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

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

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

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

Lists of cited by and citing cases may be incomplete.

Contract, Banking

Leading Case

Updated: 01 November 2021; Ref: scu.273187