitedCalland v Financial Conduct Authority CA 13-Mar-2015
The claimant appealed against the striking out of his claim of harassment against the Authority who had contacted him in an intended review of pensions mis-selling. They had contacted him once by letter, once by telephone and once by e-mail.
CitedDellal v Dellal and Others FD 1-Apr-2015
The families disputed a claim under the 1975 Act. The defendants now sought summary dismissal of the claim. . .
CitedStocker v Stocker QBD 10-Jun-2015
The claimant alleged defamation by his former wife in a post on facebook. The posting and associatedeEmails were said falsely to have accused him of serious abuse, and that the accusations had undermined his relationship with his new partner.
CitedAli v Associated Newspapers Ltd QBD 27-Jan-2010
The claimant sought damages in defamation, saying that a combination of publications identified him.
Held: Eady J briefly discussed the effect of hyperlinks in the context of a dispute about meaning or reference in a defamation case. . .
CitedGreen v Petfre (Gibraltar) Ltd (T/A Betfred) QBD 7-Apr-2021
Onerous Contract Terms Unclear – Not Incorporated
The claimant said that he had won a substantial sum on the online gaming platform operated by the defendants, but that they had refused to pay up. The defendants said that there had been a glitch in the game. The court faced a request for summary . .

Lists of cited by and citing cases may be incomplete.

Torts – Other, Banking, Civil Procedure Rules

Leading Case

Updated: 10 November 2021; Ref: scu.166154

British Bankers Association, Regina (on The Application of) v The Financial Services Authority and Another: Admn 20 Apr 2011

The claimant sought relief by way of judicial review from a policy statement issued by the defendants regarding the alleged widespread misselling of payment protection insurance policies, and the steps to be taken to compensate the purchasers. They objected that the policy statement would require them to act beyond their obligations in law.
Held: The objection failed. The parliamentary background materials did not require restriction of the scope of rules capable of being made by the respondent. The respondent was not limited to making rules with regard to matters which were actionable in themselves. Ouseley J discussed the relationship between the FSA Principles and Rules and said: ‘The Principles are best understood as the ever present substrata to which the specific rules are added. The Principles always have to be complied with. The specific rules do not supplant them and cannot be used to contradict them. They are but specific applications of them to the particular requirements they cover. The general notion that the specific rules can exhaust the application of the Principles is inappropriate. It cannot be an error of law for the Principles to augment specific rules.’
Though a specific provision is capable of carrying an implied exclusion of other general or other specific powers, section 404 did not implicitly exclude what the FSA had done, even though it would have been possible for a scheme to have been set up to achieve much or rather more of the same end, and part of the reason why it was not was the cumbersome nature of the remedy, and the fact that it would not apply to breaches of the Principles.

Ouseley J
[2011] EWHC 999 (Admin), [2011] Bus LR 1531, [2011] ACD 71
Bailii
Financial Services and Markets Act 2000 2 404
England and Wales
Citing:
CitedBlack-Clawson International Ltd v Papierwerke Waldhof Aschaffenburg AG HL 5-Mar-1975
Statute’s Mischief May be Inspected
The House considered limitations upon them in reading statements made in the Houses of Parliament when construing a statute.
Held: It is rare that a statute can be properly interpreted without knowing the legislative object. The courts may . .
CitedRegina v Secretary of State for Health ex parte Quintavalle (on behalf of Pro-Life Alliance) HL 13-Mar-2003
Court to seek and Apply Parliamentary Intention
The appellant challenged the practice of permitting cell nuclear replacement (CNR), saying it was either outside the scope of the Act, or was for a purpose which could not be licensed under the Act.
Held: The challenge failed. The court was to . .
CitedHeather Moor and Edgecomb Ltd, Regina (on the Application Of) v Financial Ombudsman Service and Another CA 11-Jun-2008
Rix LJ considered the possible scope of rules made by the respondent saying: ‘In my judgment, the following values are all to be appreciated and brought into a pragmatic balance: that an efficient and cost-effective and relatively informal type of . .
CitedCredit Suisse and Another v Waltham Forest London Borough Council CA 20-May-1996
Parliament had made detailed provision in a number of Acts for the discharge of the housing duties by local authorities. These detailed provisions did not contain a power to give a guarantee in connection with a bank loan to a company which the . .
CitedHarrison v Black Horse Ltd QBD 1-Dec-2010
The claimant sought damages for breach of the statutory duty in ICOB, and for damages for negligence. The bank faced a claim that it had assumed responsibility to take reasonable care in recommending the policy it did. The bank had relied on the . .
CitedHeather Moor and Edgecomb Ltd, Regina (on the Application Of) v Financial Ombudsman Service and Another CA 11-Jun-2008
Rix LJ considered the possible scope of rules made by the respondent saying: ‘In my judgment, the following values are all to be appreciated and brought into a pragmatic balance: that an efficient and cost-effective and relatively informal type of . .
CitedBaby Products Association and Another, Regina (on the Application of) v Liverpool City Council Admn 23-Nov-1999
The 1987 Act and its Regulations enabled a local authority with proper grounds for suspecting that a safety provision had been contravened in relation to goods, to issue a ‘suspension notice’ prohibiting a person on whom it was served from supplying . .
CitedRegina v J HL 14-Oct-2004
The defendant was to have been accused of having unlawful sexual intercourse with a girl under 16. Proceedings could not be brought, because the allegation was more than a year old, and he was instead accused of indecent assault, but on the same . .

Cited by:
CitedBarnes and Another v Black Horse Ltd QBD 31-May-2011
barnes_blackQBD11
The claimants sought repayment by the bank of sums paid to them for Payment Protection Insurance policies sold to them in connection with loans made by the bank. The Bank now resisted an application for leave to amend the particulars of the . .

Lists of cited by and citing cases may be incomplete.

Banking, Consumer, Financial Services

Updated: 10 November 2021; Ref: scu.434868

Grosvenor Casinos Ltd v National Bank of Abu Dhabi: ComC 17 Mar 2008

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 AlsoGrosvenor Casinos Ltd v National Bank of Abu Dhabi ComC 14-Nov-2007
. .
CitedCrockfords 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 . .
CitedDerry 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 . .
CitedUzinterimpex 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 . .
CitedAIC 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 . .
CitedAngus 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 . .
CitedAngus 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 . .
CitedCalico 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 . .
CitedHenderson 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 . .
CitedLipkin 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 . .
CitedSmith 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 . .
CitedKomercni 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

Bank Mellat v HM Treasury: QBD 11 Jun 2010

The respondent had made an order under the Regulations restricting all persons from dealing with the the claimant bank. The bank applied to have the order set aside. Though the defendant originally believed that the Iranian government owned 80% of the shares, the figure was 20% and soon to be reduced to 15%. It said that it should have been given an opportunity to make representations before the order was made, that the order had been made without fulfilling the require,ents and that it breached its human rights.
Held: The claim failed. The objective of the Order might not be met if by being forewarned, a subject might take steps to evade its effect. Section 63 provides a means by which the bank is afforded a reasonable opportunity of effectively challenging the measures contained in the Order.
Whilst Article 6 applied to the proceedings, it could could not apply before any proceedings commenced (Micallef). In the alternative, a hybrid procedure involving executive decision making can be compatible with Article 6(1), and the procedure for determining the bank’s civil rights in this case is hybrid: an executive decision affirmed by Parliament, subject to later challenge before a Court.
As to the substantial objection, the test was as to whether the respondent reasonably believed that Iran is developing Nuclear Weapons, and that such a development threatened the national interests of the UK. In this case: ‘the objective of the Order – to inhibit the development of nuclear weapons by Iran – is sufficiently important to justify interfering with property rights. The measure – excluding the bank from the financial sector in the United Kingdom – is rationally connected to it. To produce or facilitate the production of nuclear weapons, Iran needs to import uranium, centrifuges and, no doubt, a host of other materials, from abroad. To do so, it must pay for them. To pay for them, it will require, or at least find convenient, to use banking facilities, in particular the issuing and confirmation of letters of credit. An Iranian importer of such material is likely to turn to an Iranian bank with an international presence, to issue letters of credit. Cutting off one such bank from one of the principal financial markets in which such business may be transacted is clearly rationally connected to the inhibition of the development of nuclear weapons.’
Justice required that in this case, the some at least of the evidence evidence be put before the court and that it had to be dealt with by a Closed Material Procedure. Part of the judgment was handed down as a closed judgment not available publicly or to the bank.

Mitting J
[2010] EWHC 1332 (QB), [2010] WLR (D) 148
Bailii, WLRD
Financial Restrictions (Iran) Order 2009 (SI 2009 No 2725), Counter-Terrorism Act 2008, European Convention on Human Rights 6
England and Wales
Citing:
See AlsoBank Mellat v Her Majesty’s Treasury CA 4-May-2010
The claimants sought damages after being made subject of orders under the 2009 Order. Both parties appealed against an order (partly closed) allowing some but restricting other disclosure and use against the claimants in court of evidence which they . .
CitedCooper v The Board of Works For The Wandsworth Destrict 21-Apr-1863
Where a land-owner owner had failed to give proper notice to the Board, the Board had, under the 1855 Act, power to demolish any building he had erected and recover the cost from him. The plaintiff said that the Board had used that power without . .
CitedRegina v Secretary of State for the Home Department ex parte Doody and Others HL 25-Jun-1993
A mandatory lifer is to be permitted to suggest the period of actual sentence to be served. The Home Secretary must give reasons for refusing a lifer’s release. What fairness requires in any particular case is ‘essentially an intuitive judgment’, . .
CitedJokela v Finland ECHR 21-May-2002
Hudoc Judgment (Merits and just satisfaction) Violation of P1-1; No violation of Art. 6-1 with regard to witnesses; No violation of Art. 6-1 with regard to reasons for decision; Pecuniary damage – financial . .
CitedBAPIO Action Ltd and Another, Regina (on the Application of) v Secretary of State for the Home Department and Another CA 9-Nov-2007
The action group appealed against refusal of a judicial review of guidelines as to the employment of non-EU doctors, saying that they were in effect immigration rules and issuable only under the 1971 Act. The court had said that since the guidance . .
AppliedMicallef v Malta ECHR 15-Oct-2009
‘The Court reiterates that for Article 6(1) in its ‘civil’ limb to be applicable, there must be a dispute over a ‘civil right’ which can be said, at least on arguable grounds, to be recognised under domestic law’
Preliminary proceedings or . .
CitedWright and Others, Regina (on the Application of) v Secretary of State for Health and Another HL 21-Jan-2009
The claimants had been provisionally listed as ‘people considered unsuitable to work with vulnerable adults’ which meant that they could no longer work, but they said they were given no effective and speedy opportunity to object to the listing. . .
CitedRegina (Holding and Barnes plc) v Secretary of State for Environment Transport and the Regions; Regina (Alconbury Developments Ltd and Others) v Same and Others HL 9-May-2001
Power to call in is administrative in nature
The powers of the Secretary of State to call in a planning application for his decision, and certain other planning powers, were essentially an administrative power, and not a judicial one, and therefore it was not a breach of the applicants’ rights . .
CitedBX v Secretary of State for The Home Department CA 4-May-2010
The applicant was subject to a non-derogating control order. The court was asked (1) whether a ‘controlled person’ to whom the Secretary of State has given notice of modification under section 7(2)(d) and (8)(c) 2005 Act, may seek to challenge or . .
CitedSporrong and Lonnroth v Sweden ECHR 23-Sep-1982
Balance of Interests in peaceful enjoyment claim
(Plenary Court) The claimants challenged orders expropriating their properties for redevelopment, and the banning of construction pending redevelopment. The orders remained in place for many years.
Held: Article 1 comprises three distinct . .
CitedJames and Others v The United Kingdom ECHR 21-Feb-1986
The claimants challenged the 1967 Act, saying that it deprived them of their property rights when lessees were given the power to purchase the freehold reversion.
Held: Article 1 (P1-1) in substance guarantees the right of property. Allowing a . .
CitedHuang v Secretary of State for the Home Department HL 21-Mar-2007
Appellate Roles – Human Rights – Families Split
The House considered the decision making role of immigration appellate authorities when deciding appeals on Human Rights grounds, against refusal of leave to enter or remain, under section 65. In each case the asylum applicant had had his own . .
CitedDe Freitas v The Permanent Secretary of Ministry of Agriculture, Fisheries, Lands and Housing and others PC 30-Jun-1998
(Antigua and Barbuda) The applicant was employed as a civil servant. He joined a demonstration alleging corruption in a minister. It was alleged he had infringed his duties as a civil servant, and he replied that the constitution allowed him to . .
CitedBosphorus Hava Yollari Turizm ve Ticaretas v Minister for Transport, Energy and Communications and others ECJ 30-Jul-1996
ECJ (Judgment) Article 8 of Regulation No 990/93 concerning trade between the European Economic Community and the Federal Republic of Yugoslavia, which provides that ‘all vessels, freight vehicles, rolling stock . .

Cited by:
Appeal fromBank Mellat v HM Treasury CA 13-Jan-2011
Under the 2009 Order, the appellant Bank’s UK operations had been shut down. It appealed against the Order, but the respondent had brought evidence, closed save to the respondent, and the order had been confirmed.
Held: The bank’s appeal . .
At first instanceBank Mellat v Her Majesty’s Treasury (No 2) SC 19-Jun-2013
The bank challenged measures taken by HM Treasury to restrict access to the United Kingdom’s financial markets by a major Iranian commercial bank, Bank Mellat, on the account of its alleged connection with Iran’s nuclear weapons and ballistic . .
At first instanceBank Mellat v Her Majesty’s Treasury (No 1) SC 19-Jun-2013
Closed Material before Supreme Court
Under the 2009 order, the appellant Bank had been effectively shut down as to its operations within the UK. It sought to use the appeal procedure, and now objected to the use of closed material procedure. The Supreme Court asked itself whether it . .

Lists of cited by and citing cases may be incomplete.

Banking, International, Human Rights

Updated: 10 November 2021; Ref: scu.416753

Kpohraror v Woolwich Building Society: CA 1996

The Society, acting as a bank, had at first failed to pay its customer’s cheque for andpound;4,550, even though there were sufficient funds. The bank said that it had been reported lost. The customer sought damages to his business reputation.
Held: The bank was in breach of contract and in principle liable for injury to the customer’s business reputation if any, where it knew that he was a trader, but not for further business opportunities alleged to have been lost by reason of circumstances of which the bank was unaware on the basis of the limited facts known to it.
In this case, there was nothing to indicate that the cheque, even one drawn in favor of a goods wholesaler, was required for the purposes of international trade and would or might cause the loss of a transaction or a substantial trading profit for the plaintiff. The claim for loss of profits failed. Damages were awarded for the dishonour of the cheque and the ‘discreditable reason given by them for doing so’ and even though the plaintiff was not strictly speaking in business. The damages included a small allowance for loss of reputation in Nigeria.
Evans LJ said: ‘I would prefer to hold that the starting point for any application of Hadley -v- Baxendale is the extent of the shared knowledge of both parties when the contract was made . . When that is established, it may often be the case that the first and the second parts of the rule overlap, or at least that it is unnecessary to draw a clear line of demarcation between them. This seems to me to be consistent with the commonsense approach suggested by Scarman LJ in H. Parsons (Livestock) Limited -v- Uttley Ingham and Co. Limited [1978] QB 791 at 813, and to be applicable here.’
and ‘It is abundantly clear, in my judgment, that history has changed the social factors which moulded the rule in the nineteenth century. It is not only a tradesman of whom it can be said that the refusal to meet his cheque is ‘so obviously injurious to [his] credit’ that he should ‘recover, without allegation of special damage, reasonable compensation for the injury done to his credit’ (see [1920] AC 102 at 112, [1918-19] All ER Rep 1035 at 1037 per Lord Birkenhead LC). The credit rating of individuals is as important for their personal transactions, including mortgages and hire-purchase as well as banking facilities, as it is for those who are engaged in trade, and it is notorious that central registers are now kept. I would have no hesitation in holding that what is in effect a presumption of some damage arises in every case, in so far as this is a presumption of fact.’

Evans LJ, Waite LJ, Sir John May
[1996] 4 All ER 119
England and Wales
Citing:
CitedH Parsons (Livestock) Limited v Uttley Ingham and C. Limited CA 1978
The defendants had installed a pig nut hopper for the plaintiffs, but failed to provide adequate ventilation, causing the nuts to go sour, and the pigs to be poisoned.
Held: Remoteness of damage is a question of law. The death of the pigs . .
CitedHadley v Baxendale Exc 23-Feb-1854
Contract Damages; What follows the Breach Naturaly
The plaintiffs had sent a part of their milling machinery for repair. The defendants contracted to carry it, but delayed in breach of contract. The plaintiffs claimed damages for the earnings lost through the delay. The defendants appealed, saying . .
CitedBank of New South Wales v Milvain 1884
The farmer customer’s cheque had not been met by the bank, despite his having adequate funds to meet it. The bank appealed against the award of damages to the customer’s reputation.
Held: The customer, as a farmer, was not a trader, and could . .
CitedAddis v Gramophone Company Limited HL 26-Jul-1909
Mr Addis was wrongfully and contumeliously dismissed from his post as the defendant’s manager in Calcutta. He sought additional damages for the manner of his dismissal.
Held: It did not matter whether the claim was under wrongful dismissal. . .
CitedEvans v London and Provincial Bank 1917
Only nominal damages were awarded by a jury for damage to the plaintiff’s reputation after his bank had wrongly failed to pay on his cheque. . .
CitedWilson v United Counties Bank Ltd HL 1920
Bank’s duty to client’s reputation and credit
Major Wilson had left England on active service soon after the beginning of the Great War, leaving his business affairs, in a fairly precarious state, with his bank. The jury found that the bank had failed in its duty to supervise his business . .
CitedGibbons v Westminster Bank Ltd 1939
For a non-trading customer of a bank whose cheque has been wrongfully dishonoured, injury to credit in law must be pleaded and proved as special damages. . .
CitedDavidson v Barclays Bank Ltd 1940
The Plaintiff, a credit bookmaker successfully sued the Bank in libel. The libel proved was writing the words ‘not sufficient’ on a cheque issued by the Plaintiff when they dishonoured it. He would have had sufficient funds ad the bank followed his . .
CitedMonarch Steamship Co Ltd v Karlshamns Oljefabriker A/B HL 1949
Damages were sought for breach of contract.
Held: After reviewing the authorities on remoteness of damage, the court reaffirmed the broad general rule that a party injured by the other’s breach of contract is entitled to such money . .
CitedCzarnikow (C ) Ltd v Koufos; The Heron II HL 17-Oct-1967
The vessel had arrived late at Basrah in breach of the terms of the charterparty. The House was asked as to the measure of damages. The charterers had intended to sell the cargo of sugar promptly upon arrival, and now claimed for the fall in the . .
CitedBliss v South East Thames Regional Health Authority CA 1985
General damages cannot be awarded for frustration, mental distress or injured feelings arising from an employer’s breach of the implied term of confidence and trust. Dillon LJ said that damages for mental distress in contract are limited to certain . .
CitedRae v Yorkshire Bank plc CA 1987
The court considered the award of damages for the wrongful dishonour of its customer’s cheque. . .
CitedJoyce v Sengupta and Another CA 31-Jul-1992
The defendant published an article accusing the plaintiff of theft. Not having funds to launch a claim in libel, the plaintiff obtained legal aid to claim in malicious falsehood. She now appealed against a strike out of that claim.
Held: A . .

Cited by:
CitedJackson and Another v Royal Bank of Scotland HL 27-Jan-2005
The claimants sought damages, alleging that a breach of contract by the defendant had resulted in their being unable to earn further profits elsewhere. The defendant said the damages claimed were too remote. The bank had, by error, disclosed to one . .
CitedTransfield Shipping Inc of Panama v Mercator Shipping Inc of Monrovia ComC 1-Dec-2006
The owners made substantial losses after the charterers breached the contract by failing to redliver the ship on time as agreed.
Held: On the facts found the Owners’ primary claim is not too remote. To the knowledge of the Charterers, it was . .
CitedShah and Another v HSBC Private Bank (UK) Ltd QBD 26-Jan-2009
The claimants sought damages after delays by the bank in processing transfer requests. The bank said that the delays were made pending reports of suspected criminal activity. The bank’s delay had stigmatised the claimant causing further losses. The . .

Lists of cited by and citing cases may be incomplete.

Contract, Damages, Banking

Leading Case

Updated: 10 November 2021; Ref: scu.222086

Lordsvale Finance Plc v Bank of Zambia: QBD 20 Mar 1996

The court looked at a facility agreement opened by a bank in favour of the defendant which provided that in the event of default the defendant should pay interest during the period of default at an aggregate rate equal to the cost to the bank of obtaining the deposits required to fund its participation, an agreed margin and an additional unexplained 1%. The customer said that the 1% fee was a penalty and unenforceable.
Held: It was not.
Colman J said: ‘The defendants contend that, inasmuch as the constituents of the default interest under article 10.03(A) include at (i) 1 per cent, a rate completely unexplained, in addition to the margin (defined in article 1 as 11/2 per cent) and the cost of obtaining dollar deposits to fund the bank’s participation, the 1 per cent is a penalty. It is said to be in terrorem the borrower, its sole function being to ensure compliance with the agreements. . ‘The term provided for a modest increase. It was not a penalty and therefore not invalid.
The court analysed the concept of a penalty as follows (following Dunlop): ‘whether a provision is to be treated as a penalty is a matter of construction to be resolved by asking whether at the time the contract was entered into the predominant contractual function of the provision was to deter a party from breaking the contract or to compensate the innocent party for breach. That the contractual function is deterrent rather than compensatory can be deduced by comparing the amount that would be payable on breach with the loss that might be sustained if breach occurred.’
A simple dichotomy between a genuine pre-estimate of damages and a penalty does not always cover all the possibilities.
Although the payment of liquidated damages is ‘the most prevalent purpose’ for which an additional payment on breach might be required under a contract ‘ . . the jurisdiction in relation to penalty clauses is concerned not primarily with the enforcement of inoffensive liquidated damages clauses but rather with protection against the effect of penalty clauses. There would therefore seem to be no reason in principle why a contractual provision the effect of which was to increase the consideration payable under an executory contract upon the happening of a default should be struck down as a penalty if the increase could in the circumstances be explained as commercially justifiable, provided always that its dominant purpose was not to deter the other party from breach.’
He continued: ‘Where, however, the loan agreement provides that the rate of interest will only increase prospectively from the time of default in payment, a rather different picture emerges. The additional amount payable is ex hypothesi directly proportional to the period of time during which the default in payment continues. Moreover, the borrower in default is not the same credit risk as the prospective borrower with whom the loan agreement was first negotiated. Merely for the pre-existing rate of interest to continue to accrue on the outstanding amount of the debt would not reflect the fact that the borrower no longer has a clean record. Given that money is more expensive for a less good credit risk than for a good credit risk, there would in principle seem to be no reason to deduce that a small rateable increase in interest charged prospectively upon default would have the dominant purpose of deterring default. That is not because there is in any real sense a genuine pre-estimate of loss, but because there is a good commercial reason for deducing that deterrence of breach is not the dominant contractual purpose of the term.’

Colman J
Times 08-Apr-1996, [1996] QB 752
England and Wales
Citing:
CitedDunlop Pneumatic Tyre Company Ltd v New Garage and Motor Company Ltd HL 1-Jul-1914
The appellants contracted through an agent to supply tyres. The respondents contracted not to do certain things, and in case of breach concluded: ‘We agree to pay to the Dunlop Pneumatic Tyre Company, Ltd. the sum of 5 l. for each and every tyre, . .

Cited by:
ApprovedCine Bes Filmcilik Ve Yapimcilik and Another v United International Pictures and Others CA 21-Nov-2003
The parties entered into agreements licensing the exclusive distribution of encrypted television channels within Turkey. A clause provided a calculation of damages for a breach amounting to the balance of licence fees due, and other penalties, . .
ApprovedMurray v Leisureplay Plc QBD 5-Aug-2004
The claimant sought payment of three years’ salary after termination of his service contract. He said that an agreement had been made by the company to purchase a ‘financial institution’, which would trigger the additional payments. The defendants . .
CitedEuro London Appointments Ltd v Claessens International Ltd CA 6-Apr-2006
The court considered whether a clause in an employment agency’s terms and conditions amounted to a penalty and was unenforceable. The contract provided that if the offer was withdrawn by the eventual employer after acceptance but before the . .
CitedTullett Prebon Group Ltd v El-Hajjali QBD 31-Jul-2008
The defendant signed an employment contract to join the claimants as a senior broker. He changed his mind and decided to stay in his existing job. The new employers sued for breach of contract. The defendant said that the claimants had refused to . .
CitedAzimut-Benetti Spa (Benetti Division) v Healey ComC 3-Sep-2010
The claimant sought summary judgment under a guarantee. The defendant said that the liquidated damages clause under which the claim was made was a penalty clause and unenforceable.
Held: The request for summary judgment was granted.
CitedCleeve Link Ltd v Bryla EAT 8-Oct-2013
EAT Unlawful Deduction From Wages – The principles enunciated in Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 1979 and re-stated in Lordsvale Finance PLC v Bank of Zambia [1996] QB 752, . .
CitedCavendish Square Holdings Bv and Another v El Makdessi ComC 14-Dec-2012
The parties disputed whether clauses in a share sale agreement between them amounted to a penalty and as such were rendered unenforeable.
Held: Burton J felt able to escape those constraints, and concluded that the two provisions were valid . .
CitedEl Makdessi v Cavendish Square Holdings Bv and Another CA 26-Nov-2013
The appellants had agreed for the sale of his company by way of a share sale agreement. The price to be paid was to vary accoriding to the operating profits. A large part of the price reflected goodwill. The agreement contained a clause providing . .
CitedParkingeye Ltd v Beavis CA 23-Apr-2015
The appellant had overstayed the permitted period of free parking in a retail park by nearly an hour. The parking was managed by the respondent who had imposed a charge of 85.00 pounds. The judge had found that the appellant was in breach of a . .
CitedCavendish Square Holding Bv v Talal El Makdessi; ParkingEye Ltd v Beavis SC 4-Nov-2015
The court reconsidered the law relating to penalty clauses in contracts. The first appeal, Cavendish Square Holding BV v Talal El Makdessi, raised the issue in relation to two clauses in a substantial commercial contract. The second appeal, . .

Lists of cited by and citing cases may be incomplete.

Contract, Banking

Leading Case

Updated: 10 November 2021; Ref: scu.83211

Hamas v Council: ECFI 17 Dec 2014

ECJ Judgment – Common Foreign and Security Policy – Restrictive measures against certain persons and entities in the context of the fight against terrorism – Freezing of funds – Evidence base of freezing funds – Reference to acts of terrorism – need for a competent authority decision within the meaning of Common Position 2001/931 – Obligation to state reasons – Modulation in time the effects of a cancellation

NJ Forwood, President, F. Dehousse (Rapporteur) and J. Schwarcz, Judges
T-400/10, [2014] EUECJ T-400/10, ECLI: EU: T: 2014: 1095
Bailii
Common Position 2001/931
European

Banking

Updated: 10 November 2021; Ref: scu.540232

McGuinness v Norwich and Peterborough Building Society: CA 9 Nov 2011

The appellant had guaranteed his brother’s loan from the respondent, and the guarantee having been called in and unpaid, he had been made bankrupt. He now appealed saying that the guarantee debt, even though of a fixed amount could not form the basis of a statutory demand without action being taken on the debt first.
Held: The appeal failed. The possible inclusion of a damages liability as the basis of a good petitioning creditor’s debt cannot be based on the extended definition of ‘bankruptcy debt’ in s.382(1) and (4). It has to be found in the practice and decisions of the court as to what constitutes a debt in a liquidated sum for the purposes of a creditor’s petition. A debt for a liquidated sum must be a pre-ascertained liability under the agreement which gives rise to it. That was not the case here, and there was nothing in the wording of the deed to displace the standard result.

Ward, Moses, Patten LJJ
[2011] EWCA Civ 1286, [2012] BPIR 145, [2011] NPC 117
Bailii
Insolvency Act 1986 267 322(a) 382
England and Wales
Citing:
CitedHope v Premierpace (Europe) Ltd 1999
A claim for an account and payment was not one for debt which could form the subject of a statutory demand. . .
CitedLep Air Services v Rolloswin Investments Ltd; Moschi v LEP Air Services HL 1973
The obligation of a guarantor under a contract ‘is not an obligation himself to pay a sum of money to the creditor, but an obligation to see to it that another person, the debtor, does something.’ When a repudiatory breach is accepted by the injured . .
Appeal fromMcGuinness v Norwich and Peterborough Building Society ChD 23-Nov-2010
The claimant appealed against his bankruptcy saying that it had followed as statutory demand based upon his alleged default under a guarantee of his brothers mortgage borrowings. He said that such a claim was not a liquidated sum within the 1986 . .
CitedSocony Mobil Oil Co Inc and others v West of England Ship Owners Mutual Insurance Association Ltd (Padri Island) (No 2); Firma CF-Trade SA v Similar (The ‘Fant’) HL 14-Jun-1990
The House was asked as to the effect of section 1(3) of the 1930 Act on policies including ‘pay or be paid’ clauses.
Held: The central question was whether the condition of prior payment was rendered of no effect by section 1(3) of the Act of . .
CitedUtterson v Vernon And Others 5-Feb-1790
There had been an agreement to lend to the bankrupt some stock which she undertook to replace. The act of bankruptcy and the declaration of her bankruptcy took place before the stock was replaced. The parties disputed whether the agreement created a . .
CitedEx Parte Job Broadhurst In The Matter Of Job Broadhurst 7-Dec-1852
A covenant given by the father of two existing partners to an incoming partner to pay any shortfall in the debts due to the firm below a stated sum and to bear the debts of the existing partners in excess of a stated sum was treated not as a . .
CitedOwen v Routh And Ogle CCP 27-Jan-1854
The plaintiff alleged the breach of an undertaking to deliver share certificates on a particular day. The defendants said that bankruptcy discharged them from the obligation. The bankruptcy applied to the defendants’ ‘debts and sums of money due or . .
CitedIn Re Dummelow CA 1872
The parties disputed whether a particular creditor was entitled to vote at the first meeting. The section excluded a right to vote in the case of creditors in respect of ‘any unliquidated or contingent debt, or any debt the value of which is not . .
CitedEx parte Ward CA 1882
The court was asked whether a creditor might petition for bankruptcy on a liability as a broker who had failed to settle sums due on purchasing shares on the London Stock Exchange. He was declared a defaulter under the Exchange rules as to . .
CitedRe Miller CA 1901
A prospective partner in the firm paid andpound;2,000 to a broker on terms that he should have the option of demanding its repayment if he did not become a partner by a date. The firm was hammered before that date and having given notice to . .
CitedRe a Debtor; ex parte Berkshire Finance Co Ltd QBD 2-Jan-1962
The court was asked to consider whether a judgment debt in respect of sums due under a hire-purchase agreement was a good petitioning creditor’s debt. The judgment sum included the balance of all the remaining hire charges which became payable on . .
MentionedCampbell Discount Company Ltd v Bridge HL 1962
The parties disputed the validity of a clause in a car hire contract relating to the consequences of a breach.
Held: (Majority) The agreement had been terminated by breach rather than by the exercise of an option, so that the stipulated . .
CitedTruex v Toll ChD 6-Mar-2009
The bankrupt appealed against an order in bankruptcy made against her on application by her former solicitors in respect of their unpaid costs. The bankrupt said that since the bill was yet untaxed, it might be altered and could not base a statutory . .

Lists of cited by and citing cases may be incomplete.

Insolvency, Banking

Updated: 10 November 2021; Ref: scu.448322

Hedley Byrne and Co Ltd v Heller and Partners Ltd: HL 28 May 1963

Banker’s Liability for Negligent Reference

The appellants were advertising agents. They were liable themselves for advertising space taken for a client, and had sought a financial reference from the defendant bankers to the client. The reference was negligent, but the bankers denied any assumption of a duty of care to a third party when purely economic losses were at issue.
Held: Irrespective of any contract, if someone who is possessed of a special skill undertakes to apply that skill for the assistance of another person, who relies upon such skill, then a duty of care will arise. In certain circumstances a professional adviser might be liable even in the absence of a contractual or fiduciary relationship between himself and the person who had suffered some economic loss. Lord Devlin considered the sort of relationship which gave rise to a responsibility towards those who act upon information or advice and so created a duty of care towards the person so acting, saying ‘I do not understand any of your Lordships to hold that it is a responsibility imposed by law upon certain types of persons or in certain sorts of situations. It is a responsibility that is voluntarily accepted or undertaken, either generally where a general relationship, such as that of solicitor and client or banker and customer, is created, or specifically in relation to a particular transaction.’ and ‘If irrespective of contract, a doctor negligently advises a patient that he can safely pursue his occupation and he cannot and the patient’s health suffers and he loses his livelihood, the patient has a remedy. But if the doctor negligently advises him that he cannot safely pursue his occupation when in fact he can and he loses his livelihood, there is said to be no remedy. Unless, of course, the patient was a private patient and the doctor accepted half a guinea for his trouble: then the patient can recover all. I am bound to say, my Lords, that I think this to be nonsense. It is not the sort of nonsense that can arise even in the best system of law out of the need to draw nice distinctions between borderline cases. It arises, if it is the law, simply out of a refusal to make sense. The line is not drawn on any intelligible principle. It just happens to be the line which those who have been driven from the extreme assertion that negligent statements in the absence of contractual or fiduciary duty give no cause of action have in the course of their retreat so far reached.’
and, Lord Morris of Borth-y-Gest said: ‘it should now be regarded as settled that if someone possessed of a special skill undertakes, quite irrespective of contract, to apply that skill for the assistance of another person who relies upon such skill, a duty of care will arise. The fact that the service is to be given by means of or by the instrumentality of words can make no difference. Furthermore, if in a sphere in which a person is so placed that they could reasonably rely upon his judgment or his skill or upon his ability to make careful inquiry, a person takes it upon himself to give information or advice to, or allows his information or advice to be passed on to, another person who, as he knows or should know, will place reliance upon it, then a duty of care will arise.’
Lord Devlin held that the categories of special relationships which might give rise to a duty of care in word as well as in deed are not limited to contractual relationships or to relationships of fiduciary duty, ‘but include also relationships which in the words of Lord Shaw in Nocton v Lord Ashburton are ‘equivalent to contract’ that is, where there is an assumption of responsibility in circumstances in which, but for the absence of consideration, there would be a contract.’ and
‘I have had the advantage of reading all the opinions prepared by your Lordships and of studying the terms which your Lordships have framed by way of definition of the sort of relationship which gives rise to a responsibility towards those who act upon information or advice and so creates a duty of care towards them. I do not understand any of your Lordships to hold that it is a responsibility imposed by law upon certain types of persons or in certain sorts of situations. It is a responsibility that is voluntarily accepted or undertaken, either generally where a general relationship, such as that of solicitor and client or banker and customer, is created, or specifically in relation to a particular transaction.’

Lord Morris, Lord Devlin, Lord Reid, Lord Hodson
[1964] AC 465, [1963] 2 All ER 575, [1963] UKHL 4, [1963] 1 Lloyds Rep 485, [1963] 3 WLR 101
UBC, Bailii, Bailii
England and Wales
Citing:
ApprovedCandler v Crane Christmas and Co CA 15-Dec-1950
Though the accounts of the company in which the plaintiff had invested had been carelessly prepared and gave a wholly misleading picture of the state of the company, the plaintiff could not recover damages. A false statement, carelessly, as . .
CitedCoggs v Bernard 1703
The defendant had care of the plaintiff’s cask of brandy. He broke the cask and spilt the brandy.
Held: A bailment can exist notwithstanding that it is gratuitous, i.e. without consideration passing from the bailor to the bailee. The . .
CitedPeek v Derry CA 1887
The court considered an action for damages for deceit: ‘As I understand the law, it is not necessary that the mis-statement should be the motive, in the sense of the only motive, the only inducement of a party who has acted to his prejudice so to . .
Appeal fromHedley Byrne and Co Ltd v Heller and Partners Ltd CA 1961
A banker giving a gratuitous reference is not required to do his best by, for instance, making inquiries from outside sources which are available to him, though this would make his reference more reliable. All that he is required to do is to conform . .
CitedCann v Willson 1888
Liability of surveyor . .
CitedDonoghue (or M’Alister) v Stevenson HL 26-May-1932
Decomposed Snail in Ginger Beer Bottle – Liability
The appellant drank from a bottle of ginger beer manufactured by the defendant. She suffered injury when she found a half decomposed snail in the liquid. The glass was opaque and the snail could not be seen. The drink had been bought for her by a . .
CitedEverett v Griffiths HL 1921
The plaintiff had been committed to a mental hospital. The question was whether the doctor (Anklesaria) who signed the certificate to support his committal was liable to him in negligence.
Held: The House affirmed the judgment of the Court of . .
CitedDerry 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 . .
CitedEverett v Griffiths CA 1920
The plaintiff, who had been detained as a lunatic as the result of the decision of Griffiths, a Justice of the Peace and Chairman of the Board of Guardians in reliance on a medical certificate signed by Anklesaria, a Doctor, sued them both in . .
CitedFish v Kelly 1864
Mere casual observations are not to be used to found a duty of care. . .
CitedLow v Bouverie CA 1891
If a trustee chooses to answer questions from a stranger about the cestui que trust, his legal obligation is only to answer honestly and to the best of his information. He need not make enquiries to support those answers.
Bowen LJ said: . .
CitedDe La Bere v Pearson Ltd 1908
The defendant newspaper offered that its editor would give financial advice to readers who cared to seek it. He answered one enquiry for the name of a good stockbroker, with a reference to a person who, had he made enquiries, he would have . .
CitedGeorge v Skivington 1869
There was an injury to the wife, from a hair wash purchased under a contract of sale with the husband.
Held: The wife had a good cause of action. There was a duty in the vendor to use ordinary care in compounding the article sold, and that . .
CitedHaseldine v Daw and Son Ltd CA 1941
A lift engineer had failed adequately to repair a lift which as result later fell to the bottom of its shaft. The plaintiff was consequently injured. Scott LJ said: ‘The common law has throughout its long history developed as an organic growth, at . .
CitedHeaven v Pender, Trading As West India Graving Dock Company CA 30-Jul-1883
Duty Arising to Use Ordinary Care and Skill
The plaintiff was a painter. His employer engaged to repaint a ship, and the defendant erected staging to support the work. The staging collapsed because one of the ropes was singed and weakened, injuring the plaintiff.
Held: The defendant had . .
CitedHeilbut Symons and Co v Buckleton HL 11-Nov-1912
In an action of damages for fraudulent misrepresentation and breach of warranty, the plaintiff founded on a conversation between himself and the defendants’ representative. In this conversation the plaintiff said-‘I understand that you are bringing . .
CitedGrant v Australian Knitting Mills PC 21-Oct-1935
(Australia) The Board considered how a duty of care may be established: ‘All that is necessary as a step to establish a tort of actionable negligence is define the precise relationship from which the duty to take care is deduced. It is, however, . .
CitedHeskell v Continental Express Ltd 1950
The court discussed how a warranty of authority could arise in an agent: ‘An agent who warrants that he has authority need warrant no more than the bare fact. In the absence of special circumstances, he makes no warranty or representation about how . .
CitedLe Lievre v Gould CA 6-Feb-1893
Mortgagees of the interest of a builder under a building agreement, advanced money to him from time to time, relying upon certificates given by a surveyor as to stages reached. The surveyor was not appointed by the mortgagees, and there was no . .
CitedMorrison Steamship Co Ltd v Greystoke Castle (Cargo Owners) HL 1946
A ship was damaged in a collision. Though their goods were not damaged, the owners of cargo on the first ship became liable to the owners of the ship for a general average contribution. The owners sued the other ship owners for their negligence. The . .
CitedNocton v Lord Ashburton HL 1914
The defendant solicitor had persuaded his client to release a charge, thus advancing the solicitor’s own subsequent charge on the same property. The action was started in the Chancery Division of the High Court. The statement of claim alleged fraud . .
CitedPasley v Freeman 1789
Tort of Deceit Set Out
The court considered the tort of deceit. A representation by one person that another person was creditworthy was actionable if made fraudulently. A false affirmation made by the defendant with intent to defraud the plaintiff, whereby the plaintiff . .
CitedScholes v Brook 1891
Counsel for the appellant had submitted that the damages ought to be the difference between the value of the estate as stated by the valuers and the real value at that time. This submission was rejected.
Held: The argument was rightly . .
CitedParsons v Barclay and Co Ltd and Goddard CA 1910
An inquiry was made between banks as to the financial position of a customer of the defendant Bank. It was answered by the manager containing the words: ‘This information is for your private use only, and is given without any responsibility on our . .
CitedShiells v Blackburne 1789
A merchant agreed without taking any reward to enter a parcel of goods of another, along with his own at the Customs House for export. He negligently entered the goods under the wrong denomination, and both parcels were seized.
Held: The . .
CitedWilkinson v Coverdale 1793
The defendant had gratuitously undertaken to arrange insurance for the plaintiff. He had not done so, and the plaintiff sued him in negligence.
Held: He was liable.
Case will lie where a party undertakes to get a policy done for another . .
CitedWoods v Martins Bank Ltd 1958
If a bank chooses to give advice to a customer, then the Bank’s obligation is to advise with ordinary skill and care. The liability is primarily on contract: ‘In my judgment, the limits of a banker’s business cannot be laid down as a matter of law. . .
Too narrowOld Gate Estates Ltd v Toplis and Harding and Russell 1939
The case of Donoghue -v- Stevenson was restricted in its application to cases of negligence causing damage to life, limb or health. . .
CitedSkelton v London and North Western Ry Co CCP 1867
The defendant’s railway lines crossed a public footpath. The lines were bounded by gates which swung to, as required by law, but were not as usual also fastened. The deceased stopped as one train passed, but then stepped out in front of another and . .
CitedTournier v National Provincial and Union Bank of England CA 1924
The court considered the duty of confidentiality owed by a banker to his client. Bankes LJ said: ‘At the present day I think it may be asserted with confidence that the duty is a legal one arising out of contract, and that the duty is not absolute . .
CitedRutter v Palmer 1922
A party is not exempted by his contract from his own negligence ‘unless adequate words are used.’
Scrutton LJ said: ‘For the present purposes a rougher test will serve. In construing an exemption clause certain general rules may be applied: . .
CitedPlowright v Lambert 1885
The courts of equity have recognised that a fiduciary relationship can exist ‘in almost every shape’. . .
CitedGladwell v Steggall 19-Jun-1839
The plaintiff was a girl of ten years of age claimed she had been negligently treated by the defendant surgeon and apothecary. She sued in an action ex delicto, alleging a breach of the contract under which they had been employed, though it was her . .
CitedRobinson v National Bank of Scotland HL 10-Apr-1916
The pursuer claimed for false and fraudulent misrepresentation againt his bankers.
Held: A duty of care is not only owed in cases of fiduciary relationship in the narrow sense of relationships which had been recognised by the court of Chancery . .

Cited by:
AppliedCaparo Industries Plc v Dickman and others HL 8-Feb-1990
Limitation of Loss from Negligent Mis-statement
The plaintiffs sought damages from accountants for negligence. They had acquired shares in a target company and, relying upon the published and audited accounts which overstated the company’s earnings, they purchased further shares.
Held: The . .
CitedAnns and Others v Merton London Borough Council HL 12-May-1977
The plaintiff bought her apartment, but discovered later that the foundations were defective. The local authority had supervised the compliance with Building Regulations whilst it was being built, but had failed to spot the fault. The authority . .
CitedMutual Life And Citizens’ Assurance Co Ltd And Another v Evatt PC 16-Nov-1971
The plaintiff had been an investor with the defendant. He asked them about an associated company. He was given advice which was incorrect. He claimed damages for negligence.
Held: The company was not itself in the business of giving such . .
CitedWilliams and Another v Natural Life Health Foods Ltd and Another HL 30-Apr-1998
A company director was not personally reliable in negligence for bad advice given by him as director unless it could clearly be shown that he had willingly accepted such personal responsibility. A special relationship involving an assumption of . .
CitedHenderson 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 . .
CitedArthur JS Hall and Co (A Firm) v Simons; Barratt v Woolf Seddon (A Firm); Harris v Schofield Roberts and Hill (A Firm) HL 20-Jul-2000
Clients sued their solicitors for negligence. The solicitors responded by claiming that, when acting as advocates, they had the same immunities granted to barristers.
Held: The immunity from suit for negligence enjoyed by advocates acting in . .
CitedBank of Credit and Commerce International (Overseas) Limited (In Liquidation); BCCI Holdings (Luxembourg) SA (In Liquidation); Bank of Credit and Commerce International SA (In Liquidation) v Price Waterhouse CA 13-Feb-1998
The special relationship between an auditor and a bank, meant that a duty of care could extend even to a second bank with its own auditors. In determining whether there had been an assumption of responsibility, the the relevant factors would include . .
CitedWhite and Another v Jones and Another HL 16-Feb-1995
Will Drafter liable in Negligence to Beneficiary
A solicitor drawing a will may be liable in negligence to a potential beneficiary, having unduly delayed in the drawing of the will. The Hedley Byrne principle was ‘founded upon an assumption of responsibility.’ Obligations may occasionally arise . .
CitedNiru Battery Manufacturing Company, Bank Sepah Iran v Milestone Trading Limited CA 23-Oct-2003
The claimant had contracted to purchase lead from some of the defendants. There were delays in payment but when funds were made available they should have been repaid. An incorrect bill of lading was presented. The bill certified that the goods had . .
CitedCommissioners of Customs and Excise v Barclays Bank Plc ComC 3-Feb-2004
The claimant had obtained orders against two companies who banked with the respondent. Asset freezing orders were served on the bank, but within a short time the customer used the bank’s Faxpay national service to transfer substantial sums outside . .
CitedYianni v Edwin Evans and Sons ChD 1981
The respondent valuers reported to a building society that a property would be a sufficient security. The purchaser relied on that report to purchase the property, ignoring the advice in the lender’s form to obtain a full survey. The property was . .
AppliedChaudry v Prabhakar CA 1988
The plaintiff sued a friend of hers for wrongly advising her that a car she was thinking of buying was in good condition.
Held: An agent, even a volunteer, owed a duty of care appropriate for those circumstances. The measurement was objective, . .
CitedCommissioner of Police of the Metropolis v Lennon CA 20-Feb-2004
The claimant police officer considered being transferred to Northern Ireland. He asked and was incorrectly told that his housing allowance would not be affected by taking time off work.
Held: The break between employments had affected his . .
CitedSpring v Guardian Assurance Plc and Others HL 7-Jul-1994
The plaintiff, who worked in financial services, complained of the terms of the reference given by his former employer. Having spoken of his behaviour towards members of the team, it went on: ‘his former superior has further stated he is a man of . .
CitedBinod Sutradhar v Natural Environment Research Council CA 20-Feb-2004
The defendant council had carried out research into a water supply in India in the 1980s. The claimant drank the water, and claimed damages for having consumed arsenic in it.
Held: There is a close link between the tests in law for proximity . .
CitedCustoms and Excise v Barclays Bank Plc CA 22-Nov-2004
The claimant had obtained judgment against customers of the defendant, and then freezing orders for the accounts. The defendants inadvertently or negligently allowed sums to be transferred from the accounts. The claimants sought repayment by the . .
CitedFirst National Commercial Bank Plc v Loxleys (a Firm) CA 6-Nov-1996
The plaintiff claimed damages from the seller of land and from their solicitors for misrepresentation in the replies to enquiries before contract. He appealed a striking out of his claim.
Held: A lawyer’s disclaimer placed on his Replies to . .
CitedMcCullagh v Lane Fox and Partners Ltd CA 19-Dec-1995
There was no duty in negligent mis-statement from a vendor’s estate agent to a purchaser for that purchaser’s financial loss after proceeding without first obtaining a survey relying upon the agent.
Hobhouse LJ said: ‘On the Sunday, Mr. Scott . .
CitedMidland Bank Trust Co Ltd v Hett Stubbs and Kemp (a firm) ChD 1978
A solicitor had failed to register an option as a land charge over property. The court was asked what steps should have been taken by a solicitor in the conduct of a claim: ‘Mr Harman [leading counsel for the plaintiff] sought to rely upon the fact . .
CitedPrecis (521) Plc v William M Mercer Ltd CA 15-Feb-2005
Purchasers of a company sought to claim in negligence against the respondent actuaries in respect of a valuation of the company’s pension funds.
Held: There was a paucity of authority as to when a duty of care was assumed. The words used and . .
CitedRegina v Lam and Others (T/a ‘Namesakes of Torbay’) and Borough of Torbay CA 30-Jul-1997
The claimant sought damages after the planning authority allowed the first defendant to conduct a manufacturing business in the course of which spraying activities took place which caused them personal injuries and loss of business.
Held: The . .
CitedBrooks v Commissioner of Police for the Metropolis and others HL 21-Apr-2005
The claimant was with Stephen Lawrence when they were both attacked and Mr Lawrence killed. He claimed damages for the negligent way the police had dealt with his case, and particularly said that they had failed to assess him as a victim of crime, . .
CitedJames McNaughton Paper Group Ltd v Hicks Anderson and Co CA 31-Jul-1990
When considering the liability of an auditor in negligence, the fact and nature of any communications direct between the auditor and the potential investor must be allowed for. The court set out a non-exhaustive list of factors to be taken into . .
CitedWest Bromwich Albion Football Club Ltd v El-Safty QBD 14-Dec-2005
The claimant sought damages from the defendant surgeon alleging negligent care of a footballer. The defendant argued that he had no duty to the club as employer of his patient who was being treated through his BUPA membership. It would have created . .
CitedMachin v Adams and others CA 13-Sep-1995
. .
CitedFarraj and Another v King’s Healthcare NHS Trust and Another QBD 26-May-2006
The claimants sought damages after the birth of their child with a severe hereditary disease which they said the defendant hospital had failed to diagnose after testing for that disease. The hospital sought a contribution from the company CSL who . .
CitedHM Customs and Excise v Barclays Bank Plc HL 21-Jun-2006
The claimant had served an asset freezing order on the bank in respect of one of its customers. The bank paid out on a cheque inadvertently as to the order. The Commissioners claimed against the bank in negligence. The bank denied any duty of care. . .
CitedSutradhar v Natural Environment Research Council HL 5-Jul-2006
Preliminary Report of Risk – No Duty of Care
The claimant sought damages after suffering injury after the creation of water supplies which were polluted with arsenic. He said that a report had identified the risks. The defendant said that the report was preliminary only and could not found a . .
CitedAwoyomi v Radford and Another QBD 12-Jul-2007
The claimant sought damages from the defendant barristers who had represented her in criminal proceedings. They had not passed on to her the statement made by the judge in chambers that if she pleaded guilty he would not impose a sentence of . .
CitedJain and Another v Trent Strategic Health Authority CA 22-Nov-2007
The claimant argued that the defendant owed him a duty of care as proprietor of a registered nursing home in cancelling the registration of the home under the 1984 Act. The authority appealed a finding that it owed such a duty.
Held: The . .
CitedCalvert v William Hill Credit Ltd ChD 12-Mar-2008
The claimant said that the defendant bookmakers had been negligent in allowing him to continue betting when they should have known that he was acting under an addiction. The defendant company had a policy for achieving responsible gambling, . .
CitedTidman v Reading Borough Council QBD 4-Nov-1994
The plaintiff wanted to sell his land. The purchaser wished to know the planning status and prospects for the land. The local authority published a leaflet encouraging those interested to seek guidance from the authority’s planning officers. The . .
CitedDesmond v The Chief Constable Of Nottinghamshhire Police QBD 1-Oct-2009
The claimant appealed against the striking out of parts of his claim alleging negligence and misfeasance. He had been arrested on suspicion of indecent assault, but then was fully cleared by a third officer. When he later applied for an enhanced CRB . .
CitedJones v Kaney SC 30-Mar-2011
An expert witness admitted signing a joint report but without agreeing to it. The claimant who had lost his case now pursued her in negligence. The claimant appealed against a finding that the expert witness was immune from action.
Held: The . .
CitedMcKie v Swindon College QBD 11-Feb-2011
The claimant sought damages after having moved jobs, his former employer wrote to his new one saying that he would not be welcome back on the campus, which would be a substantial part, giving reasons.
Held: The claimant succeeded on liability. . .
CitedGlaister and Others v Appelby-In-Westmorland Town Council CA 9-Dec-2009
The claimant was injured when at a horse fair. A loose horse kicked him causing injury. They claimed in negligence against the council for licensing the fair without ensuring that public liability insurance. The Council now appealed agaiinst a . .
CitedAvrora Fine Arts Investment Ltd v Christie, Manson and Woods Ltd ChD 27-Jul-2012
The claimants had bought a painting (Odalisque) through the defendant auctioneers. They now claimed that it had been misattributed to Kustodiev, and claimed in negligence and misrepresentation.
Held: Based on the connoisseurship evidence, the . .
CitedGreen and Another v The Royal Bank of Scotland Plc CA 9-Oct-2013
The claimants appealed against a claim that they had been mis-sold interest rate swap arrangements by their bankers, thereby suffering losses. . .
CitedCramaso Llp v Ogilvie-Grant, Earl of Seafield and Others SC 12-Feb-2014
The defenders owned a substantial grouse moor in Scotland. There had been difficulties with grouse stocks, and steps taken over years to allow stocks to recover. They had responded to enquiries from one Mr Erskine with misleading figures. Mr Erskine . .
CitedSchubert Murphy (A Firm) v The Law Society QBD 17-Dec-2014
The claimant solicitors’ firm had acted in a purchase, but the vendors were represented by fraudsters presenting themselves as solicitors, registering with the defendant in names of retired solicitors, and who made off with the money intended for . .
CitedMichael and Others v The Chief Constable of South Wales Police and Another SC 28-Jan-2015
The claimants asserted negligence in the defendant in failing to provide an adequate response to an emergency call, leading, they said to the death of their daughter at the hands of her violent partner. They claimed also under the 1998 Act. The . .
CitedRhodes v OPO and Another SC 20-May-2015
The mother sought to prevent a father from publishing a book about her child’s life. It was to contain passages she said may cause psychological harm to the 12 year old son. Mother and son lived in the USA and the family court here had no . .
CitedThe Law Society of England and Wales v Schubert Murphy (A Firm) CA 25-Aug-2017
The solicitors had made use of the online facility provided by the appellant Law Society to verify the bona fides of a firm of solicitors acting for a third party to a transaction. Relying upon the information, they suffered losses, and claimed in . .
CitedDurkin v DSG Retail Ltd and Another SC 26-Mar-2014
Cancellation of Hire Finance Contract
The claimant had bought a PC with a finance agreement with the respondent. He rejected it a day later, but the respondent refused to cancel the credit agreement. The respondent had threatened to report his non-payment to credit reference companies, . .
CitedSteel and Another v NRAM Ltd (Formerly NRAM Plc) SC 28-Feb-2018
The appellant solicitor acted in a land transaction. The land was mortgaged to the respondent bank. She wrote to the bank stating her client’s intention to repay the whole loan. The letter was negligently mistaken and the bankers allowed the . .
CitedJames-Bowen and Others v Commissioner of Police of The Metropolis SC 25-Jul-2018
The Court was asked whether the Commissioner of Police of the Metropolis (‘the Commissioner’) owes a duty to her officers, in the conduct of proceedings against her based on their alleged misconduct, to take reasonable care to protect them from . .
CitedBanca Nazionale Del Lavoro Spa v Playboy Club London Ltd and Others SC 26-Jul-2018
The Playboy casino required a reference for a customer, but asked for this through a third party. The bank was not aware of the agency but gave a good reference for a customer who had never deposited any money with them and nor to whom it had issued . .

Lists of cited by and citing cases may be incomplete.

Professional Negligence, Banking

Leading Case

Updated: 10 November 2021; Ref: scu.179788

Office of Fair Trading (OFT) v Abbey National Plc and Others: SC 25 Nov 2009

The banks appealed against a ruling that the OFT could investigate the fairness or otherwise of their systems for charging bank customers for non-agreed items as excessive relative to the services supplied. The banks said that regulation 6(2) could be used neither by the OFT, nor by individual consumers to object to their charges.
Held: The banks’ appeal succeeded. The charging system had to be looked at as a package. An investigation of the charges would relate to the adequacy of the price as against the services supplied, and therefore be incorrect with 6(2)(b). The charges complained of did not relate solely to the immediate tranactions. The two sub-paragraphs of regulation 6(2) must be given their natural meaning, and ‘read in that way they set out tests which are separate but not unconnected. They reflect (but in slightly different ways) the two sides (or quid pro quo) of any consumer contract, that is (a) what it is that the trader is to sell or supply and (b) what it is that the consumer is to pay for what he gets. The definition of the former is not to be reviewed in point of fairness, nor is the ‘adequacy’ (appropriateness) of the latter.’
There was no sufficient point of doubt to require any reference to the European Court.
Lord Walker said: ‘Charges for unauthorised overdrafts are monetary consideration for the package of banking services supplied to personal current account customers. They are an important part of the banks’ charging structure, amounting to over 30 per cent of their revenue stream from all personal current account customers. The facts that the charges are contingent, and that the majority of customers do not incur them, are irrelevant. On the view that I take of the construction of Regulation 6(2), the fairness of the charges would be exempt from review in point of appropriateness under Regulation 6(2)(b) even if fewer customers paid them, and they formed a smaller part of the banks’ revenue stream. ‘
Lord Mance said: ‘Article 4(2) and regulation 6(2) are as exceptions to be construed narrowly. Nevertheless, the concepts of ‘price or remuneration’ must, I think, be capable in principle of covering, under a banking contract, an agreement to make a payment in a particular event. The language of regulation 6(2)(b) is on its face therefore capable of covering a customer’s commitment, under the package contracts put before the House, to pay the Relevant Charges in the specified events. There is no reason why a customer should not be given free services in some circumstances, but, as a quid pro quo, be expected to pay for them in others.’

Lord Phillips, President, Lord Walker, Lady Hale, Lord Mance, Lord Neuberger
[2009] UKSC 6, Times 26-Nov-2009, [2009] 3 WLR 1215
Bailii
Unfair Terms in Consumer Contracts Regulations 1999 (SI 1999/2083) 6(2), Council Directive 93/13/EEC on unfair terms in consumer contracts
England and Wales
Citing:
CitedDirector General of Fair Trading v First National Bank HL 25-Oct-2001
The House was asked whether a contractual provision for interest to run after judgment as well as before in a consumer credit contract led to an unfair relationship.
Held: The term was not covered by the Act, and was not unfair under the . .
At First InstanceOffice of Fair Trading v Abbey National Plc and seven Others ComC 24-Apr-2008
The Office sought a declaration that the respondent and other banks were subject to the provisions of the Regulations in their imposition of bank charges to customer accounts, and in particular as to the imposition of penalties or charges for the . .
See alsoOffice of Fair Trading v Abbey National Plc and others ComC 8-Oct-2008
The director sought a further judgment as to whether charges imposed by banks on a customer taking an unauthorised overdraft, and otherwise were unlawful penalties. . .
Appeal fromAbbey National Plc and others v The Office of Fair Trading CA 26-Feb-2009
The OFT had sought to enquire as to the fairness of the terms on which banks conducted their accounts with consumers, and in particular as to how they charged for unauthorised overdrafts. The banks denied that the OFT had jurisdiction, and now . .
CitedChichester Diocesan Board of Finance v Simpson HL 21-Jun-1944
The court was asked whether a gift in a will to the trustees ‘for such charitable institution or institutions or other charitable or benevolent object or objects in England’ as they should select, was valid.
Held: ‘The fundamental principle is . .
See alsoOffice of Fair Trading v Abbey National Plc and others ComC 21-Jan-2009
. .
CitedBairstow Eves London Central Ltd v Smith and Another QBD 20-Feb-2004
. .
CitedThe Office Of Fair Trading v Foxtons Ltd ChD 10-Jul-2009
The OFT alleged that certain standard terms in the defendant’s letting agent contracts were unfair. The agent had withdrawn the former terms, but relief was still sought on those terms and their effect, and as to the fairness of the new ones. The . .
CitedCollege of Estate Management v Customs and Excise HL 20-Oct-2005
The college supplied educational services by distance learning. The commissioner sought to argue that printe daterials supplied with the course were ancillary and did not have the same exemption form VAT.
Held: The supplies did benefit from . .
CitedFreiburger Kommunalbauten GmbH Baugesellschaft and Co. KG v Ludger Hofstetter, Ulrike Hofstetter ECJ 1-Apr-2004
ECJ Directive 93/13/EEC – Unfair terms in consumer contracts – Contract for the building and supply of a parking space – Reversal of the order of performance of contractual obligations provided for under national . .
CitedSrl CILFIT v Ministero Della Sanita ECJ 6-Oct-1982
ECJ The obligation to refer to the Court of Justice questions concerning the interpretation of the EEC Treaty and of measures adopted by the community institutions which the third paragraph of article 177 of the . .

Cited by:
CitedCavendish Square Holding Bv v Talal El Makdessi; ParkingEye Ltd v Beavis SC 4-Nov-2015
The court reconsidered the law relating to penalty clauses in contracts. The first appeal, Cavendish Square Holding BV v Talal El Makdessi, raised the issue in relation to two clauses in a substantial commercial contract. The second appeal, . .

Lists of cited by and citing cases may be incomplete.

Banking, Consumer, European

Updated: 10 November 2021; Ref: scu.381455

Barnes and Another v Black Horse Ltd: QBD 31 May 2011

barnes_blackQBD11

The claimants sought repayment by the bank of sums paid to them for Payment Protection Insurance policies sold to them in connection with loans made by the bank. The Bank now resisted an application for leave to amend the particulars of the counterclaim to allege that the taking out of the insurance had been made to appear obligatory.
Held: The amendments alleging breach of fiduciary duty were unsupported and bound to fail and were not allowed. Nor was any allegation of breach of a duty of care, and or unenforcability under Unfair Terms legislation, sufficiently set out in the proposed amendments and they too were rejected. Mrs Barnes however could raise the unfair relationship argument against the bank.

Waksman QC J
[2011] EWHC 1416 (QB)
Bailii
Consumer Credit Act 1974 140A, Unfair Contract Terms Act 1977, Unfair Terms in Consumer Contract Regulations 1999
Citing:
CitedPatel v Patel QBD 10-Dec-2009
The parties had entered into a loan agreement at a high rate of annual interest but with monthly rests. The court was asked to set aside the agreement as unfair under the 1974 Act. . .
CitedMothew (T/a Stapley and Co) v Bristol and West Building Society CA 24-Jul-1996
The solicitor, acting in a land purchase transaction for his lay client and the plaintiff, had unwittingly misled the claimant by telling the claimant that the purchasers were providing the balance of the purchase price themselves without recourse . .
CitedBritish Bankers Association, Regina (on The Application of) v The Financial Services Authority and Another Admn 20-Apr-2011
The claimant sought relief by way of judicial review from a policy statement issued by the defendants regarding the alleged widespread misselling of payment protection insurance policies, and the steps to be taken to compensate the purchasers. They . .
CitedHarrison v Black Horse Ltd QBD 1-Dec-2010
The claimant sought damages for breach of the statutory duty in ICOB, and for damages for negligence. The bank faced a claim that it had assumed responsibility to take reasonable care in recommending the policy it did. The bank had relied on the . .
CitedBlack Horse Ltd v Speak and Another QBD 21-Jul-2010
The court considered a case involving the selling of payment protection policies by lenders. The defendants said that since the bank had required them to take out the policy, its cost should have been included in the total charge for credit. Since . .

Lists of cited by and citing cases may be incomplete.

Consumer, Banking

Updated: 09 November 2021; Ref: scu.440466

UMBS Online, Regina (on the Application Of) v Serious Organised Crime Agency: CA 21 Mar 2007

Application for leave to appeal against refusal of leave to bring judicial review of a decision of the respondent agency. Leave to appeal was granted, but the matter was returned to the administrative court for review.

Ward LJ, Sedley LJ, Hooper LJ
[2007] EWCA Civ 375, [2008] 1 All ER 465
Bailii
Proceeds of Crime Act 2002
England and Wales
Citing:
Appeal fromRegina (ex parte UMBS Online Ltd) v Serious Organised Crime Agency Admn 2007
The customers bank accounts had been frozen at the request of the respondent agency after the bank had reported what it thought was suspicious activity to the Agency. It sought judicial review of the agency’s refusal to allow the bank to resume . .
CitedSquirrell Ltd v National Westminster Bank Plc ChD 22-Apr-2005
The court conisdered the effects of the provisions of the 2002 Act to be to ‘force a party in NatWest’s position to report its suspicions to the relevant authorities and not to move suspect funds or property either for seven working days or, if a . .

Cited by:
See AlsoUMBS Online Ltd, Regina (on the Application Of) v Serious Organised Crime Agency and Another CA 2-May-2007
The bank had reported to the respondent its suspicions about funds it held for the claimant. The accounts were frozen, and the customer now sought a judicial review of the refusal of the Agency to reconsider its decision.
Held: The review was . .
CitedShah and Another v HSBC Private Bank (UK) Ltd QBD 26-Jan-2009
The claimants sought damages after delays by the bank in processing transfer requests. The bank said that the delays were made pending reports of suspected criminal activity. The bank’s delay had stigmatised the claimant causing further losses. The . .

Lists of cited by and citing cases may be incomplete.

Banking, Police

Updated: 09 November 2021; Ref: scu.251612

Paragon Finance plc v Nash etc: CA 15 Oct 2001

The court was asked to consider whether there was any implied term limiting the power of a mortgagee to set interest rates under a variable rate mortgage.
Held: A loan arrangement which allowed a lender to vary the implied rate of interest, included an implied term not to impose an unreasonable or extortionate rate, nor to act for an unreasonable, improper, dishonest, or capricious purpose. When a court looked at the question of whether an arrangement was an extortionate credit bargain, it must look at the situation at the time the bargain is made. Also, the setting of interest rates was not ‘contractual performance’ under the 1977 Act, so as to allow that Act to bite. In this case, the lenders had failed to reduce interest rates in line with other rates generally available. This had however been for proper commercial considerations, and so any implied term did not apply. Unreasonableness in the context connotes conduct or a decision to which no reasonable person having the relevant discretion could have subscribed.

Lord Justice Thorpe, Lord Justice Dyson and Mr Justice Astill
Times 25-Oct-2001, Gazette 15-Nov-2001, [2001] EWCA Civ 1466, [2002] 1 WLR 685
Bailii
Consumer Credit Act 1974 137(2)(b) 138, Unfair Contract Terms Act 1977 3(2)(b)
England and Wales
Citing:
DistinguishedLombard Tricity Finance Ltd v Paton CA 1989
The borrower challenged a variation of the interest rate to be charged on his regulated loan. The agreement purported to give the lender a full discretion to vary the rate on notice.
Held: The Regulations required the agreement to identify the . .
CitedAbu Dhabi National Tanker Co v Product Star Shipping Ltd (No 2) CA 1993
Where parties enter into a contract which confers a discretion on one of them, the discretion must be exercised honestly and in good faith, and not ‘arbitrarily, capriciously or unreasonably’. The owner had acted unreasonably in that there was no . .
CitedGan Insurance Co Ltd v Tai Ping Insurance Co Ltd CA 3-Jul-2001
A reinsurance contract which contained a clause which provided that no settlement or compromise of a claim could be made or liability admitted by the insured without the prior approval of the reinsurers. The court considered how the discretion to . .
CitedBarclays Bank Ltd v Bird 1954
An equitable chargee has an immediate right to possession, subject only to his first obtaining an order for possession from the court: ‘An equitable mortgagee . . has no right to possession until the court gives it to him.’ . .

Cited by:
CitedParagon Finance Plc v Pender and Another CA 27-Jun-2005
The defendants had purchased their property from the local authority with the support of a loan from the claimants. The defendants fell into arrears but now sought to resist possession on the basis that the claimant, in securitising their portfolio . .
CitedLymington Marina Ltd v MacNamara and others ChD 4-Apr-2006
The claimant marina had been constructed with financial assistance from debenture holders who in return were given low cost licences. The claimant sought to refuse to the defendant debenture holders the right to sub-licence their rights to berth . .
CitedLymington Marina Ltd v MacNamara and others CA 2-Mar-2007
A share in a marina had been inherited by one brother whose application to grant successive sub-lcences of it to the other two was rejected by the marina, who said that this was not permitted. The marina appealed a finding that it had to make its . .
CitedOffice of Fair Trading v Abbey National Plc and seven Others ComC 24-Apr-2008
The Office sought a declaration that the respondent and other banks were subject to the provisions of the Regulations in their imposition of bank charges to customer accounts, and in particular as to the imposition of penalties or charges for the . .
CitedNolan v Wright ChD 26-Feb-2009
The defendant sought to re-open the question of whether the charge under which he might otherwise be liable was an extortionate credit bargain. The creditor said that that plea was time barred. The defendant argued that a finding that the agreement . .
CitedUnique Pub Properties Ltd v Broard Green Tavern Ltd and Another ChD 26-Jul-2012
The claimant freeholder sought to install in the tenant’s pub, equipment to monitor sales. It claimed a right for this in the lease. The tenant refused access, saying that the proposed system was inaccurate. The claimant now sought summary relief. . .
CitedSocimer International Bank Ltd v Standard Bank London Ltd CA 22-Feb-2008
Rix LJ considered the restraints operating a party to a contract in exercising any discretion gien under it, preferring the use of the term ‘irrationality’ to ‘unreasonableness’: ‘It is plain from these authorities that a decision-maker’s discretion . .
CitedBraganza v BP Shipping Ltd SC 18-Mar-2015
The claimant’s husband had been lost from the defendant’s ship at sea. The defendant had contracted to pay compensation unless the loss was by suicide. They so determined. The court was now asked whether that was a permissible conclusion in the . .
CitedBritish Telecommunications Plc v Telefonica O2 UK Ltd SC 9-Jul-2014
The parties disputed the termination charges which BT was entitled to charge to mobile network operators for putting calls from the latter’s networks through to BT fixed lines with associated 08 numbers. BT had introduced new tariff charges.
Consumer, Banking, Contract

Leading Case

Updated: 09 November 2021; Ref: scu.166707

LCL Le Credit Lyonnais v Fesih Kalhan: ECJ 27 Mar 2014

lcl_kalhanECJ0314

ECJ Consumer protection – Credit agreements for consumers – Directive 2008/48/EC – Articles 8 and 23 – Creditor’s obligation to assess the borrower’s creditworthiness prior to conclusion of the agreement – National provision imposing the obligation to consult a database – Forfeiture of entitlement to contractual interest in the event of failure to comply with that obligation – Effective, proportionate and dissuasive nature of the penalty

L. Bay Larsen, P
C-565/12, [2014] EUECJ C-565/12
Bailii
Directive 2008/48/EC 8 23

European, Banking, Consumer

Updated: 09 November 2021; Ref: scu.523332

American Express (Freedom of Establishment – Opinion): ECJ 6 Jul 2017

Regulation (EU) 2015/751 – Card-based payment transactions – Interchange fees for card-based payment transactions – Four party payment card schemes – Three party payment card schemes – Definition of card issuer – Three party payment card scheme with a co-branding partner – Three party payment card scheme with an agent

C-304/16, [2017] EUECJ C-304/16_O, ECLI:EU:C:2017:524
Bailii
European

Consumer, Banking

Updated: 09 November 2021; Ref: scu.668593

Kolassa v Barclays Bank plc: ECJ 3 Sep 2014

kolassaECJ1409

ECJ (Advocate General’s Opinion) Area of ??Freedom, Security and Justice – Jurisdiction in civil and commercial matters – Contracts concluded by consumers – Consumer domiciled in a Member State, who bought on the secondary market, with an intermediary established in another State Member, securities issued by a bank established in a third Member State – Competence for recourse against the bank issuing such securities

Sczpunar AG
C-375/13, [2014] EUECJ C-375/13 – O, [2015] EUECJ C-375/13
Bailii, Bailii

European, Consumer, Banking

Updated: 09 November 2021; Ref: scu.536451

National Westminster Bank plc v Spectrum Plus Limited and others: HL 30 Jun 2005

Former HL decision in Siebe Gorman overruled

The company had become insolvent. The bank had a debenture and claimed that its charge over the book debts had become a fixed charge. The preferential creditors said that the charge was a floating charge and that they took priority.
Held: The appeal was allowed. The debenture, although expressed to grant the bank a fixed charge over Spectrum’s book debts, in law granted only a floating charge. The Siebe Gorman case was incorrect and could not stand. A seven man House considered whether it was appropriate to overrule an established case, upon which so many commercial decisions and arrangements were founded. It was, but it was not proper to overrule the case only prospectively.
Lord Nicholls of Birkenhead said: ‘The essence of the principled argument against prospective overruling is that in this country prospective overruling is outside the constitutional limits of the judicial function. It would amount to the judicial usurpation of the legislative function. Power to make rulings having only prospective effect, it is said, is not inherent in the judicial role. A ruling having only prospective effect cannot be characterised as merely a less extensive form of overruling than overruling with both retrospective and prospective effect. Prospective overruling robs a ruling of its essential authenticity as a judicial act. Courts exist to decide the legal consequences of past events. A court decision which takes the form of a ‘pure’ prospective overruling does not decide the dispute between the parties according to what the court declares is the present state of the law. ‘ However ‘If, altogether exceptionally, the House as the country’s supreme court were to follow this course I would not regard it as trespassing outside the functions properly to be discharged by the judiciary under this country’s constitution. Rigidity in the operation of a legal system is a sign of weakness, not strength. It deprives a legal system of necessary elasticity. Far from achieving a constitutionally exemplary result, it can produce a legal system unable to function effectively in changing times. ‘Never say never’ is a wise judicial precept, in the interest of all citizens of the country.’
He discussed the possibility of judge made law: ‘Judges have a legitimate law-making function. It is a function they have long exercised. In common law countries much of the basic law is still the common law. The common law is judge-made law. For centuries, judges have been charged with the responsibility of keeping this law abreast of current social conditions and expectations.’

Lord Nicholls of Birkenhead, Lord Steyn, Lord Hope of Craighead, Lord Scott of Foscote, Lord Walker of Gestingthorpe, Baroness Hale of Richmond, Lord Brown of Eaton-under-Heywood
[2005] 3 WLR 58, [2005] 2 AC 680, [2005] 4 All ER 209, [2005] All ER (D) 368, [2005] 2 Lloyds Rep 275, [2005] 2 BCLC 269, [2005] BCC 694, [2005] UKHL 41, Times 31-Jul-2005
Bailii, House of Lords
England and Wales
Citing:
CitedGreat Northern Railway Co v Sunburst Oil and Refining Co 1932
(US Supreme Court) The Constitution neither prohibits nor requires prospective overruling. The Federal Court, Cardoza J said, ‘has no voice upon the subject.’ . .
CitedWest Midland Baptist (Trust) Association (Inc) v Birmingham Corporation HL 1970
The mere fact that an enactment shows that Parliament must have thought that the law was one thing, does not preclude the courts from deciding that the law was in fact something different. The position would be different if the provisions of the . .
CitedDonoghue (or M’Alister) v Stevenson HL 26-May-1932
Decomposed Snail in Ginger Beer Bottle – Liability
The appellant drank from a bottle of ginger beer manufactured by the defendant. She suffered injury when she found a half decomposed snail in the liquid. The glass was opaque and the snail could not be seen. The drink had been bought for her by a . .
CitedBanco Popolare di Cremona v Agenzia Entrate Uffficio Cremona ECJ 17-Mar-2005
A ruling of the European Court of Justice might be subject to a temporal limitation that the ruling should not take effect until a future date, namely, when the State had had a reasonable opportunity to introduce new legislation. . .
Appeal fromNational Westminster Bank Plc v Spectrum Plus Ltd; In re Spectrum Plus CA 26-May-2004
The court was asked whether a charge given over book debts in a debenture was floating or fixed.
Held: Since the charge asserted some control over receipt of the payments, it was a fixed charge. Upon payment into the account, title to the . .
CitedLaunchbury v Morgans HL 9-May-1972
The owner of a car appealed against a ruling that she was responsible for injury suffered by the three respondents who had been passengers in the car when it crashed. The owner had not been with them. The care was driven by her husband with her . .
OverruledSiebe Gorman and Co Ltd v Barclays Bank Ltd ChD 1979
It was possible to create a fixed charge over present and future book debts and on its true construction, the debenture granted to Barclays Bank Ltd in this case had done so. If the chargor of book debts, having collected the book debts, ‘[had] had . .
CitedRegina v National Insurance Commissioner, Ex parte Hudson HL 1972
The House considered whether it would have power to make a ruling with prospective effect only. Lord Diplock said the matter deserved further consideration; Lord Simon said that the possibility of prospective overruling should be seriously . .
CitedMiliangos v George Frank (Textiles) Ltd HL 1975
The issue was whether an English court was able to award damages in Sterling only.
Held: The House distinguished clearly between the substance of the debtor’s obligations and the effect of English procedural law when a debt in a foreign . .
CitedLinkletter v Walker 1965
(US Supreme Court) In both criminal and civil cases ‘the accepted rule today is that in appropriate cases the Court may in the interests of justice make the rule prospective.’ . .
CitedGolak Nath v State of Punjab 1967
(Supreme Court of India) The court considered whether it had jurisdiction to make a rulinging which was prospective only.
Held: The court reversed two earlier decisions of its own in circumstances where meanwhile constitutional amendments had . .
CitedChevron Oil Co v Huson 1971
(US Supreme Court) The Supreme Court summarised three factors to be taken into account when considering whether a ruling should be applied non-retroactively: whether the decision established a new principle of law, whether retrospective operation . .
CitedDefrenne v Sabena (No 2) ECJ 8-Apr-1976
ECJ The principle that men and women should receive equal pay, which is laid down by article 119, is one of the foundations of the community. It may be relied on before the national courts. These courts have a . .
CitedMarckx v Belgium ECHR 13-Jun-1979
Recognition of illegitimate children
The complaint related to the manner in which parents were required to adopt their own illegitimate child in order to increase his rights. Under Belgian law, no legal bond between an unmarried mother and her child results from the mere fact of birth. . .
CitedIndia Cement Ltd v State of Tamil Nadu 1990
(Supreme Court of India) The court found that it had jurisdiction to make rulings of retrospective effect only. Non-retroactive effect may be given to a ruling which decides an issue for the first time. . .
CitedRe Edward and Edward 1987
(Saskatchewan Court of Appeal) The court rejected the idea of making rulings of prospective effect only. Prospective overruling would be a ‘dramatic deviation from the norm in both Canada and England’. Bayda CJS said ‘the most cogent reason for . .
CitedMurphy v Attorney General 1982
(Supreme Court of Ireland) The Supreme Court held that certain taxation provisions were unconstitutional and void. The court rejected an argument that it was for the courts to say whether these statutory provisions should be held to be invalid . .
CitedArthur JS Hall and Co (A Firm) v Simons; Barratt v Woolf Seddon (A Firm); Harris v Schofield Roberts and Hill (A Firm) HL 20-Jul-2000
Clients sued their solicitors for negligence. The solicitors responded by claiming that, when acting as advocates, they had the same immunities granted to barristers.
Held: The immunity from suit for negligence enjoyed by advocates acting in . .
CitedReference re Language Rights under the Manitoba Act 1870 1985
(Supreme Court of Canada) The court declined to give retroactive effect to its decision on the constitutional invalidity of all statutes and regulations of the Province of Manitoba not printed and published in both English and French. A declaration . .
CitedRegina v Governor HM Prison Brockhill, ex parte Michelle Carol Evans (No 2) CA 19-Jun-1998
The plaintiff was serving a sentence of imprisonment. Her detention was correctly calculated in accordance with the law as understood. That method was later disapproved when the Divisional Court laid down (everyone has assumed correctly) a different . .
CitedRegina v Governor of Her Majesty’s Prison Brockhill ex parte Evans (No 2) HL 27-Jul-2000
The release date for a prisoner was calculated correctly according to guidance issued by the Home Office, but case law required the guidance to be altered, and the prisoner had been detained too long. The tort of false imprisonment is one of strict . .
CitedRegina (Bidar) v Ealing London Borough Council and Another ECJ 15-Mar-2005
Europa (Grand Chamber of the Court of Justice of the European Union) Citizenship of the Union – Articles 12 EC and 18 EC – Assistance for students in the form of subsidised loans – Provision limiting the grant of . .
CitedGoodwin v The United Kingdom ECHR 11-Jul-2002
The claimant was a post operative male to female trans-sexual. She claimed that her human rights were infringed when she was still treated as a man for National Insurance contributions purposes, where she continued to make payments after the age at . .
CitedKleinwort Benson Ltd v Lincoln City Council etc HL 29-Jul-1998
Right of Recovery of Money Paid under Mistake
Kleinwort Benson had made payments to a local authority under swap agreements which were thought to be legally enforceable when made. Subsequently, a decision of the House of Lords, (Hazell v. Hammersmith and Fulham) established that such swap . .
CitedWilson v Secretary of State for Trade and Industry; Wilson v First County Trust Ltd (No 2) HL 10-Jul-2003
The respondent appealed against a finding that the provision which made a loan agreement completely invalid for lack of compliance with the 1974 Act was itself invalid under the Human Rights Act since it deprived the respondent of its property . .
CitedFitzpatrick v Sterling Housing Association Ltd HL 28-Oct-1999
Same Sex Paartner to Inherit as Family Member
The claimant had lived with the original tenant in a stable and long standing homosexual relationship at the deceased’s flat. After the tenant’s death he sought a statutory tenancy as a spouse of the deceased. The Act had been extended to include as . .
CitedHa and Another v State of New South Wales and Others 17-Feb-1997
(High Court of Australia) The court unanimously considered that ‘it would be a perversion of judicial power to maintain in force that which is acknowledged not to be the law’. This would especially be so where ‘non-compliance with a properly . .
CitedTailby v Official Receiver HL 1888
A creditor can create, for good consideration an equitable charge over book debts which will attach to them as soon as they come into existence.
Lord Macnaghten said: ‘It was admitted by the learned counsel for the respondent, that a trader . .
CitedCarse v Coppen IHCS 8-Dec-1950
The court considered the inability to create a floating charge over a company’s assets in Scots law. It was conceded that a company registered in Scotland could not create a valid and effectual floating charge over its assets in Scotland, but it was . .
CitedIn Re Keenan Bros Ltd 1986
(Supreme Court of the Republic of Ireland) A debenture conferred a fixed charge on book debts. It specifically provided that withdrawals from the account to which the proceeds of the book debts had to be credited might only be made with the prior . .
CitedAgnew and Kevin James Bearsley v The Commissioner of Inland Revenue, and Official Assignee for the Estate In Bankruptcy of Bruce William Birtwhistle and Mark Leslie Birtwhistle PC 5-Jun-2001
(New Zealand) A charge had been given by a company over its book debts. The charge was expressed to create a fixed charge over debts uncollected when a receiver was appointed, so that on collection they became payable to the bank. Until the receiver . .
CitedWestminster Bank Ltd v Hilton HL 1926
As against the money of the customer’s in the banker’s hands the relationship between banker and customer is that of principal and agent.
Lord Atkinson said: ‘It is well established that the normal relation between a banker and his customer . .
CitedPractice Statement (Judicial Precedent) HL 1966
The House gave guidance how it would treat an invitation to depart from a previous decision of the House. Such a course was possible, but the direction was not an ‘open sesame’ for a differently constituted committee to prefer their views to those . .
CitedRegina v Bow Street Metropolitan Stipendiary Magistrate, ex parte Pinochet Ugarte (No 2) HL 15-Jan-1999
A petition was brought to request that a judgment of the House be set aside because the wife of one their lordships, Lord Hoffmann, was as an unpaid director of a subsidiary of Amnesty International which had in turn been involved in a campaign . .
CitedRondel v Worsley HL 1967
Need for Advocate’s Immunity from Negligence
The appellant had obtained the services of the respondent barrister to defend him on a dock brief, and alleged that the respondent had been negligent in the conduct of his defence.
Held: The House considered the immunity from suit of . .
CitedMalik v Bank of Credit and Commerce International (BCCI); Mahmud v Bank of Credit and Commerce International HL 12-Jun-1997
Allowance of Stigma Damages
The employees claimed damages, saying that the way in which their employer had behaved during their employment had led to continuing losses, ‘stigma damages’ after the termination.
Held: It is an implied term of any contract of employment that . .
CitedSharp v Thomson HL 1997
A floating charge was given over the whole of a company’s property which might from time to time be ‘comprised in our property and undertaking’. The charge terms echoed the section which allows a company to create a charge ‘over all or any part of . .
CitedHalesowen Presswork and Assemblies Ltd v Westminster Bank Ltd CA 1971
The relationship of banker and customer was a single relationship the situation was not one of lien. Buckley LJ said: ‘Nor is it a set-off situation, which postulates mutual but independent obligations between the two parties. It is an accounting . .
CitedHindcastle Ltd v Barbara Attenborough Associates Ltd and Others HL 22-Feb-1996
The guarantor of an original tenant under the lease remains liable after the disclaimer the lease on insolvency. The disclaimer operates to determine the lease altogether with the result that the landlord’s reversion is accelerated. ‘In order to . .
CitedLipkin Gorman v Karpnale Ltd CA 1989
A partner in a firm of solicitors stole money from them, and spent it gambling with the defendants. The firm sued also their banker, who had been held to be aware of the defaulting partner’s weaknesses and activities.
Held: The solicitors . .
CitedIn Re New Bullas Trading Ltd CA 12-Jan-1994
A company debenture, which purported to create a fixed charge on book debts, and a second floating charge over the proceeds when paid, was valid and effective to create a fixed charge. The chargee was not a bank, and therefore no facility could be . .
CitedIn re A Company (No 005009 of 1987); Ex parte Copp 1989
Knox J declined to look at evidence about an agreed overdraft limit, regarding it as a ‘collateral arrangement’. He said: ‘this is a type of transaction in respect of which judicial precedent is a particularly valuable guide to the commercial . .
CitedSalomon v A Salomon and Company Ltd HL 16-Nov-1896
A Company and its Directors are not same paersons
Mr Salomon had incorporated his long standing personal business of shoe manufacture into a limited company. He held nearly all the shares, and had received debentures on the transfer into the company of his former business. The business failed, and . .
CitedIn re Panama New Zealand and Australian Royal Mail Co 1870
The company had charged its ‘undertaking and all sums of money arising therefrom’.
Held: ‘undertaking’ meant ‘all the property of the company, not only which existed at the date of the debenture, but which might afterwards become the property . .
CitedIn re Colonial Trusts Corporation CA 13-Dec-1880
A company formed for the purchase and management of land, and which was empowered by articles to borrow money for the purposes of the company provided that the amount borrowed should not at any time exceed the amount of the unpaid subscribed . .
CitedEvans v Rival Granite Quarries Ltd CA 1910
The court discussed the nature of a floating charge, Buckley LJ describing it as: ‘A floating security is not a future security; it is a present security, which presently affects all the assets of the company expressed to be included in it. On the . .
CitedIn re Yorkshire Woolcombers Association Ltd CA 2-Jan-1903
Nature of Company’s Debenture Charge
The court considered the nature of a debenture charge. Romer LJ said: ‘I certainly do not intend to attempt to give an exact definition of the term ‘floating charge’, nor am I prepared to say that there will not be a floating charge within the . .
CitedIllingworth v Houldsworth HL 1904
A clause in a floating charge allowing a company to continue to trade in the assets charged: ‘contemplates not only that it should carry with it the book debts which were then existing, but it contemplates also the possibility of those book debts . .
CitedIn Re Portbase Clothing Ltd; Mould v Taylor 1993
The company had given two debentures, one fixed and one floating. Their priority was fixed by a deed of priority. On insolvency the liquidator sought direction as to the application of the assets.
Held: The deed made the bank’s floating charge . .
CitedRe: A Company (No. 005009 of 1987), ex parte Copp ChD 1988
MC Bacon Ltd had borrowed money from a bank. The loan was unsecured. The company got into financial difficulty. The bank commissioned a report on the company’s financial affairs; and insisted on the grant of a debenture to secure the company’s . .
CitedWilliam Gaskell Ltd v Highley 1994
. .
ApprovedSupercool Refrigeration and Air Conditioning v Hoverd Industries Ltd ChD 1994
(New Zealand) The court noted a greater reluctance in Australia and Ireland than in England to accept the creation of a fixed charge over present and future book debts.
Tompkins J said:’ a requirement to pay the proceeds of the book debts . .
CitedIn re Florence Land and Public Works Co 1878
The court considered a floating charge: ‘The question we have to decide must be decided, like all other questions of the kind, having regard to the surrounding circumstances under which the instrument was executed, and especially the respective . .
CitedRe Holidair Ltd 1994
(Supreme Court of Ireland) The court considered whether a debenture created a floating charge over its book debts: ‘I am satisfied, accordingly, that the correct construction of the clause is that the trustee had a discretion to determine into what . .
CitedWelsh Development Agency v Export Finance Co Ltd CA 1992
The court was asked whether a transaction relating to goods between an exporter and the defendant, as a financier, associated with sales by the exporter to third-party purchasers, amounted to a true sale by the exporter to the defendant or was . .
At First InstanceNational Westminster Bank Plc v Spectrum Plus Ltd and others ChD 15-Jan-2004
The company granted a debenture to the claimant purporting to secure its book debts. The company went into liquidation. The liquidator challenged the bank’s charge.
Held: Siebe was wrongly decided. The charge was ineffective over the book . .

Cited by:
CitedLymington Marina Ltd v MacNamara and others CA 2-Mar-2007
A share in a marina had been inherited by one brother whose application to grant successive sub-lcences of it to the other two was rejected by the marina, who said that this was not permitted. The marina appealed a finding that it had to make its . .
CitedAXA General Insurance Ltd and Others v Lord Advocate and Others SC 12-Oct-2011
Standing to Claim under A1P1 ECHR
The appellants had written employers’ liability insurance policies. They appealed against rejection of their challenge to the 2009 Act which provided that asymptomatic pleural plaques, pleural thickening and asbestosis should constitute actionable . .
CitedWillers v Joyce and Another (Re: Gubay (Deceased) No 2) SC 20-Jul-2016
The Court was asked whether and in what circumstances a lower court may follow a decision of the Privy Council which has reached a different conclusion from that of the House of Lords (or the Supreme Court or Court of Appeal) on an earlier occasion. . .
CitedBorwick Development Solutions Ltd v Clear Water Fisheries Ltd CA 1-May-2020
Only Limited Ownership of pond fish
BDS owned land with closed fishing ponds. They sold the land to the respondents, but then claimed that the fish, of substantial value, were not included in the contract. The court as asked whether the captive fish were animals ferae naturae or . .
CitedBlack, Regina (on The Application of) v Secretary of State for Justice SC 19-Dec-2017
The Court was asked whether the Crown is bound by the prohibition of smoking in most enclosed public places and workplaces, contained in Chapter 1 of Part 1 of the Health Act 2006.
Held: However reluctantly, the claimant’s appeal was . .

Lists of cited by and citing cases may be incomplete.

Banking, Insolvency, Constitutional

Leading Case

Updated: 09 November 2021; Ref: scu.228273

In re Brightlife Ltd: ChD 1987

Parties contractual freedom to be respected

A clause in a debenture gave a charge which provided that the chargor should not: ‘deal with its book or other debts or securities for money otherwise than in the ordinary course of getting in and realising the same which expression shall not authorise the selling, factoring or discounting . . of its book debts or other negotiable instruments’
Held: Whilst purporting to create a fixed charge over present and future book debts and imposing restrictions on the sale, factoring or discounting of book debts, the debenture did not require the chargor to pay them into an account with the chargee. Reference to a ‘first specific charge’ over book debts had to yield to the only conclusion from the rights in fact granted that the charge over book debts was a floating charge only.
Hoffmann J said: ‘But a floating charge is consistent with some restriction upon the company’s freedom to deal with its assets. For example, floating charges commonly contain a prohibition upon the creation of other charges ranking prior to or pari passu with the floating charge. Such dealings would otherwise be open to a company in the ordinary course of its business.’ and
‘I do not think that the bank balance falls within the term ‘book debts or other debts’ as it is used in the debenture. It is true that the relationship between banker and customer is one of debtor and creditor. It would not therefore be legally inaccurate to describe a credit balance with a banker as a debt. But this would not be a natural usage for a businessman or accountant. He would ordinarily describe it as ‘cash at bank’: compare the balance sheet formats in Part I, section B of Schedule 4 to the Companies Act 1985′ and ‘In this debenture, the significant feature is that Brightlife was free to collect its debts and pay the proceeds into its bank account. Once in the account, they would be outside the charge over debts and at the free disposal of the company. In my judgment a right to deal in this way with the charged assets for its own account is a badge of a floating charge and is inconsistent with a fixed charge.’
The significant feature of the Brightlife debenture was that the company was free to collect its debts and pay the proceeds into its bank account: ‘Once in the account, they would be outside the charge over debts and at the free disposal of the company. In my judgment a right to deal in this way with the charged assets for its own account is a badge of a floating charge and is inconsistent with a fixed charge.’
The company had given a charge over its book debts to te bank. The bank asserted that it was a first specific charge and purported to restrict the company’s right to factor its debts without the bank’s consent. A debenture holder then gave notice to fix the charge, but only a week before a voluntary winding up resolution.
Held: The charge on the book debts was a floating charge, and having crystallised a week before, it had priority over the other debts.
Although clause 3(A)(ii)(a) referred to a ‘first specific charge’ over book debts and others, ‘the rights over the debts created by the debenture were in my judgment such as to be categorised in law as a floating charge.’ . . And a ‘significant feature is that Brightlife was free to collect its debts and pay the proceeds into its bank account. Once in the account, they would be outside the charge over debts and at the free disposal of the company. In my judgment a right to deal in this way with the charged assets for its own account is a badge of a floating charge and is inconsistent with a fixed charge . . I do not think that it is open to the courts to restrict the contractual freedom of parties to a floating charge on such grounds. The floating charge was invented by Victorian lawyers to enable manufacturing and trading companies to raise loan capital on debentures . . without inhibiting its ability to trade. . The public interest requires a balancing of the advantages to the economy of facilitating the borrowing of money against the possibility of injustice to unsecured creditors . . arguments for and against the floating charge are matters for Parliament rather than the courts.’

Hoffmann J
[1987] 1 Ch 200, [1988] VLY 306
England and Wales
Citing:
DistinguishedSiebe Gorman and Co Ltd v Barclays Bank Ltd ChD 1979
It was possible to create a fixed charge over present and future book debts and on its true construction, the debenture granted to Barclays Bank Ltd in this case had done so. If the chargor of book debts, having collected the book debts, ‘[had] had . .
DistinguishedIn Re Keenan Bros Ltd 1986
(Supreme Court of the Republic of Ireland) A debenture conferred a fixed charge on book debts. It specifically provided that withdrawals from the account to which the proceeds of the book debts had to be credited might only be made with the prior . .

Cited by:
AppliedAgnew and Kevin James Bearsley v The Commissioner of Inland Revenue, and Official Assignee for the Estate In Bankruptcy of Bruce William Birtwhistle and Mark Leslie Birtwhistle PC 5-Jun-2001
(New Zealand) A charge had been given by a company over its book debts. The charge was expressed to create a fixed charge over debts uncollected when a receiver was appointed, so that on collection they became payable to the bank. Until the receiver . .
CitedNational Westminster Bank Plc v Spectrum Plus Ltd and others ChD 15-Jan-2004
The company granted a debenture to the claimant purporting to secure its book debts. The company went into liquidation. The liquidator challenged the bank’s charge.
Held: Siebe was wrongly decided. The charge was ineffective over the book . .
ConsideredRe: A Company (No. 005009 of 1987), ex parte Copp ChD 1988
MC Bacon Ltd had borrowed money from a bank. The loan was unsecured. The company got into financial difficulty. The bank commissioned a report on the company’s financial affairs; and insisted on the grant of a debenture to secure the company’s . .
AppliedRe: New Bullas Trading Ltd ChD 5-Apr-1993
A fixed charge in a debenture without restrictions on dealing with monies received must be a floating charge. . .
CitedBuchler and another (as joint liquidators of Leyland DAF Limited) v Talbot and another (as joint administrative receivers of Leyland DAF Limited) and Stichting Ofasec and others HL 4-Mar-2004
The liquidator sought to recover his expenses from assets charged under a floating charge in priority to the chargee.
Held: Barleycorn was decided in error. The liquidators costs incurred in an insolvent winding up were not to be charged . .
CitedNational Westminster Bank Plc v Spectrum Plus Ltd; In re Spectrum Plus CA 26-May-2004
The court was asked whether a charge given over book debts in a debenture was floating or fixed.
Held: Since the charge asserted some control over receipt of the payments, it was a fixed charge. Upon payment into the account, title to the . .
CitedQuickson (South and West) Limited v Stephen Mark Katz, John Stephen Kelmanson (As Joint Liquidators of Buildlead Limited) ChD 25-Aug-2004
Various applications were made in the insolvency, including for removal of the liquidators and declarations that certain payments were a fraudulent preference on the creditors.
Held: No prejudice had been shown by any procedural irregularity. . .
CitedIn Re Westmaze Ltd (In Administrative Receivership) ChD 15-May-1998
Westmaze were mechanical engineers. They gave a charge to secure borrowings, which described itself as a fixed charge.
Held: A Charge over a company’s book and trading assets was in fact floating even though described as a fixed charge unless . .

Lists of cited by and citing cases may be incomplete.

Banking, Company, Insolvency

Leading Case

Updated: 09 November 2021; Ref: scu.181234

Barclay’s Bank Plc v Varenka Goff: CA 3 May 2001

The respondent executed an all monies charge over her property to secure the liability of companies in which she had no direct interest. The bank insisted that she employ solicitors to give her independent advice. The bank sought to enforce its security, and she claimed it was signed under undue influence, of which the bank was fixed with constructive notice. The bank appealed successfully against the order setting aside the charge. Although the bank were fixed with constructive notice of the undue influence, the employment of the independent solicitor was sufficient to discharge that constructive notice. That was only disapplied where no competent solicitor could have advised the wife to enter into the transaction, and that did not apply in this case.

Lord Justice Pill, Lord Justice Mantell, and Lord Justice Buxton
Gazette 17-May-2001, [2001] EWCA Civ 635, [2001] Lloyds Rep Bank 189, [2001] NPC 88, [2001] 2 All ER (Comm) 847
Bailii
England and Wales
Citing:
Disapproved in part (at 705)Royal Bank of Scotland v Etridge, Loftus and Another v Etridge and Another, Etridge v Pritchard Englefield (Merged With Robert Gore and Co ) Midland Bank Plc v Wallace and Another (No 2) CA 31-Jul-1998
Detailed guidance was given on the quality of independent legal advice, which would be required to be given to wives signing charges to secure their husbands’ business etc accounts on the matrimonial home. The interaction of legal advice and . .
CitedMidland Bank Plc v Kidwai and Another CA 5-Jun-1995
A bank was not under a full duty to advise a wife of a business client of the risks of signing a charge. The bank was not giving independent advice. . .
CitedPortman Building Society v Dusangh and Others CA 19-Apr-2000
The defendant sought to set aside an order for possession under a mortgage.
Held: Where a case was strong enough on its face in terms of conduct and terms, unconscionable conduct could be inferred if there was no explanation offered to . .

Lists of cited by and citing cases may be incomplete.

Undue Influence, Banking, Legal Professions

Updated: 09 November 2021; Ref: scu.147528

McGuffick v The Royal Bank of Scotland Plc: ComC 6 Oct 2009

Requirements for Enforcing Consumer Loan Agreement

The claimant challenged the validity of a loan agreement with his bank as a regulated consumer credit agreement. After default, the lender failed to satisfy a request for a copy of the agreement under section 77. The bank said that though it could not enforce the agreement, it remained valid and that default would be reported to credit reference agencies. The court was asked whether during a period when the agreement was unenforceable for non-compliance, the debt was extinguished/suspended or continued and what steps were available to the bank.
Held: The House of Lords in Wilson had left this situation unclear, and the conflicting judgements were issued without full citation of the case law. The effect of unenforceability under section 65 is that the rights of the creditor and corresponding liability or obligations of the debtor do exist but are unenforceable, rather than that those rights were never acquired or that the creditor was deprived of those rights whilst the agreement was unenforceable.
The 1974 Act did not make clear what was meant by enforcement, but reference to credit reference agencies was said by the claimant to be coercive. Steps up to and including applications to court for permission to enforce such an agreement did not themselves amount to enforcement.
The 2008 regulations were not enforceable by private action.

The claimant had objected under the 1998 Act to the continued holding of information regarding his account. That claim failed: ‘There is simply no basis for the contention that the data is not being processed fairly and lawfully. The processing of the data by sharing it with other financial institutions through the CRAs, pursuant to the Principles of Reciprocity, is clearly in the legitimate interests of the bank, the CRAs and other financial institutions, for all of whom the governing principle is that the sharing of data has the aim of promoting responsible lending.’

Flaux J
[2009] EWHC 2386 (Comm)
Bailii
Consumer Credit Act 1974, Consumer Protection from Unfair Trading Regulations 2008, Directive 2005/29EC of the European Parliament and of the Council concerning unfair business-to-consumer commercial practices., Data Protection Act 1998 10(1)
England and Wales
Citing:
CitedWilson v Secretary of State for Trade and Industry; Wilson v First County Trust Ltd (No 2) HL 10-Jul-2003
The respondent appealed against a finding that the provision which made a loan agreement completely invalid for lack of compliance with the 1974 Act was itself invalid under the Human Rights Act since it deprived the respondent of its property . .
CitedTaylor v Great Eastern Railway Company 1901
The section provided that: ‘A contract for the sale of any goods of the value of ten pounds or upwards shall not be enforceable by action unless the buyer shall accept part of the goods so sold, and actually receive the same, or give something in . .
CitedRankine v American Express Services Europe Ltd 2009
The court considered the enforcement of a contract which offended the 1974 Act.
Held: The bringing of proceedings is only a step taken with a view to enforcement and not actually enforcement. . .
CitedEastern Distributors Limited v Goldring (Murphy, Third Party) CA 1957
The court considered the meaning of the phrase: ‘shall not be entitled to enforce’ in the section.
Held: ‘How is the present case affected by the fact that the hire-purchase agreement is unenforceable? If the Act said that it was void, then of . .
CitedVTB-VAB v Total Belgium NV; Galatea BVBA v Sanoma Magazines Belgium NV ECJ 21-Oct-2008
ECJ (Approximation of Laws) Opinion – Admissibility of a reference for a preliminary ruling – Proper subject of interpretation Relevance to the decision Combined offers – Directive 2005/29/EC – Interpretation in . .
CitedConister Trust Ltd v John Hardman and Co CA 21-Jul-2008
The court was asked whether an agreement by the defendant solicitors under a personal injury litigation funding scheme, to discharge a client’s ‘remaining liability’ under a loan agreement applies on its true construction where the loan agreement is . .
CitedOrakpo v Manson Investments Ltd HL 1977
Transactions were entered into under which loans were made to enable the borrower to acquire and develop certain properties were held to be unenforceable under the 1927 Act. The effect was to enrich the borrower, who had fallen into arrears of . .
CitedRegina v Modupe CACD 1991
The appellant obtained loans enabling him to buy cars by giving false information when entering into hire purchase agreements. The relevant agreement did not contain all the prescribed information and was improperly executed so that by virtue of . .

Cited by:
CitedCarey v HSBC Bank plc, Yunis v Barclays Bank plc and similar QBD 23-Dec-2009
carey_hsbcQBD2009
(Manchester Mercantile Court) The court considered the effects in detail where a bank was unable to comply with a request under section 78 of the 1974 Act to provide a copy of the agreement signed by the client.
Held: The court set out to give . .

Lists of cited by and citing cases may be incomplete.

Consumer, Banking, Information

Updated: 09 November 2021; Ref: scu.375741

Catlin v Cyprus Finance Corporation (London) Ltd: 1983

As between a banker and joint account holders, the banker has a duty of care to the account holders and each of them separately.

[1983] QB 759
England and Wales
Cited by:
CitedSandra Estelle Fielding v The Royal Bank of Scotland Plc CA 11-Feb-2004
The husband and wife had signed a bank mandate allowing the bank to act upon the authorisation of either of them. The wife complained that the bank should not be able to recover from her any sums expended by the husband.
Held: The mandate . .

Lists of cited by and citing cases may be incomplete.

Banking

Updated: 09 November 2021; Ref: scu.194779

Wilson v United Counties Bank Ltd: HL 1920

Bank’s duty to client’s reputation and credit

Major Wilson had left England on active service soon after the beginning of the Great War, leaving his business affairs, in a fairly precarious state, with his bank. The jury found that the bank had failed in its duty to supervise his business affairs and to take reasonable steps to maintain his credit and reputation. Major Wilson was made bankrupt and he and his trustee in bankruptcy joined in an action against the bank. The jury awarded damages of about andpound;45,000 for depreciation in the bankrupt’s business and estate caused by the bank’s negligence (although the House was not unanimous as to whether this finding was justified on the evidence) and andpound;7,500 for damage to his credit and reputation.
Held: The former sum was recoverable by the trustee in bankruptcy, and the latter by the bankrupt personally, even though the damages arose from the same breach of contract.
Lord Birkenhead applied Rolin, saying: ‘The defendants undertook for consideration to sustain the credit of the trading customer. On principle the case seems to me to belong to that very special class of cases in which a banker, though his customer’s account is in funds, nevertheless dishonours his cheque. The ratio decidendi in such cases, is so obviously injurious to the credit of the trader that the latter can recover, without allegation of special damage, reasonable compensation for the injury due to his credit.’
Lord Atkinson said: ‘If one man inflicts an injury upon another the resort by the sufferer to reasonable expedients for the bona fide purpose of counteracting, curing or lessening the evil effects of the injury done him, does not necessarily absolve the wrongdoer, even though the sufferer’s efforts should, in the result, undesignedly aggravate the result of injury.’

Lord Atkinson, Lord Birkenhead LC
[1918-19] All ER Rep1035, [1920] LR AC 102, [1920] AC 102
England and Wales
Citing:
CitedBeckham v Drake HL 11-Jul-1849
Non-property assets do not pass on bankruptcy
An action was brought on a contract for hiring and service, where the plaintiff was to serve for seven years, and the defendant to pay weekly wages during that time; and the breach was a dismissal during the seven years. The plaintiff, after this . .
FollowedRolin And Another v Steward, Public Officer of The East of England Bank 8-May-1854
Substantial damages may be recovered against a banker, for dishonouring an acceptance and cheques of a customer, there being sufficient assets in his hands at the time to meet them. . .

Cited by:
CitedMulkerrins v Pricewaterhouse Coopers HL 31-Jul-2003
The claimant sought damages from her former accountants for failing to protect her from bankruptcy. The receiver had unnecessarily caused great difficulties in making their claim that such an action vested in them. The defendants had subsequently, . .
CitedInvestors Compensation Scheme Ltd v West Bromwich Building Society HL 19-Jun-1997
Account taken of circumstances wihout ambiguity
The respondent gave advice on home income plans. The individual claimants had assigned their initial claims to the scheme, but later sought also to have their mortgages in favour of the respondent set aside.
Held: Investors having once . .
CitedShah and Another v HSBC Private Bank (UK) Ltd QBD 26-Jan-2009
The claimants sought damages after delays by the bank in processing transfer requests. The bank said that the delays were made pending reports of suspected criminal activity. The bank’s delay had stigmatised the claimant causing further losses. The . .
CitedKpohraror v Woolwich Building Society CA 10-Jan-1996
The defendants had wrongfully refused payment of the claimant’s cheque for pounds 4,550. The error was realised on the same day, and corrected. The master awarded damages of pounds 5,550 as general damages to the claimant’s credit by reason of the . .
CitedKpohraror v Woolwich Building Society CA 1996
The Society, acting as a bank, had at first failed to pay its customer’s cheque for andpound;4,550, even though there were sufficient funds. The bank said that it had been reported lost. The customer sought damages to his business reputation.
Insolvency, Damages, Banking

Leading Case

Updated: 02 November 2021; Ref: scu.185413

Edward Owen Engineering Ltd v Barclays Bank International Ltd: CA 1978

Performance guarantees are effectively obligations to pay on demand within the terms of the guarantee, irrespective of the rights and wrongs of any dispute between beneficiary and principal under the terms of their separate contract, subject only to fraud.
Lord Denning said: ‘It has been long established that when a letter of credit is issued and confirmed by a bank, the bank must pay it if the documents are in order and the terms of the credit are satisfied. Any dispute between buyer and seller must be settled between themselves. The bank must honor the credit . . To this general principle there is an exception in the case of what is called established or obvious fraud to the knowledge of the bank.’
. . and ‘So, as one takes instance after instance, these performance guarantees are virtually promissory notes payable on demand. So long as the Libyan customers make an honest demand, the banks are bound to pay and the banks will rarely, if ever, be in a position to know whether the demand is honest or not. At any rate they will not be able to prove it to be dishonest. So they will have to pay.
All this leads to the conclusion that the performance guarantee stands on a similar footing to a letter of credit. A bank which gives a performance guarantee must honour that guarantee according to its terms. It is not concerned in the least with the relations between the supplier and the customer; nor with the question whether the supplier has performed his contracted obligation or not; nor with the question whether the supplier is in default or not. The bank must pay according to its guarantee, on demand, if so stipulated, without proof or conditions. The only exception is when there is a clear fraud of which the bank has notice.’

Lord Denning MR
[1978] 1 All ER 976, [1978] 1 QB 159, [1977] 3 WLR 764, [1978] 1 Lloyds Rep 166
England and Wales
Citing:
ApprovedR D Harbottle (Mercantile) Limited v National Westminster Bank Limited 1978
The plaintiffs had entered into contracts of sale with Egyptian buyers. Each contract provided that the plaintiffs would establish a guarantee confirmed by a bank in favour of the buyers. The guarantees were widely expressed, and secured payment on . .

Cited by:
CitedManx Electricity Authority v J P Morgan Chase Bank CA 3-Oct-2003
The claimant sought to appeal an order striking out its claim against the defendant under a performance bond. The defendant denied that the demand was valid, saying it did not allege a current breach of the contract.
Held: The point upon which . .
CitedMarubeni Hong Kong and South China Ltd v Ministry of Finance of Mongolia CA 13-Apr-2005
A letter was written by the Mongolian Ministry of Finance guaranteeing payment for textile plant and machinery to be supplied to a Mongolian company. A letter from the justice minister confirmed the authority of the finance minister to sign the . .

Lists of cited by and citing cases may be incomplete.

Banking

Leading Case

Updated: 02 November 2021; Ref: scu.186574

Shah and Another v HSBC Private Bank (UK) Ltd: CA 4 Feb 2010

Money laundering suspicion to be explained

The customer sought to sue his bank for failing to meet his cheque. The bank sought to rely on the 2002 Act, having reported suspicious activity on freezing the account. He now appealed against summary judgment given for the bank which had refused to explain why it had made the report.
Held: The appeal succeeded. The relevant suspicion need not be based on reasonable grounds. However the court could see no reason why the bank should not be put to its proof of having a relevant suspicion, and summary judgement was not appropriate. It is for the bank to prove that it suspected their customer to be involved in money-laundering.

Ward, Longmore, Lloyd LJJ
[2010] EWCA Civ 31, Times 01-Apr-2010, [2010] 3 All ER 477, [2010] Bus LR 1514, [2011] 1 All ER (Comm) 67, [2010] Lloyd’s Rep FC 276
Bailii
Proceeds of Crime Act 2002 335
England and Wales
Citing:
CitedUMBS Online Ltd, Regina (on the Application Of) v Serious Organised Crime Agency and Another CA 2-May-2007
The bank had reported to the respondent its suspicions about funds it held for the claimant. The accounts were frozen, and the customer now sought a judicial review of the refusal of the Agency to reconsider its decision.
Held: The review was . .
CitedK Ltd v National Westminster Bank Plc and others CA 19-Jul-2006
The bank had declined to act upon a customer’s instructions, reporting its suspicions of criminal activity to the police. Permission was given to proceed but only after a delay. The claimant customer sought its costs.
Held: The customer’s . .
CitedSwain v Hillman CA 21-Oct-1999
Strike out – Realistic Not Fanciful Chance Needed
The proper test for whether an action should be struck out under the new Rules was whether it had a realistic as opposed to a fanciful prospect of success. There was no justification for further attempts to explain the meaning of what are clear . .
CitedEquitable Life Assurance Society v Ernst and Young CA 25-Jul-2003
The claimant sought damages from its accountants, saying that had they been advised of the difficulties in their financial situation, they would have been able to avoid the loss of some 2.5 billion pounds, or to sell their assets at a time when . .
CitedKing v The Serious Fraud Office CACD 18-Mar-2008
Restraint and Disclosure orders had been made on without notice applications at the request of South Africa. The applicant appealed a refusal of their discharge.
Held: Such orders did not apply to the applicant’s assets in Scotland. The orders . .
Appeal fromShah and Another v HSBC Private Bank (UK) Ltd QBD 26-Jan-2009
The claimants sought damages after delays by the bank in processing transfer requests. The bank said that the delays were made pending reports of suspected criminal activity. The bank’s delay had stigmatised the claimant causing further losses. The . .

Cited by:
Main JudgmentShah and Another v HSBC Private Bank (UK) Ltd (Costs) CA 4-Feb-2010
. .

Lists of cited by and citing cases may be incomplete.

Banking, Crime, Litigation Practice

Updated: 02 November 2021; Ref: scu.396603

Jeremy D Stone Consultants Ltd and Another v National Westminster Bank Plc and Another: ChD 11 Feb 2013

The claimants asserted an equitable claim against funds held by the defendant bank in the name of a company owned by another defendant who they said defrauded them through a Ponzi investment scheme.
Held: The claim failed. On the evidence, the defendant’s manager had not been dishonest, had made no misrepresentation, and had not been part of any conspiracy, and the bank had enjoyed no unjust enrichment.

Sales J
[2013] EWHC 208 (Ch)
Bailii
England and Wales
Citing:
CitedTournier v National Provincial and Union Bank of England CA 1924
The court considered the duty of confidentiality owed by a banker to his client. Bankes LJ said: ‘At the present day I think it may be asserted with confidence that the duty is a legal one arising out of contract, and that the duty is not absolute . .
CitedTwinsectra Ltd v Yardley and Others HL 21-Mar-2002
Solicitors acted in a loan, giving an undertaking as to its application. In breach of that undertaking they released it to the borrower. The appellants appealed a finding of liability as contributors to the breach.
Held: ‘Money in a . .
CitedNiru Battery Manufacturing Company, Bank Sepah Iran v Milestone Trading Limited CA 28-Apr-2004
Niru contracted to buy lead from Milestone, to be paid for in a letter of credit, against certifying documents produced for the purpose. Mr Mahdavi, the individual behind Milestone, procured CAI to finance the acquisition of warrants to be retained . .
CitedCompangnie Commerciale Andre S A v Artibell Shipping Co Ltd and the Governor and Company of the Bank of Scotland SCS 21-Feb-2001
. .
CitedAerostar Maintenance International Ltd and Another v Wilson and Others ChD 30-Jul-2010
The claimant sought damages alleging the defendant’s failures breach of fiduciary duty as director.
Held: In a claim of dishonest assistance in a breach of duty some dishonesty on the part f the defendant is a part of the claim. . .
CitedPortman Building Society v Hamlyn Taylor Neck (a Firm) CA 22-Apr-1998
The mortgage advance had been against an express requirement that the client use the property as his private residence. After the client defaulted, the appellant lender discovered that the solicitors acting for themselves and the lay client had . .
CitedBox and Others v Barclays Bank Plc ChD 30-Apr-1998
A depositor who had placed sums with an illegal deposit taking business was not entitled to claim that sum held in trust because he still had a statutory claim under contract with the deposit taker. . .
CitedLipkin 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 . .
CitedWilliams and Another v Natural Life Health Foods Ltd and Another HL 30-Apr-1998
A company director was not personally reliable in negligence for bad advice given by him as director unless it could clearly be shown that he had willingly accepted such personal responsibility. A special relationship involving an assumption of . .
CitedNiru Battery Manufacturing Company, Bank Sepah Iran v Milestone Trading Limited CA 23-Oct-2003
The claimant had contracted to purchase lead from some of the defendants. There were delays in payment but when funds were made available they should have been repaid. An incorrect bill of lading was presented. The bill certified that the goods had . .
CitedJames McNaughton Paper Group Ltd v Hicks Anderson and Co CA 31-Jul-1990
When considering the liability of an auditor in negligence, the fact and nature of any communications direct between the auditor and the potential investor must be allowed for. The court set out a non-exhaustive list of factors to be taken into . .
CitedAbouRahmah and Another v Abacha and others QBD 28-Nov-2005
Claims were made as to an alleged fraud by some of the respondents. . .

Lists of cited by and citing cases may be incomplete.

Equity, Banking

Updated: 02 November 2021; Ref: scu.470887

Sternlight v Barclays Bank Plc: QBD 22 Jul 2010

Various credit card customers said that the respondent banks had mis-stated the interest rates applied to them, in that the interest charged did not match the APR advertised, and that therefore the agreements were unenforceable.
Held: The claimants’ calculations did not apply. The driver of the interest rate was not the statement as to the APR, but the agreement itself. The APR was not a term of the agreement, and a mis-statement of it, if one had occurred, did not make the agreement unenforceable.

Waksman QC J
[2010] EWHC 1865 (QB)
Bailii
Consumer Credit Act 1974 60, Consumer Credit (Agreements) Regulations 1983 Sch 6
England and Wales
Citing:
CitedDimond v Lovell HL 12-May-2000
A claimant sought as part of her damages for the cost of hiring a care whilst her own was off the road after an accident caused by the defendant. She agreed with a hire company to hire a car, but payment was delayed until the claim was settled.
CitedWilson and Another v Hurstanger Ltd CA 4-Apr-2007
The company sought to enforce its loan agreement and charge over the defendants’ property. The defendants appealed saying that the agreement was unenforceable under the Act, since a commission had been paid to the introducing broker, and his fee had . .

Lists of cited by and citing cases may be incomplete.

Consumer, Banking

Updated: 02 November 2021; Ref: scu.421269

Duncan Fox and Co v North and South Wales Bank: HL 1880

The case concerned a claim by an indorser of a bill of exchange that he was subrogated to securities provided by the acceptor to the holder of the bill. The court identified three kinds of cases in which rights of subrogation had been recognised and where suretyship principles apply: (1) where there is an agreement creating the relationship of principal and surety to which the creditor is a party; (2) where there is an agreement creating the relationship of principal and surety to which the creditor is not a party; and (3) where there is no agreement but that there is nevertheless a primary and secondary liability of two persons, the debt being ‘as between the two, that of one of those persons only, and not equally of both, so that the other, if he should be compelled to pay it, would be entitled to reimbursement from the person by whom (as between the two) it ought to have been paid’.
Lord Selborne LC did not however restrict the categories of cases in which the remedy of subrogation might be available so much as identify situations that were broadly analogous to those of the case before it.

Lord Selborne LC
(1880) 6 AC 1, [1874-80] All ER Rep Ext 1406
England and Wales

Equity, Banking

Leading Case

Updated: 02 November 2021; Ref: scu.181984

Brazzill and Others v Willoughby and Others: CA 27 May 2010

The regulated bank Kaupthing Singer and Friedlander Ltd (KSF) was in financial difficulties. The Bank of England required KSF to credit to a trust account all future deposits. KSF later went into insolvency. Some deposits had been credited to the trust account but not all. The court was asked whether the sum held was for those for whose deposits transfers had actually been made, or for all those for whom transfers should have been made.
Held: The trust account was for all those for whom deposits should have been made under the direction. It operated as a class trust not a client account.

Sedley, Thomas, Lloyd LJJ
[2010] EWCA Civ 561, [2010] WLR (D) 140
Bailii, WLRD
Financial Services and Markets Act 2000 44
England and Wales
Citing:
ExplainedCherry v Boultbee HL 22-Nov-1839
B died having made a will leaving a fund to pay income to A who owed her money but had been made bankrupt before the death. The debt to B remained unpaid.
Held: The liability to pay the debt and the right to receive the legacy had never tested . .
See AlsoIn re Kaupthing Singer and Friedlander Ltd CA 11-May-2010
The court was asked as to the set-off, in a company administration, of future debts owed by the company to its creditors and by those creditors to the company, and whether the effect of those provisions was that, after the future debts were . .
See AlsoMills and Others v HSBC Trustee (CI) Ltd and Others ChD 18-Dec-2009
. .
Appeal fromBrazzill and Others v Willoughby and Others ChD 10-Jul-2009
. .
CitedMoriarty and Another v Atkinson and Various Customers of BA Peters Plc CA 16-Dec-2008
The company, a boat sales agent, made a promise to its customers to hold the funds received from them in a trust account. In breach of that promise, it used the funds to pay its own debt. The customers now appealed against a refusal to allow them to . .
CitedIn re SSSL Realisations (2002) Ltd and Another; Squires and others v AIG Europe (UK) Ltd and Another CA 18-Jan-2006
A creditor claiming an equity in a debt but who himself owed money to the debtor, could not pursue his claim without first contributing the sum due. A person could not take an aliquot share out of a fund without first contributing what he owed to . .
CitedMoriarty and others v Various Customers of BA Peters Plc (In Administration) ChD 29-Apr-2008
The company had acted as boat sales and brokerage. Claims were made on its insolvency as to the status of boats sold and unsold, and of deposits paid and held by the company. . .
CitedPicken v Lord Balfour of Burleigh CA 1945
The rules of a pension scheme set up by a railway company provided for members’ contributions to be deducted from their salary, but in practice the deductions made had been less than they should have been.
Held: The rule in Cherry v Boultbee . .
CitedOT Computers v First National Tricity Finance ChD 2003
. .
CitedOgden and Another v Trustees of the RHS Griffiths 2003 Settlement and others; In Re Griffiths deceased ChD 25-Jan-2008
A life-time transfer which had been made under a mistake as to the donor’s chances of surviving long enough for the transfer to be exempt from Inheritance Tax was set aside. Unbeknown to the donor, he had lung cancer at the time.
Held: Lewison . .
CitedIn re Akerman ChD 2-Jul-1891
The court was asked whether in the division of the testator’s residuary estate three of the testator’s seven children had to bring into account statute-barred debts due to the estate.
Held: They were bound to bring them into account. Kekewich . .
mentionedOgilvie v Allen HL 1899
The plaintiff, a widow, had executed deeds founding two charities and devoting to them a considerable part of the large fortune which she had inherited from her husband, but later brought proceedings to set the deeds aside asserting that she had not . .
CitedOgilvie v Littleboy CA 1897
Lindley LJ discussed the variation of a gift for mistake: ‘Gifts cannot be revoked, nor can deeds be set aside, simply because the donors wish they had not made them and would like to have back the property given. Where there is no fraud, no undue . .
CitedKleinwort Benson Ltd v Lincoln City Council etc HL 29-Jul-1998
Right of Recovery of Money Paid under Mistake
Kleinwort Benson had made payments to a local authority under swap agreements which were thought to be legally enforceable when made. Subsequently, a decision of the House of Lords, (Hazell v. Hammersmith and Fulham) established that such swap . .
CitedIn Re Rhodesia Goldfields Ltd ChD 1910
Partridge, a director of the company who held some of its debenture stock, was facing a serious misfeasance claim which had not yet been resolved. Set-off was therefore not available.
Held: Payment of what was due to Partridge and his . .

Lists of cited by and citing cases may be incomplete.

Banking, Insolvency

Updated: 02 November 2021; Ref: scu.416098

Barclays Bank Plc v Kufner: ComC 10 Oct 2008

barclays_kufnerComC2008

The bank sought summary judgment under a guarantee to secure a loan to purchase a luxury yacht which was to be hired out in business. The loan had been charged against the yacht, but when the yacht was re-registered, the bank failed to re-establish its charge.
Held: The application succeeded. There was no duty in equity on the bank to re-establish the charge, since the agreement allowed it to release the charge. Was the bank a supplier within the 1999 Regulations? Whilst the Regulations might apply to a banking guarantee, the defendant here was not acting as a consumer, and therefore they did not apply to him. Nor could he sustain a defence based on negligent misrepresentation.

Field J
[2008] EWHC 2319 (Comm)
Bailii
Unfair Terms in Consumer Contracts Regulations 1999 4(1)
Citing:
CitedCanada Steamship Lines Ltd v The King PC 21-Jan-1952
A lease of a freight shed exonerated the lessor from ‘any claim . . for . . damage . . to . . Goods . . being . . in the said shed’ and requiring the lessee to indemnify the lessor ‘from and against all claims’. The negligent use of an oxy-acetylene . .
CitedSkipton Building Society v Stott CA 2001
The issue was whether a mortgagee had sold at an undervalue, and if so what the damages should be.
Held: In a well-developed property market where a sale is assured and the only possible issue is as to the market level, damages for loss of . .
CitedBayerische Hypotheken- und Wechselbank v Dietzinger ECJ 17-Mar-1998
The court was asked whether the Directive applied to a bank guarantee given by a natural person who was not acting in the course of a trade or business to secure the overdraft of a third party.
Held: The scope of the Directive is not limited . .
CitedBank of Scotland v Singh 17-Jun-2005
. .
CitedSkipsredittforeningen v Emperor Navigation SA 1997
The court considered the reaonableness of a contract clause which sought to exclude liability for misrepresentation: ‘The consequence of the approach adopted in Stewart Gill [[1992] 1 QB 600] is (as the present case shows) that the court may hear . .
CitedStandard Bank London Ltd v Apostolakis and Another ComC 9-Feb-2001
Banking and financial services – conflict of laws – contract – anti-suit injunction – unfair contract terms – defendants signed foreign exchange margin trading agreement in greece – proceedings in greece and england – agreement contained english . .
CitedPrudential Assurance Co Ltd v Newman Industries Ltd (No 2) CA 1982
A plaintiff shareholder cannot recover damages merely because the company in which he has an interest has suffered damage. He cannot recover a sum equal to the diminution in the market value of his shares, or equal to the likely diminution in . .
CitedJohnson v Gore Wood and Co HL 14-Dec-2000
Shareholder May Sue for Additional Personal Losses
A company brought a claim of negligence against its solicitors, and, after that claim was settled, the company’s owner brought a separate claim in respect of the same subject-matter.
Held: It need not be an abuse of the court for a shareholder . .
CitedWRM Group Limited (Formerly Known As WRM Logistics Limited) v Wood; Burcher; Wood; Chick and Irving CA 21-Nov-1997
Breach of share sale agreement. . .
CitedPrudential Assurance Co Ltd v Newman Industries Ltd (No 2) CA 1982
A plaintiff shareholder cannot recover damages merely because the company in which he has an interest has suffered damage. He cannot recover a sum equal to the diminution in the market value of his shares, or equal to the likely diminution in . .

Lists of cited by and citing cases may be incomplete.

Banking, Consumer

Updated: 02 November 2021; Ref: scu.278851

HM Treasury v Ahmed and Others: SC 27 Jan 2010

The claimants objected to orders made freezing their assets under the 2006 Order, after being included in the Consolidated List of suspected members of terrorist organisations.
Held: The orders could not stand. Such orders were made by the executive without parliamentary scrutiny by the use of Orders in Council. Statutory provision for counter-terrorism was in place, but the choice of this procedure sidestepped its protections. The effect was to create a virtual prison for those affected. There was no right to challenge the listing in a court, and, without such a right, the order was excessive. A party could be listed solely on suspicion of involvement, and there is nothing in the listing or de-listing procedure that recognises the principles of natural justice or that provides for basic procedural fairness, but the effect was catastrophic. The UN order did not require acts to be taken against those suspect to reasonable suspicion, and the Order in Council went beyond compliance with the UN Order.
Orders in Council made under section 1 of the 1946 Act are not instruments upon which proceedings may be taken in either House. They are laid before Parliament for its information only, not for scrutiny of their merits or for debate. The effect of section 1 of the 1946 Act is that decisions as to the provisions that Orders made under it may or should contain lie entirely with the executive.

Lord Phillips, President, Lord Hope, Deputy President, Lord Rodger, Lord Walker, Lady Hale, Lord Brown, Lord Mance
[2010] UKSC 2, UKSC 2009/0016, [2010] UKHRR 204, [2010] 2 WLR 378, [2010] WLR (D) 12, [2010] 2 AC 534, [2010] 4 All ER 829, [2010] Lloyd’s Rep FC 217
Bailii, Times, SC, SC Summ, WLRD, Bailii Summary
Terrorism (United Nations Measures) Order 2006 (SI 2006/2657), Al-Qaida and Taliban (United Nations Measures) Order 2006 (SI 2006/2952), United Nations Act 1946
England and Wales
Citing:
CitedM, Regina (on the Application of) v Her Majestys Treasury HL 30-Apr-2008
The House referred to the ECJ a question about the implementation of UN resolutions imposing sanctions on Al-Qa’ida. . .
Appeal fromA and others v HM Treasury; G v HM Treasury CA 30-Oct-2008
The Treasury appealed against an order quashing its own 2006 Orders, giving effect to the obligations on the United Kingdom as a member of the United Nations to ensure that the assets of an individual designated by the UN were to be subject to . .
CitedLiversidge v Sir John Anderson HL 3-Nov-1941
The plaintiff sought damages for false imprisonment. The Secretary of State had refused to disclose certain documents. The question was as to the need for the defendant to justify the use of his powers by disclosing the documents.
Held: The . .
CitedAl-Jedda, Regina (on the Application of) v Secretary of State for Defence (JUSTICE intervening) HL 12-Dec-2007
The appellant who had dual Iraqi and British nationality complained of his detention by British troops in Iraq. He was not charged with any offence, but was detained on the ground that his internment is necessary for imperative reasons of security . .
CitedStellato, Regina (on the Application of)v Secretary of State for the Home Department HL 28-Feb-2007
The prisoner had served part of his ten year sentence, been released on licence and then recalled. He complained that the new parole system under which he had then to apply was invalid, having been made Parliament by negative resolution.
Held: . .
CitedChester v Bateson 1920
A Regulation brought in under the 1914 Act prohibited the bringing of possession proceedings against a munitions worker without the consent of the Minister.
Held: The prohibition was unlawful. It was a grave invasion of the rights of the . .
CitedRex (at the prosecution of Arthur Zadig) v Halliday HL 1-May-1917
The applicant was German born but a naturalised Englishman who complained of having been interned by a regulation made under the 1914 Act. He said that the regulation was ultra vires.
Held: The appeal failed (Lord Shaw dissenting). The House . .
CitedPyx Granite Ltd v Ministry of Housing and Local Government HL 1959
There is a strong presumption that Parliament will not legislate to prevent individuals affected by legal measures promulgated by executive public bodies having a fair opportunity to challenge these measures and to vindicate their rights in court . .
CitedSoering v The United Kingdom ECHR 7-Jul-1989
(Plenary Court) The applicant was held in prison in the UK, pending extradition to the US to face allegations of murder, for which he faced the risk of the death sentence, which would be unlawful in the UK. If extradited, a representation would be . .
CitedRegina v Secretary of State for the Home Department, Ex Parte Pierson HL 21-May-1997
The Home Secretary may not later extend the tariff for a lifer after it had been set by an earlier Home Secretary merely to satisfy needs of retribution and deterrence. ‘A power conferred by Parliament in general terms is not to be taken to . .
CitedRegina v Secretary of State for The Home Department Ex Parte Simms HL 8-Jul-1999
Ban on Prisoners talking to Journalists unlawful
The two prisoners, serving life sentences for murder, had had their appeals rejected. They continued to protest innocence, and sought to bring their campaigns to public attention through the press, having oral interviews with journalists without . .
CitedKadi v Council and Commission (Common Foreign and Security Policy) ECJ 16-Jan-2008
ECJ Common foreign and security policy (CFSP) – Restrictive measures taken against persons and entities associated with Usama bin Laden, the Al-Qaeda network and the Taliban – United Nations Security Council . .
CitedAl-Jedda, Regina (on the Application of) v Secretary of State for Defence (JUSTICE intervening) HL 12-Dec-2007
The appellant who had dual Iraqi and British nationality complained of his detention by British troops in Iraq. He was not charged with any offence, but was detained on the ground that his internment is necessary for imperative reasons of security . .
CitedRoyal College of Nursing of the United Kingdom v Department of Health and Social Security HL 2-Jan-1981
The court was asked whether nurses could properly involve themselves in a pregnancy termination procedure not known when the Act was passed, and in particular, whether a pregnancy was ‘terminated by a medical practitioner’, when it was carried out . .
CitedBehrami and Behrami v France; Saramati v France Germany and Norway ECHR 2-May-2007
The applicants complained of the action and inaction of members of an international security force (‘KFOR’) that had been deployed in Kosovo pursuant to Security Council Resolution 1244 (1999).
Held: The applications were inadmissible. The . .
CitedStellato, Regina (on the Application of)v Secretary of State for the Home Department HL 28-Feb-2007
The prisoner had served part of his ten year sentence, been released on licence and then recalled. He complained that the new parole system under which he had then to apply was invalid, having been made Parliament by negative resolution.
Held: . .
CitedRegina v Secretary of State for Health ex parte Quintavalle (on behalf of Pro-Life Alliance) HL 13-Mar-2003
Court to seek and Apply Parliamentary Intention
The appellant challenged the practice of permitting cell nuclear replacement (CNR), saying it was either outside the scope of the Act, or was for a purpose which could not be licensed under the Act.
Held: The challenge failed. The court was to . .
CitedRegina v Secretary of State for Foreign and Commonwealth Affairs ex parte Quark Fishing Limited HL 13-Oct-2005
The applicant had previously received licences to fish for Patagonian Toothfish off South Georgia. The defendant had instructed the issuer of the licence in such a way that it was not renewed. It now had to establish that its article 1 rights had . .
CitedRegina v Secretary of State for the Home Department ex parte Anufrijeva HL 26-Jun-2003
The appellant challenged the withdrawal of her benefits payments. She had applied for asylum, and been granted reduced rate income support. A decision was made refusing her claim, but that decision was, by policy, not communicated to her for several . .
CitedRegina v Secretary of State for Health ex parte Quintavalle (on behalf of Pro-Life Alliance) HL 13-Mar-2003
Court to seek and Apply Parliamentary Intention
The appellant challenged the practice of permitting cell nuclear replacement (CNR), saying it was either outside the scope of the Act, or was for a purpose which could not be licensed under the Act.
Held: The challenge failed. The court was to . .
CitedSaik, Regina v HL 3-May-2006
The defendant appealed aganst his conviction for conspiracy to engage in moneylaundering. At trial he pleaded guilty subject to a qualification that he had not known that the money was the proceeds of crime, though he may have suspected that it . .
CitedEntick v Carrington KBD 1765
The Property of Every Man is Sacred
The King’s Messengers entered the plaintiff’s house and seized his papers under a warrant issued by the Secretary of State, a government minister.
Held: The common law does not recognise interests of state as a justification for allowing what . .

Cited by:
CitedForsyth, Regina v, Regina v Mabey SC 23-Feb-2011
The defendants were to face trial on charges of making funds available to Iraq in breach of the 2000 Order. They said that the 2000 Order was ultra vires and ineffective, not having been made ‘forthwith’ after the UN resolution it was based upon, . .
CitedHome Office v Tariq SC 13-Jul-2011
(JUSTICE intervening) The claimant pursued Employment Tribunal proceedings against the Immigration Service when his security clearance was withdrawn. The Tribunal allowed the respondent to use a closed material procedure under which it was provided . .
CitedTest Claimants In The Franked Investment Income Group Litigation v Inland Revenue SC 23-May-2012
The European Court had found the UK to have unlawfully treated differently payment of franked dividends between subsidiaries of UK companies according to whether all the UK subsidiaries were themselves UK based, thus prejudicing European . .
See AlsoYoussef v Secretary of State for Foreign and Commonwealth Affairs SC 27-Jan-2016
An Egyptian national, had lived here since 1994. He challenged a decision by the Secretary of State,as a member of the committee of the United Nations Security Council, known as the Resolution 1267 Committee or Sanctions Committee. The committee . .
See AlsoYoussef and Others v The Secretary of State for Foreign and Commonwealth Affairs Admn 14-Nov-2011
The claimant sought to challenge the continued inclusion of his name on a list of persons subject to restrictions for showing sympathy to al Qaida, asking at this hearing: ‘Whether the Secretary of State’s decision to propose the relevant Claimant . .
See AlsoYoussef, Regina (on The Application of) v Secretary of State for Foreign and Commonwealth Affairs Admn 23-Jul-2012
The claimant challenged having been listed as an associate of Al-Qaida, with the resulting freezing of assets and a travel ban.
Held: His request for judicial review failed. . .
See AlsoIn re Guardian News and Media Ltd and Others; HM Treasury v Ahmed and Others SC 27-Jan-2010
Proceedings had been brought to challenge the validity of Orders in Council which had frozen the assets of the claimants in those proceedings. Ancillary orders were made and confirmed requiring them not to be identified. As the cases came to the . .

Lists of cited by and citing cases may be incomplete.

Banking, Crime, Constitutional

Leading Case

Updated: 02 November 2021; Ref: scu.395046

South Australia Asset Management Corporation v York Montague Ltd etc: HL 24 Jun 1996

Limits of Damages for Negligent Valuations

Damages for negligent valuations are limited to the foreseeable consequences of advice, and do not include losses arising from a general fall in values. Valuation is seldom an exact science, and within a band of figures valuers may differ without one of them being negligent. But once the valuer has been found to have been negligent, the loss for which he is responsible is that which has been caused by the valuation being wrong. A negligent valuer is not necessarily liable for the whole of the loss in such circumstances. The correct approach has been held to be to ascertain what element of loss suffered as a result of the transaction was attributable to the inaccuracy of the information supplied by the valuer. For this purpose the valuation negligently provided is to be compared with the figure which a reasonable valuer, using the information available at the relevant time, would have put forward as its most likely open market value. Thus the valuer may escape liability for a subsequent fall in market values. The court discussed the ‘mountaineer’s knee’: ‘A mountaineer about to undertake a difficult climb is concerned about the fitness of his knee. He goes to a doctor who negligently makes a superficial examination and pronounces the knee fit. The climber goes on the expedition, which he would not have undertaken if the doctor had told him the true state of his knee. He suffers an injury which is an entirely foreseeable consequence of mountaineering but has nothing to do with his knee . . on what I have suggested is the more usual principle, the doctor is not liable. The injury has not been caused by the doctors bad advice because it would have occurred if the advice had been correct’.
Lord Hoffmann: ‘Before one can consider the principle on which one should calculate the damages to which a plaintiff is entitled as compensation for loss, it is necessary to decide for what kind of loss he is entitled to compensation . . Rules which make the wrongdoer liable for all the consequences of his wrongful conduct are exceptional and need to be justified by some special policy. Normally the law limits liability to those consequences which are attributable to that which made the act wrongful.’
Lord Hoffmann said: ‘The Court of Appeal (Banque Bruxelles Lambert SA v Eagle Star Insurance Co Ltd and other appeals [1995] 2 All ER 769, [1995] QB 375) decided that in a case in which the lender would not otherwise have lent (which they called a ‘no-transaction’ case), he is entitled to recover the difference between the sum which he lent, together with a reasonable rate of interest, and the net sum which he actually got back. The valuer bears the whole risk of a transaction which, but for his negligence, would not have happened. He is therefore liable for all the loss attributable to a fall in the market. They distinguished what they called a ‘successful transaction’ case, in which the evidence shows that if the lender had been correctly advised, he would still have lent a lesser sum on the same security. In such a case, the lender can recover only the difference between what he has actually lost and what he would have lost if he had lent the lesser amount. Since the fall in the property market is a common element in both the actual and the hypothetical calculations, it does not increase the valuer’s liability.
The valuers appeal. They say that a valuer provides an estimate of the value of the property at the date of the valuation. He does not undertake the role of a prophet. It is unfair that merely because for one reason or other the lender would not otherwise have lent, the valuer should be saddled with the whole risk of the transaction, including a subsequent fall in the value of the property.

Lord Hoffmann, Lord Goff of Chieveley, Lord Jauncey of Tullichettle, Lord Slynn of Hadley, Lord Nicholls of Birkenhead
Gazette 04-Sep-1996, Times 24-Jun-1996, [1997] AC 191, [1996] PNLR 455, [1996] 27 EG 125, [1996] UKHL 10, [1996] 3 WLR 87, [1996] 3 All ER 365, [1996] 2 EGLR 93, 80 BLR 1, [1996] 5 Bank LR 211, [1996] CLC 1179, [1996] 50 Con LR 153
Bailii
England and Wales
Citing:
Appeal fromBanque Bruxelles Lambert Sa v Eagle Star Insurance Co Ltd and Others CA 24-Feb-1995
The plaintiffs were mortgagees. The defendants were valuers. The defendants negligently over-valued properties and the plaintiffs then accepted mortgages of the properties. Later the property market collapsed and the various borrowers defaulted and . .
Appeal fromCraneheath Securities v York Montague CA 1996
When testing whether a valuation was negligent, it would not be enough for the plaintiff to show that there have been errors at some stage of the valuation unless they can also show that the final valuation was wrong. would not be enough for the . .
AppliedDoyle v Olby (Ironmongers) Ltd CA 31-Jan-1969
The plaintiff had been induced by the fraudulent misrepresentation of the defendant to buy an ironmonger’s business for 4,500 pounds plus stock at a valuation of 5,000 pounds. Shortly after the purchase, he discovered the fraud and started the . .
CitedIn re the Oropesa CA 1943
Two steam vessels collided. One’s Master sent fifty of his crew in boats to the other ship and about an hour and a half after the collision decided himself to go to that ship and confer with her Master on measures to be taken. He transferred in . .
At first instanceBanque Bruxelles Lambert Sa v Eagle Star Ins Co Ltd and Others QBD 7-Mar-1994
A negligent valuer was liable for the loss arising from an overvaluation, but the valuer was not liable for that proportion of the lender’s loss on the loan which was attributable to the fall in the market after the valuation date, even though (i) . .
CitedRegina v Shulman, Regina v Prentice, Regina v Adomako; Regina v Holloway HL 1-Jul-1994
An anaesthetist failed to observe an operation properly, and did not notice that a tube had become disconnected from a ventilator. The patient suffered a cardiac arrest and died, and the defendant was convicted of manslaughter, being guilty of gross . .

Cited by:
CitedAneco Reinsurance Underwriting Limited (In Liquidation) (a Body Incorporate Under the Laws of Bermuda) v Johnson and Higgins Limited HL 18-Oct-2001
Brokers contracted to obtain re-insurance of risks undertaken by the claimants. They negligently failed to obtain full cover. The question at issue was whether they were liable for the full loss, or whether their duty was limited to obtaining . .
AppliedPlatform Home Loans Ltd v Oyston Shipways Ltd and others HL 18-Feb-1999
The plaintiffs had lent about 1 million pounds on the security of property negligently valued at 1.5 million pounds. The property was sold for much less than that and the plaintiffs suffered a loss of 680,000 pounds. The judge found that the . .
CitedPetersen v Personal Petersen (Deceased), Representative of CA 31-Jan-2002
The claim was against a solicitor for negligence. The claimant had purchased a property in respect of which there was an unsettled dispute, He claimed that the solicitor had accepted a condition under which he accepted a proportion of the liability . .
CitedEquitable Life Assurance Society v Ernst and Young (A Firm) ComC 10-Feb-2003
The company complained that its auditors had failed to give appropriate warning of the Society’s exposure to risk in awarding larger bonuses than were justified, and that had the true position been known, it xould have put itself up for sale . .
CitedGoldstein v Levy Gee ( A Firm) ChD 1-Jul-2003
There had been a dispute between shareholders, and the defendant was called upon to value the company. He issued a tender for valuers to value the properties. Complaint was made that the tender was negligent in its description of the basis for . .
CitedEquitable Life Assurance Society v Ernst and Young CA 25-Jul-2003
The claimant sought damages from its accountants, saying that had they been advised of the difficulties in their financial situation, they would have been able to avoid the loss of some 2.5 billion pounds, or to sell their assets at a time when . .
CitedAMEC Mining v Scottish Coal Company SCS 6-Aug-2003
The pursuers contracted to remove coal by opencast mining from the defender’s land. They said the contract assumed the removal first of substantial peat depositys from the surface by a third party. They had to do that themselves at substantial cost. . .
CitedDP Mann and others v Coutts and Co ComC 16-Sep-2003
The claimants were involved in litigation, They took certain steps on the understanding that the respondents had had deposited with them substantial sums in accounts under binding authorities. The bank had written a letter upon which they claim they . .
CitedRees v Darlington Memorial Hospital NHS Trust HL 16-Oct-2003
The claimant was disabled, and sought sterilisation because she feared the additional difficulties she would face as a mother. The sterilisation failed. She sought damages.
Held: The House having considered the issue in MacFarlane only . .
AffirmedNykredit Mortgage Bank Plc v Edward Erdman Group Ltd (No 2) HL 27-Nov-1997
A surveyor’s negligent valuation had led to the plaintiff obtaining what turned out to be inadequate security for his loan. A cause of action against a valuer for his negligent valuation arises when a relevant and measurable loss is first recorded. . .
CitedSmith 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 . .
CitedA and Another v Essex County Council CA 17-Dec-2003
The claimant sought damages. The respondent had acted as an adoption agency but had failed to disclose all relevant information about the child.
Held: Any such duty extended only during the period where the child was with the prospective . .
CitedHumblestone v Martin Tolhurst Partnership (A Firm) ChD 5-Feb-2004
The solicitors sent a will to the client for execution, but failed to notice on its return that it had not been properly executed, the signature not being that of the client.
Held: The solicitors were under a duty to ensure that the will would . .
CitedRoger Michael and others v Douglas Henry Miller and Another ChD 22-Mar-2004
Property had been sold by the respondents as mortgagees in possession. The claimants said the judge had failed to award the value of the property as found to be valued, and had not given a proper value to a crop of lavender.
Held: In . .
CitedMcLoughlin v Jones; McLoughlin v Grovers (a Firm) CA 2002
In deciding whether a duty of care is established the court must go to the ‘battery of tests which the House of Lords has taught us to use’, namely: ‘. . the ‘purpose’ test (Banque Bruxelles Lambert SA v Eagle Star Insurance Co Ltd); the ‘assumption . .
CitedCrehan v Inntrepreneur Pub Company (CPC) CA 21-May-2004
The claimant had taken two leases, but had been made subject to beer ties with the defendant. He claimed damages for the losses, saying he had been forced to pay higher prices than those allowed to non-tied houses, and that the agreement was . .
CitedGreen and Another v Alexander Johnson (A Firm) and Another ChD 26-May-2004
The judgment related to the assessment of damages for professional negligence by the defendants. The court deprecated the practice of separating off assessments of damages from the principal claim, since this created a risk of confusion. The . .
CitedChester v Afshar HL 14-Oct-2004
The claimant suffered back pain for which she required neurosurgery. The operation was associated with a 1-2% risk of the cauda equina syndrome, of which she was not warned. She went ahead with the surgery, and suffered that complication. The . .
CitedLondon General Holdings Ltd and others v USP Plc and Another CA 22-Jul-2005
Copyright was claimed in a draft legal agreement. Infringement was established, but the court was asked to look at the assessment of damages.
Held: ‘what is the basis upon which damages for breach of copyright are awarded? The question cannot . .
CitedWeston v Gribben ChD 20-Dec-2005
. .
CitedPhelps v Stewarts (A Firm) and Another ChD 2-Jul-2007
The claimant sought damages for the negligent drafting of a deed of trust, saying that he had not been advised of a charge to tax which would arise. The defendant said that her duties were limited, and did not include advice on this point, having . .
CitedTransfield Shipping Inc v Mercator Shipping Inc (The Achilleas) HL 9-Jul-2008
The parties contracted to charter the Achileas. The charterer gave notice to terminate the hire, and the owner found a new charterer. Until the termination the charterers sub-chartered. That charter was not completed, delaying the ship for the . .
CitedPegasus Management Holdings Sca and Another v Ernst and Young (A Firm) and Another ChD 11-Nov-2008
The claimants alleged professional negligence in advice given by the defendant on a share purchase, saying that it should have been structured to reduce Capital Gains Tax. The defendants denied negligence and said the claim was statute barred.
CitedParker and Another v SJ Berwin and Co and Another QBD 17-Dec-2008
The claimants sought damages from their former solicitors. They set out to purchase a football club, expending substantial sums for the purpose, relying on the defendants’ promised provision of service in finding and arranging the funding. They said . .
CitedD Pride and Partners (A Firm) and Others v Institute for Animal Health and Others QBD 31-Mar-2009
The claimants sought damages after the loss of business when the defendants’ premises were the source of an outbreak of foot and mouth disease. The organism had escaped from their premises via a broken drain.
Held: Much of the damage claimed . .
CitedMilner and Another v Carnival Plc (T/A Cunard) CA 20-Apr-2010
Damages for Disastrous Cruise
The claimants had gone on a cruise organised by the defendants. It was described by them as ‘the trip of a lifetime.’ It did not meet their expectations. There had been several complaints, including that the cabin was noisy as the floor flexed with . .
CitedCox v Ergo Versicherung Ag SC 2-Apr-2014
The deceased army officer serving in Germany died while cycling when hit by a driver insured under German law. His widow, the claimant, being domiciled in England brought her action here, claiming for bereavement and loss of dependency. The Court . .
CitedJetivia Sa and Another v Bilta (UK) Ltd and Others SC 22-Apr-2015
The liquidators of Bilta had brought proceedings against former directors and the appellant alleging that they were party to an unlawful means conspiracy which had damaged the company by engaging in a carousel fraud with carbon credits. On the . .
CitedMeadows v Khan QBD 23-Nov-2017
Claim for the additional costs of raising the claimant’s son, A, who suffered from both haemophilia and autism. It is admitted that, but for the defendant’s negligence, A would not have been born because his mother would have discovered during her . .
CitedKuddus v Regina CACD 16-May-2019
The defendant appealed his conviction for gross negligence manslaughter. He ran a takeaway food business. A meal was ordered by the victim through a third party website, adding that she suffered mild allergies. There was no evidence that the . .
CitedBPE Solicitors and Another v Hughes-Holland (In Substitution for Gabriel) SC 22-Mar-2017
The court was asked what damages are recoverable in a case where (i) but for the negligence of a professional adviser his client would not have embarked on some course of action, but (ii) part or all of the loss which he suffered by doing so arose . .
CitedManchester Building Society v Grant Thornton UK Llp ComC 2-May-2018
claim for damages by a building society caused by the admitted negligence of its accountant. . .
CitedManchester Building Society v Grant Thornton UK Llp CA 30-Jan-2019
Liability of an auditor for losses incurred on long term interest rate swap agreements which were entered into in reliance upon negligent accounting advice and which were closed out at a loss when the negligent advice came to light. . .
CitedManchester Building Society v Grant Thornton UK Llp SC 18-Jun-2021
Was the Court of Appeal was right to hold that the break costs claimed by the Appellant fell outside the scope of the Respondent’s duty of care as professional accountants? . .
CitedKhan v Meadows SC 18-Jun-2021
‘ A woman approaches a general medical practice for testing to establish whether she is a carrier of a hereditary disease. Tests which are inappropriate to answer that question are arranged. A general medical practitioner when informing her of the . .

Lists of cited by and citing cases may be incomplete.

Damages, Professional Negligence, Banking

Leading Case

Updated: 02 November 2021; Ref: scu.89405

Williams v Central Bank of Nigeria: SC 19 Feb 2014

Bank not liable for fraud of customer

The appellant sought to make the bank liable for a fraud committed by the Bank’s customer, the appellant saying that the Bank knew or ought to have known of the fraud. The court was asked whether a party liable only as a dishonest assistant was a trustee, and subject to the exception which would extend the limitation period.
Held: The bank’s appeal succeeded. The definition of ‘trustee’ in section 21 of the 1980 Act did not apply to include someone deemed to be a trustee for acting as a dishonest assistant or knowing recipient within a fraudulent scheme. He could only be a consructive trustee.

Lord Neuberger, President, Lord Mance, Lord Clarke, Lord Sumption, Lord Hughes
[2014] UKSC 10, 16 ITELR 740, [2014] WLR(D) 88, [2014] 2 All ER 489, [2014] 2 WLR 355, [2014] WTLR 873, UKSC 2012/0113
Bailii, WLRD, Bailii Summary, SC Summary, SC
Limitation Act 1980 21(1)(a)
England and Wales
Citing:
See AlsoWilliams v Central Bank of Nigeria QBD 8-Apr-2011
The claimant had been defrauded by a customer of the defendant bank. He brought a claim against the bank, saying that they knew or ought to have known of the fraudster’s activities, and were liable. The Bank denied that the UK courts had . .
See AlsoWilliams v Central Bank of Nigeria QBD 24-Jan-2012
The claimant asserted involvement by the defendant bank in a fraud perpetrated against him. Jurisdiction had already been admitted for one trust , and now the claimant sought to add two further claims.
Held: ‘None of the gateways to English . .
See AlsoCentral Bank of Nigeria v Williams CA 3-Apr-2012
The claimant alleged that he had been defrauded and accused the appellant of involvement in the fraud. The Bank appealed against a finding that the claim against it was not time limited.
Held: The appeal failed. The action was by a beneficiary . .
See AlsoWilliams v Central Bank of Nigeria CA 2-Jul-2013
The claimant appealed against an order dis-allowing service on it out of the jurisdiction.
Held: Dr Williams’ appeal in respect of the Nigerian law claim was allowed but rejected in respect of the trust claim and the contract claim. . .
CitedBeckford v Wade PC 1805
(Jamaica) The board was concerned with the application of the English statutes of limitation, which were held to apply in Jamaica subject to a Jamaican statute excepting (among other people) trustees. Sir William Grant MR said: ‘The question then . .
CitedHovenden v Lord Annesley 1806
Referring to a judgment of Lord Macclesfield on the application of statutory limitation by analogy to claims against trustees for breach of trust, he continued: ‘Now I take it that the position which has been laid down, ‘that trust and fraud are not . .
CitedParagon Finance Plc (Formerly Known As National Home Loans Corporation Plc v D B Thakerar and Co (a Firm); Ranga and Co (a Firm) and Sterling Financial Services Limited CA 21-Jul-1998
Where an action had been begun on basis of allegations of negligence and breach of trust, new allegations of fraud where quite separate new causes of claim, and went beyond amendments and were disallowed outside the relevant limitation period. . .
CitedSelangor United Rubber Estates Ltd v Cradock (No 3) ChD 1968
The expressions ‘constructive trust’ and ‘constructive trustee’ are ‘nothing more than a formula for equitable relief. It is the actual control of assets belonging beneficially to a company which causes the law to treat directors as analogous to . .
CitedBonney v Ridgard 3-Dec-1784
A purchaser of leasehold premises from an executor need not (in general) see to the application of the purchase money, nor need there be any recital in such an assignment of the purpose for which it is sold ; but if on the face of the assignment it . .
CitedWilson v Moore 22-Mar-1834
Merchants who, by the direction of an executor, their commercial correspondent, applied a fund, which they knew to be part of the testator’s assets, in satisfaction of advances made by them, in the course of trade, to relieve the embarrasments of . .
CitedBarnes v Addy 1874
A stranger to a trust can be liable in equity for assisting in a breach of trust, even though he received no trust property.
Lord Selborne said: ‘Now in this case we have to deal with certain persons who are trustees, and with certain other . .
CitedSoar v Ashwell CA 1893
Trustees under a will had entrusted the trust fund to a solicitor for investment. The solicitor exercised all of their administrative and investment powers for them and distributed part of the fund invested to the beneficiaries under the will but . .
CitedIn re Gallard 1897
. .
CitedIn re Eyre-Williams 1923
. .
CitedHeynes v Dixon 1900
. .
CitedIn re Jane Davies 1891
An action brought by a residuary legatee against an executor for the administration of the testator’s estate is an action for a legacy.
An executor, qua executor, is not an express trustee. . .
CitedIn re Lacy; Royal General Theatrical Fund Association v Kydd 1899
Equity prevents trustees from raising limitation against their beneficiaries.
An executor, qua executor, is not an express trustee. . .
CitedTaylor v Davies PC 19-Dec-1919
(Ontario) An assignee for the benefit of creditors conveyed mortgaged property to the mortgagee in satisfaction of part of the debt due to him. The mortgagee was also one of the inspectors required by the Canadian legislation to supervise the . .
CitedClarkson v Davies PC 1923
In a case involving fraud, referring to Taylor v Davies, Lord Justice Clerk said that: ‘it was there laid down that there is a distinction between a trust which arises before the occurrence of the transaction impeached and cases which arises only by . .
CitedRoyal Brunei Airlines SDN BHD v Tan PC 24-May-1995
(Brunei) The defendants were a one-man company, BLT, and the one man, Mr Tan. A dishonest third party to a breach of trust was liable to make good a resulting loss even though he had received no trust property. The test of knowledge was an objective . .
CitedDeg-Deutsch Investitions Und Entwicklungsgesellschaft Mbh v Koshy (No 3) Gwembe Valley Development Co Ltd v Same (No 3) ChD 26-Oct-2001
A claim against a company director which alleged a misapplication of company assets involving a fraudulent, or dishonest breach of trust, was not subject to a limitation period. A company was alleged to have fraudulently hidden certain profits. The . .
CitedDEG-Deutsche Investitions und Entwicklungsgesellschaft mbH v Koshy and Other (No 3); Gwembe Valley Development Co Ltd (in receivership) v Same (No 3) CA 28-Jul-2003
The company sought to recover damages from a director who had acted dishonestly, by concealing a financial interest in a different company which had made loans to the claimant company. He replied that the claim was out of time. At first instance the . .
CitedHalton International Inc (Holding) and Another v Guernroy Ltd ChD 9-Sep-2005
Parties had entered into a shareholders’ agreement as to voting arrengemets within a company. Thay disputed whether votes had been used in reach of that agreement, particularly as to the issue of new shares and their allotment, but the court now . .
CitedHalton International Inc Another v Guernroy Ltd CA 27-Jun-2006
The parties had been involved in investing in an airline to secure its future, but it was now said that one party had broken the shareholders’ or voting agreement in not allowing further investments on a pari passu basis. The defendants argued that . .
CitedCattley and Another v Pollard and Another ChD 7-Dec-2006
The first defendant solicitor misappropriated money from an estate he was administering. The beneficiaries later commenced proceedings against his wife, alleging knowing assistance. She said that that claim was out of time. The claimant responded . .
CitedPeconic Industrial Development Ltd v Lau Kwok FAI 27-Feb-2009
Hong Kong Court of Final Appeal. The limitation period for a claim in dishonest assistance is 6 years. For limitation purposes a distinction is to be made between two kinds of constructive trustees: those who are fiduciaries and those who are . .

Lists of cited by and citing cases may be incomplete.

Banking, Torts – Other, Limitation

Leading Case

Updated: 02 November 2021; Ref: scu.521993

Nelson and Others v First Caribbean International Bank (Barbados) Ltd: PC 3 Sep 2014

nelson_FCIBPC1409

(St Lucia) A loan had been secured against land by a hypothec. A landslip damged the charged property, and the borrowers now challenged the lender’s right to pursue them personally.
Held: The apepeal should be dismissed. Reading the hypothecary obligation and facilities letter together, as they must be, the personal obligation accepted was clear. The assertion that eth bank was limited to its hypothecary was erroneous in failing to ‘distinguish between the law of obligations and the law of real rights. This is a fundamental distinction in civilian legal systems. Obligations are a juridical relationship between persons, namely the debtor and the creditor. Real rights are concerned with things, such as an owner’s right to possess a thing which can be asserted against the world.’

Lady Hale, Lord Kerr, Lord Wilson, Lord Carnwath, Lord Hodge
[2014] UKPC 30
Bailii

Commonwealth, Banking

Updated: 01 November 2021; Ref: scu.536384

Williams and Glyn’s Bank Ltd v Boland: HL 19 Jun 1980

Wife in Occupation had Overriding Interest

The wife had made a substantial financial contribution to the purchase price of the house which was registered only in her husband’s name, and charged to the bank. The bank sought possession. The wife resisted saying that she had an overriding interest.
Held: Her equitable interest was not only a ‘minor interest’ within section 3 (xv) of the Act, but was also protected as an overriding interest because she occupied the land. The House considered the relationship between registered interests on the one hand, and equitable ‘minor interests’ and trusts on the other. Lord Wilberforce said: ‘The system of land registration, as it exists in England, which long antedates the Land Registration Act 1925, is designed to simplify and to cheapen conveyancing. It is intended to replace the often complicated and voluminous title deeds of property by a single land certificate, on the strength of which land can be dealt with. In place of the lengthy and often technical investigation of title to which a purchaser was committed, all he has to do is consult the register; from any burden not entered on the register, with one exception, overriding interests, he takes free. Above all, the system is designed to free the purchaser from the hazards of notice – real or constructive – which, in the case of unregistered land, involve him in inquiries, often quite elaborate, failing which he might be bound by equities. The Law of Property Act 1925 contains provisions limiting the effect of the doctrine of notice, but it still remains a potential source of danger to purchasers. By contrast, the only provisions of the Land Registration Act 1925 with regard to notice are provisions which enable a purchaser to take the estate free from equitable interests or equities whether he has notice or not. (See, for example, section 3 (xv) ‘minor interests’). The only kind of notice recognised is by entry on the register.

‘The exception just mentioned consists of ‘overriding interests’ listed in section 70. As to these, all registered land is stated to be deemed to be subject to such of them as may be subsisting in reference to the land, unless the contrary is expressed on the register. The land is so subject regardless of notice actual or constructive. In my opinion therefore, the law as to notice as it may affect purchasers of unregistered land, whether contained in decided cases, or in a statute (the Conveyancing Act 1882, section 3, Law of Property Act, section 199) has no application even by analogy to registered land. Whether a particular right is an overriding interest, and whether it affects a purchaser, is to be decided upon the terms of section 70, and other relevant provisions of the Land Registration Act 1925, and upon nothing else. In relation to rights connected with occupation, it has been said that the purpose and effect of section 70 (1) (g) of the Land Registration Act 1925 was to make applicable to registered land the same rule as previously had been held to apply to unregistered land.’ The existence of overriding interests within the system of registered conveyancing might be troublesome for purchasers, but ‘What is involved is a departure from an easy-going practice of dispensing with enquiries as to occupation beyond that of the vendor and accepting the risks of doing so. To substitute for this a practice of more careful enquiry as to the fact of occupation, and if necessary, as to the rights of occupiers can not, in my view of the matter, be considered as unacceptable. I adhere to this, but I do not accept the argument which learned counsel for the appellant sought to draw from it. His submission was that, in applying section 70(1)(g), we should have regard to and limit the application of the paragraph in the light of the doctrine of notice. But this would run counter to the whole purpose of the Act. The purpose, in each system, is the same, namely, to safeguard the rights of persons in occupation, but the method used differs. In the case of unregistered land, the purchaser’s obligation depends upon what he has notice of – notice actual or constructive. In the case of registered land, it is the fact of occupation that matters. If there is actual occupation, and the occupation has rights, the purchaser takes subject to them. If not, he does not. No further element is material.’
On the plain meaning of the words ‘actual occupation’, what is required is ‘physical presence, not some entitlement at law’ these words are ordinary words of plain English, and should, in my opinion, be interpreted as such’ and ‘the word ‘actual’ merely emphasises that what is required is physical presence, not some entitlement in law’ and ‘undivided shares in land can only take effect in equity, behind a trust for sale upon which the legal owner is to hold the land.’

Lord Wilberforce, Viscount Dilhorne, Lord Salmon and Lord Roskill
[1981] AC 487, [1980] 2 All ER 408, [1980] 3 WLR 138, [1980] UKHL 4
Bailii
Land Registration Act 1925 70(1)
England and Wales
Citing:
CitedNational Provincial Bank Ltd v Hastings Car Mart Ltd CA 1964
The purpose and effect of section 70(1)(g) of the Land Registration Act 1925 was to make applicable to registered land the same rule as previously had been held to apply to unregistered land. (Russell LJ, Dissenting) ‘Nor should the mind be in any . .
CitedNational Provincial Bank Limited v Ainsworth HL 1965
The significance of the distinction between occupation and rights was that although the deserted wife was in actual occupation of the former matrimonial home, the quality of her rights was not such as to be capable of amounting to an overriding . .
ApprovedBridges v Mees ChD 1957
An overriding interest, namely an estate contract, was protected under s. 70(1) of the Act even though it could have been protected by a caution under s. 59. . .
ApprovedHodgson v Marks ChD 1970
The plaintiff, an elderly widow, transferred her house into the name of her lodger, but remained in occupation of the house, on exactly the same basis as before, until the lodger sold the house and the purchaser had mortgaged it to a building . .
Appeal FromWilliams and Glyn’s Bank Ltd v Boland CA 1979
Money was raised on mortgage of registered land and paid to a single trustee holding the land on trust for sale, and it was held that the rights of beneficiaries who were in occupation and of whom no enquiries had been made were not mere minor . .
OverruledCedar Holdings Ltd v Green CA 1981
A property was held in the joint names of a former husband and wife. To obtain a loan for the husband, a legal charge over the property was executed by the husband, but he had another woman execute for the wife, pretending to be her. The chargee . .

Cited by:
CitedMalory Enterprises Ltd v Cheshire Homes (UK) Ltd and others CA 22-Feb-2002
The applicant said that its land had been misappropriated, and sought rectification of the register against the respondent who was a successor in title having bought the land from the wrongdoer.
Held: On registration, section 69 operated to . .
DistinguishedCity of London Building Society v Flegg And Another HL 14-May-1987
A couple bought a property and registered it in their own names with substantial financial assistance from the parents of one of them. The parents occupied the house with them. Without telling the parents, the owners borrowed again, executing . .
AppliedKingsnorth Finance Co Ltd v Tizard ChD 1986
The marriage between the defendants had broken down, but the wife still visited the house regularly, staying and caring for the children when the husband was away. The house was held in his sole name. He charged it to the plaintiffs, who now sought . .
CitedFerrishurst Ltd v Wallcite Ltd CA 30-Nov-1998
A person in actual occupation of registered land at time of transfer can enforce his rights against the transferee. A sub-underlessee in occupation of part could enforce an option to purchase against the freeholder acquiring intermediate registered . .
CitedDougbar Properties Ltd v Keeper of the Registers of Scotland SCS 9-Feb-1999
Even if there existed an acknowledged error in the Land Registry, rectification was the only available remedy. The existence of an inaccuracy did not alter the legal reality that the registered proprietor had a right created by registration. In . .
CitedState of India v Sood and Others CA 30-Oct-1996
Beneficial equitable interests in land were overreached by a mortgage despite no the fact that no capital was actually advanced under the charge. . .
CitedBankers Trust Company v Namdar and Namdar CA 14-Feb-1997
The bank sought repayment of its loan and possession of the defendants’ property. The second defendant said that the charge had only her forged signature.
Held: Non-compliance with section 2 of the 1989 Act does not make a bargain illegal, and . .
CitedHalifax Building Society v Campbell-Lebens CA 4-Jun-1998
. .
CitedBhullar and Another v McArdle CA 10-Apr-2001
The defendant had registered a caution against the claimant’s land at the Land Registry. The claimant sought its removal and now appealed an order for rectification of the register against him. The parties had reached oral agreements as to the . .
CitedPritchard Englefield v Steinberg and Steinberg ChD 30-Jul-2004
Enforcement of charging order absolute. . .
CitedNational Westminster Bank Plc, Malhan Malhan v Malhan, The Secretary of State for Consitutional Affairs and Lord Chancellor ChD 22-Apr-2004
. .
CitedLloyd and others v Dugdale and Another CA 21-Nov-2001
The claimants asserted a right to possession of land, and the defendant resisted, claiming a proprietary estoppel. A predecessor had intended to grant a sub-lease to the defendant, who had arranged for his company JAD Ltd to execute major works on . .
CitedLink Lending Ltd v Bustard CA 23-Apr-2010
The respondent had been detained in a secure mental unit for a year. In that time her home was charged to the appellant. She asserted that she had been a person in actual occupation. The chargee now appealed against a finding that the respondent had . .
CitedChaudhary v Yavuz CA 22-Nov-2011
The court was asked ‘whether and if so how an easement arising informally and not protected by any entry at the Land Registry can be effective against a purchaser of the land over which the easement would be exercised.’ The parties respectively . .
CitedCook v The Mortgage Business Plc CA 24-Jan-2012
The land owners sought relief from possession orders made under mortgages given in equity release schemes: ‘If the purchaser raises all or part of the purchase price on mortgage, and then defaults, the issue arises whether the mortgagee’s right to . .
CitedScott v Southern Pacific Mortgages Ltd and Others SC 22-Oct-2014
The appellant challenged a sale and rent back transaction. He said that the proposed purchaser had misrepresented the transaction to them. The Court was asked s whether the home owners had interests whose priority was protected by virtue of section . .
CitedLloyds Bank plc v Rosset CA 13-May-1988
Claim by a wife that she has a beneficial interest in a house registered in the sole name of her husband and that her interest has priority over the rights of a bank under a legal charge executed without her knowledge. The case raises a point of . .

Lists of cited by and citing cases may be incomplete.

Registered Land, Banking

Leading Case

Updated: 01 November 2021; Ref: scu.180518

Director General of Fair Trading v First National Bank: HL 25 Oct 2001

The House was asked whether a contractual provision for interest to run after judgment as well as before in a consumer credit contract led to an unfair relationship.
Held: The term was not covered by the Act, and was not unfair under the Regulations. It was by way of a default condition, rather than a penalty. The provision excluding the award of statutory interest after judgment did not operate to exclude the contractual term, and the inconsistency would not defeat the regulations if such clauses were only allowed to operate if they fell fairly and squarely within the section. The 1999 Regulations set up a ‘a dual system of ex casu challenges and pre-emptive or collective challenges by appropriate bodies’, and ‘The system of preemptive challenges is a more effective way of preventing the continuing use of unfair terms . . than ex casu actions.’
Lord Bingham explained the regulations: ‘A term falling within the scope of the Regulations is unfair if it causes a significant imbalance in the parties’ rights and obligations under the contract to the detriment of the consumer in a manner or to an extent which is contrary to the requirement of good faith. The requirement of significant imbalance is met if a term is so weighted in favour of the supplier as to tilt the parties’ rights and obligations under the contract significantly in his favour. This may be by the granting to the supplier of a beneficial option or discretion or power, or by the imposing on the consumer of a disadvantageous burden or risk or duty. The illustrative terms set out in Schedule 3 to the Regulations provide very good examples of terms which may be regarded as unfair; whether a given term is or is not to be so regarded depends on whether it causes a significant imbalance in the parties’ rights and obligations under the contract. This involves looking at the contract as a whole. But the imbalance must be to the detriment of the consumer; a significant imbalance to the detriment of the supplier, assumed to be the stronger party, is not a mischief which the Regulations seek to address. The requirement of good faith in this context is one of fair and open dealing. Openness requires that the terms should be expressed fully, clearly and legibly, containing no concealed pitfalls or traps. Appropriate prominence should be given to terms which might operate disadvantageously to the customer. Fair dealing requires that a supplier should not, whether deliberately or unconsciously, take advantage of the consumer’s necessity, indigence, lack of experience, unfamiliarity with the subject matter of the contract, weak bargaining position or any other factor listed in or analogous to those listed in Schedule 2 to the Regulations. Good faith in this context is not an artificial or technical concept; nor, since Lord Mansfield was its champion, is it a concept wholly unfamiliar to British lawyers. It looks to good standards of commercial morality and practice. Regulation 4 (1) lays down a composite test, covering both the making and the substance of the contract, and must be applied bearing clearly in mind the objective which the Regulations are designed to promote.’

Lord Bingham of Cornhill Lord Steyn Lord Hope of Craighead Lord Millett Lord Rodger of Earlsferry
Times 01-Nov-2001, [2002] 1 AC 481, [2001] UKHL 52, [2001] 3 WLR 1297, [2002] 1 LLR 489, [2001] 2 All ER (Comm) 1000, [2002] 1 All ER 97, [2002] ECC 22, [2002] 1 Lloyd’s Rep 489
House of Lords, Bailii
Unfair Terms in Consumer Contracts Regulations 1994 (1994 No 3159), County Courts (Interest on Judgment Debts) Order 1991 (1991 No 1184), Consumer Credit Act 1974, County Courts Act 1984 71, Council Directive 93/13/EEC (OJ 1993, L95, p 29) on unfair terms in consumer contracts
England and Wales
Citing:
At First InstanceDirector General of Fair Trading v First National Bank Plc ChD 30-Jul-1999
The claimants sought an injunction under the regulations to prevent the defendant bank from including in any of its agreements a clause allowing them to claim interest on judgments on regulated agreements. . .
Appeal fromDirector General of Fair Trading v First National Bank Plc CA 15-Sep-1999
A bank had a clause in its standard terms which provided that it could continue to recover interest at the contract rate after judgment for default. The clause was an unfair term. The clause allowed a bank to impose an arrangement for repayment by . .
CitedIn re Sneyd; Ex parte Fewings CA 1883
The mortgagee’s costs, whether costs of an enforcement or a redemption action or included in ‘costs, charges and expenses’, are not recoverable from the mortgagor personally, but both as against the mortgagor and other persons interested in the . .
CitedEconomic Life Assurance Society v Usborne HL 1902
If the loan agreement provides that the contract term for payment of interest survives judgment, then the contract term remains enforceable after judgment. Lord Halsbury said: ‘My Lords, it seems to me that Fry LJ in the case of Ex parte Fewings . . . .

Cited by:
CitedBankers Insurance Company Limited v South, Gardner QBD 7-Mar-2003
The two defendants had been involved in a jet-ski accident on holiday in Europe. The claimant sought a declaration that it was not liable to indemnify its insured under the holiday insurance under which they travelled. The policy excluded liability . .
CitedOffice of Fair Trading v Abbey National Plc and seven Others ComC 24-Apr-2008
The Office sought a declaration that the respondent and other banks were subject to the provisions of the Regulations in their imposition of bank charges to customer accounts, and in particular as to the imposition of penalties or charges for the . .
CitedOffice of Fair Trading v Foxtons Ltd ChD 17-Jul-2008
Complaint was made that the Foxtons standard terms of acting in residential lettings were unfair. Foxtons objected to the jurisdiction of the Claimant to intervene.
Held: On a challenge to an individual contract, the court would be able to see . .
CitedAbbey National Plc and others v The Office of Fair Trading CA 26-Feb-2009
The OFT had sought to enquire as to the fairness of the terms on which banks conducted their accounts with consumers, and in particular as to how they charged for unauthorised overdrafts. The banks denied that the OFT had jurisdiction, and now . .
CitedOffice Of Fair Trading v Foxtons Ltd CA 2-Apr-2009
The OFT had sought and obtained an injunction regarding the use of certain standard terms in their estate agency business. Both parties appealed.
Held: The OFT’s appeal succeeded. The court had been wrong to restrict the effect of the . .
CitedThe Office Of Fair Trading v Foxtons Ltd ChD 10-Jul-2009
The OFT alleged that certain standard terms in the defendant’s letting agent contracts were unfair. The agent had withdrawn the former terms, but relief was still sought on those terms and their effect, and as to the fairness of the new ones. The . .
CitedOffice of Fair Trading (OFT) v Abbey National Plc and Others SC 25-Nov-2009
The banks appealed against a ruling that the OFT could investigate the fairness or otherwise of their systems for charging bank customers for non-agreed items as excessive relative to the services supplied. The banks said that regulation 6(2) could . .
CitedThe Office of Fair Trading v Ashbourne Management Services Ltd and Others ChD 27-May-2011
The OFT alleged that the defendant companies had been engaged in breaches of the Act and the Regulations in their practices in selling gym memberships. The defendant were selling and managing memberships for gyms. They advised as to the different . .
CitedRossetti Marketing Ltd v Diamond Sofa Company Ltd and Another QBD 3-Oct-2011
Rossetti_diamondQBD2011
The claimants sought compensation under the 1993 Rules. The defendants denied that the claimants were agents within the rules, since they also acted as agents for other furniture makers.
Held: Whether a party is a commercial agent within the . .
CitedRochdale Borough Council v Dixon CA 20-Oct-2011
The defendant tenant had disputed payment of water service charges and stopped paying them. The Council obtained a possession order which was suspended on payment or arrears by the defendant at andpound;5.00. The tenant said that when varying the . .
CitedPerpetual Trustee Co Ltd v Khoshaba 20-Mar-2006
Austlii (Supreme Court of New South Wales – Court of Appeal) CONTRACTS – Unjust contracts – Determination that a contract ‘unjust’ – Appellate review – Nature of decision appealed from – Conclusion that ‘unjust’ . .
CitedDu Plessis v Fontgary Leisure Parks Ltd CA 2-Apr-2012
The claimant, who owned a holiday mobile home on the respondent’s site challenged the raising of site fees, saying that the contract was unfair. Previously all site fees were equal within the site, but the respondent had introduced a scheme which . .
CitedChubb and Another v Dean and Another ChD 24-Apr-2013
The court considered whether it had power to award a post judgment interest at a contractual rather than the statutory interest rate.
Held: There is no power of the court in this claim to add any amount beyond the statutory interest to the . .
CitedParkingeye Ltd v Beavis CA 23-Apr-2015
The appellant had overstayed the permitted period of free parking in a retail park by nearly an hour. The parking was managed by the respondent who had imposed a charge of 85.00 pounds. The judge had found that the appellant was in breach of a . .
CitedGreen v Petfre (Gibraltar) Ltd (T/A Betfred) QBD 7-Apr-2021
Onerous Contract Terms Unclear – Not Incorporated
The claimant said that he had won a substantial sum on the online gaming platform operated by the defendants, but that they had refused to pay up. The defendants said that there had been a glitch in the game. The court faced a request for summary . .

Lists of cited by and citing cases may be incomplete.

Banking, Consumer, Litigation Practice

Leading Case

Updated: 01 November 2021; Ref: scu.166701

Royal Bank of Scotland v Etridge (No 2); Barclays Bank plc v Harris; Midland Bank plc v Wallace, etc: HL 11 Oct 2001

Wives had charged the family homes to secure their husband’s business borrowings, and now resisted possession orders, claiming undue influence.
Held: Undue influence is an equitable protection created to undo the effect of excess influence of one person over the will of another, though it should not always be presumed to arise from the existence of certain close relationships. A bank should be put on enquiry whenever a wife gives security for her husband’s debts, even where she may be jointly liable, or is a director. The independent advice given has often been superficial. The bank should take reasonable steps to satisfy itself that the wife has had brought home to her the practical implications of the proposed transaction. The solicitor should ensure that the wife properly understands the documentation and risks. He should explain that his involvement may mean that she cannot later challenge the charge. The advice should be given face to face, and in the absence of the husband. Provided the solicitor feels he can properly represent her interests, he may also act for the husband. The decision must be hers.
The court listed other steps to be taken by the bank and by the solicitors.
Lord Nicholls said: ‘Undue influence is one of the grounds of relief developed by the courts of equity as a court of conscience. The objective is to ensure that the influence of one person over another is not abused. In everyday life people constantly seek to influence the decisions of others. They seek to persuade those with whom they are dealing to enter into transactions, whether great or small. The law has set limits to the means properly employable for this purpose. To this end the common law developed a principle of duress. Originally this was narrow in its scope, restricted to the more blatant forms of physical coercion, such as personal violence. Here, as elsewhere in the law, equity supplemented the common law. Equity extended the reach of the law to other unacceptable forms of persuasion.’ and
‘the high degree of trust and confidence and emotional interdependence which normally characterises a marriage relationship provides scope for abuse. One party may take advantage of the other’s vulnerability. Unhappily, such abuse does occur. Further, it is all too easy for a husband, anxious or even desperate for bank finance, to misstate the position in some particular or to mislead the wife, wittingly or unwittingly, in some other way. The law would be seriously defective if it did not recognise these realities.’

Lord Bingham of Cornhill Lord Nicholls of Birkenhead Lord Clyde Lord Hobhouse of Wood-borough Lord Scott of Foscote
Times 17-Oct-2001, [2001] UKHL 44, [2001] 3 WLR 1021, [2002] 2 AC 773, [2002] HLR 4, [2002] 1 Lloyd’s Rep 343, [2001] NPC 147, [2001] Fam Law 880, [2001] 43 EGCS 184, [2001] 2 All ER (Comm) 1061, [2001] 4 All ER 449, [2001] 2 FLR 1364, [2002] 1 P and CR DG14, [2001] 3 FCR 481
House of Lords, Bailii
England and Wales
Citing:
CitedBarclays Bank Plc v O’Brien and Another HL 21-Oct-1993
The wife joined in a charge on the family home to secure her husband’s business borrowings. The husband was found to have misrepresented to her the effect of the deed, and the bank had been aware that she might be reluctant to sign the deed.
DisapprovedRoyal Bank of Scotland v Etridge, Loftus and Another v Etridge and Another, Etridge v Pritchard Englefield (Merged With Robert Gore and Co ) Midland Bank Plc v Wallace and Another (No 2) CA 31-Jul-1998
Detailed guidance was given on the quality of independent legal advice, which would be required to be given to wives signing charges to secure their husbands’ business etc accounts on the matrimonial home. The interaction of legal advice and . .
CitedHuguenin v Baseley 1807
When undue influence is alleged, the law will investigate the way the intention to enter into the transaction was secured. Lord Eldon LC said: ‘Take it that she (the plaintiff) intended to give it to him (the defendant): it is by no means out of the . .
CitedBainbrigge v Browne ChD 1881
Bainbrigge_BrowneChD1881
An impoverished father had prevailed upon his inexperienced children to charge their reversionary interests under their parents’ marriage settlement to pay his mortgage debts. Undue influence was claimed.
Held: The defendants who were not . .
CitedCIBC Mortgages Plc v Pitt and Another HL 21-Oct-1993
Mrs Pitt resisted an order for possession of the house saying that she had signed the mortgage only after misrepresentations by and the undue infuence of her husband who was acting as the bank’s agent.
Held: A bank was not put on enquiry as to . .
CitedNational Westminster Bank plc v Morgan HL 7-Mar-1985
Undue influence was alleged.
Held: Equity avoids dispositions of property procured by the improper or unconscientious use of the influence of one person over another, that cannot be explained on the grounds of friendship, charity or other . .
CitedAllcard v Skinner CA 1887
The donor had parted with almost all her property. She now sought to have the transaction set aside for undue influence.
Held: Where a wife has entered into a gratuitous transaction with her husband, the burden was on the husband as donee to . .
CitedZamet v Hyman CA 1961
In considering a claim of undue influence the court referred to relationships where one party owed the other an obligation of candour and protection. A presumption of undue influence arose only where it is proved that the gift was made by the donor . .
CitedBank of Credit and Commerce International SA v Aboody CA 1989
In a case where the defendant said that a mortgage had been signed from undue pressure the court may find actual undue influence as opposed to presumed undue influence. Slade LJ said: ‘Ever since the judgments of this court in Allcard v Skinner a . .
CitedRoyal Bank of Scotland v Etridge, Loftus and Another v Etridge and Another, Etridge v Pritchard Englefield (Merged With Robert Gore and Co ) Midland Bank Plc v Wallace and Another (No 2) CA 31-Jul-1998
Detailed guidance was given on the quality of independent legal advice, which would be required to be given to wives signing charges to secure their husbands’ business etc accounts on the matrimonial home. The interaction of legal advice and . .
CitedBank of Montreal v Stuart PC 1911
The court used the phrase ‘immoderate and irrational’ to describe the character of a transaction which might of its nature suggest undue influence. A solicitor who is advising a client about a transaction and has reason to suspect that the client is . .
Appeal fromBarclays Bank Plc v Coleman and Others CA 5-Jan-2000
It is still the case that a claimant, arguing for a charge to be set aside for undue influence must show some manifest and clear disadvantage arising from the charge. This may be subject to change in the future, but still applies now. A document . .
CitedIn re Lloyds Bank Ltd, Bomze v Bomze 1931
Where there is evidence that a husband has taken unfair advantage of his influence over his wife, or her confidence in him, ‘it is not difficult for the wife to establish her title to relief.’ . .
CitedMassey v Midland Bank Plc CA 1995
Where a woman executes a mortgage charging her property in favour of the bank to secure her partner’s debts, the bank is fixed with notice of the possibility of undue influence. It was not necessary that the couple should be married or cohabit. . .
CitedCobbett v Brock CA 1855
Knowledge of the undue influence of a husband over his wife in securing her signature to a charge is required before a lender is bound by that undue influence. . .
CitedRe Coomber, Coomber v Coomber ChD 1911
A father had been assisted in his business by his second son. After the father’s death, the mother transferred the business assets to that second son. After her death, the elder son sought the transfer of those assets back into her estate, saying . .
CitedCredit Lyonnais Bank Nederland NV v Burch CA 1-Jul-1996
A Bank was to assume that undue influence existed where they knew that an employee was giving security for his employer’s debt to the bank. An unlimited guarantee given by an employee to his employer’s bank was set aside as unconscionable. The . .
CitedBank of Baroda v Rayarel and Others CA 19-Jan-1995
A bank may assume that a solicitor advising a customer’s wife had acted properly. The solicitors acted for both the husband and the wife before they also gave their instructions to the solicitors. . .
CitedInche Noriah v Shaik Allie Bin Omar PC 1928
Undue influence was alleged against a nephew over his elderly aunt. One solicitor had drafted the deed of gift, and another had witnessed it. The solicitor had established that she understood it and entered into it freely, but had not asked enough . .
CitedSmith v Governor and Company of The Bank of Scotland HL 6-Feb-1997
A bank which did not warn its customer of the of risks of a loan and of the need for independent advice was bound by misrepresentations made by customer. The House referred to ‘the broad principle in the field of contract law of fair dealing in good . .
CitedIn re Craig, Decd 1971
Undue influence was found to have been exercised by a secretary companion over her elderly employer. . .
CitedTurnbull and Co v Duval PC 1902
Mr Duval owed three separate sums to a firm Turnbull and Co including andpound;1,000 owed to the Jamaican branch for beer. Turnbulls’ manager and agent in Jamaica was a Mr Campbell. Mr Campbell was also an executor and trustee of a will under which . .
CitedWatt or Forsyth (Assisted Person) v the Royal Bank of Scotland Plc SCS 26-Jul-1999
It appeared to the creditor that the wife had already had the benefit of professional legal advice, and it did not recommend that she should seek independent legal advice. . .
CitedBanco Exterior Internacional SA (Formerly Banco Exterior – UK a Limited Liability Company Incorporated Under the Laws of Spain) v Thomas and Barry the Executors of Patricia Dempsey CA 31-Jul-1996
The bank sought to enforce a guarantee against the estate of the deceased guarantor. The executors alleged undue influence. The bank appealed.
Held: Where the other contracting party had had actual knowledge of the undue influence or . .
CitedCommission for the New Towns v Cooper (Great Britain) Ltd, (Formerly Coopind UK Ltd) CA 4-Mar-1995
The trial judge had dismissed a claim for rectification on the basis that the defendant hoped and suspected, but did not know, of the relevant mistake by the plaintiff.
Held: Rectification was ordered because the defendant had sought to . .
CitedKenyon-Brown v Desmond Banks and Co 2000
. .
CitedHamilton v Watson 1845
Although a would-be surety is, in general, expected to acquaint himself with the risk he is undertaking, the creditor is under an obligation to disclose to the intending surety ‘anything which might not naturally be expected to take place between . .
CitedSeaton v Heath CA 1899
A suretyship contract is not a contract uberrimae fidei. Romer LJ said: ‘The risk undertaken is generally known to the surety and the circumstances generally point to the view that as between the creditor and surety it was contemplated and intended . .
CitedBanco Exterior Internacional v Mann and Others CA 19-Dec-1994
A charge to secure a husband’s borrowings was enforceable where the wife’s signature had been taken before a solicitor who had explained it. Hobhouse LJ (dissenting) ‘It must be remembered that the starting point of this exercise is that the wife’s . .
CitedLondon General Omnibus Co Ltd v Holloway 1912
Lee was employed by the bus company in a position which involved receiving money on their behalf. The bus company required him to obtain a fidelity bond from a third party. The bond was given by Holloway, a relative of Lee, without either the bus . .
Appeal fromGovernor and Company of Bank of Scotland v Bennett and Another CA 21-Dec-1998
The bank appealed an order setting aside a deed of guarantee and mortgage and denying the possession order sought. The guarantee had been given to support borrowings of the defendant’s company. The defendant was the wife of the director and had been . .
CitedPooraka Holdings Pty Ltd v Participation Nominees Pty Ltd 1991
The court considered the creditor’s duty of disclosure to a surety.
Held: The duty of disclosure extends to any unusual feature surrounding the transaction between the creditor and the surety (a) of which the creditor is or ought to be aware, . .
ApprovedGovernor and Company of Bank of Scotland v Bennett and Another ChD 1997
Mrs Bennett defended the bank’s claim for possession of the matrimonial home charged to the bank to secure her husband’s borrowings. She said that her signature, both to the guarantee and to the legal charge, had been procured by her husband’s undue . .

Cited by:
CitedNational Westminster Bank Plc v Amin and Another HL 28-Feb-2002
The respondents resisted an application for possession of their property by the bank. They claimed undue influence, and that because of an inability to speak English, the charge should be avoided. They appealed an order striking out their defence . .
CitedU v Centre for Reproductive Medicine CA 24-Apr-2002
The claimant appealed a refusal to grant an order preventing the destruction of the sperm of her late husband held by the respondent fertility clinic. The clinic had persuaded her husband to sign a form of consent for this purpose. The claimant said . .
CitedHammond v Osborn and Another CA 27-Jun-2002
Where there was any relationship of trust and confidence between parties, and a substantial gift was made by the one in whom that trust was placed, there would be a presumption of undue influence. Undue influence is a matter of public policy. In a . .
CitedPadgham and another v Rochelle and another ChD 1-Aug-2002
The testator occupied farmland and buildings. He was helped in maintaining the farm by his son, but gave the land to his grandchildren by his will. The son claimed to have been granted an informal written agricultural tenancy by his father before . .
CitedFranklyn Dailey v Harriet Dailey PC 2-Oct-2003
PC (British Virgin Islands) The husband and wife had developed a business together. Transfers between the parties had taken place and there were suspicions about misappropriation of money.
Held: The . .
CitedUCB Group Ltd v Hedworth CA 4-Dec-2003
The defendant challenged the claimant’s right to possession under a legal charge. She appealed a finding that she had not established the undue influence of her husband, a solicitor.
Held: A lender who received a voidable security was entitled . .
CitedUCB Group Ltd v Hedworth CA 4-Dec-2003
The defendant challenged the claimant’s right to possession under a legal charge. She appealed a finding that she had not established the undue influence of her husband, a solicitor.
Held: A lender who received a voidable security was entitled . .
CitedSandra Estelle Fielding v The Royal Bank of Scotland Plc CA 11-Feb-2004
The husband and wife had signed a bank mandate allowing the bank to act upon the authorisation of either of them. The wife complained that the bank should not be able to recover from her any sums expended by the husband.
Held: The mandate . .
CitedNiersmans v Pesticcio CA 1-Apr-2004
A house have been given by a man with learning difficulties to her sister. The case appealed an order that undue influence had applied.
Held: The gift failed despite the attempt at independent legal advice. The court reviewed the law of undue . .
CitedVale v Armstrong, Armstrong ChD 21-May-2004
The claimant sought to set aside a transfer of his house to the defendants made at an undervalue and under an enduring power of attorney, who had charged it to raise money for their business. He had received independent advice.
Held: The . .
CitedYorkshire Bank Plc v Tinsley CA 25-Jun-2004
The defendant’s husband had charged the matrimonial home on several occasions to the claimant. It was found that the first charges were affected by undue influence and could not be enforced. The defendant argued that the last charge which replaced . .
CitedAnthony Papouis v Valerie Gibson-West ChD 4-Mar-2004
The deceased had purchased her flat using the discount available as a tenant, and money contributed by the defendant. A deed of trust had been executed, which the claimant now asserted had been obtained by undue influence.
Held: The principles . .
CitedR v Her Majesty’s Attorney-General for England and Wales PC 17-Mar-2003
PC (From Court of Appeal of New Zealand) T had been a member of the British SAS. Other members had written books and the Army sought to impose confidentiality contracts or to impose a return to their unit. R . .
CitedDaniel v Drew CA 6-May-2005
The Aunt had succeeded in her claim that her retirement from a family trust of a farm had been procured by the undue influence of her nephew. The nephew now appealed. She had assigned her interest to her son, who then fell into disagreement about . .
CitedRandall v Randall ChD 30-Jul-2004
The executor sought to set aside gifts made by the deceased, an elderly aunt before her death to his brother, alleging undue influence.
Held: The recipient had acted falsely in failing to declare overpayments of benefits. The deceased had been . .
CitedBowser v Caley and others ChD 16-Mar-2006
The claimant alleged that the transfer by him of his land to his sister and her husband had been obtained by any of several wrongful means and should be set aside.
Held: The allegations of undue influence failed. The claimant did not establish . .
CitedHalpern and Another v Halpern and others ComC 4-Jul-2006
The court considered whether a party can avoid a contract procured by duress in circumstances where he cannot offer the other party substantial restitutio in integrum.
Held: Unless the claimant could offer counter-restitution, the remedy of . .
CitedStack v Dowden HL 25-Apr-2007
The parties had cohabited for a long time, in a home bought by Ms Dowden. After the breakdown of the relationship, Mr Stack claimed an equal interest in the second family home, which they had bought in joint names. The House was asked whether, when . .
CitedHalpern and others v Halpern and Another (No 2) CA 3-Apr-2007
The parties had settled by compromise a dispute about the implementation of a will before the Beth Din. It was now said that the compromise agreement had been entered into under duress and was unenforceable. The defendant said that rescission could . .
CitedDe Wind v Wedge ChD 19-Mar-2008
Brother and sister contested the devolution of their mother’s house. The sister had fallen into debt and been given much financial assistance by other members of the family. The brother said that to rebalance that, the mother had given the house to . .
CitedGoodchild v Branbury and others CA 15-Dec-2006
Application was made to set aside transfers of land for undue influence, and that the second transfere was aware of the deficiency in the first.
Held: The appeal suceeded, and the transfers were set aside. Chadwick LJ said: ‘A gift which is . .
CitedGreene King Plc v Stanley and others CA 30-Nov-2001
The claimant challenged an order that the two defendant chargors were discharged from liability to the claimants under their individual voluntary arrangement and on the basis that it had been entered under undue influence. . .
CitedHewett v First Plus Financial Group Plc CA 24-Mar-2010
The appellant appealed against a mortgage possession order, saying that she had been misled into signing the charge by a non-disclosure by her husband of an extra-marital affair he was conducting. The bank had not met the standards set in Etridge, . .
CitedLink Lending Ltd v Bustard CA 23-Apr-2010
The respondent had been detained in a secure mental unit for a year. In that time her home was charged to the appellant. She asserted that she had been a person in actual occupation. The chargee now appealed against a finding that the respondent had . .
CitedBrown v Stephenson ChD 23-Aug-2013
The claimant sought to have set aside transfers and declarations of trust made by her in the defendant’s favour, saying that they had been given under his undue influence taking advantage of her dyslexia, and by bullying.
Held: The claims of . .
CitedDay v Shaw and Another ChD 17-Jan-2014
Mr and Mrs Shaw had granted a second charge over their jointly-owned matrimonial home to secure the personal guarantee given by their daughter and by Mr Shaw in respect of a bank loan to a company (Avon). Their daughter and Mr Shaw were the . .

Lists of cited by and citing cases may be incomplete.

Banking, Legal Professions, Undue Influence, Equity

Leading Case

Updated: 01 November 2021; Ref: scu.166567

Durkin v DSG Retail Ltd and Another: SC 26 Mar 2014

Cancellation of Hire Finance Contract

The claimant had bought a PC with a finance agreement with the respondent. He rejected it a day later, but the respondent refused to cancel the credit agreement. The respondent had threatened to report his non-payment to credit reference companies, which in due course caused the appellant more difficulties. He claimed damages of 250,000 pounds for this damage, alleging negligence. He had succeeded in establishing a right to reject the computer. The bank succeeded on appeal against a finding that it was liable in damages.
Held: The appeal succeeded. Lord Hodge said that the purpose of the restricted-use credit agreement is to finance a transaction between the consumer and the supplier. Where, as here, the contract is tied to a particular transaction, it has no other purpose. The rescission of the supply agreement excuses the innocent party from further performance of any obligations he has under it. It is inherent in a debtor-creditor-supplier agreement under the 1974 Act, which is also tied into a specific supply transaction, that if the supply transaction it financed is brought to an end by the supplier’s repudiatory breach of contract, the debtor must repay the borrowed funds recovered from the supplier. In order to reflect that reality, the law implies a term into such a credit agreement that it is conditional upon the survival of the supply agreement. The debtor on rejecting the goods and thereby rescinding the supply agreement for breach of contract may also rescind the credit agreement by invoking this condition.

Hale, Hodge LL
[2014] 1 WLR 1148, [2014] UKSC 21, [2014] WLR(D) 144, 2014 GWD 12-211, UKSC 2012/0135
Bailii, WLRD, SC Summary, SC
Consumer Credit Act 1974 75(1)
Scotland
Citing:
Appeal fromDurkin (Aberdeen Sheriff Court) v DSG Retail Ltd SCS 15-Jun-2010
The appellant had purchased a computer from an associated company of the defender with finance from the defender. He complained that on his return of the computer the defender had failed to cancel the consumer credit agreement, causing him losses. . .
CitedUnited Dominions Trust Ltd v Taylor ScSf 1980
. .
CitedKrell v Henry CA 1903
A contract to rent rooms for two days and from which the coronation processions of King Edward VII were to be viewed was frustrated when the processions were cancelled on the days the rooms were taken for because the contract was ‘a licence to use . .
CitedMcWilliams v Sir William Arrol and Company Ltd HL 21-Feb-1962
Damages were sought after the death of the pursuer’s husband working for the respondent. The trial judge had been satisfied that even if the defendants had performed their duty at common law and pursuant to statute, and had provided the deceased . .
CitedHedley Byrne and Co Ltd v Heller and Partners Ltd HL 28-May-1963
Banker’s Liability for Negligent Reference
The appellants were advertising agents. They were liable themselves for advertising space taken for a client, and had sought a financial reference from the defendant bankers to the client. The reference was negligent, but the bankers denied any . .
CitedFederal Commerce Ltd v Molena Alpha Inc; (The ‘Nanfri’) CA 1978
The court considered whether claim as against a shipowner could be set off against sums due under a time charter hire.
Held: Save for any contractual provision to the contrary a tenant is entitled to deduct from the rent payable, so as to . .
CitedPhoto Production Ltd v Securicor Transport Ltd HL 14-Feb-1980
Interpretation of Exclusion Clauses
The plaintiffs had contracted with the defendants for the provision of a night patrol service for their factory. The perils the parties had in mind were fire and theft. A patrol man deliberately lit a fire which burned down the factory. It was an . .

Lists of cited by and citing cases may be incomplete.

Consumer, Negligence, Banking

Leading Case

Updated: 01 November 2021; Ref: scu.523194

Tai Hing Ltd v Liu Chong Hing Bank: PC 1985

(Hong Kong) The relationship between banker and customer is principally a contractual one between debtor and creditor. As between the banker and his customer, the risk of loss through forgery of the customer’s signature falls on the banker unless negligence or other disentitling conduct of the customer precludes the customer’s claim. No wider duty should be imposed on the customer beyond a duty not to act in a way that facilitates forgery and to make the bank aware of any known forgeries occurred: ‘The business of banking is the business not of the customer but of the bank. They offer a service, which is to honour their customer’s cheques when drawn upon an account in credit or within an agreed overdraft limit. If they pay out upon cheques which are not his, they are acting outside their mandate and cannot plead his authority in justification of their debit to his account. This is a risk of the service which it is their business to offer.’
The Board considered the need for the Board to follow earlier decisions of the House of Lords: ‘It was suggested, though only faintly, that even if English courts are bound to follow the decision in Macmillan’s case the Judicial Committee is not so constrained. This is a misapprehension. Once it is accepted, as in this case it is, that the applicable law is English, their Lordships of the Judicial Committee will follow a House of Lords’ decision which covers the point in issue. The Judicial Committee is not the final judicial authority for the determination of English law. That is the responsibility of the House of Lords in its judicial capacity. Though the Judicial Committee enjoys a greater freedom from the binding effect of precedent than does the House of Lords, it is in no position on a question of English law to invoke the Practice Statement (Judicial Precedent) [1966] 1 WLR 1234 of July 1966 pursuant to which the House has assumed the power to depart in certain circumstances from a previous decision of the House. And their Lordships note, in passing, the Statement’s warning against the danger from a House of Lords’ decision in a case where, by reason of custom, statute, or for other reasons peculiar to the jurisdiction where the matter in dispute arose, the Judicial Committee is required to determine whether English law should or should not apply. Only if it be decided or accepted (as in this case) that English law is the law to be applied will the Judicial Committee consider itself bound to follow a House of Lords’ decision.’

Lord Scarman
[1985] 2 All ER 947, [1985] 2 Lloyds Rep 313, [1985] 3 WLR 317, [1986] AC 80, [1985] UKPC 22
Bailii
England and Wales
Citing:
CitedLiverpool City Council v Irwin HL 31-Mar-1976
The House found it to be an implied term of a tenancy agreement that the lessor was to be responsible for repairing and lighting the common parts of the building of which the premises formed part. In analysing the different types of contract case in . .

Cited by:
CitedYorkshire Bank plc v Lloyds Bank plc CA 12-May-1999
A customer of the plaintiff, sent a cheque to the defendant, with an application for shares. The cheque was stolen whilst in the defendant’s custody, but the plaintiff at first debited the account, then re-credited the balance. The claim failed . .
CitedSandra Estelle Fielding v The Royal Bank of Scotland Plc CA 11-Feb-2004
The husband and wife had signed a bank mandate allowing the bank to act upon the authorisation of either of them. The wife complained that the bank should not be able to recover from her any sums expended by the husband.
Held: The mandate . .
CitedJames, Regina v; Regina v Karimi CACD 25-Jan-2006
The defendants appealed their convictions for murder, saying that the court had not properly guided the jury on provocation. The court was faced with apparently conflicting decision of the House of Lords (Smith) and the Privy Council (Holley).
CitedDonington Park Leisure Ltd v Wheatcroft and Son Ltd ChD 7-Apr-2006
Leave to apply was pursued under the provisions of a Tomlin order. The parties had disputed the extent to which parts of the order should be exhibited to the court.
Held: The Tomlin order should be amended to add terms necessary to give effect . .
CitedBlackpool and Fylde Aero Club Ltd v Blackpool Borough Council CA 25-May-1990
The club had enjoyed a concession from the council to operate pleasure flights from the airport operated by the council. They were invited to bid for a new concession subject to strict tender rules. They submitted the highest bid on time, but the . .
See AlsoTai Hing Cotton Mill Ltd v Liu Chong Hing Bank Ltd PC 5-Feb-1986
(Hong Kong) The Boad considered the costs payable for counsel on an appeal to the Board from Hong Kong . .
CitedWillers v Joyce and Another (Re: Gubay (Deceased) No 2) SC 20-Jul-2016
The Court was asked whether and in what circumstances a lower court may follow a decision of the Privy Council which has reached a different conclusion from that of the House of Lords (or the Supreme Court or Court of Appeal) on an earlier occasion. . .

Lists of cited by and citing cases may be incomplete.

Constitutional, Banking

Leading Case

Updated: 01 November 2021; Ref: scu.238119

Carey v HSBC Bank plc, Yunis v Barclays Bank plc and similar: QBD 23 Dec 2009

carey_hsbcQBD2009

(Manchester Mercantile Court) The court considered the effects in detail where a bank was unable to comply with a request under section 78 of the 1974 Act to provide a copy of the agreement signed by the client.
Held: The court set out to give guidance on these issues. A photocopy of the signed document was not required, and a reconstruction would do, though as matter of good practice and so as not to mislead the debtor it is clearly desirable that the creditor should explain that it is providing a reconstituted as opposed to a physical copy of the executed agreement. The document produced need not be in a condition such that if it were signed it would be satisfy the requirements for regulation. What mattered was that it provided what was needed clearly and without misleading the debtor. Also, regulation 7 requires a copy of the executed agreement in its original form as well as a statement of the terms as they are at the time of the request.
Waksman QC J set out costs principles on a discontinuance: ‘(1) when a claimant discontinues the proceedings, there is a presumption by reason of CPR 38.6 that the defendant should recover his costs; the burden is on the claimant to show a good reason for departing from that position;
(2) the fact that the claimant would or might well have succeeded at trial is not itself a sufficient reason for doing so;
(3) however, if it is plain that the claim would have failed, that is an additional factor in favour of applying the presumption;
(4) the mere fact that the claimant’s decision to discontinue may have been motivated by practical, pragmatic or financial reasons as opposed to a lack of confidence in the merits of the case will not suffice to displace the presumption;
(5) if the claimant is to succeed in displacing the presumption he will usually need to show a change of circumstances to which he has not himself contributed;
(6) however, no change in circumstances is likely to suffice unless it has been brought about by some form of unreasonable conduct on the part of the defendant which in all the circumstances provides a good reason for departing from the rule.’

Waksman QC J
[2009] EWHC 3417 (QB), Times 25-Jan-2010, [2010] Bus LR 1142, [2009] CTLC 103
Bailii
Consumer Credit Act 1974 61 78 189, The Consumer Credit (Agreements) Regulations 1983, The Consumer Credit (Cancellation Notices and Copies of Documents) Regulations 1983
Citing:
CitedIn re Hewer 1882
A true copy of a document was provided, but it was said that it could not be a true copy for an error as to the description of monthly payments.
Held: Bacon CJ said that a true copy did not necessarily need to be an exact copy: ‘but that it . .
CitedWilson v Secretary of State for Trade and Industry; Wilson v First County Trust Ltd (No 2) HL 10-Jul-2003
The respondent appealed against a finding that the provision which made a loan agreement completely invalid for lack of compliance with the 1974 Act was itself invalid under the Human Rights Act since it deprived the respondent of its property . .
CitedDimond v Lovell HL 12-May-2000
A claimant sought as part of her damages for the cost of hiring a care whilst her own was off the road after an accident caused by the defendant. She agreed with a hire company to hire a car, but payment was delayed until the claim was settled.
CitedBurchell v Thompson CA 1920
A printed form of bill of sale set out that in consideration of andpound;250 being ‘now paid by the grantees to’ and then identifying a third person ‘at the request of the grantor’ chattels were assigned by way of security for the repayment of the . .
CitedBarras v Aberdeen Steam Trawling and Fishing Co HL 17-Mar-1933
The court looked at the inference that a statute’s draughtsman could be assumed when using a phrase to rely on a known interpretation of that phrase.
Viscount Buckmaster said: ‘It has long been a well established principle to be applied in the . .
CitedLloyds Bank v Mitchell CC 13-Sep-2009
(Leeds County Court) The defendant sought to escape liability under a consumer credit agreement saying that the bank had failed to provide a true copy of the agreement as required by the Act.
Held: A strict requirement that the bank produce . .
CitedHuntpast v Leadbetter 1993
It is crucial to the working of the Act that the parties know at the date when they make the agreement whether or not it is a regulated agreement. . .
CitedMcGinn v Grangewood Securities Ltd CA 23-Apr-2002
The lender used part of the loan to repay a small amount of arrears of the claimant on another loan. The part so used was not part of the objective of the loan, but one of the costs of obtaining it.
Held: The deduction was properly part of the . .
CitedRowlands v Hodson CA 8-Oct-2009
. .
CitedMcGuffick v The Royal Bank of Scotland Plc ComC 6-Oct-2009
Requirements for Enforcing Consumer Loan Agreement
The claimant challenged the validity of a loan agreement with his bank as a regulated consumer credit agreement. After default, the lender failed to satisfy a request for a copy of the agreement under section 77. The bank said that though it could . .
CitedKhodari v Al Tamimi QBD 18-Dec-2008
Claim for repayment of the balance of eighteen loans said to have been made to the Defendant. The total loaned was about pounds 1,125,000. Less repayments, and including an additional 10 percent he claims to be entitled to on the money advanced, his . .

Cited by:
AppliedKneale v Barclays Bank Plc (T/A Barclaycard) ComC 23-Jul-2010
The bank appealed against an order for pre-action dicslosure and payment of the costs to date of its customers request for copies of the agreement under which it sought payment, and otherwise.
Held: After Carey it was not to be argued . .
Appeal fromBrookes v HSBC Bank Plc CA 29-Mar-2011
The appellant had failed in his challenge to the bank’s imposition of charges. . .
CitedFresenius Kabi Deutschland Gmbh and Others v Carefusion 303 Inc CA 8-Nov-2011
The parties had litigated the validity of a patent. . .

Lists of cited by and citing cases may be incomplete.

Banking, Consumer

Updated: 01 November 2021; Ref: scu.384472

Abbey National Plc and others v The Office of Fair Trading: CA 26 Feb 2009

The OFT had sought to enquire as to the fairness of the terms on which banks conducted their accounts with consumers, and in particular as to how they charged for unauthorised overdrafts. The banks denied that the OFT had jurisdiction, and now appealed against an order against them.
Held: An assessment of the fairness of the Relevant Charges in this case was not excluded by regulation 6(2)(b), and the appeal was dismissed. The contracts between banks and their customers were covered by the 1999 regulations, and the OFT could investigate. The 1999 Regulations were to be interpreted so as to give effect to the Directive, and the travaux preparatoires are a legitimate aid to the construction of the Directive. Those works showed that the underlying idea of excluding anything from the assessment for fairness was that there should be excluded only that which could be expected to result from the contractual freedom of the parties to negotiate the particular term. That might exclude the core terms of a contract but should not exclude ancillary terms. In the circumstances the Relevant Charges were not part of the core or essential bargain with the customer.
The court adopted four propositions as to the interpretation of EC instruments: ‘rules or principles of interpretation. A provision means what it means, in the context in which it appears and, as in domestic law, resort may be had to a variety of different indicators in arriving at the true meaning of the provision in hand, and in different contexts different indicators will have different degrees of influence. There are no hard edged rigid rules.
ii) It is wrong to set up a teleological or purposive interpretation on the one hand and a literal interpretation on the other as if they were mutually exclusive alternatives. It is not as simple as that. A literal interpretation of legislative wording may be required in order to achieve the legislative purpose. In that event a teleological approach would require a literal interpretation. A teleological interpretation does not necessarily mean an expansive interpretation. It simply means giving effect to the intended purpose of the legislative instrument, which may or may not involve simply giving its words their literal meaning.
iii) It is wrong to adopt a prescriptive approach to the meaning of the expression ‘restrictive interpretation’. It is not a mathematical formula to be applied with precision. As Lord Steyn has said extrajudicially, interpretation is an art and not a science. When applying a restrictive interpretation, the court must take account of the ordinary meaning of the words used but it must do so in the relevant legislative context and must therefore have regard to the overall purpose of the Directive, and in particular to the specific interests that the relevant exception (here article 4(2) of the Directive (and therefore paragraph 6(2)(b) of the 1999 Regulations)) is designed to protect. Such an exercise might involve reading words in, cutting them out or taking any other step necessary to produce a result which reflects the relevant purpose in the circumstances. It follows that it is wrong to suggest that the phrase ‘restrictive interpretation’ must involve simply giving the words their ordinary meaning. It is not as simple as that. As ever, all depends upon the circumstances.
iv) It does not help to say that a restrictive interpretation means giving words their ordinary or usual meaning because legislative wording inevitably has a certain elasticity of meaning depending upon its context. Put another way, the natural meaning of the words will itself depend upon the purpose for which and the context in which they are being used.’

Sir Anthony Clarke MR
[2009] EWCA Civ 116, Times 03-Mar-2009, [2009] 2 CMLR 30, [2009] 1 All ER (Comm) 1097, [2009] 2 WLR 1286
Bailii
Unfair Terms in Consumer Contracts Regulations 1999 6(2)(b), Council Directive 93/13/EEC on unfair terms in consumer contracts, EC Treaty 95(3)
England and Wales
Citing:
See AlsoOffice of Fair Trading v Abbey National Plc and others ComC 21-Jan-2009
. .
CitedCommission v Spain ECJ 18-Jan-2001
ECJ Judgment – Failure of a Member State to fulfil its obligations – Article 12(3)(a) of the Sixth VAT Directive – Application of a reduced rate to motorway tolls . .
CitedDirector General of Fair Trading v First National Bank HL 25-Oct-2001
The House was asked whether a contractual provision for interest to run after judgment as well as before in a consumer credit contract led to an unfair relationship.
Held: The term was not covered by the Act, and was not unfair under the . .
CitedLondon Borough of Newham v Khatun, Zeb and Iqbal CA 24-Feb-2004
The council made offers of accommodation which were rejected as inappropriate by the proposed tenants.
Held: The council was given a responsibility to act reasonably. It was for them, not the court to make that assessment subject only to . .
See AlsoOffice of Fair Trading v Abbey National Plc and others ComC 8-Oct-2008
The director sought a further judgment as to whether charges imposed by banks on a customer taking an unauthorised overdraft, and otherwise were unlawful penalties. . .
Appeal fromOffice of Fair Trading v Abbey National Plc and seven Others ComC 24-Apr-2008
The Office sought a declaration that the respondent and other banks were subject to the provisions of the Regulations in their imposition of bank charges to customer accounts, and in particular as to the imposition of penalties or charges for the . .

Cited by:
Appeal fromOffice of Fair Trading (OFT) v Abbey National Plc and Others SC 25-Nov-2009
The banks appealed against a ruling that the OFT could investigate the fairness or otherwise of their systems for charging bank customers for non-agreed items as excessive relative to the services supplied. The banks said that regulation 6(2) could . .

Lists of cited by and citing cases may be incomplete.

Banking, Consumer, European

Updated: 01 November 2021; Ref: scu.304530

Ladbroke and Co v Todd: 1914

The plaintiff had drawn a cheque and sent it to the payee by post. The letter was stolen and the thief took it to the defendant, a banker, and used it to open an account. In doing so, he forged the payee’s endorsement. The defendant believed him to be the payee. He was not introduced to the bank and no references were obtained. The defendant opened the account and the cheque was specially cleared at the request of the thief, and he drew out the proceeds on the next day. On discovering the fraud, the plaintiff brought an action against the defendant for conversion. One question raised was whether the account having been opened by payment in all the cheques to be collected the defendant could be properly regarded as having received payment for a customer.
Held: Since the account had already been opened when the cheque was collected, payment had been received for a customer. The drawer thereupon sent another cheque to the real payee and took an assignment of his rights in the stolen cheque and, as holders of the cheque or alternatively as assignees, brought an action against the bank to recover the proceeds collected by the bank as money had and received to their use. Evidence had been given that it was the general practice of bankers to obtain a satisfactory introduction or reference.
The banker had acted in good faith, but was guilty of negligence in not taking reasonable precautions to safeguard the interests of the true owner of the cheque and that therefore he had put himself outside the protection of Section 82 of the 1882 Act. The banker would have been entitled to the protection of the section as having received payment for a customer, but had lost it owing to his want of due care. The relation of banker and customer began as soon as the first cheque was handed in to the banker for collection, and not when it was paid.

Bailhache J
(1914) 30 TLR 433, (1914) 111 LT 43, (1914) 19 Com Cas 256
Bills of Exchange Act 1882 82
England and Wales

Banking

Leading Case

Updated: 01 November 2021; Ref: scu.514413

BNP Paribas And BNL v Commission: ECJ 21 Jun 2012

ECJ Appeals – State aid – Scheme for the realignment of the value of assets for tax purposes – Banking sector – Taxation of capital gains – Substitute tax – Selectivity

Cunha Rodrigues P
C-452/10, [2011] EUECJ C-452/10 – P
Bailii
European
Citing:
See AlsoBNP Paribas And BNL v Commission ECJ 3-Mar-2011
(Order) Intervention . .

Lists of cited by and citing cases may be incomplete.

European, Banking, Capital Gains Tax

Updated: 01 November 2021; Ref: scu.460889

National Westminster Bank Plc v Somer International (Uk) Limited: CA 22 Jun 2001

The bank by mistake credited andpound;76,000 to the Defendant’s account and erroneously later indicated that it had come from a customer of the Defendant, M; in reliance on that, the Defendant dispatched goods to the value of some andpound;13,000 to M who later ceased trading and effectively disappeared without paying.
Held: The defendant’s appeal failed. Because the Defendant had only suffered detriment in relation to the andpound;13,000 it was not entitled to keep the balance because it will be unconscionable for it to do so. With respect to the defence of change of position to a claim for equitable restitution, ‘change of position’ only protects actual reduction of the transferee’s assets following receipt.’
Potter LJ said: ‘Similarly, the point is made that, albeit in Skyring -v Greenwood and Holt -v- Markham there was no exact enquiry into the degree to which each defendant had altered his financial position, there was equally no judicial statement that estoppel by representation could not operate pro tanto in an appropriate case. In Skyring -v- Greenwood, indeed, it is not clear that there was evidence of any detrimental reliance, the court simply assuming that it had taken place. In Holt -v- Markham, while it is clear from the judgment of Warrington LJ at 512 that not all the money had been spent, there is no indication whether the balance which remained was substantial and it is clear that, in addition to mere spending, the defendant had parted with his War Savings Certificates: see per Bankes LJ at 511. It seems to me that those cases do no more than establish that the court will generally think it appropriate to treat the matter broadly and will not require the defendant to demonstrate in detail the precise degree or value of the detriment which he has suffered in circumstances where, as Slade LJ pointed out, ‘he may find it difficult subsequently to recall and identify retrospectively the nature and extent of commitments undertaken or expenditure incurred as a result of an alteration in his general mode of living’. However, it is open to the court, acting on equitable principles, to take the view that some restitution is necessary, albeit the burden upon the defendant of proving the precise extent of his detriment should be a light one. In these circumstances, the court may well have broad regard to, without being bound to follow, the developing lines of the courts’ approach in `change of position’ cases. However, the two defences will remain distinct, unless or until the House of Lords rules otherwise.’
Peter Gibson LJ said: ‘I fully accept that the court, when assessing detriment, should not apply too demanding a standard of proof because of the practical difficulties faced by a defendant conducting a business who has been led to believe that the moneys paid by mistake are his (see the remarks of Slade L.J. in Howlett at pp. 621, 2) . . ‘

Lord Justice Peter Gibson, Lord Justice Potter, Lord Justice Clarke
[2001] EWCA Civ 970, [2002] QB 1286, [2002] 3 WLR 64, [2002] 1 All ER 198, [2001] All ER (D) 235, [2001] Lloyds Rep Bank 263
Bailii
England and Wales
Cited by:
CitedCommerzbank Ag v Price-Jones CA 21-Nov-2003
The respondent had received a bonus of andpound;250,000. His employers wrote to him in error increasing it. He later chose to stay rather than take redundancy because he now expected the full amount. He resisted an order for restitution. The . .

Lists of cited by and citing cases may be incomplete.

Equity, Banking

Leading Case

Updated: 01 November 2021; Ref: scu.160071

Tam Wing Chuen v Bank of Credit and Commerce Hong Kong Ltd: PC 1996

The Board considered a banking transaction and the application of a chargeback by the bank, under which a loan was made only after a deposit by a third party against which it was secured, and particularly in the context of the insolvency of the bank itself.
Held: Lord Mustill discussed the need to construe a contract contra preferentem: ‘the basis of the contra proferentem principle is that the person who puts forward the wording of a proposed agreement may be assumed to have looked after his own interests, so that if words leave room for doubt about whether he is intended to have a particular benefit there is reason to suppose that he is not.’

Lord Mustill
[1996] 2 BCLC 69, [1996] UKPC 69
Bailii
England and Wales
Citing:
CitedIn Re Conley CA 1938
A loan had been made, secure by a deposit by a third party. The company was said to have repaid the secured overdraft to secure the release of the deposit and its release from the hands of the general creditors. The court was asked whether the . .
CitedIn re Charge Card Services Ltd ChD 1987
The court discussed the historic availability of set-off in an insolvency: ‘By the turn of the [20th] century, therefore, the authorities showed that debts whose existence and amount were alike contingent at the date of the receiving order, and . .
CitedMorris and Others v Agrichemicals Ltd and Others CA 20-Dec-1995
No mandatory set off on liquidation without the requirement for mutuality. The Court accepted a proposition that a chargeback arrangement was inefficiency, no implication followed as to the recourse against the Depositor of a collateral security. . .

Cited by:
CitedOxonica Energy Ltd v Neuftec Ltd PatC 5-Sep-2008
The parties disputed the meaning of an patent and know how licence. The parties disputed whether the agreement referred to IP rights before formal patents had been granted despite the terms of the agreement.
Held: ‘The secret of drafting legal . .
CitedPeabody Trust v Reeve ChD 2-Jun-2008
The court was asked to sanction the unilateral alteration by the landlord of the terms of some ten thouand tenancies. The agreements contained a clause which the landlord said allowed for variations under the Housing Act 1985. The landlord was a . .
CitedOxonica Energy Ltd v Neuftec Ltd CA 9-Jul-2009
The parties had entered into a patent and know-how licensing agreement, the interpretation of which was now disputed. . .

Lists of cited by and citing cases may be incomplete.

Contract, Banking

Leading Case

Updated: 01 November 2021; Ref: scu.273187

K Ltd v National Westminster Bank Plc and others: CA 19 Jul 2006

The bank had declined to act upon a customer’s instructions, reporting its suspicions of criminal activity to the police. Permission was given to proceed but only after a delay. The claimant customer sought its costs.
Held: The customer’s appeal failed. Parliament had laid down a proper procedure and the bank had followed it: ‘if a statute renders the performance of a contract illegal, the contract is frustrated and both sides are discharged from further performance. In a case, however, where a statute makes it temporarily illegal to perform the contract, the contract will only be suspended until the illegality is removed. That still means that, during the suspension, no legal right exists on which any claim to an injunction must depend. ‘ and ‘Parliament has struck a precise and workable balance of conflicting interests in the 2002 Act. It is, of course, true that to intervene between a banker and his customer in the performance of the contract of mandate is a serious interference with the free flow of trade. But Parliament has considered that a limited interference is to be tolerated in preference to allowing the undoubted evil of money-laundering to run rife in the commercial community.’

[2006] EWCA Civ 1039, Times 27-Jul-2006, [2007] 1 WLR 311, [2007] Bus LR 26
Bailii
Proceeds of Crime Act 2002 328
England and Wales
Citing:
CitedBank of Scotland v A Ltd and Others (Serious Fraud Office, Interested Party) CA 6-Feb-2001
A bank, having been informed that the activities of a customer involved money laundering, found itself in a position where, if it paid out the funds, it would face conviction, but if it failed to do so, it be found to be involved in tipping off the . .
CitedDa Silva, Regina v CACD 11-Jul-2006
The defendant appealed her conviction for assisting another to retain the proceeds of crime. The court considered what was meant by ‘suspicion’.
Held: For a defendant to be convicted of an offence under section 93A(1)(a) of the 1988 Act, he or . .
CitedAmalgamated Metal Trading Ltd v City of London Police Financial Investigation Unit and others ComC 3-Apr-2003
The company provided trading services in financial futures. They became concerned as to the integrity of their client, and its relationship with shareholders and other companies where parties came to be arrested for fraud in the US. They sought a . .
CitedNew Bridge Holdings v Barclays Bank 10-Feb-2006
The court suggested as a way of dealing with problems under the Act that attempts should be made: ‘to provide for some procedure whereby the arbitrary and capricious exercise of power should be prevented by the court being told, in confidence by the . .
CitedAshingdane v The United Kingdom ECHR 28-May-1985
The right of access to the courts is not absolute but may be subject to limitations. These are permitted by implication since the right of access ‘by its very nature calls for regulation by the State, regulation which may vary in time and place . .
See AlsoK Ltd v National Westminster Bank Plc and Another CA 22-May-2006
Application by respondent bank for security for costs. . .

Cited by:
CitedShah and Another v HSBC Private Bank (UK) Ltd QBD 26-Jan-2009
The claimants sought damages after delays by the bank in processing transfer requests. The bank said that the delays were made pending reports of suspected criminal activity. The bank’s delay had stigmatised the claimant causing further losses. The . .
CitedShah and Another v HSBC Private Bank (UK) Ltd CA 4-Feb-2010
Money laundering suspicion to be explained
The customer sought to sue his bank for failing to meet his cheque. The bank sought to rely on the 2002 Act, having reported suspicious activity on freezing the account. He now appealed against summary judgment given for the bank which had refused . .

Lists of cited by and citing cases may be incomplete.

Banking, Crime

Updated: 01 November 2021; Ref: scu.243324

Westdeutsche Landesbank Girozentrale v Islington London Borough Council: HL 22 May 1996

Simple interest only on rate swap damages

The bank had paid money to the local authority under a contract which turned out to be ultra vires and void. The question was whether, in addition to ordering the repayment of the money to the bank on unjust enrichment principles, the court could also award compound interest. It was clear law that the court had power to do so in the case of a breach of trust.
Held: Simple interest only was payable on a debt payable for an interest rate swap agreement which had been avoided as ultra vires the council’s powers. The failure of the swap agreement did not place the authority under any fiduciary duty to the claimants. A finding to that effect would create equitable interests with uncertain consequences for others. Accordingly simple interest only was payable. Parliament had made its intentions clear and it was not for the courts to create new situations in which compound interest would be awarded. ‘Although it is difficult to find clear authority for the proposition, when property has been obtained by fraud equity imposes a constructive trust on the fraudulent recipient: the property is recoverable and traceable in equity.’ An innocent recipient of property wrongfully obtained does not become a constructive trustee of it until receipt of knowledge of the claim in equity of the true owner.
HL Lord Goff said: ‘Claims in restitution are founded upon a principle of justice, being designed to prevent the unjust enrichment of the defendant: see Lipkin Gorman v Karpnale Ltd. [1991] 2 A.C. 548. Long ago, in Moses v Macferlan (1760) 2 Burr. 1005, 1012, Lord Mansfield C.J. said that the gist of the action for money had and received is that ‘the defendant, upon the circumstances of the case, is obliged by the ties of natural justice and equity to refund the money’. It would be strange indeed if the courts lacked jurisdiction in such a case to ensure that justice could be fully achieved by means of an award of compound interest, where it is appropriate to make such an award, despite the fact that the jurisdiction to award such interest is itself said to rest upon the demands of justice. I am glad not to be forced to hold that English law is so inadequate as to be incapable of achieving such a result. In my opinion the jurisdiction should now be made available, as justice requires, in cases of restitution, to ensure that full justice can be done. The seed is there, but the growth has hitherto been confined within a small area. That growth should now be permitted to spread naturally elsewhere within this newly recognised branch of the law. No genetic engineering is required, only that the warm sun of judicial creativity should exercise its benign influence rather than remain hidden behind the dark clouds of legal history.’
Lord Browne-Wilkinson said (obiter): ‘The argument for a resulting trust was said to be supported by the case of a thief who steals a bag of coins. At law those coins remain traceable only so long as they are kept separate: as soon as they are mixed with other coins or paid into a mixed bank account they cease to be traceable at law. Can it really be the case, it is asked, that in such circumstances the thief cannot be required to disgorge the property which, in equity, represents the stolen coins? Moneys can only be traced in equity if there has been at some stage a breach of fiduciary duty, i.e. if either before the theft there was an equitable proprietary interest (e.g. the coins were stolen trust moneys) or such interest arises under a resulting trust at the time of the theft or the mixing of the moneys. Therefore, it is said, a resulting trust must arise either at the time of the theft or when the moneys are subsequently mixed. Unless this is the law, there will be no right to recover the assets representing the stolen moneys once the moneys have become mixed.
I agree that the stolen moneys are traceable in equity. But the proprietary interest which equity is enforcing in such circumstances arises under a constructive, not a resulting, trust. Although it is difficult to find clear authority for the proposition, when property is obtained by fraud equity imposes a constructive trust on the fraudulent recipient: the property is recoverable and traceable in equity. Thus, an infant who has obtained property by fraud is bound in equity to restore it: Stocks v. Wilson [1913] 2 K.B. 235, 244; R. Leslie Ltd. v. Sheill [1914] 3 K.B. 607. Moneys stolen from a bank account can be traced in equity: Bankers Trust Co. v. Shapira [1980] 1 W.L.R. 1274, 1282C-E: see also McCormick v. Grogan (1869) L.R. 4 H.L. 82, 97′.
Lord Browne-Wilkinson explained the differences between institutional and remedial constructive trusts: ‘Under an institutional constructive trust, the trust arises by operation of law as from the date of the circumstances which give rise to it: the function of the court is merely to declare that such trust has arisen in the past. The consequences that flow from such trust having arisen (including the possibly unfair consequences to third parties who in the interim have received the trust property) are also determined by rules of law, not under a discretion. A remedial constructive trust, as I understand it, is different. It is a judicial remedy giving rise to an enforceable equitable obligation: the extent to which it operates retrospectively to the prejudice of third parties lies in the discretion of the court.’

Lord Browne-Wilkinson, Lord Goff, Lord Woolf
Times 30-May-1996, [1996] 2 All ER 961, [1996] 2 AC 669, [1996] UKHL 12, [1996] 2 WLR 802, [1996] 5 Bank LR 341
Bailii
England and Wales
Citing:
Appeal fromWestdeutsche Landesbank Girozentrale v Islington London Borough Council CA 30-Dec-1993
A bank paid money to a local authority under an interest rate swap agreement, which was held later to be outside the local authority’s powers.
Held: The local authority was to repay the money paid to it for an ultra vires purpose (a swap . .
CitedBurdick v Garrick HL 1870
In the courts of Chancery, the statute of limitations would not apply when the person in a confidential relationship had got the property into his hands. A court presumes against the party against whom relief is sought that he has made that profit . .
CitedWallersteiner v Moir (No 2) CA 1975
The court was asked whether Moir would be entitled to legal aid to bring a derivative action on behalf of a company against its majority shareholder.
Held: A minority shareholder bringing a derivative action on behalf of a company could obtain . .
AppliedHazell v Hammersmith and Fulham London Borough Council HL 1991
Swap deals outwith Council powers
The authority entered into interest rate swap deals to protect itself against adverse money market movements. They began to lose substantial amounts when interest rates rose, and the district auditor sought a declaration that the contracts were . .

Cited by:
CitedSmithkline Beecham Plc Glaxosmithkline UK Ltd and Another v Apotex Europe Ltd and others (No 2) CA 23-May-2006
The parties to the action had given cross undertakings to support the grant of an interim injunction. A third party subsequently applied to be joined, and now sought to take advantage of the cross undertakings to claim the losses incurred through . .
CitedIslamic Republic of Pakistan v Zardari and others ComC 6-Oct-2006
The claimant alleged that the defendants had funded the purchase of various properties by secret and unlawful commissions taken by them whilst in power in Pakistan. They sought to recover the proceeds. They now sought permission to serve proceedings . .
CitedStack v Dowden HL 25-Apr-2007
The parties had cohabited for a long time, in a home bought by Ms Dowden. After the breakdown of the relationship, Mr Stack claimed an equal interest in the second family home, which they had bought in joint names. The House was asked whether, when . .
CitedBryce Ashworth v Newnote Ltd CA 27-Jul-2007
The appellant challenged a refusal to set aside a statutory demand, in respect of his director’s loan account with the respondent company, saying the court should have accepted other accounts to set off against that debt.
Held: A statutory . .
CitedSempra Metals Ltd v Inland Revenue Commissioners and Another HL 18-Jul-2007
The parties agreed that damages were payable in an action for restitution, but the sum depended upon to a calculation of interest. They disputed whether such interest should be calculated on a simple or compound basis. The company sought compound . .
CitedKommune and Another v DEPFA Acs Bank ComC 4-Sep-2009
Local authorities in Denmark sought to recover sums paid to the defendant banks for swap trading, saying that the payments had been outwith their powers. . .
CitedClarence House Ltd v National Westminster Bank Plc CA 8-Dec-2009
The defendant tenants, anticipating that the landlord might delay or refuse consent to a subletting entered into a ‘virtual assignment’ of the lease, an assignment in everything but the deed and with no registration. The lease contained a standard . .
CitedTwentieth Century Fox Film Corp and Others v Harris and Others ChD 5-Feb-2013
The court was asked whether a copyright owner has a proprietary claim to money derived from infringement of the copyright.
Held: He did not. No such argument could be shown to have suceeded before. . .
CitedPindell v AirAsia CA 2011
Tomlinson LJ drew attention to the danger of attempting to draw parallels between an aircraft operating (dry) lease and some other more commonly litigated superficially similar instruments such as time charters of ships, where the legal incidents . .
CitedOlympic Airlines Sa v ACG Acquisition XX Llc CA 17-Apr-2013
The parties disputed their mutual obligations under aircraft leasing agreements. The insolvent airline said that in signing to accept the condition of the aircraft on delivery, it had not created an estoppel against itself when the aircraft later . .
CitedBailey and Another v Angove’s Pty Ltd SC 27-Jul-2016
The defendant had agreed to act as the claimant’s agent and distributor of the claimant’s wines in the UK. It acted both as agent and also bought wines on its own account. When the defendant went into litigation the parties disputed the right of the . .
CitedFilby v Mortgage Express (No 2) Limited CA 22-Jun-2004
Mr and Mrs Filby’s matrimonial home was charged to the Halifax. They also had an unsecured loan with the Midland Bank. Mr Filby sought to remortgage the matrimonial home with Mortgage Express. The mortgage advance was paid to solicitors who used . .
CitedAkers and Others v Samba Financial Group SC 1-Feb-2017
Saad Investments was a Cayman Islands company in liquidation. The liquidator brought an action here, but the defendant sought a stay saying that another forum was clearly more appropriate. Shares in Saudi banks were said to be held in trust for the . .
Obiter comments doubtedShalson and others v Russo and others ChD 11-Jul-2003
Rimer J doubted obiter comments of Lord Brown-Wilkinson: ‘I do not find that an easy passage. As to the first paragraph, a thief ordinarily acquires no property in what he steals and cannot give a title to it even to a good faith purchaser: both the . .
CitedScott v Bridge and Others ChD 25-Nov-2020
Claim to recover money and property said to have been transferred by the claimant to the defendants or one or more of them. The money concerned came from a bank account belonging to the claimant. The property concerned consisted of two . .
CitedPrudential Assurance Company Ltd v Revenue and Customs SC 25-Jul-2018
PAC sought to recover excess advance corporation tax paid under a UK system contrary to EU law. It was now agreed that some was repayable but now the quantum. Five issues separated the parties.
Issue I: does EU law require the tax credit to be . .
CitedFetch.AI Ltd and Another v Persons Unknown Category A and Others ComC 15-Jul-2021
Cryptocurrency Action
The claimants sought damages and other remedies saying that the unknown defendants had obtained access to the private key guarding their crypto currency assets, and then sold them at an undervalue, acquiring substantial profits for themselves in . .

Lists of cited by and citing cases may be incomplete.

Banking, Local Government, Equity

Leading Case

Updated: 01 November 2021; Ref: scu.90405

Royal Bank of Scotland Plc v Wilson and Another: SC 24 Nov 2010

(Scotland) Neighbours had each granted a standard security over their respective properties to the bank. The charge agreements contained personal covenants to repay the sums borrowed on demand. The land-owners appealed against an order for ejectment.
Held: The borrowers’ appeal succeeded. The 1970 Act created the standard security but it was a very technical Act. The chargors said that the notice given by the bank was defective under the Act having failed to state that it was exercising its powers under the charge, and failing to give notice to each chargor. Instead of applying under the notice, the bank applied under section 24. However, section 24 could not be used in substitution for a calling up notice. A certificate of default is an item of evidence created for use in proceedings and is not a ‘formal requisition’ under section 5, since that requisition has to be made before any proceedings are begun.
Section 19(1) imposes mandatory requirements, and is not merely permissive.

Lord Hope, Deputy President, Lord Rodger, Lord Walker, Lady Hale, Lord Clarke
[2010] UKSC 50, UKSC 2009/0228, 2010 SLT 1227, 2010 GWD 39-792, 2010 Hous LR 88, 2010 SLT 1227
Bailii, SC Summary, SC, Bailii Summary
Conveyancing and Feudal Reform (Scotland) Act 1970 5 19(1) 24, Heritable Securities (Scotland) Act 1894 5
Scotland
Citing:
CitedAIB Group (UK) Plc (Formerly Allied Irish Banks Plc and AIB Finance Limited) v Martin and Another HL 13-Dec-2001
Where a mortgage was taken out by business partners, their liability was joint and several. Partners had taken out a loan, but the terms of the mortgage appeared to make each debtor liable for all sums due from either of them, including for debts to . .
See AlsoThe Royal Bank of Scotland Plc v Wilson and Wilson (Ap) Wilson and Wilson OHCS 9-Jul-2003
. .
Appeal fromRoyal Bank of Scotland Plc v Wilson and Others SCS 5-May-2009
The bank appealed against refusal of ejectment under a charge.
Held: The appeal failed. . .
CitedMulti-Link Leisure Developments v North Lanarkshire Council SCS 30-Dec-2009
Landlords appealed against a ruling that the ‘full market value’ of the presents to be paid by the tenants on exercising an option contained in their lease was to be set by reference to its intended use.
Held: The appeal succeeded. The words . .

Lists of cited by and citing cases may be incomplete.

Banking, Land

Updated: 01 November 2021; Ref: scu.426474

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 the chips, and applied for summary judgment. At first instance, Henry J held that the cheques had been accepted in conditional repayment of the loan, so that on dishonour of the cheques, the Defendant remained liable on the loan. He then held that, just as section 16(2) and (4) validated the cheques, so they validated the underlying loan.
Held: A cheque which had been given in exchange for gaming tokens which complied with the Act was to be enforced as would be any other cheque. The use of such tokens was regulated and supported by the law. No new sub-species of contract was created by the Act.
Lloyd LJ said: ‘The legislative purpose of section 16 of the 1968 Act was to discourage gaming on credit. But consistently with that overall objective Parliament had to allow machinery for enabling lawful gaming to take place at licensed clubs. Otherwise those taking part in the gaming would have had to bring their own cash. The solution adopted was a neat one, and is to be found in section 16(1) and (2). Provided the cheque meets the requirements of subsection (2) and subsection (3), the giving of cash or tokens in exchange for the cheque does not contravene subsection (1).
The error in Mr Glick’s argument is to treat section 16(2) as if it only validated the cheque. It does more than that. It validates the whole transaction. Subsection (1) is subject to subsection (2). Subsection (2) provides that the transaction-that is to say the giving of the cash or tokens in exchange for the cheque-shall not contravene section 16(1). Provided the cheque complies with subsections (2) and (3) there is nothing in subsection (1) to prohibit the underlying loan.
What then was the purpose of section 16(4)? The explanation, like so much else in our law, is historical. The old legislation did not make loans for lawful gaming illegal. The Act of 1710 is concerned with securities. It provides that all securities for repaying money knowingly lent for gaming should be ‘utterly void frustrate and of none effect to all intents and purposes whatsoever’. But this was found to work injustice on an innocent holder for value-that is to say a third party to whom the security may have been negotiated without notice. So 125 years later, by the Act of 1835, Parliament amended the law so as to provide that the security should not be void, but should be deemed to have been given for an illegal consideration. Nothing in either Act affects the underlying loan.
The subsequent history is traced in CHT Ltd v Ward [1965] 2 QB 63. It was argued that it would be absurd to invalidate the security but to leave the contract of loan unaffected. That cannot have been Parliament’s intention. This argument was accepted by the Divisional Court in Carlton Hall Club Ltd v Laurence best reported in 98 LJKB 305. It was held that the consideration for the security which was deemed to be illegal as between immediate parties under the Act of 1835 tainted the loan itself.
It was to prevent this line of argument being resurrected that Parliament found it necessary, or at any rate desirable, to enact section 16(4). The source of the taint has now been removed. There is no longer, therefore, any basis for the argument that the underlying loan is illegal or unenforceable. Indeed, to turn the argument the other way, it would surely be absurd to hold that Parliament had, by the Act of 1968, made the cheque enforceable, but made it a criminal offence to enter into the underlying contract of loan.’

Lloyd LJ
Gazette 08-Jan-1992, [1992] 1 WLR 355
Gaming Act 1968 16
England and Wales
Cited by:
CitedAspinall’s Club Ltd v Al-Zayat CA 19-Oct-2007
The claimant had sued the defendant for non-payment under a cheque for andpound;2 million. The cheque had been issued to replace earlier cheques given but not met, for sums staked for gambling at the claimant’s casino. The defendant said that the . .
CitedGrosvenor Casinos Ltd v National Bank of Abu Dhabi ComC 17-Mar-2008
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 . .
CitedThe Ritz Hotel Casino Ltd v Al Daher QBD 15-Aug-2014
The claimant sought to recover andpound;1m on unpaid cheques. The cheques represented half of the sum gambled away by the defendant in one evening. She now alleged that the claimant had not complied with its duties under the 2005 Act to act . .

Lists of cited by and citing cases may be incomplete.

Contract, Banking

Leading Case

Updated: 01 November 2021; Ref: scu.79676

Baczo And Vizsnyiczai v Raiffeisen Bank Zrt: ECJ 12 Feb 2015

baczo_ECJ201502

ECJ Judgment – Reference for a preliminary ruling – Consumer protection – Directive 93/13/EEC – Article 7 – Mortgage loan agreement – Arbitration clause – Unfairness – Action by consumer – National procedural rule – Lack of jurisdiction of the court hearing the action by a consumer for a declaration of invalidity of a standard contract to hear the application for a declaration of unfairness of terms in the same contract

M Ilesic P
C-567/13, [2015] EUECJ C-567/13
Bailii
Directive 93/13/EEC 7

European, Banking, Consumer

Updated: 01 November 2021; Ref: scu.543252

The Co-Operative Bank Plc v Phillips: ChD 21 Aug 2014

coop_phillipsChD1408

The bank had brought possession proceedings against the defendant under two legal charges securing personal guarantees. The proceedings had been abandoned, but the court now was asked whether costs for the defendant should be on the standard or indemnity basis. The defendant argued that the proceedings had been brought for a collateral purpose and were and abuse of process. The bank also argued that the costs should be added to the sum secured. The defendant had entered into an individual voluntary arrangement, saying also that the properties should be excluded since the prior charges themselves left him with negative equity.
Held: The bringing of the possession proceedings for the purpose of putting pressure on Mr Phillips was for the purpose of obtaining repayment of the sums secured by the charges and was therefore a permissible purpose.
As to the costs, the court applied the Gomba Holdings case. Though the proceedings were not an abuse of process, that did not mean that they were reasonable for this purpose. The defendant had shown that the bank had acted unreasonably in bringing th two sets of proceedings, and the bank should not be allowed to add the costs incurred to the mortgage debt, and was liable to him for his costs incurred, and nor was the bank entitled to set off such liability against the mortgage debt.

Morgan J
[2014] EWHC 2862 (Ch)
Bailii
Civil Procedure Rules 38.5(3) 38.6(1)
Citing:
CitedDownsview Nominees Ltd and Another v First City Corporation Ltd and Another PC 19-Nov-1992
(New Zealand) The holder of a second debenture appointed receivers to the assets. The first debenture holder then also appointed receivers not to obtain repayment of its debt, but to disrupt the work of the first appointed receivers and in order to . .
CitedQuennell v Maltby CA 15-Nov-1978
A house was mortgaged to a bank. The house was then let to tenants at an annual rate of andpound;1,000. The tenants were protected as against the mortgagor by the Rent Acts. The tenancy was not binding on the bank. The mortgagor’s wife took a . .
CitedRopaigealach v Barclays Bank plc CA 6-Jan-1999
The applicant’s property was charged to the defendant. At the time it was not occupied. The mortgage fell into arrears, and after serving notice at the property, the bank took posssession and sold the property at auction. The claimants said the bank . .
CitedCukurova Finance International Ltd and Another v Alfa Telecom Turkey Ltd PC 30-Jan-2013
(British Virgin Islands) The claimant sought to recover shareholdings given in charge.
Held: There was an event of default, which entitled ATT to accelerate the loan and to appropriate – or forfeit – the charged shares, but that relief against . .
CitedMeretz Investments Nv and Another v ACP Ltd and others ChD 30-Jan-2006
The applicant challenged the exercise of a power of sale under a mortgage, saying that the mortgagee’s purposes included purposes not those under the mortgage. The parties had been involved in an attempted development of a penthouse.
Held: The . .
CitedAlbany Home Loans Ltd v Massey CA 1997
It is generally not appropriate to order possession against one of two mortgagors where the order would be of no benefit to the mortgagee, particularly where the joint mortgagors were husband and wife. An ordinary order for possession might be . .
CitedGoldsmith v Sperrings Ltd CA 1977
Claims for Collateral Purpose treated as abuse
The plaintiff commenced proceedings for damages for libel and an injunction against the publishers, the editors and the main distributors of Private Eye. In addition, he issued writs against a large number of other wholesale and retail distributors . .
AppliedGomba Holdings (UK) Ltd v Minories Finance Ltd (No 2) CA 1993
A clause entitling a mortgagee to recover legal costs from the mortgagor did not extend to costs that were unreasonably incurred or which were unreasonable in amount. Whether costs were unreasonably incurred or were unreasonable in amount was to be . .
CitedBerkshire Capital Funding Limited v Street and Barker, Nationwide Building Society CA 14-Apr-1999
The court can make an order for possession in favour of the second mortgagee, subject to the rights of a prior mortgagee. Where the first mortgagee grants a tenancy of the mortgaged property, the second mortgagee will be bound by that tenancy and . .

Lists of cited by and citing cases may be incomplete.

Costs, Banking, Insolvency

Updated: 01 November 2021; Ref: scu.536007

Ledra Advertising v Commission and ECB: ECJ 20 Sep 2016

European Stability Mechanism – Constitutional?

ECJ (Judgment) Appeals – Stability support programme for the Republic of Cyprus – Memorandum of Understanding of 26 April 2013 on Specific Economic Policy Conditionality concluded between the Republic of Cyprus and the European Stability Mechanism (ESM) – Duties of the European Commission and the European Central Bank – Non-contractual liability of the European Union – Second paragraph of Article 340 TFEU – Conditions – Obligation to ensure that the Memorandum of Understanding is consistent with EU law

ECLI:EU:C:2016:701, [2016] EUECJ C-8/15
Bailii
European

European, Banking

Updated: 01 November 2021; Ref: scu.569513

Barclays Bank SA v Sara Sanchez Garcia: ECJ 30 Apr 2014

ECJ Judgment – Request for a preliminary ruling – Directive 93/13/EEC – Thirteenth recital in the preamble – Article 1(2) – Consumer contracts – Mortgage loan agreement – Mortgage enforcement proceedings – National statutory and regulatory provisions – Contractual balance

A. Borg Barthet, P
C-280/13, [2014] EUECJ C-280/13
Bailii
Directive 93/13/EEC
European

European, Consumer, Banking

Updated: 01 November 2021; Ref: scu.525423

Shah and Another v HSBC Private Bank (UK) Ltd: QBD 26 Jan 2009

The claimants sought damages after delays by the bank in processing transfer requests. The bank said that the delays were made pending reports of suspected criminal activity. The bank’s delay had stigmatised the claimant causing further losses. The bank requested that the claims be struck out. The claimants sought permission to amend their claims.
Held: The law is a developing area. As to the level of suspicion required to trigger a duty to report funds: ‘All that is required is that there is a suspicion. If there is, then POCA is triggered regardless of the reasonableness of that suspicion. ‘ and ‘Suspicion is something less than proof. It is also straightforward. In the context of a bank, the relevant employee either suspects or he does not. If he does, he must inform the authorities. Parliament intended suspicion as a subjective fact to be sufficient (1) to expose a person to criminal liability for money laundering and (2) to trigger disclosures to the authorities. Parliament did not require, in addition, that the suspicion be based upon ‘reasonable’ or ‘rational’ grounds. There are good practical reasons for this. Unlike law enforcement agencies, banks have neither the responsibility nor the expertise to investigate criminal activity to satisfy themselves that the grounds for their suspicion are well founded, reasonable or ‘rational’.’
The effect of the Act was to suspend the normal contractual duties between client and bank. The customer could claim only if it could show bad faith (which was not pleaded) or negligence. The requested amendment to allow a claim for breach of confidence failed. Nor could the claimant request the reasons for the disclosure.

Hamblen J
[2009] EWHC 79 (QB), [2009] Lloyd’s Rep FC 225, [2009] 1 Lloyd’s Rep 328, [2009] 6 EG 100
Bailii
Civil Procedure Rules, Proceeds of Crime Act 2002 328
England and Wales
Citing:
CitedCobbold v London Borough of Greenwich CA 9-Aug-1999
The tenant had sought an order against the council landlord for failure to repair her dwelling. The defendant appealed refusal of leave to amend the pleadings in anticipation of the trial, now due to start on the following day.
Held: Leave was . .
CitedUMBS Online, Regina (on the Application Of) v Serious Organised Crime Agency CA 21-Mar-2007
Application for leave to appeal against refusal of leave to bring judicial review of a decision of the respondent agency. Leave to appeal was granted, but the matter was returned to the administrative court for review. . .
CitedK Ltd v National Westminster Bank Plc and others CA 19-Jul-2006
The bank had declined to act upon a customer’s instructions, reporting its suspicions of criminal activity to the police. Permission was given to proceed but only after a delay. The claimant customer sought its costs.
Held: The customer’s . .
CitedEquitable Life Assurance Society v Ernst and Young CA 25-Jul-2003
The claimant sought damages from its accountants, saying that had they been advised of the difficulties in their financial situation, they would have been able to avoid the loss of some 2.5 billion pounds, or to sell their assets at a time when . .
CitedSwain v Hillman CA 21-Oct-1999
Strike out – Realistic Not Fanciful Chance Needed
The proper test for whether an action should be struck out under the new Rules was whether it had a realistic as opposed to a fanciful prospect of success. There was no justification for further attempts to explain the meaning of what are clear . .
CitedDa Silva, Regina v CACD 11-Jul-2006
The defendant appealed her conviction for assisting another to retain the proceeds of crime. The court considered what was meant by ‘suspicion’.
Held: For a defendant to be convicted of an offence under section 93A(1)(a) of the 1988 Act, he or . .
CitedBarclays Bank plc v Quincecare Ltd QBD 1992
The relationship of banker and customer is that of agent and principal: ‘Primarily, the relationship between a banker and customer is that of debtor and creditor. But quoad the drawing and payment of the customer’s cheques as against the money of . .
CitedWeld-Blundell v Stephens HL 1920
A physical cause may be irrelevant as a matter of law. The law is concerned not with causation, but with responsibility. Lord Sumner said: ‘more than half of human kind are tale-bearers by nature’.
Where a legal wrong was committed without loss . .
CitedWilson v United Counties Bank Ltd HL 1920
Bank’s duty to client’s reputation and credit
Major Wilson had left England on active service soon after the beginning of the Great War, leaving his business affairs, in a fairly precarious state, with his bank. The jury found that the bank had failed in its duty to supervise his business . .
CitedKpohraror v Woolwich Building Society CA 1996
The Society, acting as a bank, had at first failed to pay its customer’s cheque for andpound;4,550, even though there were sufficient funds. The bank said that it had been reported lost. The customer sought damages to his business reputation.
CitedChristopher Hill Ltd v Ashington Piggeries Ltd CA 1969
The buyer suppied a food formula to a food mixer and claimed damages when the food mix injured his mink. The defendant argued that the level of damages sought exceeded that expectations of the parties when the contract was entered into.
Held: . .
CitedBarclays Bank plc v Quincecare Ltd QBD 1992
The relationship of banker and customer is that of agent and principal: ‘Primarily, the relationship between a banker and customer is that of debtor and creditor. But quoad the drawing and payment of the customer’s cheques as against the money of . .

Cited by:
CitedShah and Another v HSBC Private Bank (UK) Ltd (Costs) CA 4-Feb-2010
. .
Appeal fromShah and Another v HSBC Private Bank (UK) Ltd CA 4-Feb-2010
Money laundering suspicion to be explained
The customer sought to sue his bank for failing to meet his cheque. The bank sought to rely on the 2002 Act, having reported suspicious activity on freezing the account. He now appealed against summary judgment given for the bank which had refused . .
See AlsoShah and Another v HSBC Private Bank (UK) Ltd QBD 4-Jul-2011
The claimants sought very substantial damages against the bank, arising from the bank’s delay in executing four transactions. The defendant said that it suspected that the proposed transactions concerned criminal property and that, in those . .
See AlsoShah and Another v HSBC Private Bank (UK) Ltd CA 13-Oct-2011
. .
See AlsoShah and Another v HSBC Private Bank (UK) Ltd CA 30-Nov-2011
Appeal against refusal of permission to amend pleadings. The claimants suffered large losses after the bank delayed implementing his instructions after staff members initiated a report under the 2002 Act. The claimant said that the evidence . .
See AlsoShah and Another v HSBC Private Bank (UK) Ltd QBD 16-May-2012
The Claimants claimed damages in a sum in excess of US$300,000,000 arising out of delays by the Defendant, their bankers, in executing four transfers from the Claimants’ account during the period September 2006 to March 2007 and the Defendant’s . .
See AlsoShah and Another v HSBC Private Bank (UK) Ltd QBD 5-Jul-2012
. .

Lists of cited by and citing cases may be incomplete.

Banking, Criminal Practice, Civil Procedure Rules

Updated: 01 November 2021; Ref: scu.280155

Smith v Governor and Company of The Bank of Scotland: HL 6 Feb 1997

A bank which did not warn its customer of the of risks of a loan and of the need for independent advice was bound by misrepresentations made by customer. The House referred to ‘the broad principle in the field of contract law of fair dealing in good faith.’

Lord Clyde
Times 23-Jun-1997, [1997] 2 FLR 862, 1997 SC (HL) 111, [1997] UKHL 26
House of Lords, Bailii
Scotland
Citing:
Appeal fromMumford v Bank of Scotland; Smith v Same OHCS 4-Aug-1994
Bank has no duty in Scotland to wife of borrower securing debt on house. . .

Cited by:
CitedRegina v Immigration Officer at Prague Airport and another, ex parte European Roma Rights Centre and others HL 9-Dec-2004
Extension oh Human Rights Beyond Borders
The appellants complained that the system set up by the respondent where Home Office officers were placed in Prague airport to pre-vet applicants for asylum from Romania were dsicriminatory in that substantially more gypsies were refused entry than . .
CitedRoyal Bank of Scotland v Etridge (No 2); Barclays Bank plc v Harris; Midland Bank plc v Wallace, etc HL 11-Oct-2001
Wives had charged the family homes to secure their husband’s business borrowings, and now resisted possession orders, claiming undue influence.
Held: Undue influence is an equitable protection created to undo the effect of excess influence of . .

Lists of cited by and citing cases may be incomplete.

Banking, Contract

Leading Case

Updated: 01 November 2021; Ref: scu.135220

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 representation of fact.
(c) The representation must be false.
(d) It must have been made dishonestly in the sense that the representor has no real belief in the truth of what he states: this involves conscious knowledge of the falsity of the statement.
(e) The statement must have been intended to be relied upon.
(f) It must have in fact been relied upon: see Derry v Peek (1889) 14 App Cas 337, Angus v Clifford [1891] 2 Ch 449, Armstrong v Strain [1951] 1 TLR 856, The Kriti Palm [2007] 1 Lloyd’s Rep 555.
In addition, all the elements must be established by reference to the heightened burden of proof as discussed in Hornal v Neuberger Products Ltd [1954] 1 QB 247, Re H (Minors) [1996] AC 563.’

David Steel J
[2007] EWHC 1151 (Comm), [2007] 2 Lloyd’s Rep 187
Bailii
England and Wales
Cited by:
CitedGrosvenor Casinos Ltd v National Bank of Abu Dhabi ComC 17-Mar-2008
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 . .
Appeal fromUzinterimpex JSC v Standard Bank Plc CA 15-Jul-2008
The parties disputed the result of a contract for the purchase of cotton with the contract underwritten by a bank.
Held: After the breach of the contract, the claimant had failed properly to mitigate his losses. That failure in turn itself . .

Lists of cited by and citing cases may be incomplete.

Banking, Torts – Other

Leading Case

Updated: 31 October 2021; Ref: scu.252331

Barclays Bank Plc v O’Brien and Another: HL 21 Oct 1993

The wife joined in a charge on the family home to secure her husband’s business borrowings. The husband was found to have misrepresented to her the effect of the deed, and the bank had been aware that she might be reluctant to sign the deed.
Held: The charge was not to be enforced. The bank was under constructive notice, and ought to have known of the undue influence of the husband. The security was obtained by undue influence or misrepresentation. The House set a low level for the threshold which must be crossed before a bank is put on inquiry.
Lord Browne-Wilkinson: ‘Therefore in my judgment a creditor is put on inquiry when a wife offers to stand surety for her husband’s debts by the combination of two factors: (a) the transaction is on its face not to the financial advantage of the wife; and (b) there is a substantial risk in transactions of that kind that, in procuring the wife to act as surety, the husband has committed a legal or equitable wrong that entitles the wife to set aside the transaction.’ Unconscionable conduct is ‘ some other legal wrong’. ‘if the doctrine of notice is properly applied, there is no need for the introduction of a special equity in these types of cases. A wife who has been induced to stand as a surety for her husband’s debts by his undue influence, misrepresentation or some other legal wrong has an equity as against him to set aside that transaction. Under the ordinary principles of equity, her right to set aside that transaction will be enforceable against third parties (e.g. against a creditor) if either the husband was acting as the third party’s agent or the third party had actual or constructive notice of the facts giving rise to her equity. Although there may be cases where, without artificiality, it can properly be held that the husband was acting as the agent of the creditor in procuring the wife to stand as surety, such cases will be of very rare occurrence. The key to the problem is to identify the circumstances in which the creditor will be taken to have had notice of the wife’s equity to set aside the transaction. The doctrine of notice lies at the heart of equity. Given that there are two innocent parties, each enjoying rights, the earlier right prevails against the later right if the acquirer of the later right knows of the earlier right (actual notice) or would have discovered it had he taken proper steps (constructive notice).’

Lord Templeman, Lord Lowry, Lord Browne-Wilkinson, Lord Slynn of Hadley and Lord Woolf
Gazette 17-Dec-1993, Times 22-Oct-1993, Independent 22-Oct-1993, [1993] 3 WLR 786, [1994] 1 AC 180, [1993] 4 All ER 417, [1993] UKHL 6
Bailii
England and Wales
Citing:
CitedAvon Finance Co Ltd v Bridger CA 1985
The son arranged finance for his parents to move near to him. He borrowed money to help finance it, secured by an expensive second loan. He deceived his parents into executing the loan. After the son defaulted, the plaintiff sought possession.
CitedBainbrigge v Browne ChD 1881
Bainbrigge_BrowneChD1881
An impoverished father had prevailed upon his inexperienced children to charge their reversionary interests under their parents’ marriage settlement to pay his mortgage debts. Undue influence was claimed.
Held: The defendants who were not . .
CitedBank of Credit and Commerce International SA v Aboody CA 1989
In a case where the defendant said that a mortgage had been signed from undue pressure the court may find actual undue influence as opposed to presumed undue influence. Slade LJ said: ‘Ever since the judgments of this court in Allcard v Skinner a . .
CitedBank of Montreal v Stuart PC 1911
The court used the phrase ‘immoderate and irrational’ to describe the character of a transaction which might of its nature suggest undue influence. A solicitor who is advising a client about a transaction and has reason to suspect that the client is . .
CitedBank of Victoria Ltd v Mueller 1925
Cussen J opined that a wife was entitled to relief from a guarantee granted to the bank undertaken under pressure from her husband where amongst other matters it could be shown: ‘that the husband in procuring and pressing for such consent . .
CitedBischoff’s Trustee v Frank 1903
. .
CitedCIBC Mortgages Plc v Pitt and Another HL 21-Oct-1993
Mrs Pitt resisted an order for possession of the house saying that she had signed the mortgage only after misrepresentations by and the undue infuence of her husband who was acting as the bank’s agent.
Held: A bank was not put on enquiry as to . .
CitedColdunell Ltd v Gallon CA 1986
Even in the absence of agency, if the debtor has been guilty of undue influence or misrepresentation in securing the giving of security by a third party to cover his debt to the creditor, the creditor may not be able to enforce the surety contract . .
CitedGrigby v Cox 1750
The court considered a claim that the husband had exercised undue influence over his wife.
Held: The court rejected any presumption of undue influence, and said that a court of equity ‘will have more jealousy’ over dispositions by a wife to a . .
CitedHoghton v Hoghton CA 16-Apr-1852
When a person has made a large voluntary disposition the burden is thrown on the party benefitting to show that the disposition was made fairly and honestly and in full understanding of the nature and consequences of the transaction. Romilly MR . .
CitedHowes v Bishop 1909
The relationship of husband and wife does not bring a case within Class 2(A). . .
CitedKings North Trust Ltd v Bell CA 1986
The wife claimed to have signed a legal charge in favour of the plaintiffs by virtue of her husband’s fraudulent misrepresentation. The charge secured the business borrowings of the husband. She did not get independent advice.
Held: The bank . .
CitedMidland Bank Plc v Shephard CA 1988
Setting aside of bank’s charge where execution by a third party to secure the creditors debt had been secured by the creditors misrepresentation of the charge. . .
CitedTurnbull and Co v Duval PC 1902
Mr Duval owed three separate sums to a firm Turnbull and Co including andpound;1,000 owed to the Jamaican branch for beer. Turnbulls’ manager and agent in Jamaica was a Mr Campbell. Mr Campbell was also an executor and trustee of a will under which . .
CitedYerkey v Jones 1939
The relationship of husband and wife is not enough of itself to raise a presumption of undue influence. The Court of Chancery was not blind to the opportunities of obtaining and unfairly using influence over a wife which the husband often possesses. . .
Appeal fromBarclays Bank Plc v O’Brien and Another CA 22-May-1992
A bank leaving a husband to explain a proposed charge over the matrimonial home to his wife to secure his business debts, could not enforce that charge against her. There was a presumption of undue influence in the husband which made the charge . .

Cited by:
CitedCooke v National Westminster Bank Plc; Waldron Wetherell and Co CA 17-Jun-1998
Where a bank had failed to require the solicitors witnessing a wife’s signature to a guarantee, to write to confirm that she had received independent advice, and there had been undue influence, they were deemed to be on notice of such influence. . .
CitedRoyal Bank of Scotland v Etridge, Loftus and Another v Etridge and Another, Etridge v Pritchard Englefield (Merged With Robert Gore and Co ) Midland Bank Plc v Wallace and Another (No 2) CA 31-Jul-1998
Detailed guidance was given on the quality of independent legal advice, which would be required to be given to wives signing charges to secure their husbands’ business etc accounts on the matrimonial home. The interaction of legal advice and . .
CitedRoyal Bank of Scotland v Etridge (No 2); Barclays Bank plc v Harris; Midland Bank plc v Wallace, etc HL 11-Oct-2001
Wives had charged the family homes to secure their husband’s business borrowings, and now resisted possession orders, claiming undue influence.
Held: Undue influence is an equitable protection created to undo the effect of excess influence of . .
CitedGovernor and Company of Bank of Scotland v Bennett and Another CA 21-Dec-1998
The bank appealed an order setting aside a deed of guarantee and mortgage and denying the possession order sought. The guarantee had been given to support borrowings of the defendant’s company. The defendant was the wife of the director and had been . .
CitedPortman Building Society v Dusangh and Others CA 19-Apr-2000
The defendant sought to set aside an order for possession under a mortgage.
Held: Where a case was strong enough on its face in terms of conduct and terms, unconscionable conduct could be inferred if there was no explanation offered to . .
CitedUCB Group Ltd v Hedworth CA 4-Dec-2003
The defendant challenged the claimant’s right to possession under a legal charge. She appealed a finding that she had not established the undue influence of her husband, a solicitor.
Held: A lender who received a voidable security was entitled . .
CitedNiersmans v Pesticcio CA 1-Apr-2004
A house have been given by a man with learning difficulties to her sister. The case appealed an order that undue influence had applied.
Held: The gift failed despite the attempt at independent legal advice. The court reviewed the law of undue . .
CitedBarclays Bank Plc v Boulter and Another HL 26-Oct-1999
The question of whether notice of certain facts amounted to constructive notice of other facts is a question of law. Where it was claimed that a party should be exempt from liability under a document which it was claimed was signed because of . .
CitedScotlife Home Loans (No 2) Limited v Melinek and Melinek CA 9-Sep-1997
The second defendant sought leave to appeal against a possession order obtained by the claimant. The loan obtained had been misapplied by the first defendant, her husband. She had been advised in the transaction by his partner in their solicitors’ . .
CitedR Griggs Group Ltd and others v Evans and others (No 2) ChD 12-May-2004
A logo had been created for the claimants, by an independent sub-contractor. They sought assignment of their legal title, but, knowing of the claimant’s interest the copyright was assigned to a third party out of the jurisdiction. The claimant . .
CitedRandall v Randall ChD 30-Jul-2004
The executor sought to set aside gifts made by the deceased, an elderly aunt before her death to his brother, alleging undue influence.
Held: The recipient had acted falsely in failing to declare overpayments of benefits. The deceased had been . .
CitedForsdike v Forsdike CA 21-Feb-1997
The claimant appealed dismissal of his claim to set aside a transfer by way of gift by his father on the basis of an alleged undue influence.
Held: The judges was entitled to make the findings he had done, and to be impressed by the spacing of . .
CitedInvestors Compensation Scheme Ltd v West Bromwich Building Society HL 19-Jun-1997
Account taken of circumstances wihout ambiguity
The respondent gave advice on home income plans. The individual claimants had assigned their initial claims to the scheme, but later sought also to have their mortgages in favour of the respondent set aside.
Held: Investors having once . .
CitedGreene King Plc v Stanley and others CA 30-Nov-2001
The claimant challenged an order that the two defendant chargors were discharged from liability to the claimants under their individual voluntary arrangement and on the basis that it had been entered under undue influence. . .

Lists of cited by and citing cases may be incomplete.

Undue Influence, Banking

Leading Case

Updated: 31 October 2021; Ref: scu.78210

Southern Pacific Securities 05-2 Plc v Walker and Another: SC 7 Jul 2010

The appellant borrowed a sum from the respondent under a fixed sum credit agreement. A broker administration fee had been advanced to facilitate the loan. The agreement recorded the ‘Amount of Credit’ net of the fee, and the ‘Total Amount Financed’ included the fee. The borrower said the agreement was unenforceable for mis-stating the amount of credit by not including the charge for credit.
Held: The borrower’s appeal failed. Since under section 9(4) ‘an item entering into the total charge for credit shall not be treated as credit even though time is allowed for its payment.’ The fee was indisputably part of the total charge for credit and must accordingly be excluded from the amount of credit. The fact that interest was charged on the fee did not change this: ‘Section 9(4) does not prohibit the charging of interest. If the fee itself was part of the total charge for credit, it seems to us to follow that interest on that fee was also part of the total charge for credit and not therefore to be treated as credit.’

Lord Hope, Deputy President, Lord Walker, Lord Brown, Lord Mance, Lord Clarke
[2010] UKSC 32, UKSC 2009/0217, [2010] Bus LR 1396, [2010] 1 WLR 1819, [2010] 4 All ER 277, [2011] 1 All ER (Comm) 164
SC, Bailii, Bailii Summary, SC Summary
Consumer Credit Act 1974
England and Wales
Citing:
CitedWilson v First County Trust Ltd (1) CA 3-Nov-2000
The administrative charges for entering into a loan were not to be included in the loan, but rather as an item entering into the total charge for credit. To hold otherwise went against accounting practice, would disguise the cost of the loan, and . .
Appeal fromSouthern Pacific Personal Loans Ltd v Walker and Another CA 12-Nov-2009
The bank appealed against an order that a consumer credit agreement was unenforceable for failing to meet the requirements. The amount of credit figure had been calculated to include the deferred obligation to pay the broker’s fee.
Held: The . .
CitedWilson v Robertsons (London) Ltd. ChD 5-Jul-2005
The parties entered into pawnbroking arrangements. In order to get around the consequences of the 1974 Act, the agreements were antedated.
Held: The court would not allow parties to contract out of the 1974 Act. Also, by including a document . .
CitedWatchtower Investments Ltd v Payne and Another CA 20-Jul-2001
The mortgagor borrowed funds against the charge, and part of the condition of the loan was that any arrears on the first charge must be discharged. The total amount of the loan was calculated to include sufficient to discharge the arrears on the . .

Lists of cited by and citing cases may be incomplete.

Consumer, Banking

Leading Case

Updated: 31 October 2021; Ref: scu.420386

HFO Capital Ltd v Wegmuller: Misc 24 Jan 2012

‘claim brought by the claimant for monies allegedly owed by the defendant under a credit agreement regulated by the Consumer Credit Act 1974. It is claimed that the credit agreement was made between Barclaycard and the defendant in about June 2006. It involved the provision of a credit card by Barclaycard to the defendant.!

[2012] EW Misc 19 (CC)
Bailii
Consumer Credit Act 1974

Banking, Consumer

Updated: 31 October 2021; Ref: scu.510048