Category: Banking

Sv Capital OU v European Banking Authority: ECJ 14 Dec 2016

ECJ Judgment – Appeal – Application to initiate an investigation into the Estonian and Finnish supervisory authorities – Decision of the European Banking Authority (EBA) – Board of Appeal decision of the European Supervisory Authorities – Regulation (EU) No 1093/2010 – Articles 17 and 60 – Board of Appeal – Period allowed for commencing proceedings – Excusable error

C-577/15, [2016] EUECJ C-577/15
Bailii
European

Banking

Updated: 27 January 2022; Ref: scu.572614

Gutierrez Naranjo v Cajasur Banco SAU and similar: ECJ 21 Dec 2016

ECJ Judgment – Reference for a preliminary ruling – Directive 93/13 / EEC – Contracts with consumers – Mortgages – Unfair terms – Article 4 (2) – Article 6 (1) – Declaration of invalidity – Limitation by national courts of The declaration of nullity of an abusive clause

C-154/15, [2016] EUECJ C-154/15
Bailii
European

Consumer, Banking

Updated: 27 January 2022; Ref: scu.572584

Al-Ghabra v Commission: ECFI 13 Dec 2016

ECJ Judgment (Third Chamber) – Common foreign and security policy – Restrictive measures directed against certain persons and entities associated with Usama bin Laden, the Al-Qaeda network and the Taliban – Regulation (EC) No 881/2002 – Freezing of the funds and economic resources of a person included on a list drawn up by a United Nations body – Inclusion of that person’s name on the list in Annex I to Regulation No 881/2002 – Action for annulment – Reasonable time – Obligation to verify and justify the merits of the grounds relied on – Judicial review

ECLI:EU:T:2016:721, [2016] EUECJ T-248/13
Bailii
European

Banking

Updated: 27 January 2022; Ref: scu.572563

National Westminster Bank Plc v Glen Terence Breeds, Pete Kay Breeds: ChD 1 Feb 2001

The customers appealed against an order for possession in favour of the bank under its charge, challenging the judge’s finding that the bank had taken sufficient steps to avoid being fixed with notice of the wife’s equity against her husband.

Lawrence Collins J
[2001] EWHC Ch 21
Bailii
England and Wales

Banking

Updated: 27 January 2022; Ref: scu.135597

Rotenberg v Council: ECFI 30 Nov 2016

ECJ Judgment – Common foreign and security policy – Restrictive measures in respect of actions undermining or threatening Ukraine – Freezing of funds – Restrictions on admission to the territories of the Member States – Natural person actively supporting or implementing actions undermining or threatening Ukraine – Natural person benefiting from Russian decision-makers responsible for the annexation of Crimea – Rights of defence – Obligation to state reasons – Manifest errors of assessment – Right to property – Freedom to conduct a business – Right to respect for private life – Proportionality

ECLI:EU:T:2016:689, [2016] EUECJ T-720/14
Bailii
European

Banking

Updated: 26 January 2022; Ref: scu.571978

Surrey Asset Finance Ltd v National Westminster Bank plc: QBD 30 Nov 2000

That a cheque was endorsed ‘account payee’ did not mean that the drawer of the cheque would be entitled to damages for conversion from a paying bank crediting it to a different account. to succeed under this section the claimant had to show an immediate right to possession of the cheque. There appeared to be no evidence that the cheque has not been delivered to the payee. It appeared that the conversion took place after that delivery. The possession in the section referred to legal possession rather than their physical custody. Since the section deemed good delivery, there was no conversion as against the claimant. An entitlement to injunctive relief did not amount to an immediate right to possession under the section. In this case of the cheque would have been paid in any event, and there was no demonstrable loss arising from the payment of the cheque into a different account.

Times 30-Nov-2000
Bills of Exchange Act 1882 21(3)
England and Wales
Cited by:
Appeal from – Surrey Asset Finance Ltd v National Westminster Bank CA 24-Jan-2001
Application for leave to appeal against dismissal of application for summary judgment – rejected. . .
Cited – Iran v The Barakat Galleries Ltd QBD 29-Mar-2007
The claimant government sought the return to it of historical artefacts in the possession of the defendants. The defendant said the claimant could not establish title and that if it could the title under which the claim was made was punitive and not . .

Lists of cited by and citing cases may be incomplete.

Banking

Updated: 26 January 2022; Ref: scu.89614

Dowling And Others v Minister for Finance: ECJ 8 Nov 2016

ECJ (Judgment) Regulation (EU) No 407/2010 – European Financial Stabilisation Mechanism – Implementing Decision 2011/77/EU – European Union financial assistance to Ireland – Recapitalisation of national banks – Company law – Second Directive 77/91/EEC – Articles 8, 25 and 29 – Recapitalisation of a bank by means of judicial direction order – Increase in share capital without general meeting decision and without the shares issued being offered on a pre-emptive basis to existing shareholders – Issue of new shares at a price lower than their nominal value

C-41/15, [2016] EUECJ C-41/15, ECLI:EU:C:2016:836
Bailii, WLRD
Regulation (EU) No 407/2010
European

Banking, Company

Updated: 25 January 2022; Ref: scu.571269

Hamcho and Hamcho International v Council: ECFI 26 Oct 2016

ECJ Judgment – Common Foreign and Security Policy – Restrictive measures against Syria – Freezing of funds – Cancellation of prior acts by a judgment of the Court – New actions include the applicants’ names in the lists – Action for annulment – Article 76 d) of the Rules of procedure – Content of the application – Admissibility – Obligation to state reasons – Burden of proof – Right to property – corporate Freedom

ECLI:EU:T:2016:630, [2016] EUECJ T-153/15
Bailii
European

Banking

Updated: 24 January 2022; Ref: scu.570584

NIOC and Others v Council: ECJ 22 Sep 2016

ECJ (Judgment) Appeal – Restrictive measures against the Islamic Republic of Iran – List of persons and entities to which the freezing of funds and economic resources – Implementing Regulation (EU) No 945/2012 – legal basis – entity Concept associated

ECLI:EU:C:2016:721, [2016] EUECJ C-595/15
Bailii
Regulation (EU) No 945/2012
European

Banking

Updated: 23 January 2022; Ref: scu.569516

Alsharghawi v Council: ECFI 20 Sep 2016

ECJ (Judgment) Common Foreign and Security Policy – Restrictive measures because of the situation in Libya – Freezing of funds – List of persons subject to restrictions on entry and transit through the territory of the European Union – Functions former chief of staff of Muammar Qadhafi – Choice of legal basis – Obligation to state reasons – Rights of the defense – Presumption of innocence – Proportionality – Freedom to come and go – ownership – Duty to justify the merits the measure

ECLI:EU:T:2016:520, [2016] EUECJ T-485/15
Bailii
European

Banking

Updated: 23 January 2022; Ref: scu.569495

National Iranian Tanker Company v Council: ECFI 14 Sep 2016

Judgment – Common foreign and security policy – Restrictive measures adopted against Iran with the aim of preventing nuclear proliferation – Freezing of funds – Res judicata – Right to an effective remedy – Error of assessment – Rights of the defence – Right to property – Proportionality

T-207/15, [2016] EUECJ T-207/15
Bailii
European

Banking, International

Updated: 23 January 2022; Ref: scu.569372

Woods 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. The nature of such a business must in each case be a matter of fact . .’ and ‘I find that it was and is within the scope of the Defendant Bank’s business to advise on all financial matters and that as they did advise him they owed a duty to the Plaintiff to advise him with reasonable care and skill.’
Salmon J discussed the duty of the lawyers for a party to make full disclosure: ‘It cannot be too clearly understood that solicitors owe a duty to the court, as officers of the court to make sure, as far as possible, that no relevant documents have been omitted from their client’s list’.
Salmon J discussed the duties of legal advisers: ‘it cannot be too clearly understood that solicitors owe a duty to the court, as officers of the court, to go through the documents disclosed by their client to make sure, as far as possible, that no relevant documents have been omitted from their client’s [list].’

Salmon J
[1958] 3 All ER 166, [1958] 1 WLR 1018, [1959] 1 QB 55
England and Wales
Cited by:
Cited – Mutual 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 . .
Cited – 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 . .
Cited – Al-Sweady and Others, Regina (on the Application of) v Secretary of State for the Defence Admn 2-Oct-2009
The claimant’s son had died whilst in the custody of the British Armed Forces in Iraq. His uncle now claimed that his human rights had been infringed. The case ‘raised a fundamental issue of jurisdiction under Article 1 of the ECHR because if the . .
Cited – Earles v Barclays Bank plc Merc 8-Oct-2009
earles_barclaysQBD2009
The claimant had lost his claim against the bank, but resisted the amount of costs claimed.
Held: The trial had been of a simple factual dispute, and the bank had failed adequately to disclose electronically held material in its possession. . .

Lists of cited by and citing cases may be incomplete.

Banking, Negligence, Litigation Practice

Updated: 22 January 2022; Ref: scu.181791

Habib Bank Ltd v Gulabhai Naginbas Tailor: CA 25 May 1982

Appeal against mortgagee possession order.
Held: S 36 relief is in practice to be limited to a restricted range of cases – ‘for, if the mortgagor was already in difficulties with his instalments, the chances of his being able to pay off the whole principal as well in a reasonable time must be considered fairly slim’

Oliver LJ
[1982] EWCA Civ 6, [1982] 3 All ER 561, [1982] 1 WLR 1218
Bailii
Administration of justice Act 1970 36
England and Wales

Land, Banking

Updated: 22 January 2022; Ref: scu.262673

The Honourable Society of the Middle Temple v Lloyds Bank plc and Another: QBD 8 Feb 1999

Where a cheque marked ‘a/c payee only’ had been stolen, and an English clearing bank collected it as agent for a foreign bank not acting for the payee, that bank was liable for the misrepresentation involved in the presentation. Where a bank asks its English agent for collection to collect English cheques crossed ‘a/c payee’ it is impliedly warranting that its customer is entitled to the proceeds. The court drew a distinction between an agent’s breach of duty as against his principal and an agent’s breach of duty to a third party. Where an agent for a collecting bank was negligent towards a third party payee, he would be indemnified by a collecting bank for any loss caused to a third party as a consequence of performing the collecting bank’s request. This was not so where the loss arose from the agent’s negligence in the actual performance of the collecting bank’s request.
Rix J: ‘When, however, the cheque emerges from that multitude and is referred by the clerical staff to management, albeit only as a result of an inquiry after fate, it seems to me that different considerations come into play. The cheque is no longer a mere item following a course in a factory-like process. It no longer becomes impracticable to give it individual attention, or the attention of management. It is referred for just such individual attention, even if the cause of referral is something collateral.’

Rix J
Times 08-Feb-1999, [1999] 1 All ER (Comm) 193
Cheques Act 1992
England and Wales
Cited by:
Approved – Linklaters (A Firm) v HSBC Bank Plc and and Banco Popular Espanol ComC 22-May-2003
A stolen cheque was endorsed in blank, and paid through an account opened for that purpose. It had been crossed ‘A/C PAYEE ONLY’ The cheques was paid in, and the money authorised for payment by HSBC. The banks had to apportion responsibility. The . .
Cited – Architects of Wine Ltd v Barclays Bank Plc CA 20-Mar-2007
The bank appealed summary judgement against it for conversion of cheques. The cheques had been obtained by a fraud.
Held: The court considered the question of neglience under section 4: ‘The section 4 qualified duty does not require an . .

Lists of cited by and citing cases may be incomplete.

Banking, Agency

Updated: 21 January 2022; Ref: scu.89822

Hodgson v Creation Consumer Finance: ComC 22 Dec 2021

The Claimant sought relief under sections 75 and/or 56 of the Consumer Credit Act 1974 for the alleged misrepresentation of a supplier in selling solar panels to the Claimant. The alleged representation related to the performance of the panels. The Defendant funded the purchase by a debtor-creditor-supplier agreement within the meaning of section 12 of the 1974 Act and hence had a statutory liability for losses caused by any misrepresentation by the supplier.

His Honour Judge Pearce

Sitting as a Judge of the High Court
[2021] EWHC 3515 (Comm)
Bailii
England and Wales

Consumer, Banking, Litigation Practice

Updated: 21 January 2022; Ref: scu.671027

MacKinnon v Donaldson, Lufkin and Jenrette Securities Corporation: ChD 1986

A plaintiff in an English action had obtained an order against an American bank, served on its London office, requiring production of books and papers at its New York head office.
Held: The court pointed out the distinction between ‘personal jurisdiction, i.e. who can be brought before the court’ and ‘subject matter jurisdiction, i.e., to what extent the court can claim to regulate the conduct of those persons’. The court should not, save in exceptional circumstances, impose such a requirement upon a foreigner, and, in particular, upon a foreign bank. The principle is that a state should refrain from demanding obedience to its sovereign authority by foreigners in respect of their conduct outside the jurisdiction. The need to exercise the court’s jurisdiction with due regard to the sovereignty of others is particularly important in the case of banks. Banks are in a special position because their documents are concerned not only with their own business but with that of their customers. They will owe their customers a duty of confidence regulated by the law of the country where the account is kept. That duty is in some countries reinforced by criminal sanctions and sometimes by ‘blocking statutes’ which specifically forbid the bank to provide information for the purpose of foreign legal proceedings. If every country where a bank happened to carry on business asserted a right to require that bank to produce documents relating to accounts kept in any other such country, banks would be in the unhappy position of being forced to submit to whichever sovereign was able to apply the greatest pressure. An English court should not, except in connection with substantive litigation here or in exceptional circumstances, make orders seeking to control the conduct of foreigners abroad or affecting their assets abroad.

Hoffmann J
[1986] Ch 482
Bankers Books Evidence Act 1879 87
England and Wales
Citing:
Approved – Regina v Grossman CA 1981
An application was made against Barclays Bank in London to obtain inspection of an account held at a branch of the bank in the Isle of Man.
Held: The Civil Division of the Court of Appeal which determined the application was later held to have . .

Cited by:
Cited – Societe Eram Shipping Company Limited and others v Hong Kong and Shanghai Banking Corp Ltd, Compagnie Internationale de Navigation HL 12-Jun-2003
The appeal concerned a final third party debt order (formerly a garnishee order). A judgment in France was registered here for enforcement. That jurisdiction was now challenged.
Held: A third party debt order is a proprietary remedy operating . .
Cited – BAS Capital Funding Corporation, Deutsche Bank Ag London, Paine Webber Capital Inc, PW Exe Lp, Pw Partners 1999 Lp v Medfinco Limited, Abacus Holdings Limited, Andreas W Gerdes, HTC Inc, etc ChD 25-Jul-2003
The claimants wanted to bring actions in respect of various matters under shareholders agreements in complex international joint ventures. Leave was given to serve English proceedings in Malta, and the claim form and particulars of claim were faxed . .
Cited – Mahme Trust v Lloyds TSB Bank plc ChD 29-Jul-2004
The claimant began an action in England. The defendant sought a stay, saying the appropriate forum was Switzerland.
Held: The defendant was a truly multi-national orgaisation and had branches in many countries. The choice of forum belongs to . .
Cited – Mitsui 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 . .

Lists of cited by and citing cases may be incomplete.

Banking, Jurisdiction

Updated: 20 January 2022; Ref: scu.183552

Felix Hadley and Co v Hadley: ChD 1898

A cheque for a sum due which (a) is delivered to a creditor (b) is not returned by the creditor and (c) is met on first presentation discharges the debt as at the date the cheque is delivered.

Byrne J
[1898] 2 Ch 680
England and Wales
Cited by:
Cited – Andy Coltrane v Janice Day CA 14-Mar-2003
In the course of possession proceedings for non payment of rent under an assured tenancy, the tenant gave the landlord a cheque which cleared the arrears.
Held: The past course of dealings between the parties showed that the landlord had . .

Lists of cited by and citing cases may be incomplete.

Banking

Updated: 20 January 2022; Ref: scu.180781

Samuel Keller (Holdings) Ltd v Martins Bank: ChD 1970

On an interpleader summons by a bank, the question asked was whether the proceeds of sale held by the bank of properties mortgaged should be paid to the mortgagee or paid into court because the mortgagor had a cross-claim against the mortgagee.
Held: The mortgage remained in being despite the existence of the cross-claim and the mortgagee was entitled to the proceeds.
A mortgagor is not entitled to claim to set off an unliquidated claim for damages against a debt, secured by a mortgage, so as to prevent its enforcement and the application of the sale proceeds in discharge of the secured debt.

Megarry J
[1970] 3 All ER 950, [1971] 1 WLR 43
England and Wales
Cited by:
Cited – Platts v Trustees Savings Bank Plc CA 13-Feb-1998
A counterclaim for negligent sale was a valid claim allowing potential against repossessing bank but would not make bank’s claim unliquidated. The Judge could properly hold that there was a liquidated and unsecured debt the subject of the statutory . .

Lists of cited by and citing cases may be incomplete.

Banking

Updated: 20 January 2022; Ref: scu.184796

CW v Council T-224/14: ECFI 30 Jun 2016

ECJ (Judgment) Foreign Policy and Security – Restrictive measures against certain persons and entities in view of the situation in Tunisia – Freezing of funds – Extension – Right to property – Proportionality – Error of fact – Misuse of powers – Liability Not contractual

ECLI:EU:T:2016:375, [2016] EUECJ T-224/14
Bailii
European

Banking

Updated: 18 January 2022; Ref: scu.566453

CW v Council T-516/13: ECFI 30 Jun 2016

ECJ (Judgment) Common Foreign and Security Policy – Restrictive measures against certain persons and entities in view of the situation in Tunisia – Freezing of funds – Applicant name registration based on a new motivation after cancellation freezing of funds earlier – Right to property – Proportionality – Error of fact – Misuse of powers – non-contractual liability – causation

ECLI:EU:T:2016:377, [2016] EUECJ T-516/13
Bailii
European

Banking

Updated: 18 January 2022; Ref: scu.566454

Ludgate Insurance Company Ltd v Citibank Na: Admn 26 Jan 1998

The Plaintiffs’ claims arise out of a dispute between the parties which followed the collapse of certain companies trading in the London insurance market in the early 1990s. Ludgate, in short, contends that Citibank is wrongly retaining too much by way of collateral deposits in support of Letters of Credit it has issued and that it has also wrongly debited interest charges to its account.

Brooke, Mummery LJJ, Sir Patrick Russell
[1998] EWHC 1144 (Comm), [1998] Lloyds Rep IR 221
Bailii

Banking

Updated: 18 January 2022; Ref: scu.565841

BNY Mellon Corporate Trustee Services Ltd v LBG Capital No 1 Plc and Another: SC 16 Jun 2016

The Court was asked whether Lloyds Banking Group was entitled to redeem 3.3 billion pounds of loan notes which would otherwise carry a relatively high rate of interest, namely over 10% per annum. The loan notes are contingent convertible securities (perhaps inevitably known as ‘Cocos’), and are formally described as enhanced capital notes, or the ECNs. The ECNs are potentially convertible into fully paid up shares in LBG, and they were issued in November 2009, at a time when LBG, like many other banks, was in dire need of recapitalisation in order to protect its capital position and to comply with regulatory requirements.
Held: The trustees’ appeal failed (Sumption and Clarke LL dissenting). The Trust Deed had to be understood in the context of FSA’s regulatory policies at the time. The ECNs had to be interpreted so as to allow the bank to pass the stress test.

Lord Neuberger, President, Lord Mance, Lord Clarke, Lord Sumption, Lord Toulson
[2016] UKSC 29, [2016] WLR(D) 310, [2016] Bus LR 725, UKSC 2016/0007
Bailii, Bailii Summary, SC, SC Summary
England and Wales
Citing:
Cited – The Egyptian Salt and Soda Company Limited v The Port Said Salt Association Limited PC 21-Apr-1931
(Egypt) Disapproving the trial judge’s reliance on ‘surrounding circumstances at the time when the memorandum was framed’, Lord Macmillan said that ‘the purpose of the memorandum is to enable shareholders, creditors and those who deal with the . .
Cited – Homburg Houtimport BV v Agrosin Private Ltd (the ‘Starsin’) HL 13-Mar-2003
Cargo owners sought damages for their cargo which had been damaged aboard the ship. The contract had been endorsed with additional terms. That variation may have changed the contract from a charterer’s to a shipowner’s bill.
Held: The specific . .
Cited – Attorney General of Belize and others v Belize Telecom Ltd and Another PC 18-Mar-2009
(Belize) A company had been formed to manage telecommunications in Belize. The parties disputed the interpretation of its articles. Shares had been sold, but the company was structured so as to leave a degree of control with the government. It was . .
Cited – Chartbrook Ltd v Persimmon Homes Ltd and Others HL 1-Jul-2009
Mutual Knowledge admissible to construe contract
The parties had entered into a development contract in respect of a site in Wandsworth, under which balancing compensation was to be paid. They disagreed as to its calculation. Persimmon sought rectification to reflect the negotiations.
Held: . .
At CA – LBG Capital No 1 Plc and Another v BNY Mellon Corporate Trustee Services Ltd CA 10-Dec-2015
The court was asked whether Issuers were entitled to redeem, pursuant to their terms, certain contingent convertible securities.
Held:
The reference to ‘the Consolidated Core Tier 1’ in para (2) of the Definition should, in the events . .
At ChD – BNY Mellon Corporate Trustee Services Ltd v LBG Capital No 1 Plc and Another ChD 3-Jun-2015
The court was asked whether the defendants, wholly-owned subsidiaries of Lloyds Banking Group plc, are now entitled to redeem certain enhanced capital notes in advance of their respective maturity dates. That turns on whether or not a Capital . .
Cited – Sigma Finance Corporation, Re; (in administrative receivership) SC 29-Oct-2009
The court considered how the losses of the insolvent company were to be distributed as between secured creditors and preferential creditors, given the terms of the applicable trust deed.
Held: The court considered the interpretations of the . .

Lists of cited by and citing cases may be incomplete.

Banking

Updated: 17 January 2022; Ref: scu.565567

Alexander (Representative of The ‘Property118 Action Group’) v West Bromwich Mortgage Company Ltd: CA 8 Jun 2016

This appeal concerns the proper construction of the contractual documentation relating to a ‘buy to let’ interest only mortgage provided to the appellant, Mr Alexander, by the respondent, West Bromwich Mortgage Company Ltd

Sir Brian Leveson P QBD, Sharp DBE, Hamble JJ
[2016] EWCA Civ 496
Bailii
England and Wales

Banking

Updated: 17 January 2022; Ref: scu.565357

Bank Mellat v Council: ECFI 2 Jun 2016

ECJ (Judgment) Common foreign and security policy – Restrictive measures against Iran – Restrictions on transfers of funds involving Iranian financial institutions – Jurisdiction of the General Court – Action for annulment – Regulatory act not entailing implementing measures – Whether directly concerned – Interest in bringing proceedings – Admissibility – Proportionality – Obligation to state reasons – Legal safeguards as referred to in Article 215(3) TFEU – Legal certainty – Non-arbitrariness – Breach of fundamental rights

T-160/13, [2016] EUECJ T-160/13
Bailii
European

Banking

Updated: 17 January 2022; Ref: scu.564966

Association Francaise Des Usagers De Banques v Minister of Economy and Finance: ECJ 27 Feb 2020

(Opinion) Reference for a preliminary ruling – Consumer protection – Consumer credit contracts relating to immovable property for residential use – Payment or savings account – Obligation for the borrower to domiciliate his income in a payment account for a period fixed by the contract loan – Individualized advantage – Directive 2007/64 / EC – Article 45, paragraph 2 – Directive (EU) 2015/2366 – Article 55, paragraph 2 – Directive 2014/17 / EU – Article 4, points 26 and 27 – Tied selling – Grouped sale – Article 12, paragraph 1 – Article 12, paragraph 2, sub a) – Article 12, paragraph 3 – Directive 2014/92 / EU

C-778/18, [2020] EUECJ C-778/18_O, [2020] EUECJ C-778/18
Bailii, Bailii
European

Banking, Consumer

Updated: 17 January 2022; Ref: scu.654753

First Islamic Investment Bank v Council: ECFI 22 Sep 2015

ECJ Judgment – Common foreign and security policy – Restrictive measures taken against Iran with the aim of preventing nuclear proliferation – Freezing of funds – Error of assessment – Obligation to state reasons – Rights of the defence – Right to effective judicial protection – Proportionality

T-161/13, [2015] EUECJ T-161/13, ECLI:EU:T:2015:667
Bailii
European

Banking

Updated: 16 January 2022; Ref: scu.552667

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

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)
England and Wales
Citing:
Cited – Downsview 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 . .
Cited – Quennell 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 . .
Cited – Ropaigealach 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 . .
Cited – Cukurova 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 . .
Cited – Meretz 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 . .
Cited – Albany 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 . .
Cited – Goldsmith 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 . .
Applied – Gomba 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 . .
Cited – Berkshire 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: 15 January 2022; Ref: scu.536007

Barclays 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 misrepresentations and undue influence by a third party, the burden of proof remained on the party making that assertion that the bank had constructive notice of such misrepresentation and or undue influence: ‘In the case of undue influence exercised by a husband over a wife, the burden is prima facie very easily discharged. The wife needs to show only that the bank knew that she was a wife living with her husband and that the transaction was not on its face to her financial advantage. The burden is then upon the bank to show that it took reasonable steps to satisfy itself that her consent was properly obtained. ‘

Lord Slynn of Hadley, Lord Nolan, Lord Steyn, Lord Hoffman, Lord Hutton
Times 26-Oct-1999, Gazette 03-Nov-1999, [1999] UKHL 39, [1999] 4 All ER 513, [1999] 3 EGLR 88, (2000) 32 HLR 170, [2000] Fam Law 25, (2000) 79 P and CR D1, [2000] CP Rep 16, [1999] 49 EG 97, [1999] 2 FLR 986, [2000] Lloyd’s Rep Bank 29, [1999] 3 FCR 529, [1999] 1 WLR 1919, [1999] EG 121, [1999] NPC 124
House of Lords, Bailii
England and Wales
Citing:
Cited – 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.
Cited – Bainbrigge v Browne ChD 19-May-1881
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 . .
Cited – CIBC 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 . .
Cited – Bainbrigge v Browne ChD 19-May-1881
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 . .
Cited – In re Nisbet and Potts’ Contract 1905
Where a party asserted he was a purchaser in good faith without notice and for value, the burden of proving all the elements of the defence is upon the purchaser. A title acquired by adverse possession was not paramount to, and did not destroy the . .
Cited – Independent Automatic Sales Ltd v Knowles and Foster 1962
If a pleading alleges all the facts which would, as a matter of law, give rise to constructive notice on the part of the other party of the matters alleged that should be enough to enable the party to argue the legal consequences of the facts . .
Cited – Whitehorn Brothers v Davison CA 1911
It is for the defrauded owner seeking to recover his goods to prove that the purchaser had actual or constructive knowledge of the fraud. The passing of a good title to an innocent purchaser applied when the owner had been induced by false pretences . .

Lists of cited by and citing cases may be incomplete.

Undue Influence, Banking

Updated: 15 January 2022; Ref: scu.78191

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:
Cited – Avon 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.
Cited – Bainbrigge v Browne ChD 19-May-1881
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 . .
Cited – Bank 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 . .
Cited – Bank 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 . .
Cited – Bank 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 . .
Cited – Bischoff’s Trustee v Frank 1903
. .
Cited – CIBC 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 . .
Cited – Coldunell 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 . .
Cited – Grigby 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 . .
Cited – Hoghton 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 . .
Cited – Howes v Bishop 1909
The relationship of husband and wife does not bring a case within Class 2(A). . .
Cited – Kings 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 . .
Cited – Midland 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. . .
Cited – Turnbull 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 . .
Cited – Yerkey 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 from – Barclays 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:
Cited – Cooke 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. . .
Cited – 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 . .
Cited – 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 . .
Cited – Governor 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 . .
Cited – Portman 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 . .
Cited – UCB 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 . .
Cited – Niersmans 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 . .
Cited – Barclays 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 . .
Cited – Scotlife 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’ . .
Cited – R 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 . .
Cited – Randall 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 . .
Cited – Forsdike 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 . .
Cited – Investors 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 . .
Cited – Greene 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: 15 January 2022; Ref: scu.78210

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:
Cited – 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.
Disapproved – 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 . .
Cited – Huguenin 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 . .
Cited – Bainbrigge v Browne ChD 19-May-1881
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 . .
Cited – CIBC 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 . .
Cited – National 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 . .
Cited – Allcard 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 . .
Cited – Zamet 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 . .
Cited – Bank 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 . .
Cited – 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 . .
Cited – Bank 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 from – Barclays 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 . .
Cited – In 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.’ . .
Cited – Massey 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. . .
Cited – Cobbett 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. . .
Cited – Re 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 . .
Cited – Credit 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 . .
Cited – Bank 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. . .
Cited – Inche 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 . .
Cited – 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 . .
Cited – In re Craig, Decd 1971
Undue influence was found to have been exercised by a secretary companion over her elderly employer. . .
Cited – Turnbull 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 . .
Cited – Watt 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. . .
Cited – Banco 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 . .
Cited – Commission 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 . .
Cited – Kenyon-Brown v Desmond Banks and Co 2000
. .
Cited – Hamilton 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 . .
Cited – Seaton 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 . .
Cited – Banco 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 . .
Cited – London 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 from – Governor 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 . .
Cited – Pooraka 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, . .
Approved – Governor 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:
Cited – National 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 . .
Cited – U 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 . .
Cited – Hammond 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 . .
Cited – Padgham 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 . .
Cited – Franklyn 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 . .
Cited – UCB 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 . .
Cited – UCB 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 . .
Cited – Sandra 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 . .
Cited – Niersmans 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 . .
Cited – Vale 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 . .
Cited – Yorkshire 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 . .
Cited – Anthony 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 . .
Cited – R 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 . .
Cited – Daniel 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 . .
Cited – Randall 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 . .
Cited – Bowser 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 . .
Cited – Halpern 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 . .
Cited – Stack 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 . .
Cited – Halpern 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 . .
Cited – De 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 . .
Cited – Goodchild 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 . .
Cited – Greene 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. . .
Cited – Hewett 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, . .
Cited – Link 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 . .
Cited – Brown 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 . .
Cited – Day 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: 15 January 2022; Ref: scu.166567

Raiffeisen Bank SA v JB, and Similar: ECJ 5 Mar 2020

(Opinion) Reference for a preliminary ruling – Directive 93/13 / EEC – Establishment of the unfairness of contractual clauses – Credit agreement relating to a personal loan – Legal procedures – Legal action under common law imprescriptible – Legal action under common law, personal, patrimonial and prescriptible – Timing objective of the consumer’s knowledge of the existence of an unfair term

C-698/18, [2020] EUECJ C-698/18_O, ECLI: EU: C: 2020: 181, [2020] EUECJ C-698/18
Bailii, Bailii
European

Banking, Consumer

Updated: 14 January 2022; Ref: scu.654924

Post Bank Iran v Council: ECFI 3 May 2016

ECJ (Judgment) Common foreign and security policy – Restrictive measures adopted against Iran with the aim of preventing nuclear proliferation – Freezing of funds – Plea of illegality – Article 46(2) of Regulation (EU) No 267/2012 – Article 215 TFEU – Article 20(1)(c) of Decision 2010/413/CFSP, as amended by Article 1(7) of Decision 2012/35/CFSP – Article 23(2)(d) of Regulation No 267/2012 – Fundamental rights – Articles 2 TEU, 21 TEU and 23 TEU – Articles 17 and 52 of the Charter of Fundamental Rights – Error of assessment – Equal treatment – Non-discrimination – Principle of sound administration – Obligation to state reasons – Misuse of powers – Legitimate expectations – Proportionality

T-68/14, [2016] EUECJ T-68/14, ECLI:EU:T:2016:263
Bailii

European, Human Rights, Banking

Updated: 14 January 2022; Ref: scu.563117

Sparkasse Allgau v Finanzamt Kempten: ECJ 14 Apr 2016

ECJ (Judgment) Reference for a preliminary ruling – Freedom of establishment – Article 49 TFEU – Legislation of a Member State requiring credit institutions to notify the tax authorities of deceased customers’ assets for purposes related to the collection of inheritance tax – Application of that legislation to branches established in another Member State in which banking secrecy prohibits, in principle, the disclosure of such information

C-522/14, [2016] EUECJ C-522/14, ECLI:EU:C:2016:253
Bailii

European, Banking

Updated: 13 January 2022; Ref: scu.562072

Sales Sinues v Caixabank SA: ECJ 14 Apr 2016

(Judgment) Reference for a preliminary ruling – Directive 93/13/EEC – Contracts concluded between sellers or suppliers and consumers – Mortgage contracts – ‘Floor’ clause – Examination of the clause with a view to its invalidation – Collective proceedings – Action for an injunction – Stay of an individual action with the same subject matter

C-381/14, [2016] EUECJ C-381/14, [2016] EUECJ C-381/14 – CO
Bailii, Bailii
Directive 93/13/EEC

European, Consumer, Banking

Updated: 13 January 2022; Ref: scu.562071

The High Commissioner for Pakistan In The United Kingdom v National Westminster Bank Plc and Others: ChD 16 Jan 2015

The parties disputed management of a fund subject to a legal stalemate since 1948, and now worth some andpound;35 million pounds. Application to set aside discontinuance without permission.
Held: If, upon such an application, the Court is persuaded that the discontinuance was an abuse of the Court’s process, it may set it aside and impose terms. The discontinuance was found to be an improper attempt to extract the claimant state from the consequences of an unequivocal waiver of immunity.

Henderson J
[2015] EWHC 55 (Ch)
Bailii
England and Wales
Cited by:
Cited – Arcadia Group Ltd and Others v Telegraph Media Group Ltd QBD 8-Feb-2019
Claimant’s application for leave to withdraw request for injunction to prevent publication of stories regarding matters subject to non-disclosure agreements.
Held: Granted. An junction had been granted, but Lord Hain had disclosed protected . .

Lists of cited by and citing cases may be incomplete.

Banking, Litigation Practice

Updated: 13 January 2022; Ref: scu.541490

Safe Interenvios SA v Liberbank SA and Others: ECJ 10 Mar 2016

ECJ (Judgment) Reference for a preliminary ruling – Prevention of the use of the financial system for the purpose of money laundering and terrorist financing – Directive 2005/60/EC – Customer due diligence measures – Directive 2007/64/EC – Payment services in the internal market

C-235/14, [2016] EUECJ C-235/14, ECLI:EU:C:2016:154
Bailii
Directive 2007/64/EC, Directive 2005/60/EC
European

Banking

Updated: 12 January 2022; Ref: scu.560963

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

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
England and Wales
Citing:
Cited – Patel 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. . .
Cited – Mothew (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 . .
Cited – 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 . .
Cited – Harrison 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 . .
Cited – Black 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: 12 January 2022; Ref: scu.440466

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

(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
England and Wales
Citing:
Cited – In 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 . .
Cited – Wilson 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 . .
Cited – Dimond 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.
Cited – Burchell 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 . .
Cited – Barras 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 . .
Cited – Lloyds 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 . .
Cited – Huntpast 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. . .
Cited – McGinn 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 . .
Cited – Rowlands v Hodson CA 8-Oct-2009
. .
Cited – 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 . .
Cited – Khodari 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:
Applied – Kneale 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 from – Brookes v HSBC Bank Plc CA 29-Mar-2011
The appellant had failed in his challenge to the bank’s imposition of charges. . .
Cited – Fresenius 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: 12 January 2022; Ref: scu.384472

James Grosett, Son and Executor-Dative of Walter Grossett of Logie, Esq, Deceased, Formerly Inspector-General of His Majesty’s Customs In Scotland v Sir James Murray, Receiver-General of The Customs In Scotland: HL 17 Mar 1763

Bill – Negotiation.-
Held a party (a public officer) to whom a bill was indorsed in security of the customs, was bound, on the bill falling due, duly to negotiate it, and payment not being recovered in consequence of his neglect to do so: Held him liable in the contents.

(1763) 2 Paton 81, [1763] UKHL 2 – Paton – 81
Bailii
Scotland

Banking

Updated: 11 January 2022; Ref: scu.560595

Alexander Brebner, Merchant In Portsoy v John Haliburton and Company, Merchants In Edinburgh: HL 13 Dec 1763

The appellant sent three bills to the respondents (with whom he had dealings in business) for the purpose of negotiation and payment, indorsing them for that purpose. The respondents delayed timeously to present the bills for payment, and failed otherwise in duly negotiating the same, but they sent them to Boyd in Glasgow, with whom they had dealings, who failed with the proceeds in their hands. Held (1), That there was no culpable negligence on the part of the respondents to subject them in liability, and (2) As regarded the sum of andpound;200 sent by Boyd to Haliburton, on 25th March, sought to be imputed pro rata of this debt, this remitted to the

[1763] UKHL 6 – Paton – 753, (1763) 6 Paton 753
Bailii
Scotland

Banking

Updated: 11 January 2022; Ref: scu.560597

National Iranian Oil Company v Council (Judgment): ECJ 1 Mar 2016

ECJ Appeal – Restrictive measures against the Islamic Republic of Iran – List of persons and entities subject to the freezing of funds and economic resources – Implementing Regulation (EU) No 945/2012 – Legal basis – Criterion relating to the material, logistical or financial support for the Government of Iran

ECLI:EU:C:2016:128, [2016] EUECJ C-440/14
Bailii
European

International, Banking

Updated: 10 January 2022; Ref: scu.560501

Nelmes v Nram Plc: CA 26 May 2016

The appellant challenged possession orders under mortgages, saying that the mortgage arrangement was unfair under section 140A of the 1974 Act. He said that the lender’s valuation had been excessive.
Held: With the exception of his treatment of the procuration fee, the judge was entitled to conclude that there was no unfairness in the relationship between NR and Mr Nelmes which required the court to use its powers under section 140B.

Elias, Christopher Clarke, Kitchin LJJ
[2016] EWCA Civ 491
Bailii
Consumer Credit Act 1974 140A
England and Wales

Consumer, Banking

Updated: 10 January 2022; Ref: scu.564719

Council v Bank Mellat: ECJ 18 Feb 2016

ECJ Judgment – Appeal – Common foreign and security policy – Combating nuclear proliferation – Restrictive measures taken against the Islamic Republic of Iran – Freezing of funds of an Iranian bank – Obligation to state reasons – Procedure for the adoption of the act – Manifest error of assessment)

C-176/13, [2016] EUECJ C-176/13
Bailii
European

International, Banking

Updated: 10 January 2022; Ref: scu.560209

Camdex International Ltd v Bank of Zambia and Another: CA 3 Apr 1996

Appeal by the Defendant from a judgment on an application for summary judgment under RSC Order 14 by the Plaintiffs, Camdex International Ltd judgment was entered for the Plaintiffs in the sum of Kuwaiti Dinars 20,595,557.429. The Plaintiffs pleaded that the Central Bank of Kuwait deposited with the Defendant the sum of Kuwaiti Dinars 15,000,000 for a period of a year at an agreed rate of interest. The deposit was renewed in a number of subsequent years with the interest being accumulated. The Central Bank of Kuwait and the Defendant entered into two further agreements which had the effect of rescheduling part of the Defendant’s interest liability and extended the deposit of the principal sum and the balance of the interest for a further year. The Defendant paid a sum of 616,098 Kuwaiti Dinars during 1990 but otherwise failed to pay the sums due under the 1988 agreements. Having pleaded the indebtedness of the Defendant to the Central Bank of Kuwait, the Plaintiffs pleaded that the Central Bank of Kuwait assigned absolutely to the Plaintiffs the debts due under the 1988 agree ments and that the Plaintiffs had given written notice of the assignment to the Defendant and that they had accordingly become entitled to the payment of the debt to them.
Held: The appeal failed. There was no maintenance in the assignment of debt though litigation was required to recover it. It remains objectionable to traffic in litigation. The assignment had no essence in maintenance and was contemplated by statute, and was effective.

Neill, Peter Gibson, Hobhouse LJJ
Gazette 10-Jul-1996, Times 08-Apr-1996, [1998] QB 22, [1996] EWCA Civ 1356
Bailii
Law of Property Act 1925 136
England and Wales
Citing:
Cited – Ellis v Torrington CA 1920
An assignment of the benefit of a covenant in a lease held to be sufficiently connected with enjoyment of the property as not to be a bare right of action. The assignment was not void.
Scrutton LJ stated that the assignee of a cause of action . .
Cited – Mayor of Bradford v Pickles HL 29-Jul-1895
The plaintiffs sought an injunction to prevent the defendant interfering with the supply of water to the city. He would have done so entirely by actions on his own land.
Held: The plaintiffs could have no property in the water until it came on . .

Cited by:
See Also – Camdex International Ltd v Bank of Zambia and Another CA 22-May-1996
Application by the defendant for leave to appeal and, should leave be granted, an appeal . .
See Also – Camdex International Ltd v Bank of Zambia and Others (2) CA 28-Jan-1997
English Courts have no power to enforce foreign public law here. . .

Lists of cited by and citing cases may be incomplete.

Torts – Other, Banking

Updated: 09 January 2022; Ref: scu.559147

NRAM Plc v McAdam and Another: ComC 10 Dec 2014

The claimant, formerly Northern Rock, pursued repayment of many loans based on part secured and part unsecured loans. The defendants said that the loans were unenforceable against them under the Consumer Credit legislation because the requisite information had not been provided.

Burton J
[2014] EWHC 4174 (Comm)
Bailii
Consumer Credit Act 1974 8(2), Consumer Credit (Agreements) Regulations 1983, Consumer Credit (Cancellation Notices and Copies of Documents) Regulations 1983, Consumer Credit (Disclosure of Information) Regulations 2004, Consumer Credit Act 2006, Consumer Credit (Information Requirements and Duration of Licences and Charges) Regulations 2007
England and Wales

Banking, Consumer

Updated: 08 January 2022; Ref: scu.539962

Gibbons 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.

Lawrence J
[1939] 2 KB 882, [1939] 3 All ER 577
England and Wales
Cited by:
Cited – 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.
Banking, Damages

Updated: 08 January 2022; Ref: scu.448096

LBG Capital No 1 Plc and Another v BNY Mellon Corporate Trustee Services Ltd: CA 10 Dec 2015

The court was asked whether Issuers were entitled to redeem, pursuant to their terms, certain contingent convertible securities.
Held:
The reference to ‘the Consolidated Core Tier 1’ in para (2) of the Definition should, in the events which have happened, be treated as a reference to ‘its then regulatory equivalent’ – ie the Common Equity Tier 1 Capital. This conclusion involved a departure from the strictly literal meaning of the definition of ‘Core Tier 1 Capital’ in clause 19, but the departure was justified because it was ‘clear that something has gone wrong with the language and [it was] clear what a reasonable person would have understood the parties to have meant’
Gloster LJ departed from the literal meaning of the closing words of para (2) of the Definition because:
(i) it was notorious at the time of the issue of the ECNs that the regulatory requirements as to financial institutions’ capital would be ‘strengthened and changed’,
(ii) it was envisaged in the TandCs, in particular in clause 19, that expressions such as ‘Regulatory Capital Requirements’ and ‘Core Tier 1 Capital’ could change their meaning;
(iii) indeed, it was inherent in the terms of the Definition that this was so;
(iv) it was obvious that changes of substance might lead to changes of nomenclature; and
(v) one of the essential features of the ECNs was that, if necessary, they could be converted into LBG core capital, whatever expression was used to define it. She concluded that, given these points, coupled with the existence of the ECN maturity dates, it made no commercial sense to limit the reference to ‘Core Tier 1 Capital’ in para (2) of the Definition to CT1 Capital, as opposed to holding that it could, in the events which had happened apply to CET1 Capital. The error would ‘have been obvious to a reasonable addressee of the Exchange Offer Memorandum’.
Briggs LJ said: ‘In order to resist early redemption of the ECNs is it sufficient that they continue to be taken into account for some purpose or purposes in the stress-test now applied by the [PRA], which in my view they do, or must they play a part in enabling LBG to pass that test, which they clearly no longer do, because of the change in the Regulatory Capital Requirements which had the effect of elevating the pass ratio to a level above the Conversion Trigger.’

Gloster, Briggs, Sales LJJ
[2015] EWCA Civ 1257
Bailii
England and Wales
Citing:
At ChD – BNY Mellon Corporate Trustee Services Ltd v LBG Capital No 1 Plc and Another ChD 3-Jun-2015
The court was asked whether the defendants, wholly-owned subsidiaries of Lloyds Banking Group plc, are now entitled to redeem certain enhanced capital notes in advance of their respective maturity dates. That turns on whether or not a Capital . .
Cited – Sigma Finance Corporation, Re; (in administrative receivership) SC 29-Oct-2009
The court considered how the losses of the insolvent company were to be distributed as between secured creditors and preferential creditors, given the terms of the applicable trust deed.
Held: The court considered the interpretations of the . .

Cited by:
At CA – BNY Mellon Corporate Trustee Services Ltd v LBG Capital No 1 Plc and Another SC 16-Jun-2016
The Court was asked whether Lloyds Banking Group was entitled to redeem 3.3 billion pounds of loan notes which would otherwise carry a relatively high rate of interest, namely over 10% per annum. The loan notes are contingent convertible securities . .

Lists of cited by and citing cases may be incomplete.

Financial Services, Banking

Updated: 08 January 2022; Ref: scu.556789

Banif Plus Bank Zrt v Marton Lantos: ECJ 3 Dec 2015

ECJ Judgment – References for a preliminary ruling – Directive 2004/39/EC – Articles 4(1) and 19(4), (5) and (9) – Markets in financial instruments – Concept of ‘investment services and activities’ – Provisions to ensure investor protection – Conduct of business obligations when providing investment services to clients – Obligation to assess the suitability or appropriateness of the service to be provided – Contractual consequences of non-compliance with that obligation – Consumer credit contracts – Foreign currency denominated loan – Advancement and reimbursement of loan in domestic currency – Terms relating to the exchange rate

[2015] WLR(D) 498, ECLI:EU:C:2015:794, C-312/14, [2015] EUECJ C-312/14
WLRD, Bailii
Directive 2004/39/EC 4(1)

European, Banking, Consumer

Updated: 07 January 2022; Ref: scu.556323

Greenwood v Martins Bank Ltd: HL 1932

The plaintiff had an account with the defendant bank. His wife forged his signature on four cheques, drew out all the money in the account, and lent it to her sister. The plaintiff on discovering the facts did not at once inform the bank, but about nine months later, when his wife told him but she wanted more money for her sister, he stated his intention of going to the bank. That night his wife committed suicide. The plaintiff then went to the bank and told the manager about the cheques. In an action by the plaintiff claiming to be credited by the defendant bank with the amount of the forged checks, the bank pleaded a) adoption and ratification, and b) that the plaintiff was estopped by his silence from alleging that the signatures were forgeries. The tribunal of first instance found that the first cheques were honoured by the carelessness of the bank officials. There was no evidence that the plaintiff had ever adopted the forged cheques as his own.
Held: Ratification had no applicability to a forged signature, but the plaintiff was estopped from alleging the forgeries, because his silence until after his wife’s death had caused the bank to lose their right of action against the forger and therefore the action failed.
A bank’s customer has a duty to inform the bank of any forgery of a cheque purportedly drawn on the account as soon as he, the customer, becomes aware of it.
Lord Tomlin considered the requirements to create an estoppel: ‘The essential factors giving rise to an estoppel are I think: (1) A representation or conduct amounting to a representation intended to induce a course of conduct on the part of the person to whom the representation is made. (2) An act or omission resulting from the representation, whether actual or by conduct, by the person to whom the representation is made. (3) Detriment to such person as a consequence of the act or omission.
Mere silence cannot amount to a representation, but when there is a duty to disclose deliberate silence may become significant and amount to a representation.’

Lord Tomlin, Lord Thankerton and Lord MacMillan
[1932] All ER 318, [1933] AC 51, 101 LJKB 623, 147 LT 441, 48 TLR 601, 76 Sol Jo 544, 38 Com Cas 54
England and Wales
Citing:
Affirmed – Greenwood v Martins Bank Limited CA 1932
A husband who failed to disclose that his signature had been forged by his wife was estopped for asserting the forgery against his bank.
The relationship between a bank and its customer is a continuing one and therefore involves a continuing . .

Lists of cited by and citing cases may be incomplete.

Estoppel, Banking

Updated: 07 January 2022; Ref: scu.356585

Dickinson and Another v UK Acorn Finance Ltd: CA 25 Nov 2015

The court was asked as to circumstances in which a secured loan is prima facie unenforceable because the lender was not authorised to carry on the business of lending money on the security of a particular type of property under the 2000 Act, it is an abuse of process, on the facts found below, for the borrowers to seek to rely on that unenforceability after a possession order has been granted and numerous applications have been made to set aside that order and have been refused.

Longmore, Briggs, King LJJ
[2015] EWCA Civ 1194
Bailii
Financial Services and Markets Act 2000
England and Wales

Banking

Updated: 06 January 2022; Ref: scu.554997

Property Alliance Group Ltd v The Royal Bank of Scotland Plc: ChD 13 Nov 2015

PAG contended that RBS mis-sold swap contracts to PAG in the period 2004-2008. The allegations included misrepresentations relating to LIBOR. PAG also contends that in breach of contract RBS transferred PAG into RBS’s turnaround division (called the Global Restructuring Group (‘GRG’)). Certain misconduct relating to manipulation of LIBOR has been admitted by RBS but otherwise PAG’s claim is denied. PAG terminated the swaps in 2011 by paying andpound;8 million to RBS.

[2015] EWHC 3272 (Ch)
Bailii
England and Wales
Cited by:
See Also – Property Alliance Group Ltd v The Royal Bank of Scotland Plc ChD 20-Nov-2015
Second judgment dealing with issues of privilege. . .

Lists of cited by and citing cases may be incomplete.

Torts – Other, Banking

Updated: 06 January 2022; Ref: scu.554801

Re Public Joint-Stock Company Commercial Bank ‘Privatbank’: ChD 13 Nov 2015

The Bank applied for the sanction of the Court to a scheme of arrangement under section 899 of the 2006 Act with creditors in respect of two series of subordinated loan notes, having an aggregate nominal value of US $220 million.

David Richards J
[2015] EWHC 3299 (Ch)
Bailii
Companies Act 2006 899
England and Wales

Insolvency, Banking

Updated: 06 January 2022; Ref: scu.554803